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With PRS rents rising, a study picking the pockets of poverty in London in London shows 15% of the capital’s low income households can’t pay the bills week to week.
And their number is expected to triple to 238,000 by 2021 if nothing changes.
The biggest growth in cash-strapped families since 2016 was in Sutton (79%), Camden (40%), Southwark (43%).
A new Living Standards Index for London tracks the financial security of 550,000 low income families.
The Index was compiled by socially-minded software specialists Policy in Practice using data drawn from 18 London councils.
Released today (April 15), the latest findings, released today, show that 1 in 7 (15%) of the low income families studied can’t pay the bills.
The tool makes it possible for people to analyse one of the largest data samples about low income Londoners, and will be regularly updated with new information.
Policy in Practice’s Index identifies Enfield, Barnet, Camden, and Sutton as ‘poverty hotspots’ with the highest proportion of families in dire financial straits – 20% of low income families in Enfield and 25% in Barnet reported a regular cash shortfall.
The data suggests much of the hardship is driven by rising rents in the private sector.
In Enfield, 47% of low income families rent privately, and 45% of families in Barnet – the highest rates in London.
Policy in Practice Director Deven Ghelani says his firm found a concerning rise in the number of cash-strapped households in the last two years.
Using data from the 18 participating councils, analysts were able to track the soaring financial insecurity of low income households on a monthly basis, and forecast their living standards into the future given rising rents, frozen benefits and comprehensive Universal Credit roll out.
“The data we’ve brought together through our London Living Standards Index shows what a lot of councils and community organisations have been saying.
“Rising living costs and frozen benefits have combined to push more families into real hardship – where they simply don’t have enough money to pay the bills each week,” said Ghelani.
“This Index allows service providers and charities to see what low income families are experiencing in their area, and to see the pockets of need that are currently below their radars,” he said.
Between 2016 and 2018 the number of London families in the sample facing a weekly budget shortfall has risen by 21% to 81,000.
The sharpest rises have been in Sutton (79%), Camden (40%) and Southwark (43%).
As well as councils, Policy in Practice is pitching its tool to London-based volunteers, charities, and change campaigners.
Ghelani said many of the 18 councils involved in the project, which is funded by the Trust for London, are already using the Index and its tracker tools to better target support to families in need.
“Our leaders should harness this information to drive how they spend resources to reach those families in most need and prevent shortfalls from leading to hardship or homelessness,” said Ghelani.
“If the trends we’ve identified continue, London is going to see an extra 157,000 families at the end of their financial rope by 2021, putting strain on support resources, local authorities and charities,” he said.
