Written statement: Households Below Average Income Statistics Release - Mar 26

Minister for Employment (Dame Diana Johnson): The Department for Work and Pensions (DWP) has today published its annual statistics on incomes and living standards covering 2024/25 – the last three months of the previous government as well as the first nine months of this government.

These statistics include Households Below Average Income (HBAI), which contains estimates of household incomes and a range of poverty rates and low-income indicators for 2024/25, derived from the Family Resources Survey (FRS).

Further publications in today's release are: Income Dynamics, Pensioners' Income Series, Children in Low Income Families, Improving Lives Indicators, Separated Families Statistics and the Family Resources Survey. These publications cover the four statutory measures of child poverty required to be published by DWP under the 2010 Child Poverty Act.

Accurate data is fundamental to making effective policy interventions to support low–income households and allows us to track and to be accountable for the progress we make. In 2024/25, we have therefore made two important methodological changes that improve the accuracy of the HBAI statistics.

For 2024/25, we have for the first time been able to link HBAI survey responses to benefits administrative data following several years of work started under the previous government. This means that our statistics now address the fact that survey respondents, for a variety of reasons, don't always report their benefit income accurately (with people more likely to under rather than over-report their income). This improvement in methodology produces reduced overall rates of poverty as people in low income generally receive a greater proportion of their income from benefits.

The improved methodology has also been applied to all years from 2021/22 enabling consistent comparisons over the most recent years.

For the statistics released today, the baseline year for absolute poverty has been updated from 2010/11 to 2024/25. The baseline year is updated every 10 to 15 years to ensure it remains relevant to modern-day incomes. This change increases the reported level of absolute poverty whilst leaving key trends unchanged.

The proportion of individuals living in relative poverty (after housing costs) in 2024/25 was 20%, unchanged from 2023/24. Within this, the proportion of working age adults and children living in relative poverty was also unchanged at 19% and 27%, respectively. However, the relative poverty rate for pensioners increased to 14% compared with 12% in 2023/24.

The percentage of children in food insecure households has decreased, from 18% to 14%, with 2 million children overall living in a food insecure household in 2024/25. For working age adults, the food insecurity rate fell from 11% to 9%, whereas for pensioners it remained stable at 3%. The number of individuals in households that had accessed a food bank in the previous 12 months fell from 2.8 million to 2.5 million, around 4% of the population.

These high inherited levels of poverty and food insecurity are wholly unacceptable and, since we first came into government, we have taken robust action to change the course we're on, drive down poverty and deliver lasting change for the millions of families whose lives are damaged by poverty now and in the future.

In December, we published our UK-wide Child Poverty Strategy. This represents our first step towards ending child poverty and will lift 550,000 children out of relative low income (after housing costs) in 2029/30 – this will lead to the largest reduction in a single UK Parliament since comparable records began. The removal of the two-child limit from April will alone lift 450,000 children out of poverty in the last year of this Parliament. Alongside this, we are putting in place robust arrangements to ensure that we can continue to build on our success as part of a long-term, 10-year strategy for lasting change.

We know that getting more people into better jobs is crucial to reducing poverty and improving living standards, as well as to the UK's future economic prosperity. Through the proposals in our Get Britain Working Strategy, we are driving forward the biggest reforms to employment support in a generation, with funding of £3.8 billion by 2028/29, to help more people into work and to get on in work.

Alongside this, we have taken substantive action to support those on the lowest incomes including:

• Boosting the National Living Wage, which will increase again to £12.71 an hour from next month – an increase of £900 a year for a full-time worker.
• Introducing a Fair Repayment Rate for deductions from Universal Credit from April 2025, allowing 1.2 million of the poorest households to retain more of their award.
• From next month, introducing the first sustained above inflation rise in the basic rate of Universal Credit since it was introduced, with just under four million households benefitting from our decision to increase the Universal Credit standard allowance.

• Providing a £1 billion package (including Barnett) to reform Crisis Support in England from April – the first ever multi-year settlement for crisis support.

Despite having to make the tough decisions to deal with our fiscal inheritance, this government remains absolutely committed to giving pensioners the security they deserve in retirement. The basic and new State Pensions will increase by 4.8% in April, benefitting over 12 million pensioners by up to £575 and our commitment to protect the Triple Lock means that annual spending on State Pensions is forecast to be an estimated £30 billion more a year by the end of this Parliament. Alongside this, we are delivering the biggest ever drive to increase Pension Credit take-up, which has seen some 208,900 applications received in 2025 with nearly 33,500 extra Pension Credit awards, compared to 2024.