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Last Updated:  Thursday, 13 March, 2003, 11:45 GMT
Pensioner and child poverty falls
Pensioner couple in poor area
Pensioner incomes are rising
The position of Britain's poor is improving, according to the latest figures from the government.

Figures released by the Department for Work and Pensions (DWP) showed that incomes amongst the poorest two-fifths of the UK population are growing faster than the national average for the first time in a generation.

In particular, pensioners and children have seen their financial position improve, which the government said was partly due to increased state aid.

As a result, the government said it was progressing strongly towards its target of cutting child poverty by a half by 2010.

Credit boost

Official figures showed that since 1996/97 the disposable income of the poorest two-fifths of the UK population rose by a quarter, while incomes for the whole population increased by just 19%.

Secretary of State for Work and Pensions Andrew Smith said that "the number of children in absolute income poverty is down by 1.8 million - or by 42% - on 1996/97. The same count for pensioners is down by 1.6 million - or 59%."

Key to the relative improvement in the position of the UK poor has been a series of tax credits for low income families and the minimum income guarantee (MIG) to pensioners.

With the MIG single pensioners are guaranteed an income of 98.15 per week and married pensioner couples 149.80.

Child poverty

The government says that between 1979 and 1997 the numbers of children in "relative poverty" doubled.

A family in "relative poverty" has an income that is lower than 60% of the median household income across the population.

Based on 2001/2 prices - before housing costs - the median income was 311 a week, and after housing costs it was 274 a week.

Back in 1999 Prime Minister Tony Blair committed the Labour government to eradicating child poverty by 2020 and halving numbers by 2010.

As for children defined as being in "relative poverty" by the government, the number stands at 3.8 million compared with 4.3 million in 1996/97.

"There is more to do, but I am confident that our poorest children and pensioners will continue to reap the rewards of government policies," Mr Smith said.

Poor still losing out

However an Institute for Fiscal Studies (IFS) report painted a less rosy picture of the government's progress on reducing poverty.

The IFS concluded that income inequality had fallen slightly from 2000/1, but remained higher than the level inherited by Labour in 1996/7.

But they added that 22% of pensioners were in poverty in 2001-02, the lowest level since the mid-1980s.

Non-take-up of benefits explained a small proportion of the continuing poverty amongst pensioners, the IFS said.

The institute estimated that if all benefits were claimed, about 200,000 fewer pensioners would be in poverty.




SEE ALSO:
Poverty 'unchanged' under Labour
12 Dec 02 |  Business


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