The analysis has been helpful throughout, in particular for my economic development colleagues in identifying what is on the horizon for the many self-employed and residents we have working in the gig economy.
A data led investigation into the causes and
Supported by Trust for London Policy in Practice is tracking changing living standards for almost one million Londoners in half a million households. By combining anonymised household level data sets from councils across London we can see how income, employment and poverty is changing, on a monthly basis.
About the project
Data can tell us what impact national and local policies are having on low income households and help us design better interventions.
The project shows what can be revealed when local authorities collaborate with their data. Tracking households over time tells policymakers what support is effective. The evidence base we’ve built is now a powerful tool, capable of influencing central government. Our approach is proven and deserves wider application to other areas.
We believe that administrative data is so influential it can drive the future of social policy. Some councils taking part in this project are showing how. They’re using insights from their data to identify struggling families early and targeting support, to avoid crisis.
To find out more or get involved please email firstname.lastname@example.org or call 0330 088 9242.
- Outer London boroughs are more heavily impacted by welfare reforms
- An effective measure of living standards should take needs into account
- Tracking employment patterns show disability is the greatest barrier
- The benefit cap disproportionally affects temporary accommodation
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- Many low-income Londoners are self employed
- UC will hit self employed low-income Londoners hard
- A third of families got jobs, a third moved home and a third left due to the benefit cap
- Those most hit by the cap are private renting lone parents
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- Low income Londoners are becoming less financially resilient. The proportion of Londoners with low financial resilience has grown by 20% in the last two years and will continue to grow through to 2020
- Employment helps build financial resilience. Employment is the main driver of people improving their financial resilience; for people affected, welfare reforms are a driver of lower resilience, but they don’t tell the full story
- Living standards fluctuate. Over two years a quarter of low-income households in work lost their job at least once; improving job stability can help build resilience
- The future isn’t bright. Londoners on low incomes face a bleak future with an average drop in their disposable income of £100 p/w if rents and other livings costs continue to rise as expected
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- Londoners are poorer. Almost a quarter of working-age low-income London households (24.4% of those tracked) were facing a cash shortfall in 2019, up from 15.7% in 2016.
- Welfare reforms made people poorer. 39% of working-age households who were affected by at least one of five main welfare reforms were financially vulnerable, compared to just 17% among those not impacted by any of these reforms.
- Universal Credit and the LHA rate had a negative impact before the pandemic. Close to half (44%) of households on Universal Credit could no longer make ends meet by August 2019, while two-fifths (40%) of households impacted by the Local Housing Allowance were in cash shortfall.
- More families with children are poorer. Almost two-thirds (61%) of families with children were worse-off after household costs by 2019 than they were in 2016. As a result, the proportion of families with children facing a cash shortfall had doubled from 11% to 23%. It is estimated that across London this could equate to 229,000 children living in households that could not make ends meet.
- The COVID-19 welfare support helped some. As a result of April 2020’s welfare reforms, the average working-age low-income London household’s disposable income has been boosted by £85. This has meant an extra 6% of London’s pre-existing working-age low-income households can make ends meet.
- The new LHA increase has helped some private renters. 20% of private tenants who previously saw restrictions in housing support will no longer have their housing-related benefits restricted as a result of the increases to the Local Housing Allowance introduced in April 2020. Among those who are still impacted, their disposable income will increase by £172, moving them on average from a significant cash shortfall (-£140) to a small surplus of £33.
- The benefit cap stopped some households from getting COVID-19 welfare support. However, the benefit cap is still preventing some financially vulnerable Londoners from fully benefiting from the April reforms. Those who were already capped received no additional support and have an average cash shortfall of over £400, while those who are newly capped received some boost in income but remain with an average cash shortfall of £284.
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New analysis: Who are the most financially vulnerable residents in London?
- Council tax support scheme caseloads grew by 13%. On average, this equates to an extra 1,942 households claiming support from their council in each Borough.
- Council tax support scheme costs grew by 16% during the pandemic. Over a year, this is £2.4m for the average Borough, which represents nearly 1% of a council’s total budget. The government has responded to increased caseloads with an extra £670m funding package for England, with £92m going to London and £3.4m to the average borough in this study.
- The take-up rate of council tax support varies between Boroughs, from 35% in Sutton to 14% in Lambeth. This is driven by the generosity of council tax support schemes (more generous council tax support schemes drive better take up), how easy it is to claim, and demographic trends. Councils may want to focus on raising awareness of their scheme and improving the ease of claiming.
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New analysis: Council tax support scheme costs rise by 16% in London
London Boroughs who are participating
- Barking and Dagenham
- Hammersmith and Fulham
- Kensington and Chelsea
- Tower Hamlets
- Waltham Forest
We are happy to take part in this important project that tracks the living standards of London’s most vulnerable residents. It’s cost free, sending our data was easy, and we’re learning valuable insights.
This project has been an opportunity to better understand how our resident’s living standards benchmark against others in London, and get to grips with the drivers behind those differences. It will absolutely inform our poverty tackling strategy going forward.
With welfare reform, rising living costs, job insecurity and the roll-out of Universal Credit, it is a time of real change for low-income Londoners. The response from policy makers needs to be right if we are to prevent many thousands of people from being pushed into real financial hardship because of the changes.
This project is unique in the way that it examines household benefits data for over half a million Londoners and allows that data to be linked over time.
20% of the success of this project lies in the data, 80% in the collaboration.