London’s Poverty Profile
London’s Poverty ProfileTom MacInnes and Peter Kenway
London’s Poverty ProfileTom MacInnes and Peter Kenwaywww.londonspovertyprofile.org.uk
A summary of this report can be downloaded in PDF format fromwww.londonspovertyprofile.org.ukWe are happy for the free use of material from this report for non-commercial purposesprovided City Parochial Foundation and New Policy Institute are acknowledged. New Policy Institute, 2009ISBN 1 901373 40 1
Contents5 ForewordAcknowledgements 67 Introduction and summary11 Chapter one: An overview of LondonLondon’s boroughs: ‘cities’ in their own right 11The changing populations of Inner and Outer London 12London’s diverse population 12London’s age structure 15London’s ‘sub-regions’ 16At London’s margins 1719 Chapter two: Income povertyKey points 19Context 20Headline poverty statistics, ‘before’ and ‘after’ housing costs 21Before or after housing costs? 22Poverty in London compared with other English regions 23Poverty in Inner and Outer London 26In-work poverty 2729 Chapter three: Receiving non-work benefitsKey points 29Context 30Working-age adults receiving out-of-work benefits 30Children and pensioners in households receiving benefits 3437 Chapter four: Income and pay inequalityKey points 37Context 38Income inequality in London compared with other English regions 39Inequalities within London boroughs 4043 Chapter five: Work and worklessnessKey points 43Context 44Working-age adults lacking work 45Children in workless households 48Lone parent employment rates 49The link between worklessness and child poverty 50
51 Chapter six: Low pay and in-work benefitsKey points 51Context 52Low-paid residents 53Low-paid jobs 55Families receiving in-work benefits 5759 Chapter seven: Ethnicity, low income and workKey points 59Context 60Low income and ethnicity 61Work, ethnicity and country of birth 62The link between work and low income for different ethnic groups 6667 Chapter eight: Ill healthKey points 67Context 68Ill health among children 68Ill health among working-age adults 7175 Chapter nine: Low educational outcomesKey points 75Context 76Attainment at age 11 77Attainment at age 16 79Free school meals and low educational attainment 81Not in education employment or training – ‘NEETs’ 8385 Chapter ten: Housing and homelessnessKey findings 85Context 86Homelessness and temporary accommodation 87Overcrowding 9295 Tables & charts
ForewordWhen we think of the profile of a city, what usually springs to mind is a panorama of tallbuildings outlined against the sky. For most Londoners, that might be the Houses ofParliament, the Post Office Tower, Canary Wharf perhaps. Important buildings which standfor authority, power, and wealth. This report is about a different kind of profile in a differentkind of London. It describes the social and economic profile of the capital, by picking out forus where poverty, deprivation and social exclusion are at their most prominent.Like any profile, it shows us high and low points. The report reveals that in some respectsLondon is making progress: in educational achievement, for example, the findings areencouraging. But elsewhere, and even within the shadows of the same London buildingsthat represent privilege, the report finds evidence of unrelieved deprivation that shouldconcern us all. And by comparison to other cities in England, and despite its size andstatus, London’s record in combating some aspects of poverty is dispiritingly poor.Poverty is to be found everywhere in London, in differing forms, with varying symptomsand of greater or lesser intensity. The strength of this report is that it shows thesedifferences, and allows comparisons to be drawn between communities, areas andboroughs. It provides information that will allow lessons to be drawn, policies andpractices to be changed, resources to be reallocated, so that lives can be improved.This report was paid for by charitable funds, and is independent of political or sectionalinterests. The information which underpins its analysis is drawn from public sources.This gives the report an authority which has to be respected by the Governmentagencies who collected the raw data with which the authors have worked. Theconclusions cannot be dismissed as biased, unfounded or lacking in credibility. Wherethere are gaps in the report’s coverage (for example in relation to the extent of povertyor deprivation experienced by undocumented migrants or lesbians and gay men) it isbecause there are gaps in the official statistics.The City Parochial Foundation, founded to help the poor of London over a century ago,commissioned this report because we believe that an independent and coherent sourceof data on poverty is an essential step in focusing attention on priorities for action.Charities like CPF undoubtedly have a part to play in responding to the report. We needto decide what changes to make to our own priorities in the light of these findings, forexample to address the growing poverty in Outer London. Meanwhile, we shall continuewith our existing initiatives to combat poverty, discrimination, and exclusion in London,for example in support of the London