ROOF Blog

The rising cost of fuel, food and public transport has hit the poor hardest. The Joseph Rowntree Foundation calculates that the cost of living for those on a minimum household budget is rising faster than inflation. The costs for a single household on a low-income budget were up 5.3 per cent this year, followed by 5 per cent up for pensioners and couples with children.

More people live in poverty in outer London than in inner London, new research has found. The study found that 54 per cent of Londoners with low incomes live in outer London, up from half 10 years ago – and more children were affected by poverty in outer (380,000) than inner London (270,000). Overall, London had the highest proportion of people living below the poverty line, and was found to be the least equal region with more people with an income in either the top or bottom 10 per cent nationally than anywhere else in the country.

More than 100 Labour MPs, including some senior cabinet figures, have backed a campaign to top up benefits or tax credits to low-paid parents. In an open letter to the Observer, the MPs argue that giving tax cuts to the middle classes may see money squirrelled away into savings accounts, whereas giving cash to those who really need it ensure it gets spent. Work and pensions minister James Purnell and children’s secretary Ed Balls are among those urging a payments boost.

Scotland’s biggest local authorities are to use millions of pounds of public money to offer mortgages to people who have been turned down by banks. Dundee city council will become the first council to offer the 100 per cent mortgages to those on low income with no savings or collateral, with Edinburgh and Glasgow expected to launch similar schemes later this year.  Critics called the plans ‘madness’ and have accused the authorities of misusing public funds by offering credit to people who may not be able to keep up repayments, raising fears that taxpayers will face a huge bill if borrowers default.

Typical householders have ‘no realistic hope’ of paying off their debts in their lifetime, Citizens Advice said today. People turning to CAB advisers for assistance owed an average of £16,971, an amount that would take 93 years to pay off. The most common reasons for debt were low incomes, over-commitment, illness or disability, and job loss, and more than half had debts of priority bills such as mortgage repayments, rent, council tax or fuel bills. The average debt was two-thirds higher than in 2001.

A quarter of families in the UK have cut back on their heating because they are worried about the bills. A further 45 per cent of low-income families can only afford to heat their homes partially, a survey by Save the Children has found. Help the Aged has similarly found that more than a third of older people say they will sometimes live in just one heated room of their home to save costs, while half of those surveyed said they would be forced to turn down their heating if they were unable to pay their bills.

The government has announced that local councils will be required to meet local targets on child poverty. Under the proposals local authorities will have to set a target for the percentage of children in their area living in low-income families. Other plans to end child poverty by 2020 include setting up a national commission on child poverty which will report to parliament on its progress and a pilot scheme to help parents of younger children prepare for employment by paying for childcare costs when they attend training or counselling.

Attempts by the government to tackle low-paid jobs and poverty have failed, the Institute for Public Policy Research said yesterday. The IPPR said that persistent high levels of low pay and ‘in-work’ poverty remained despite the national minimum wage and tax credits. Five million employees, or a fifth of the UK’s workforce, are low paid, earning less that 60 per cent of average earnings, and more than half poor children live in a working household.

A documentary has lifted the lid on rural people living in poverty, and shows the hardship and stigma faced by those living on a low income in the countryside. In the film people speak of having nowhere to live, of being unable to work because they cannot afford to run a car, or of living without a phone, TV or hot water.

The government has been accused of creating a poverty trap with changes to the tax credit and benefit system for up to two million low earners. Those earning just above the minimum wage and receiving housing benefit are likely to face the highest penalty, as small increases in earnings could result in a loss of benefits and push up their tax rate to 90 per cent.