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poverty in the UK 2023

Many years ago, when I taught A-level sociology, I ran an introductory lesson that was very popular with students. If the weather was nice, it was an outdoor activity on the football pitch, if it was wet, it took place on the indoor basketball court. The students dipped for various sociological status categories written on slips of paper in a tombola, for example ‘upper class’ / ‘family on state benefits’/ ‘live in rented accommodation’. Then they were asked to stand in a line on one side of the pitch or court.

I then called out the different categories one by one and after each one, I would say either ‘take a step forward’ or ‘take a step back’. When we’d covered all the categories, and they had moved into an arrangement in which they were unevenly distributed, I would say, ‘OK, the goal on the other side of the pitch is university entrance, now make a run for it’.

The students would always enjoy the race, but then they’d say ‘but miss, that wasn’t fair, because some of us started way ahead of the others’. And I’d reply ‘yes, so that’s the first lesson we need to learn in sociology’.

Unequal shares

Eventually, these students would learn more conventionally that a key underlying, unifying factor in this ‘race of life’ was access to financial resources. Those who are (for example) from the upper/middle class, non-disabled, lived in owner occupied accommodation, have attended private school etc. are far more statistically likely to have access to both financial resources and ‘social capital’ (to be perceived as an ‘insider’ in the upper echelons of society), and therefore gain access to opportunities to build further wealth.

Inequality in the UK has increased steadily since 1979, when Margaret Thatcher’s government took control, vowing to roll back the ‘welfare state’. There were some small fluctuations in the period of Labour government 1997–2010, but overall, it made very little difference. Income inequality remains high; it has increased over the 2020s thus far, and even in 2019, the UK had one of the highest income inequality scores across the OECD member nations.

The Institute for Fiscal Studies points out that prior to 1940, income equality in the UK was huge; for example, the chart below shows that between 1910 and 1920, the top 10% owned 90% of the property. Around 1945, the middle 40% began a steady climb in property ownership which began to flatten out around 1980. This was also the case for the bottom 50%, but it was a much shallower climb.

William Beveridge: slaying the ‘evil giants’

So, what happened around the mid-1940s that reduced inequality for the lower/middle classes? At the height of the second world war, in 1942, William Beveridge produced the Report on Social Insurance and Allied Services. In this he identified five ‘giants’ or ‘evils’ to be eradicated from UK society:

  1. Ignorance – to be defeated by free compulsory secondary education, set out in the 1944 Education Act.

  2. Squalor – to be defeated by ‘slum clearance’ set out in the New Towns Act 1946 and Town and Country Planning Act 1947.

  3. Idleness – to be defeated by a government commitment to full employment, outlined by Beveridge in his 1944 book Full Employment in a Free Society.

  4. Disease – to be defeated by setting up the National Health Service, set up by the 1946 National Health Service Act – health care, free at the point of delivery.

  5. Want – to be defeated by a universal national insurance scheme –Universal National Insurance Scheme, outlined in the National Assistance Act 1948.

Beveridge proposed that these reforms would give the entire UK population a chance to build better lives, without being hampered by poor education, poor housing, poor health and lack of basic necessities such as adequate food and heating. The acts of parliament were rolled out by the nation’s first stable Labour government across the mid-1940s, and they are now viewed as a cohesive ‘grand’ policy; the instigation of the ‘welfare state’. The statistics quoted above suggest that across the latter half of the twentieth century, Beveridge’s plan had many of the intended effects, despite some inevitable flaws that emerged over time.

Beveridge also realised that the five giants were not independent of one another, but interactional, most particularly due to the perniciousness of ‘want’, which is nowadays more commonly termed ‘poverty’. For example, those whose families cannot pay for the best education will not be able to access the most highly paid employment; those who live in poor housing and who are too poor to buy sufficient and/or a sufficient quality of food are more likely to become ill.

Over time, researchers have found additional interactions between poverty and limitations on life chances. For example in 2020, I published an academic paper on the interactions between the stress that poverty brings into families with young children, and the deleterious effect this has upon the child’s development of stress-coping abilities. The basic findings were summarised last year in the article school, stress and poverty in the Yorkshire Bylines.

Increasing inequality over the 2020s

In 2023, the Resolution Foundation stated:

“2022 was a disaster for UK living standards … inflation reached its highest level in 41 years, the government responded with household cost of living support of £58bn in 2022–23… [but this was not] enough to prevent median household incomes from falling by 3% in 2022–23.”

Use of charitable foodbanks has rocketed over this period, with many working people, including those in the NHS and education, needing to turn to them due to their wages not stretching beyond rising housing and heating costs.

“While the pandemic and cost of living crisis have had a serious impact on food bank needs in the UK, they are not the sole problems, but rather have exacerbated the longer-term crisis of a weakened social security system … sustained low levels of income and low levels of social security payments are among the main reasons for people to need to rely on food banks.”

When it is considered that the very first foodbank was created in 2000 and that nearly 3 million parcels were distributed over the last year, we can see how far the welfare state has fallen, forty four years after the Thatcher government determined to dismantle it. Thirteen years of Labour government between that time and today made very little difference to the progression of these plans.

Key points from Resolution Foundation research include:

  1. 45% per cent of respondents, or 24 million people, are quite worried or very worried about their energy bills over the winter months, rising to 63 % in the bottom income quintile.

  2. 19% of respondents –, or 10 million people, are not confident about their finances as a whole over the next few months, rising to 32% in the bottom income quintile and 43% for the unemployed.

  3. In November 2022, 28% could not afford to eat balanced meals, and 23% per cent of those receiving means-tested or disability benefits were severely food insecure.

  4. In November 2022, 11% of respondents said that their debts had increased moderately or substantially in the past three months, rising to 20% amongst workers in low-income families.

  5. The typical after housing costs income of non-pensioner households is set to fall by 3% in 2022–23, and 4% per cent in 2023–24.

  6. Rising interest rates boost savings and investment incomes so that incomes of the top 5% are on course to rise by 4%.

  7. Child poverty in 2027–28 is forecast to be the highest since 1998–99, with 170,000 more children in poverty than in 2021–22.

New government, new Britain?

There are also ongoing crises in schooling, in housing and in health, stemming from lack of funding and the current government’s attempt to privatise what were previously state administered services. All in all, we are back to a similar situation to the one in which Beveridge found himself in 1942. So, what might a Labour government in 2024 have to offer?

Keir Starmer’s five point plan does not explicitly mention poverty or inequality, but focuses upon economic growth, clean energy, health and social care reform, police and criminal justice reform and child care/education. He has further commented that his keywords for governance will be ‘stability, order, security’.

It is plain, however, to any A-level sociology student, that the UK can have none of these things with a population as unequal as it is at present. As such, if Starmer wishes to govern effectively it is past time for his party to communicate more effectively about their plans for poverty reduction; most particularly how they intend to re-slay Beveridge’s ‘evil giants’, which are currently running riot across UK society once more.