Britain now has a record number of people living in 'very deep poverty'—defined as incomes below 40% of median earnings—according to analysis by the Joseph Rowntree Foundation, reported by The Guardian on Monday.
The findings present Prime Minister Keir Starmer with a profound political dilemma. Labour won the 2024 election promising fiscal discipline and refusing to commit to substantial increases in welfare spending. Now in government, the party faces mounting evidence that 14 years of Conservative austerity have pushed millions into destitution that modest tinkering cannot address.
The Joseph Rowntree Foundation's analysis defines very deep poverty as household income below 40% of the median after housing costs—a threshold that captures those living in genuine material deprivation rather than relative disadvantage. This represents a step beyond standard poverty measures and indicates households unable to afford basic necessities including adequate food, heating, or clothing.
As they say in Westminster, 'the constitution is what happens'—precedent matters more than law. The political significance of these numbers lies not merely in their magnitude but in their trajectory. Deep poverty has risen steadily since 2010, through periods of both economic growth and recession, suggesting structural problems that transcend the business cycle.
The findings arrive as Labour's honeymoon period evaporates. The government has maintained Conservative spending plans in most areas whilst proposing modest tax increases that have generated substantial backlash from both business and middle-class voters. Chancellor Rachel Reeves has repeatedly emphasised fiscal responsibility, ruling out what she terms 'unfunded commitments' that might spook bond markets.
Yet the Joseph Rowntree analysis suggests that the cost of inaction may exceed the cost of intervention. Deep poverty correlates with poor health outcomes, lower educational attainment, and reduced economic productivity—factors that impose long-term costs on public services and economic growth. The Foundation estimates that child poverty alone costs the UK economy £39 billion annually through reduced tax receipts and increased public spending.
The Conservative response has been predictably defensive. Shadow ministers argue that poverty fell during their time in office using standard measures, whilst acknowledging that 'more needs to be done' to help those at the bottom of the income distribution. This position conveniently ignores that changes to poverty measurement methodology obscure the lived experience of millions.
Labour backbenchers are growing restive. Several MPs from northern constituencies have privately told party leadership that welfare reform must go further than currently planned, warning that voters who switched from Conservative to Labour expect tangible improvement in living standards. The government's decision to maintain the two-child benefit cap has proved particularly contentious.
The political calculations are fraught. Polling suggests the British public supports helping the 'deserving poor' whilst remaining sceptical of welfare spending generally. Labour strategists fear that substantial benefit increases could trigger the same 'tax and spend' attacks that undermined previous Labour governments. Yet the alternative—presiding over rising destitution whilst claiming economic success—carries its own electoral risks.
The Joseph Rowntree Foundation calls for substantial increases in Universal Credit, restoration of the £20 weekly uplift removed in 2021, and removal of the benefit cap and two-child limit. These measures would cost billions but, the Foundation argues, would dramatically reduce deep poverty whilst boosting economic demand.
As Westminster observers know, Labour governments historically struggle to balance their social democratic instincts against market pressures and media scrutiny. The party's response to this crisis will reveal whether Starmer's administration represents genuine change or merely competent management of an unsustainable status quo.
