The UK poverty line
Each year, the Government publishes a survey of income poverty in the UK called Households Below Average income (HBAI).
This survey sets the poverty line in the UK at 60 per cent of the median UK household income. In other words, if a household’s income is less than 60 per cent of this average, HBAI considers them to be living in poverty.
Before or after housing costs?
HBAI provides two types of household data: before housing costs are deducted (BHC) and after housing costs have been removed (AHC). Many official poverty statistics employ the BHC information. At CPAG, we consider a better measure to be the income a household has left AHC, as this more realistically reflects the amount of money families and individuals have at their disposal. All the figures we use are AHC unless otherwise stated.
Adjustments made to HBAI
The HBAI poverty line takes into account the size and the composition of households through a process called equivalisation. As common sense would suggest, the poverty line for a household with one adult and one child is set at a lower level than a two parent family with more children.
The poverty line is not adjusted, however, for other important household characteristics such as disability or caring responsibilities.
The table below shows the HBAI poverty line for 2014 to 2015, for a couple and a lone parent with two children, excluding housing costs.
|Per month||Per year|
|Lone parent (2 children)||£1,261||£15,132|
|Couple (2 children)||£1,703||£20,436|