The poverty of the poverty measure

‘400,000 children will fall into relative poverty by 2015, says IFS’ we read on The Guardian’s front page today — yes, one of the most pernicious ideas of recent years is back. It’s the definition of ‘poverty’ as being figures on a spreadsheet, households deemed to fall beneath an arbitrary threshold. It’s almost entirely meaningless, and diverts energy and resources away from a real fight against poverty. I really do believe that, as ideas go, this one has damaged Britain more than almost any other over the last two decades — and it’s high time it was confronted.
 
The ‘poverty’ that the Institute of Fiscal Studies is talking about is defined by Eurostat as having an income below an arbitrary threshold: 60 per cent of the median income. It occurred to Gordon Brown in about 1999 that he didn’t need to fight real poverty at all. Instead, he could get his tax credits to precision bomb benefits on those just below the threshold, so they moved just above.