Child poverty cumulative impact assessment: update

6. Deep poverty

This section considers the impact of Scottish Government policies on deep child poverty, also known as severe child poverty. A person is considered to be in deep poverty if their equivalised household income after housing costs is below 50% of the median, as compared to 60% of the median on the relative poverty measure. Measuring deep poverty gives us a more complete picture of whether living standards of children in the lowest income households are keeping up with the average household.

For example, a recent report by the Joseph Rowntree Foundation (JRF) found that deep poverty has not reduced in Scotland since 1994-97, while very deep poverty (below 40% of median household income) has actually increased, even while relative poverty has fallen.^[11] They attribute this deepening of poverty to the failure of benefit income to keep up with earnings growth, which has also been slower for those on the lower end of the income distribution.

Using the same methodology as our main analysis, we project that in 2024-25 the Scottish Government policy package will keep 70,000 children out of deep poverty. This shows that Scottish Government policies are not only supporting children who would otherwise be close to the relative poverty line, but are acting to raise the incomes of households at the bottom end of the distribution. The percentage-point impact of the policy package is lower for deep (and absolute) child poverty than it is for relative child poverty, but these comparisons are complicated by unevenness in the income distribution, among other factors.