Poverty

Greg Clark
To ask the Secretary of State for Work and Pensions how the Government (a) defines and (b) measures severe poverty; and if he will make a statement.

Mr. Jim Murphy
Specific information regarding low income for Wales, Scotland and the English regions is available in the latest publication of “Households Below Average Income 1994-95 to 2004-05”. The threshold of below 60 per cent. contemporary median income is the most commonly used in reporting trends in low income.

Our current approach in “Opportunity for all” is to present a range of low-income thresholds (50, 60 and 70 per cent.). This gives an idea of the depth of poverty and it is simple to interpret. Indeed, the incorporation of two different relative low-income thresholds into our new child poverty measure (60 and 70 per cent. of median), together with the absolute tier, further ensures that different depths of poverty will be looked at separately.

We know that there are some anomalies at the very bottom end of the income distribution, due to people misreporting income, to self-employment, and to people on temporary zero income but with high living standards (e.g. students, people taking a career break). These become proportionally more important the smaller the group we focus on. That is part of the reason that, from next year, we will be collating material deprivation data as well, excluding people with low measured income but high living standards.