Low Income
Nearly 1 in 5 live in low income households
Proportion of children living in households below 60 per cent of median income
In 2006-07, 18 per cent of the UK population lived in low income households. This proportion was fairly static during the early 1980s rising steeply throughout the 1980s to reach a peak of 22 per cent in the early 1990s. During the 1990s the proportion declined in most years, though it remained well above the early 1980s level.
Children are disproportionately present in low income households. In 2006/07, 2.9 million children were living in low income households. This represents a fall of 500,000 since 1996/97. After rising to a peak of 29 per cent in the early 1990s, the proportion fell and then levelled off at 23 per cent for each of the three years 2000/01 to 2002/03. It fell again for 2003/04 and 2004/05 to 21 per cent before returning to 22 per cent in 2005/06 and 2006/07.
In 2006/07, children in lone-parent families, in workless families, those in families with three or more children, or in families where the head of the household came from an ethnic minority group were all more likely of living in a low income household than other groups of children.
Other groups of people who were more likely to be living on a low income or living in a low income household in 2006/07 included people of any age living in workless families (those with no working age adults in work), single pensioners, households headed by a member of a minority ethnic group, particularly those headed by someone of Pakistani or Bangladeshi origin, disabled people not receiving disability benefits, and tenants in the social rented sector.
Source: Households Below Average Income (HBAI) series, Department for Work and Pensions (Data from 1979 to 1993/95 are for UK and taken from the Family Expenditure Survey (estimates are not available for the 1981, 1983 and 1985 datasets); from 1994/95 data are from the Family Resources Survey and are for Great Britain from 1994/95 to 2001/02 and for UK from 2002/03)
Notes: Low income - in this summary, the threshold generally adopted to define low income is 60 per cent of contemporary median equivalised household disposable income before the deduction of housing costs. The HBAI analysis also presents disposable income after the deduction of housing costs, to take into account the fact that variations in housing costs do not necessarily correspond to comparable variations in the quality of housing.
Equivalisation – in analysing the distribution of income, household disposable income is usually adjusted to take account of the size and composition of the household.
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Redistribution of Household Income