Scourge of hardship spreading fast

Confucius once said, “In a country well governed, poverty is something to be ashamed of. In a country badly governed, wealth is something to be ashamed of.”

This could well apply to Britain. Poverty seems to have hit what was regarded till now an affluent country. The number of Britons earning less than the real living wage is set to soar to 5.1 million next year, new research shared with The Independent has found.

Around 3.5 million workers currently earn less than the real living wage – the sum paid voluntarily by thousands of UK employers based on what people need to afford basic living costs.

But the Living Wage Foundation has forecast that another 1.6 million people will be pulled into poverty pay rates by the spring of 2023 because wages cannot keep pace with soaring inflation.

It means 5.1 million workers – one in five of all UK jobs – will be earning less than what they need to live on, the foundation said.

Katherine Chapman, director of the Living Wage Foundation, said: “Our forecasts demonstrate a bleak picture for next year, with an estimated 5.1 million workers set to be paid below the real living wage.”

She added: “With the cost of living rising and families facing more pressure this winter, it has never been more important for businesses to do the right thing and commit to paying a real living wage.”

The real living wage – slightly higher than the government’s statutory minimum wage and paid voluntarily by more 11,000 employers – stands at £11.95 in London and £10.90 across the rest of the UK.

This voluntary rate was increased 10.1 per cent in September, roughly in line with inflation, in recognition of the sharp increase in living costs over the past year.

But the Living Wage Foundation said the ongoing inflation problem meant that by April, around 1.6 million workers would have been pulled into poverty pay rates – below what they need to pay their bills.

Employees must pay national minimum wage rates of between £4.81 and £9.18 from school leaving age until the age of 23, while workers who are 23 or older must get paid a minimum wage of £9.50 an hour – rebranded by the government as the “national living wage” in 2016.

However, the real living wage is set independently. “The real living wage must continue to be at the heart of solutions to tackle the cost of living crisis,” said Ms Chapman.

It comes as the TUC and union leaders warned Prime Minister Rishi Sunak and his colleague to protect public sector pay ahead of next week’s autumn budget.

The PCS union – announcing strike action earlier this week for more than 100,000 government workers – said many low-paid staff in Whitehall and public bodies across the UK were forced to turn to food banks.

Food banks had been set up at the Department for Business Energy and Industrial Strategy (BEIS) and other major government offices, said PCS boss Mark Serwotka.

“Poverty is everywhere in the civil service. Food banks for civil servants tell us that pay is chronically low and urgent intervention by government is needed,” he said.

Shocks related to the COVID-19 pandemic and the war in Ukraine mean the world is unlikely to meet a longstanding goal of ending extreme poverty by 2030, the World Bank said in a new report.

The COVID-19 pandemic marked a historic turning point after decades of poverty reduction, the report said, with 71 million more people living in extreme poverty in 2020.

That meant 719 million people – or about 9.3% of the world’s population – were living on just $2.15 a day, and the ongoing war, reduced growth in China and higher food and energy prices threatened to further stall efforts to reduce poverty, it said.