The Joseph Rowntree Foundation has reported a surge in the number of individuals in the UK experiencing “very deep poverty,” reaching a new peak. The foundation’s study highlights a concerning trend of escalating poverty levels, with those affected now living 29% below the poverty threshold, a significant increase from 23% in the mid-1990s. The report reveals that 6.8 million people are currently enduring “very deep poverty,” representing nearly half of all individuals living in poverty and marking a historical high.
While the recent decision by the Labour party to remove the two-child benefit cap is expected to reduce the number of children living in poverty by approximately 400,000 compared to the previous year, the Joseph Rowntree Foundation cautions that without additional interventions, relative poverty rates are anticipated to remain persistently high following April this year. The study also points out a concerning uptick in child poverty, which has now affected 4.5 million children and has been steadily increasing for the third consecutive year.
Moreover, the foundation warns of a rapid escalation in hunger, with an additional 1.1 million impoverished individuals struggling to afford an adequate supply of food compared to two years ago, bringing the total number of food-insecure individuals to 3.5 million. These findings underscore the pressing need for sustained efforts to address deep-rooted poverty issues in the UK.
In other news, there are reports indicating that the BBC may utilize iPlayer streaming data to identify individuals who have not paid for a TV license. The potential linkage of up to 40 million BBC iPlayer accounts with a database tracking TV license ownership could have significant implications for non-compliant viewers. Currently, a TV license costing £174.50 per year is mandatory for individuals watching or recording live TV programs on any channel, as well as those accessing content on BBC iPlayer, whether live or on catch-up.
Additionally, a significant change is on the horizon for workers as the self-assessment tax system undergoes a major overhaul. The implementation of Making Tax Digital (MTD), a digital reporting system, is set to expand its reach to encompass sole traders and landlords with an annual income surpassing £50,000 starting from April 2026. The transition to MTD-compatible software is projected to incur an average cost of £320 initially, followed by an annual fee of £110. As MTD gradually extends to lower income thresholds in the subsequent years, individuals are advised to prepare for the upcoming tax reporting changes.
Furthermore, the European wholesale gas market, including the UK, is experiencing a spike in prices attributed to freezing weather conditions in the United States. The recent winter storms in the US have disrupted LNG exports to Europe, impacting gas supply and contributing to the surge in wholesale gas prices. The UK witnessed a notable increase in the day-ahead gas price to 104.13p per therm, while gas storage levels across Europe have declined to 45% capacity, raising concerns about potential implications for energy bills in the UK.
Amidst these developments, the Centre for Cities has identified the UK towns and cities where disposable income has shown the fastest growth. According to their report, living standards have risen by 5.2% in 11 top-performing locations since 2013, outpacing the national average of 2.4%. Cities like Brighton, Worthing, and London have experienced notable improvements in economic growth and disposable income, reflecting positive trends in these regions. The findings underscore the diverse economic landscape across different UK locales and the varying trajectories of prosperity.
Lastly, significant changes in the leasehold sector are on the horizon as ground rents are set to be capped at £250 annually in England and Wales, benefiting over five million leaseholders. The proposed reforms aim to alleviate financial burdens on leaseholders by imposing a cap on ground rents that will gradually reduce to a nominal amount after 40 years. The legislation, expected to come into effect by late 2028 pending parliamentary approval, also includes provisions to ban new leasehold flats and grant existing leaseholders the option to convert to commonhold. This overhaul seeks to address longstanding issues of escalating ground rents and empower leaseholders with greater control over their residential properties.