New approach to measuring poverty

DWP launches new poverty measurement based on SMC approach
Earlier today, the Department for Work and Pensions (DWP) launched its first iteration of “Below Average Resources (BAR): developing a new poverty measure”.

This new Official Statistic in Development is based on eight years of work from the Social Metrics Commission (SMC), for which WPI Economics has provided the Secretariat and Technical Team.

Today’s DWP announcement states:

“The Office for Statistics Regulation (OSR) Review of Income-Based Poverty Statistics recommended that the DWP assess how the SMC’s proposals can be implemented to enhance the public value of our statistics. The OSR recognised that a basket of main poverty measures is required to meet varying user needs, but that signposting and coherence between different statistics could be improved to help users navigate the varying measures.

“The BAR approach provides a more expansive view of available resources (both savings and inescapable costs) than the income measurement adopted under HBAI, and also includes some methodological changes proposed by the SMC.”

Matthew Oakley, Founder and Director of WPI Economics, said:

“The Social Metrics Commission was set up in 2016 to try to develop a new measure of poverty for the UK that both more accurately captured the nature and experiences of poverty in the UK, and that had cross-party and widespread support.

“We hope that we have achieved that, with publication as the first step towards new Official Statistics on poverty for the UK.”

The SMC was established by Baroness Stroud in 2016. The team at WPI Economics would like to thank the Baroness and all the SMC Commissioners, without whom the new measure could not have been created.

More information on the SMC can be found here.

You can respond to the DWP consultation here.