Poverty levels broadly stable

Covering the period until March 2023, the latest statistics show little recent change in poverty levels for children and pensioners. Poverty for working-age adults is slightly higher than in recent years, which could be driven by people becoming economically inactive as a result of the pandemic.

The four child poverty measures in the Child Poverty (Scotland) Act (relative and absolute poverty, combined low income and material deprivation, and persistent poverty) are broadly stable over the recent period. These measures are based on single-year figures which tend to fluctuate year on year, and the three-year averages provide a robust indication of trends.

While the poverty risk is much lower for children where someone in the household is in paid work compared to those in workless households, not all work pays enough to lift the household above the poverty line. Over two thirds of children in poverty live in a household with someone in paid work. This proportion has increased markedly over the past decade or so as more people move into employment.        

Other key points are:

• Working-age adults (21%) and pensioners (15%) are less likely to be in relative poverty after housing costs compared to children (24%).
• Relative poverty has been broadly stable for all age groups. Adults under 25 are more likely to be in poverty than older adults.
• Minority ethnic households are more likely to be in poverty compared to white British households. Muslim adults have higher rates of poverty compared to adults of Christian and those with no religion. Some of this difference may be explained by these households being younger.

Background

The two full statistical publications are available here:

Poverty and Income Inequality in Scotland contains statistics on poverty, child poverty, poverty risks for various equality characteristics, household income and income inequality for Scotland. This report also includes statistics on household food security. The data comes from the Department for Work and Pensions’ (DWP) Family Resources Survey, Households Below Average Income dataset. Comparable UK income and poverty figures are published on the same day by DWP.

Figures are presented as three-year averages of each estimate. Three-year estimates best identify trends over time. Data collected during the year between April 2020 and March 2021 are excluded from the most recent estimates as response rates were affected by the COVID-19 pandemic.  As a result, estimates covering this period are for two years rather than three.

The four child poverty measures in the Child Poverty (Scotland) Act are based on single-year figures.  These are available in the reference tables and in the child poverty summary.  

Persistent Poverty in Scotland presents estimates of the proportion of people in Scotland who live in persistent poverty. The data comes from the Understanding Society Survey, and the latest statistics cover the period from 2018 to 2022.

These poverty statistics are used by the Scottish Government and other organisations to monitor progress in tackling poverty and child poverty, and to analyse what drives poverty and what works for tackling poverty and income inequality.

Official statistics are produced in accordance with the Code of Practice for Statistics.

Key poverty measures:

Relative poverty: A person is in relative poverty if their current household income is less than 60% of the current UK median. Increases in the proportion of people living in relative poverty indicate that the gap between the poorest and middle income households is widening.

Absolute poverty: A person is in absolute poverty if their current household income is less than 60% of the UK median in 2010/11, adjusted for inflation. Increases in the proportion of people living in absolute poverty indicate that prices are rising faster than the incomes of the poorest households.

Combined low income and material deprivation identifies the number of children in families that cannot afford basic essential goods and services because of a low income (below 70 percent of the middle household income).

Persistent poverty identifies the number of people in relative poverty for three or more out of four years. People who live in poverty for several years may be affected by it through their lifetime.

Household income is adjusted for household size.

The poverty publications present poverty figures before and after housing costs. Before housing costs figures are a basic measure of household income from earnings and benefits. After housing costs figures subtract spending on rents, mortgage interest payments and other unavoidable housing costs from this basic income. In Scotland, poverty statistics focus mainly on poverty after housing costs. The poverty estimates in the child poverty summary refer to relative poverty after housing costs.

Further information on income and poverty statistics within Scotland is available.