Oxfam reports of a rise in full-time workers in poverty

A new report on poverty in the UK by the charity Oxfam concludes that poverty is not shared equally across society and since the 2008 financial crisis the situation has got worse for sections of society that were already in poverty.

The charity says that even those in work, on relatively low wages are falling into the poverty trap because of high inflation, the rising cost of living, cuts to benefits, a rise in unemployment and falling wages.

Oxfam says that the minimum wage needs to be increased to combat this problem. It says that average food costs have increased by 30 per cent in the last five years, compared to a 12 per cent increase in the minimum wage.

The charity says that six out of ten working-age adults living in poverty come from working households.

Oxfam reports that average earnings have fallen by 4.4 per cent overall in the last year but the pay of FTSE 100 directors has increased by 49 per cent over the same period.

Poverty is defined by the government as living on less than 60 per cent of the median net income.

Oxfam says that the public sector cuts have affected different parts of society disproportionately. It says the poorest ten per cent of society have been affected 13 times more than the richest ten per cent.

This has meant a large rise in the number of food banks being set up and used, even by people in a full-time job.

The report also suggests that women and households from ethnic minorities are being affected more than white men. The cuts announced in the Autumn 2010 spending review will be paid for mainly by women, 72 per cent, compared to 28 per cent for men.

Oxfam's director of UK poverty Chris Johnes said: "Despite the Government's rhetoric about making work pay, having a job is no longer necessarily enough to lift someone out of poverty.

"The Government is justifying huge cuts to welfare support for people on low incomes by saying this will incentivise work, but there simply aren't enough decent jobs available."

"We need to see income being distributed more fairly if we are to make any impact on reducing levels of poverty.

"If we carry on down this path, the UK will return to levels of inequality not seen since Victorian times."

The Department for Work and Pensions said that the introduction of the Universal Credit will simplify the system and help boost a system that was not working.

A spokesman said: "Over the last decade vast sums of money have been poured into the benefits system in an attempt to address poverty - £150bn was spent on tax credits alone between 2004 and 2010.

"This approach has failed, with the UK likely to miss its own 2010 child poverty targets. We need to address the root causes of poverty including worklessness.

"The Universal Credit will replace a complex mess of benefits and tax credits and make work pay.

"It is estimated that Universal Credit could lift 350,000 children and 550,000 adults out of poverty."