WIREDGOV

In 2010, 17.1 per cent of the UK population, or 10.7 million people, were defined as being at risk of poverty, according to analysis published yesterday by the Office for National Statistics (ONS). This has fallen from 19.0 per cent in 2005.

People are defined as at risk of poverty if their disposable income is below 60 per cent of the UK median disposable income. The at-risk-of-poverty rate has declined as average disposable income fell in the UK after the onset of the economic downturn in 2008-09.

The fall in the at-risk-of-poverty rate between 2008 and 2009 may initially appear surprising as this was a time when the UK was in recession and the unemployment rate was rising.  However, between these two years, the UK median disposable income actually fell in cash terms on this measure, leading to a reduction in the at-risk-of-poverty threshold.  This in turn means that some individuals whose income was just below the threshold in 2008 would no longer be classified as at-risk-of-poverty in 2009, even if their incomes had not changed.

The UK rate in 2010 is close to the overall EU rate of 16.4 per cent – however, the rate for people aged 65 and over was significantly higher than the EU average, at 21.4 per cent compared with 18.9 per cent.

The UK has the 10th highest at-risk-of-poverty rate among the 27 EU member states in 2010. The highest rates were in Latvia (21.3 per cent), Romania (21.1 per cent) and Spain and Bulgaria (both on 20.7 per cent).

The lowest rates were found in the Czech Republic (9 per cent), the Netherlands (10.3 per cent), Slovakia (12 per cent) and Austria (12.1 per cent).

It is, however, important to remember that the rates only measure relative risk of poverty within countries. It is not necessarily the case that someone at risk of poverty in one country would have a similar standard of living to someone at risk in another.

Background notes