More than 300,000 households in Wales have seen incomes fall since the start of the pandemic

A think-tank has called on the Welsh Government to take immediate action to support families trapped in poverty as new data shows that nearly a quarter of Welsh households have seen their incomes fall since the outbreak of the pandemic.

More than 320,000 households have seen their incomes fall since the start of the pandemic, new data gathered by YouGov on behalf of the Bevan Foundation reveals.

At the same time households have seen a number of key living costs increase including 41% seeing an increase in the cost of heating, electric and/ or water and 38% seeing an increase in the cost of food.

Whilst the economic impact of the pandemic has hit people across Welsh society, it is the poorest households who have been most greatly impacted, with many forced to cut back on essentials or forced to borrow money.

More than a one in five households whose gross household income is less than £20,000 have had to cut back on food for adults and heating, electricity and/ or water.

The same proportion have had to borrow money since the outbreak of the pandemic. 9% of households have fallen behind on a bill since March, rising to 19% of social renters and 20% of private renters.

Dr Steffan Evans of the Bevan Foundation said:

“The new data shows that it is the poorest households who have borne the brunt of the economic impact of the pandemic.

With 700,000 people already trapped in poverty in Wales before the pandemic struck and many others struggling to keep their heads above water, many families have had little room to manoeuvre as incomes have fallen and living costs have increased.

This is putting a real squeeze on families leading many to cut back on essentials.”

Many families do not expect the situation to improve significantly over the next three months. 21% of Welsh households expect to have to cut back on at least one essential over the next three months, with a further 11% expecting to have to borrow money to make ends meet.

Dr Steffan Evans added:

“Whilst there may be hope on the horizon with the roll out of the vaccine underway, for families trapped in poverty the outlook is bleak. Debt families have fallen into over 2020 will have to be paid off whilst there is little sign of the jobs market improving in the immediate future.”

The data does demonstrate that there is broad support from the Welsh public for the Welsh Government to take action to provide people with emergency support, to construct more affordable housing, to support young adults in education and to close the attainment gap. The Bevan Foundation is therefore calling on the Welsh Government to take short term and longer term solutions to poverty.

Dr Steffan Evans said:

“In the short term there are a number of steps that the Welsh Government could take to reduce the impact of the pandemic on poverty. This includes providing free laptops to all children who are in receipt of Free School Meals, establish an EMA hardship fund, write off Tenant Saver Loans and ensure income maximisation advice is provided nationally.

In the longer term we believe the Welsh Government must invest in public services and bring together all the various support schemes it provides people on low income into a united and reformed Welsh Benefits System. We believe that by taking such action we could transform Wales and reduce poverty and inequality”