Professor Anne Power spoke to us about her research on poverty in the UK 15 February 2015

Anne Power has been a community organiser, government advisor and university researcher and teacher on issues affecting low-income communities. Since 1996 she has been Professor at the London School of Economics, and has received numerous awards and honours for her work, which focuses in particular on issues of housing and cities, both in Britain and on the continent.

The Impact of Welfare Reform on Social Landlords and Tenants is a recent report by Anne and her colleagues for the Joseph Rowntree Foundation.

We invited her to give our second termly talk, following on from our first event in September 2014 in which we heard from Jane Benyon, founded of Oxford’s Community Emergency Foodbank. We plan in future events to continue to alternate between speakers who are involved with local Oxford initiatives to fight poverty, and speakers who will focus more on the big picture.

Below I’ve summarised the key points raised by Anne in her talk, and by Anne and others in the Q&A afterwards.

Why has UK poverty become more acute over the past 8-10 years?

1. The impact of the 2008 financial crisis on the UK economy. The UK’s early industrialisation, the fact that it’s an old country, has meant the change required for real recovery has been slower.
2. The prices of basics, above all food, has been steadily rising
3. The top of the income scale is moving off the map while the bottom is increasingly losing out

Who is most likely to be poor?

Some statistics

1. 12.9 million people in Britain are currently living in poverty
2. ethnic minorities are over-represented, as are families with children who live in poor areas (e.g. 49% of children in Tower Hamlets live in poverty); poverty to a great extent an urban problem, particularly in big cities
3. the top 10% are 75% richer than the bottom 10%

People who depend on welfare are having a particularly bad time; and many of those people are in work. Jobs that pay at least the living wage are crucial. Growing youth unemployment is particularly worrying.

Why are people poor?

Anne told us that research has shown that the Coalition government welfare reforms have exacerbated poverty and also pushed people into poverty.

1. the bedroom tax, which only affects social housing tenants (Anne’s research team has seen much evidence of the hardship caused by this reduction in housing benefit)
2. benefit sanctions being applied punitively and arbitrarily, meaning the many people have become terrified of Job Centres (who administer this system)
3. capping housing benefit means that people in private rental are paying an extremely high proportion (55%) of their income in rent
4. the system for assessing people’s eligibility for sickness and disability benefits needs to be better and fairer – it looks like it might be improving
5. the way national and local government have played into media stereotypes about ‘benefit scroungers’ poisons the terms of the debate and casts a shadow of suspicion over all benefit recipients

in-work poverty a growing problem

• 8 million paid less than the living wage – 20% of the workforce
• Nearly 2/3 poor children are in working households
• Low skill, low-pay work most likely to be temporary, part-time, zero hours
• basics (energy and food) are costing more: Energy price rise – 37% since 2010; Food prices up – 44% since 2005 (energy and food now falling)
• Rents – 1.4 million private renters receive Housing Benefit
• Poorest 20% spend 55% of income on rent (in social housing the poorest spend 33%)
• a broad consensus is building on the importance of a living wage that is higher than the minimum wage
• zero-hours contracts represent a return to older modes of casual labour, with employees needing to remain available but only being paid when there is work

Anne, while advising us to be very cautious of ‘trends’ (‘don’t trust the dotted line on the graph’), pointed to the following possible trends:

Tax aversion is a big problem if we want to see more government support for policies that would help poor people, with the consensus across all the parties that more taxes are a bad thing. In particular Council Tax (calculated on the value of homes) needs to be raised significantly for more expensive properties. At the moment, owners of very expensive houses pay rates of council tax not dissimilar to owners (and tenants) of much more modest properties. Increasing tax on more expensive properties would also act as a brake on the acquisition of second homes and of foreign investment in homes.

Other trends to be concerned about:

• the belief in growth at any cost (e.g. detriment to the environment)
• incentives on employers to pay less, since the shortfall will be made up by benefits; the introduction of universal credit will make this worse
• poverty moving out of inner cities towards the suburbs (e.g. Croydon in London, which was badly affected by the summer 2011 riots)

Anne spoke in the Q&A about the importance of a healthy private rental sector for creating decent, affordable and flexible housing. While strict rent control is a bad idea (it has in the past decimated the rental sector), the completely unregulated system we now have is full of injustices. What we need is a lightly regulated system.

Does inequality matter?

It does because decision makers concentrated at the top are ever more remote from the lives of those at the bottom.

This means policies are made that ignore very real problems. For example, people are being penalised for not working even if they’re caring for disabled relatives. People over 50, who have often experienced serious workplace accidents or who have developed work-related illnesses, are being assessed as able to work, even though it is particularly difficult for the over-50s to find work.

Environmental limits are also important for inequality, with an upward pressure on resources.

Environmental degradation is particularly felt by people at the lower end of the income scale. Children growing up in poor areas are 4 times more likely to be exposed to environmental dangers.

What can we do?

1. Write to MPs and parliamentary candidates. Anne encouraged us to be very forceful in these letters, and to really push the voice of poor people, preferably using stories of real people.
2. For example through community vegetable gardens; shared meals.
3. Helping people save energy through education, etc, and thus bring down energy bills
4. Tackling food waste (e.g. 50% of school dinners are wasted.) In the Q&A, the Oxford Foodbank, which collects ‘waste’ food from supermarkets and gives it to charities who can distribute it to those who are in need, was mentioned as an example of positive action. Volunteers are needed (Ag can provide more information.)
5. Initiatives such as the coffee mornings held by Margaret Hodge MP in her constituency, bringing members of the community together to discuss issues openly.
6. In general, Anne encouraged people to ‘do good’, and not to be afraid of being ‘do-gooders’. In her experience, voluntary community initiatives are much appreciated, as long as they’re done sensitively, without preaching and judging ‘and if you can possibly help it, try not to be too posh!’