Living Wage, in our work to help undocumentedmigrants, and through our initiative to combat modern-day slavery.But it is not to the charitable sector that this report is primarily directed. It is directedto the various local and central government agencies with the power to bring aboutfundamental change in social and economic conditions. The report gives them theinformation on which to promote change. It gives them a yardstick against which tomeasure their progress. It provides a base for Londoners to assess government’sperformance over the next few years, as updated versions of this report are published.Above all, however, this report throws down a challenge to local and central governmentto act now to reduce the towering profile of poverty in London. We must all hope thatthey are equal to the challenge.Nigel PantlingChairman, City Parochial Foundation
AcknowledgementsThis report has been made possible by the support and advice of people andorganisations within London. Advisory group – Kate Green (Child Poverty Action Group),Chris Goulden (Joseph Rowntree Foundation), Prof Jane Wills (Queen Mary, Universityof London), Rob Lewis (Greater London Authority, GLA) and Jason Strelitz (Save theChildren).We would also like to thank GLA statisticians who helped us with procuring data, andCACI for allowing us to use their ward level income data.We were also helped by statisticians in government departments who helped us withrequests, notably in the Department for Work and Pensions Incomes Monitoring Teamand the Department for Children, Schools and Families Schools Data Unit.We, the authors, and not those who have helped us are wholly responsible for all errors,omissions and misunderstandings to be found in this report.About City Parochial FoundationAbout New Policy InstituteEstablished in 1891, City ParochialFoundation (CPF), is one of the largestindependent charitable foundations inLondon. It aims to reduce poverty andinequality in the capital by supportingwork that tackles poverty and its rootcauses.The New Policy Institute is aprogressive think tank, founded in1996. Wholly independent, it hasneither financial backers nor politicalpatrons. Almost all its funding isproject-based and comes principallyfrom charitable foundations, tradeunions, voluntary sector organisationsand public sector bodies.CPF funds research – as with thisreport – when it increases knowledgeof these areas of work or otheraspects of poverty in London. Aparticular interest is in work that has aclear application to policy and practice.City Parochial Foundationwww.cityparochial.org.uk6 Middle StreetLondon EC1A 7PHNew Policy Institutewww.npi.org.uk003 Coppergate House16 Brune StreetLondon E1 7NJTelephone: 44 (0)20 7721 8421E-Mail: info@npi.org.ukTelephone: 44 (0)20 7606 6145E-mail: info@cityparochial.org.ukCharity registration number: 205629Project Co-ordinators: Mubin Haq, Director of Policy & Grants, Rachael Takens-Milne,Field Officer (Special Initiatives) at CPFProduction: Tina Stiff, Publications & IT Manager at CPFDesign: Clare Carey at LiftEditing: Chris BazlintonPrinters: Wealden Printing Ltd (printed on recycled paper)
Introduction and summaryAim of the reportLondon is by far and away the richest part of Britain. It is the engine of the UK economy,contributing 36% more per head of population than the next most productive region.[1] YetLondon also has high poverty levels – how can this possibly be?In our experience, many commentators are utterly perplexed by this. Britain, they pointout, is a rich country (14th richest in per capita terms in 2005 according to OECD – andapart from the US, all the countries ahead of it have much smaller populations).[2] Fromthis perspective, therefore, Britain itself is a bubble. With its much higher than averageincome, London is then a bubble within that bubble.What the perplexed observer fails to take account of, however, is the possibility that theirview of London may be a very partial one. For if that view is dominated by images of theCity, of the Houses of Parliament, of the Royal Parks, of Knightsbridge, Hampstead andNotting Hill, then what that outsider actually has in mind is not ‘London’ in its generalitybut rather a quite distorted and select slice of it.The aim of this report is to correct such misconceptions, first by placing London withinthe context of England (chiefly by means of comparisons with the eight other Englishregions) and second, by looking inside London, at Inner and Outer London, thensub-regions within Inner and Outer London and finally at individual London boroughs.Besides geographical variations, the report also looks closely at variations by ethnicity(in recognition of London’s diversity), age and especially work status. The end productis something intended to convey a sense of the texture of London as far as the subjectmatter is concerned.Scope of the report[1]Gross Value Added (GVA)per head of population in 2007: 30,000 in London, 22,000in the South East (the 2ndregion) 16,000 in the NorthEast (bottom region). Officefor National Statistics, 2008,Regional, sub-regional and localgross value added, First Release,table 1.1: