Having a job is no guarantee of escaping poverty in modern Britain

Getting a job is no guarantee of escaping poverty in modern Britain, according to a new report by Oxfam, as new Government figures are expected to show a rise in the “working poor” today.

The report, The Perfect Storm, argues that the Government’s deficit reduction strategy, is disproportionately hitting those on the lowest incomes.

It argues that a “perfect storm” of factors including rising increasing unemployment, lack of reasonably paid jobs, rising living costs, falling incomes and the proposed deep cuts to welfare and public services are buffeting the UK’s most vulnerable citizens.

The report’s publication report was timed to coincide with release of the Government’s latest data on Households Below Average income later today, which are expected to reveal an increase in the number of working people in the UK living in poverty. Currently six in every 10 of the 7.9 million working-age adults in poverty are from working households.

Oxfam’s Director of UK Poverty, Chris Johnes, said: “Despite the Government’s rhetoric about making work pay, having a job is no longer necessarily enough to lift someone out of poverty; more working age adults in poverty now live in working households than in workless ones. The Government is justifying huge cuts to welfare support for people on low incomes by saying this will incentivise work, but there simply aren’t enough decent jobs available.”

Oxfam called on the Government to reverse its cuts to working tax credits and to increase the minimum wage, which has fallen or been frozen in real terms in each of the last four years.

The charity warned that inequality is growing in the UK, as the gap between the earnings of rich and poor widens. UK average earnings shrunk 4.4 per cent last year, while the incomes of FTSE 100 company directors rose by 49 per cent.

Mr Johnes added: “We need to see income being distributed more fairly if we are to make any impact on reducing levels of poverty; if we carry on down this path the UK will return to levels of inequality not seen since Victorian times.”

Case study

Micky Price, 45, lives in Ashton-under-Lyne near Manchester. Earning £425 a month as an administrator for a local charity, he argues that if he went for the job of his dreams, he’d be out of pocket.

“Life is getting dearer and dearer and people expect you to just carry on. I stopped smoking three years ago and I’ve never seen a penny of it. I’ve not had a drink for years so my social life is non-existent. I wonder where I would find that money – that £40 – to take someone out to dinner. My weekly food budget is £15, but that doesn’t mean you have to eat rubbish. I can make four chillies for £2.50.

“I grew up with my grandparents, and they took me out everywhere. Now I have an 8-year-old daughter, and I have to take her people watching in Ashton, and I think what have we come to. I used to go to pop concerts and shows in Manchester, but I can’t anymore.

“Two years ago, I met the Prime Minister because we’re a social enterprise firm, and we were on ITV news. If we knew what would happen we wouldn’t have let him leave the room. They need to realise that £15,000 a year isn’t a great wage, so minimum wage is an abomination.

“If my employer offered me any future rises, I’d have to refuse the job. I’ve got to stay on minimum wage to scrounge the tax credit, and it’s not fair on people working 30 hours for the same amount. I earn £425 a month for 16 hours a week, and I then get £50 in housing benefit and £85 a week tax credit. If I got a job for £14,000, I’d have to pay tax on £4,500. I’d be thousands worse off. So I’m stuck on minimum wage.”