A UK minimum income standard
- Research identifies a minimum socially acceptable level of income or living wage
Loughborough’s Centre for Research in Social Policy has identified a minimum socially acceptable income standard in the UK, based on detailed consultation with the general public.
Close engagement with the public and with organisations promoting social welfare has helped to establish an accepted national benchmark that has been used directly by charities to distribute money equitably and by wage negotiators and campaigners to identify a living wage.
The research brought together the two leading approaches to compiling minimum household budgets – expert-led research and consensual deliberation among panels of members of the public.
Means-tested benefits were found to be much too low for a minimum living standard for working age households, but about right for pensioners.
The research also identified that the minimum wage is too low for most working households to reach an acceptable standard of living, and that minimum household costs have been rising faster than average prices – and much faster than typical household incomes – since 2008.
The credibility of the research was enhanced by the participation of members of the public in setting a defined Minimum Income Standard.
The usefulness of the Standard has been assured through clarity of written reports, an easy-to-use online calculator – showing the minimum income relevant to a wide variety of households – and on-going updates to ensure that the data is current.
The MIS methodology is now being adopted by researchers worldwide. For example, an ONPES-funded project is currently developing consensual budget standards for French households.
RAISING PUBLIC AWARENESS
The research received an exceptional amount of media coverage – including national television, BBC Radio 4, the web and newspapers – helping to influence public thinking about minimum needs.
TAX THRESHOLDS RAISED
The Demos think-tank used the Minimum Income Standard in its report arguing for a raise in personal tax thresholds, contributing to Government policy.
PENSIONS POLICY REFORMS
The Pensions Policy Institute used the Minimum Income Standard as a key benchmark in a report considering how high pensions need to be in order to meet minimum needs. In 2010, the Treasury’s consultation paper on annuities reform suggested this benchmark as one potential criterion for a minimum income requirement.
CAMPAIGNING FOR A LIVING WAGE
The Living Wage Campaign has adopted a Living Wage level for outside London based explicitly on the Minimum Income Standard. By November 2012, 30,000 people outside London had received pay increases worth a total of £33m as a result.
Various charities use the Minimum Income Standard as a threshold to determine whether to assist people in hardship. For example, Independent Age use it to determine the distribution of £6m pa in grants to older people.