www.statistics.gov.uk/pdfdir/gva1208.pdf[2]OECD Factbook 2008: GrossNational Income per capita,PPP basis, http://dx.doi.org/1787/272524436267. Of theother 12 countries ahead of theUK, two are Canada and Australiawhose combined populations areonly two-thirds of the total for theUK. The populations of the otherten add up to the total for the UK.The report covers London poverty (as measured by low income) and a range of otherproblems experienced by Londoners that tend to be associated with it, includingunemployment and worklessness, low pay, poor health, weak educational outcomesand inadequate housing.Our basic material is statistical – official statistics almost invariably – which are of highquality, wide-ranging and readily available. In addition, we also draw attention to groupsnot covered by the official statistics – those working outside the formal economy, thosewho lack official documentation. The picture painted here is not, by any means, entirelybleak. Low income and poverty do not automatically and inevitably translate into otherproblems – and we include some striking exceptions.A report such as this has to be selective and some groups are inevitably underrepresented. One such group is pensioners. We suspect that the root of this lies in theway that official anti-poverty strategies prioritise ‘work’ as the answer to the problem– which naturally marginalises pensioners. This may be compounded by the way thatpensioner poverty has receded under this Government.Finally, it should be noted that in the year that it has taken to compile the data, theeconomic situation has been utterly transformed. The report has virtually nothing toIntroduction and summary 7
say about the recession. While that may seem a weakness from the point of view thatprioritises ‘topicality’ above all else, it can be defended on the grounds that what isshown here is the longer view. This report shows where London stood – and how it hadgot there – on the brink of the recession. It is, in short, an assessment of the progressthat was made (or not) in the good times – and of the challenges that remain to befaced even after the recession has ended.Key findingsEvery chapter in the report begins with a summary of its main findings. Of these, thefollowing are those we think are the most important: London is the most unequal region in England and income is more concentrated atthe top than elsewhere. It has the highest proportion of households in the top tenth ofincomes nationally, and the highest proportion in the bottom tenth. London has the highest rate of income poverty of any region in England. InnerLondon in particular has the highest rates for all age groups (children, working-ageadults and pensioners) after housing costs are taken into account. Although Inner London is worse than any English region on many indicators, it hasseen improvements in recent years. However, Outer London has experienced asignificant deterioration across a number of indicators since the late 1990s, includingchild and working-age poverty. More of the capital’s low-income population now livein Outer London than Inner London. Boroughs in the Inner East & South of the capital fare worse across a range ofindicators in comparison to London’s other boroughs. This is particularly noticeablefor worklessness and ill health. The difference between Inner and Outer Londontherefore masks a stronger contrast between the Inner East & South and the rest ofLondon. The proportion and number of children in poverty who live in a household where atleast one adult works, has risen since the late 1990s. In-work poverty now accountsfor almost half of all child poverty in London. Rates of poverty vary considerably between London’s ethnic groups. Bangladeshihouseholds are three times as likely to be in poverty as Indian or White households.Work rates vary substantially not only by ethnicity, but also (within ethnic groups) bycountry of birth. The unemployment rate among young adults in both Inner and Outer London wasabout 20% in the middle years of this decade, more than any other region. InnerLondon’s higher rate has been falling whereas Outer London’s slightly lower rate hasbeen rising. The proportion of homeless households in London living in temporaryaccommodation is ten times higher than the national average and five times higherthan the English city with the second highest rate. Educational attainment at both ages 11 and 16 has significantly improved in Londonsince the late 1990s. At age 16, Outer London now has a lower proportion of pupilsnot attaining five GCSEs than any English region. The proportion of men who die before the age of 65 is much higher in Inner Londonthan in any other region of England.8 London’s Poverty Profile
