UK low- to middle-income families far poorer than OECD counterparts – study
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Britons 39% worse off than Dutch equivalent due to housing costs 44% higher than western European average. Low- to middle-income families in Britain are far poorer than their counterparts in western Europe because of sky-high housing costs, according to an analysis by the Resolution Foundation.
The thinktank said that while prices in the UK were 8% higher than the average in the 38 member countries of the Organisation for Economic Cooperation and Development (OECD), less well-off Britons were more affected by the cost of housing, which is 44% higher in the UK than the OECD average.
Higher housing costs in the UK more than offset the benefit of food, another major area of spending for those on lower incomes, being 12% cheaper than the average in those developed countries. When lower-income families’ tendency to spend more on necessities and less on luxuries is factored in, German families are 21% or £2,300 a year better off than their UK equivalents and the gap with Dutch families is even wider, at 39%.
Without that adjustment, poorer German families would be 16%, or £1,700 a year, better off than poorer British families. Simon Pittaway, a senior economist at the Resolution Foundation, said: “Britain’s housing costs crisis is a major driver of child poverty, and contributes to poor families being £2,300 worse off than their German counterparts. The crisis needs to be tackled urgently – from building more affordable homes to providing better support for low-income renters.
