EU says Britons fall into poverty faster

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The gap between rich and poor has been widening more in Britain than anywhere else in the European Union, according to a report which is due for release today by the European Commission.

Numbers of families living below the poverty line as a proportion of the population rose from 14.3 per cent to 17.2 per cent during the decade 1983 to 1993 - by far the biggest increase. The poverty line is defined as half the average income for the country as a whole, and the report puts Britain ahead only of the four most deprived EU members: Spain, Portugal, Greece and Ireland. By contrast, only 5 per cent of househoulds in Benelux states fall below the poverty line. GDP per capita in Britain stood at 98.7 per cent of EU average in 1983; 10 years later, it was 98.9 per cent.

The long-awaited report, the first official in-depth analysis of the achievements of the EU's regional policy, comes as part of the groundwork for the union's enlargement to the poverty-stricken economies of central and eastern Europe. Budgetary austerity will spell big cuts in spending on the present beneficiaries of aid.

The Commission confirms significant strides in bridgingeconomic gaps between the rich and poor member states thanks to big aid transfers. Around pounds 100 billion in funding is being funnelled to the poorest regions during the 1994 to 1998 period - mostly to Spain, Portugal, Greece and Ireland - and the results vindicate the policy, the report concludes. In 1983, average income per head in the poor four countries was 66 per cent the EU average; by 1993, it had risen to 73 per cent.

The most spectacular pro- gress has been in Ireland, where growth has brought income per head from 64 per cent of the EU average in 1993 to 90 per cent in 1995. In the coming year, the Commission believes Ireland will overtake Finland.

But if EU efforts to bridge the gap for the most peripheral countries have been positive, the report highlights a worrying trend for more advanced eco-nomies like Britain, where there is evidence of weakening economic and social cohesion. Britain is one country where disparity between regions on incomes and employment has become most pronounced during the past decade.

However, Britain has managed to keep ahead of its EU partners on long- term unemployment but the distribution of jobs has been uneven, exacerbating the north/south divide. Greater London, with an income per head nearly one-and-a-half times the EU average, still ranks alongside Paris, Hamburg, Vienna, Luxembourg and Brussels in the top 10 richest regions in the EU.

Monika Wulf-Mathies, the German commissioner in charge of regional policy will use the findings to argue for a complete scaling-down of the present structural funding system when current funds run out in 1999. Her ideas have already triggered acrimony within the executive, a foreshadow of the political battle which lies ahead, with the Mediterranean countries fighting to retain their present share of handouts.