An overview of London’s boroughsSo is there a simple split between Inner and Outer London? In the table below,comparisons are made within London across 16 key poverty and inequality indicators,and this shows that the picture is not so straightforward. London’s 32 boroughs aredivided into five groups – the Inner East & South, Inner West, Outer South, Outer West& North West, and the Outer East & North East.[3]The four boroughs with the worst score on any particular indicator are shown in red, thefour with the next worst score in darker orange, the eight with the next worst in lightorange and the remaining 16 (which are therefore the better half) in beige. Therefore, thedeeper the colour the greater the problems faced in the borough.KeyWorst 4 boroughs – highestNext 4 boroughsNext 8 boroughsRemaining 16 – below averageLoweducationalattainment Ill HealthLow Income and benefits Low Pay1234567891011InadequateHousing1213141516Outer West Barnetand North erBromleySouthCroydonKingstonMertonSuttonInner West CamdenHammersmith & FulhamKensington & ChelseaWandsworthWestminsterInner East Hackney& rkTower HamletsOuter East Barking & Dagenhamand North BexleyEastEnfieldGreenwichHaveringRedbridgeWaltham Forest[3]The categories are basedon a statistical definition usedby the EU which places southLondon boroughs Southwark,Lewisham and Lambeth in theInner East, which for the purposeof this report we have calledInner East & South.1 Working-age benefit recipiency2 Children in families in receipt ofkey out-of-work benefits3 Pensioners receivingGuarantee Pension Credit4 Working-age people who lack,but want, paid work5 Low pay by residency67891011Low pay by place of workPay inequalitiesLow attainment aged 11Low attainment aged 16Infant mortalityPopulation aged less than 65who die each year12 Working-age people with alimiting long-standing illness13 Underage pregnancies14 Newly homeless households15 Households in temporaryaccommodation16 Household overcrowdingIntroduction and summary 9
Several things stand out. First, the two parts of Inner London are very different from oneanother. Problems are concentrated in the Inner East & South: a sea of red and orangewith very little beige. Only low pay breaks the pattern. This is in marked contrast to theInner West where the worst borough (Camden) would be comfortably the best in theInner East & South. The Inner West certainly scores badly on housing and pay, but ingeneral, the challenge is of a different order to that faced in the Inner East & South. Amajor flaw with any simple emphasis on Inner London is that it misses this.Second, there is huge variation in Outer London, too. Individual boroughs face greatchallenges. For example, Brent’s record looks like that of a borough in the Inner East& South. But, overall, neither the Outer South nor the Outer West & North West arecomparable even with the Inner West, never mind the Inner East & South. Nor are theycomparable with the Outer East & North East. With the exception of housing, severalboroughs in the Outer East, notably Barking & Dagenham, look like the Inner East & South.What is most noticeable about the Outer East is that most boroughs which share aborder with the Inner East & South – Greenwich, Waltham Forest, Barking & Dagenhamand Enfield, have the most problems. So if there is a great divide in London, it is notbetween Inner and Outer or North and South, but rather between the Inner East & Southalong with some of its neighbours, and the rest.Note that this area is not simply the old East End. Tower Hamlets, which might bethought to be the heart of what was once meant by that term, is (after Islington) thesecond best of the Inner East & South boroughs. In his biography of London, PeterAckroyd had the East beginning at the Aldgate pump, about 150 metres from theCity’s border with Tower Hamlets. But he also had the boundary extending north, fromBishopsgate via Shoreditch and Kingsland to Tottenham – which, after writing this report,seems to us to be the more significant.Part of the reason for this is that with its very small resident population, the City simplylacks the weight to make a telling contrast with Whitechapel. But Tottenham belongs toHaringey which also includes prosperous Highgate. One effect of this is that Haringeyemerges in this report as the most deeply divided of the 32 boroughs (for example, asmeasured by the high number of both rich wards and poor wards within its boundary).But Haringey’s emblematic status goes further than that, for Highgate, sitting next toHampstead Heath, is just about the northernmost tip of London’s rich inner bubble. InHaringey, the bubble and this Inner East & South meet.It is vital to remember that there are always exceptions to any simple, general pattern.For example: Newham, along with two Outer East boroughs, doe
51 Chapter six: Low pay and in-work benefits Key points 51 Context 52 Low-paid residents 53 Low-paid jobs 55 Families receiving in-work benefits57 59 Chapter seven: Ethnicity, low income and work Key points 59 Context 60 Low income and ethnicity 61 Work, ethnicity and country of birth 62 The link between work and low income for different ethnic groups 66 67 Chapter eight: Ill health
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Insights from the New Virginia Poverty Measure . Three Major Findings on Poverty in Virginia . May 2013 . . tions in the way poverty is measured, the VPM presents a more accurate picture of the status of low- . 2011, the new SPM reported a national poverty rate of 16.1 percent, while the official rate for that year .
