The Minimum Income Standard 2014 study asks members of the public what goods and services they think different types of households need to live to an adequate level.
Published annually since 2008, the study uses this information to calculate how much people have to earn – taking into account their family circumstances, the changing cost of these essentials and changes to the tax and benefit system – to reach this benchmark.
This year’s research finds:
- a lone parent with one child now needs to earn more than £27,100, up from £12,000 in 2008. A couple with two children need to earn more than £20,200 each, compared to £13,900 each in 2008. Single working-age people must now earn more than £16,200, up from £13,500 in 2008;
- despite social and economic change, the list of goods and services is very similar to that of the original study in 2008, but people’s ability to afford them has declined. Overall the cost of a basket of essential items has risen by 28% over six years, while average wages have increased 9% and the minimum wage 14%;
- increased tax allowances have eased the pressure somewhat for some households, but the freeze to child benefit and ongoing cuts in tax credits have outweighed this for low-earning families with children. Out-of-work benefits have fallen further and now provide 39% of what single, working-age people need to reach a Minimum Income Standard. On the other hand, pensioner couples who claim all their allowances receive 95% of the amount required.