Poverty costs UK £78 bn a year: report
02 Aug 2016
Poverty cost the UK £78 billion a year, or £1,200 for every person, according to new research.
The research, which focused on the cost to the public purse of dealing with the effects of poverty, showed a stunning £1 in every £5 of all spending on public services was spent on the impact and cost poverty had on the lives of people.
In addition to the £69 billion of public money researchers estimated that there was another £9 billion in lost tax revenue and additional benefits spending resulting from dealing with the symptoms of poverty.
According to the Joseph Rowntree Foundation (JRF), which commissioned the report, that was equivalent to 4 per cent of the UK's GDP.
Julia Unwin, chief executive of the Joseph Rowntree Foundation, said, ''It is unacceptable that in the 21st century, so many people in our country are being held back by poverty. But poverty doesn't just hold individuals back, it holds back our economy too.
''Poverty wastes people's potential, depriving our society of the skills and talents of those who have valuable contributions to make. This drags down the productivity of our economy, hinders economic growth, and reduces tax revenue,'' the UK's Daily Record reported.
The report also considered the knock on effect that experiencing poverty had on future costs to the public purse.
The research, carried out for JRF by Heriot-Watt and Loughborough universities, was designed to highlight the economic case, over and above the social arguments, for tackling poverty in the UK. The prime minister, Theresa May, had made cutting inequality a central pledge.
''Taking real action to tackle the causes of poverty would bring down the huge £78bn yearly cost of dealing with its effects, and mean more money to create better public services and support the economy. UK poverty is a problem that can be solved if government, businesses, employers and individuals work together,'' Unwin said, The Guardian reported.
