Poverty levels have 'deepened', warns report

Poverty in Scotland is becoming more entrenched with the number of households trapped in the worst conditions rising, a new report warns today.

More than half a million people in Scotland – equivalent to one in ten of the population - were living in severe or extreme poverty in 2012-13, up 110,000 on the previous year.

Of those 510,000 individuals living in poverty, 330,000 were working age adults, 100,000 were children and 80,000 pensioners.

The Child Poverty Action Group urged both the UK and Scottish governments as well as employers to make "different decisions".

Although the overall number living in poverty has fallen over the last decade, a greater proportion of households are now classed as being stuck on severe or extreme low income.

After housing costs, half of individuals living in poverty in 2012-13 were deemed as living in extreme poverty compared to just over a third in 2002-03. 

Severe poverty is considered to arise when household incomes sit below 50 per cent of UK median annual household income – or less than £11,500 in 2012-13 – while extreme poverty is defined as less than 40 per cent.

“Poverty is changing; work is no longer a guarantee of a life free of poverty; people in poverty face increasing costs; and those in receipt of benefits and tax credits – which of course includes many in work - are finding their incomes squeezed,” says the Scottish Government’s Severe Poverty in Scotland report published this morning. 

“While policies targeted at reducing poverty have reduced relative poverty over time, the depth of poverty has not improved. 

“Those in poverty are now more likely to be further away from, not closer to, the poverty threshold. 

“It is these poorest children and adults who are likely to live in prolonged financial and material deprivation, with the poor outcomes associated with persistent poverty.”

A fall in real earned income, a rise in the likes of zero hour contracts, and increases in the numbers in low pay are held up as factors for the worsening picture.

Likewise, recent welfare reforms, including changes in eligibility for tax credits, has hit household income for low income working families, argues the report.  

Social Justice Secretary Alex Neil said: “It’s a disgrace that so many people live in such severe or extreme poverty, but it’s an unfortunate and inevitable result of the UK Government’s failed austerity agenda and welfare cuts that are slashing incomes for some of our poorest households.

“With employment increasing and unemployment down, Scotland is outperforming the rest of the UK, yet the statistics show that a job is no longer any guarantee against severe or extreme poverty.”

Director of CPAG in Scotland, John Dickie, said: "There is absolutely nothing inevitable about these levels of poverty. They are the result of political and economic decisions to tolerate low pay and insecurity at work and to cut the child benefits  and tax credits that families both in and out of work rely on.

"We need to see politicians and employers at every level make different decisions, prioritise support for families and make work pay.

"The UK government must restore the value of child and family benefits as a matter of urgency and take a far more assertive approach to increasing the national minimum wage.

"Here in Scotland we need to promote decent pay, act to keep housing costs down and use all the powers at the disposal of local and national government to boost support for families and cut the costs they face.