How could Brexit affect poverty in the UK

Kumar, Ashwin ORCID: https://orcid.org/0000-0002-1994-6643, Heykoop, Laurie and Barnard, Helen (2018) How could Brexit affect poverty in the UK. Discussion Paper. Joseph Rowntree Foundation, York.

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Abstract

This briefing analyses Brexit’s potential impact on families in poverty, along with other forces that could help or hinder efforts to solve UK poverty. It is unacceptable that 14 million people are locked in poverty as Britain prepares for Brexit. The Brexit vote reflected deep-seated anger about economic marginalisation, poverty and lack of opportunities, but it is highly unlikely that leaving the European Union (EU) will solve these problems. Our analysis shows that: Child poverty is set to increase across the country, and to affect poorer areas of the UK worst. This rise predates the Brexit vote and is driven by domestic decisions about housing, social security and the labour market. However, many of the worst-hit areas are also highly exposed to changes in trade with the EU and any loss of regional funding. There are increasingly strong risks of price rises, falls in real wages, lower employment and lower tax revenues as the UK-EU trading relationship becomes incrementally more distant. Poverty rates are not predicted to be greatly affected by Brexit; but this depends on future governments protecting low-income families from the effects of rising inflation by uprating benefits and tax credits to cover rising costs. Two years on from the vote to leave the EU, it is only right we unlock opportunities so more families are not left behind. The UK Government must deliver more affordable housing, better jobs and an improved social security system to meet the expectations of those who voted to leave the EU. The time and energy being spent on Brexit must not reduce our capacity to deliver a country that works for everyone after Brexit.