Poverty in data in the spotlight: Open Data Institute & Poverty Strategy Commission reports

Profile photo of James LockwoodWe examine two recently published reports that look at the current cost-of-living crisis and poverty, and how data can aid in alleviating these societal issues.

During 2023 and 2024, the UK Data Service Impact team are seeking to draw together and share examples of how the data in our collection is underpinning research and work in the areas of poverty, deprivation and cost-of-living.

As part of this we recently published a blog post which highlighted the impact some of the data available via the UK Data Service is having on research, policy and public conversations around the areas of poverty, deprivation and the cost-of-living crisis. To do this we pulled together some of the research, reports and articles we noted over the summer that make use of data available in the collection.

In September we were encouraged by two reports that were published which we believe have the potential to be significant in this area and which we wanted to briefly highlight. The reports were from the Open Data Institute (ODI) and the Poverty Strategy Commission (PSC).

The cost-of-living: how data can help tackle the crisis

The ODI’s report focused on the cost-of-living crisis and how data can aid in the current crisis. Pulling together a significant number of key groups and organisations that work in the area of poverty and cost of living, the report highlighted some of the ways in which current data can shed light on the cost-of-living crisis and also some of the gaps in the data and area which could be improved.

Gaps in the data

The ways in which available datasets can often exclude many of those who are suffering from different types and levels of poverty. This could be due to a number of factors including:

  • Official definitions of poverty (such as fuel poverty) can exclude those who we might intuitively include in such groups. Fuel poverty is defined in England as an individual living in a property with an energy performance certificate of band D or below who fall below the poverty line after fuel cost. This means that people in low-income households who live in higher EPC-rated buildings are excluded from the official statistics, regardless of how their energy bills affect their income and expenditure. Interestingly this extra requirement is not included in the statistics in Wales, Scotland or Northern Ireland.
  • Limited data can also exclude people from statistic, such as hidden homelessness which includes people who live in severely crowded accommodation, sleep rough out of sight or are staying with friends or family or “sofa-surfing”.

The necessity of quality, up to date data

The report found that one issue with current research in this area is the inevitable time lag between data collection, publication, analysis and research publication that is based on many of the most important datasets in this area (such as the Family Resource Survey or Wealth and Assets Survey). The last couple of years with Covid and the rapid rise in energy costs for example have meant that there are gaps in these areas which can lead to a partial or incomplete view of the issues. Whilst the report does not give any specific solutions to this problem, they encourage those in position to continue to seek the most effective way to get high-quality and timely data available for use. They argue that the cost of this would be outweighed by the benefits.

Innovative digital tools

We really liked the digital tools (which can be found here) they have developed that draw on a range of datasets to provide information on the both the cost-of-living crisis and related support services. Both tools are location based, with one providing a map of the UK and including various metrics related to cost of living. There is also a Local Authority Tool which provides data on the same metrics based on local authority. You can also search by postcode to see which of the cost-of-living challenges are most prevalent in a specific area. These tools, and the datasets they’re built on, will hopefully be of use to researchers and people “on the ground” across England.

We commend this report and the ongoing work of the Open Data Institute and support their calls for more innovative and accessible methods of data collection, dissemination to encourage more timely and beneficial research to be conducted on these major topics and themes.

A new framework for tackling poverty

The Poverty Strategy Commission’s (PSC) interim report had a different focus, presenting the work conducted by the commission so far. We were delighted to work with the Social Metrics Commission on a case study about their development of a new poverty measure a few years ago, and it is encouraging to see this work is having continued impact through the PSC’s new endeavour. The need for a poverty measure would appear more pressing than ever, with the cost-of-living crisis over the past year impacting people across the UK and worldwide and we were encouraged to see that the Department for Work and Pensions has reopened their project to develop a new experimental statistic earlier in the year.

The resource gap

The PSC is developing a new framework for tackling poverty in the UK in which they have quantified the scale of the problem of poverty. Their analysis focusses around what they call the “resource gap”. This they define as the change in resources (either by increasing income or assets or reducing cost and debt) that would be needed for a family to no longer be in poverty. For the UK the total “resource gap” stands at £36 billion a year, which means that if interventions were targeted correctly and resulted in an increase of £36bn then poverty in the UK could be eradicated. They are clear to point out that this is unlikely, but that it is a helpful benchmark and one that includes many possible avenues of focus which include government, business, employers and individuals aiding in making changes which can lead to poverty levels, which have remained stubbornly at between 21% and 24% in the UK over the past couple of decades, can be lowered.

The need for a social contract

The Commission state that this idea of all areas of society working together is best put into action when underpinned by a clear and codified “social contract”. By this they mean an agreement between each of the actors involved about what they should be doing to support a reduction in poverty. The Commission has put together an idea of what such a contract could look like based on current Government policy (i.e. not necessarily what the Commission thinks a social contract should look like) which includes the following five points:

  1. No one should be in deep poverty (defined as more than 50% below the poverty line).
  2. Those not expected to work should not be in poverty.
  3. People should do all they can to increase earnings.
  4. Those earning as much as expected should not be in poverty.
  5. Businesses need to fulfil their obligations.

These points are expanded on in detail in the report. They also comment on using a variety of “levers” that are available to help tackle poverty, and the importance of using all of these. These levers include net income, debt, recurring costs (housing, childcare etc.), the family and communities of those living in poverty, mental and physical health, and education and skills.

We are encouraged by the work that is ongoing. We look forward to seeing the work develop and to the next phase of the commission which will include developing key proposal for action across sectors and ongoing consultation before a final report in 2024.

About the author

James Lockwood is Research Impact and Engagement Manager at the UK Data Service.

You can find more about the UK Data Service training and events on our website.

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