New report confirms ‘deep and persistent poverty’ in London before and during pandemic

New report confirms ‘deep and persistent poverty’ in London before and during pandemic

London has continued to have the highest poverty rate in the country, with around one million Londoners in “deep poverty”, defined as more than 50 per cent below the poverty line, according to a new report.

Research by the Legatum Institute think tank focussing on London poverty immediately before the pandemic and during the second quarter of 2020, when Covid-19 struck the capital, has found the poverty rate increased from 28.8 per cent between the financial year 2019-20 to 29.3 per cent in April-June 2020.

However, it stresses that this “broadly flat” picture obscures the effects of the virus’s impacts on the labour market and the government’s response in the form of a £20 a week increase in the standard Universal Credit (UC) allowance.

The think tank calculates that the pandemic’s effect on jobs meant the number of people living in poverty in London increased by around 230,000, but that 130,000 were protected against it by the UC “uplift”, which was withdrawn in October.

Looking ahead, Legatum’s research anticipates Covid’s labour market impact will increase the number of people living in poverty by 70,000 during the second and current quarter of 2022, and that changes to UC announced in the autumn budget, including a reduction in the “taper rate” – the speed with which the benefit is reduced as people move into work – will “protect 130,000 Londoners from poverty in Q2 2022.”

Summarising the capital’s pre-pandemic poverty, the report says its poverty rate in the region of 29 per cent compares with 21 per cent among the population of the UK, that 17 per cent of Londoners were living in “persistent poverty” and that 42 per cent of those in poverty were in “deep poverty”, compared with 29 per cent of those in poverty elsewhere. Londoners in poverty were also more likely to be in work.

Within London, the poverty rate among children was found to be 42 per cent compared with 31 per cent for the UK. Among pensioners it was 20 per cent compared with 11 per cent for the UK and among non-pensioner adults, 26 per cent compared with 20 per cent for the UK.

The research uses poverty measures defined by the Social Metrics Commission, formed and led by the Legatum Institute’s chief executive Philippa Stroud, formerly chief executive of the Centre for Social Justice. Read the whole report HERE.

Image from report cover.

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