A useful example of how we get our poverty and inequality statistics entirely wrong here. Yes, this is specific to the UK in details but it is indeed an illustration of a larger problem which affects all such calculations everywhere.
The claim is that if the oldies among us have to pay for a TV licence then this will push some of them into poverty. This isn’t actually true given the measure being used anyway:
Scrapping the free TV licence for over-75s could push 50,000 older people into relative poverty, according to research by the charity Age UK, which is urging the government to pick up the bill of providing BBC services to elderly people.
The broadcaster opened a consultation last year on whether to start charging older people the £150.50-a-year fee, but the charity said such a move could distress many older people, “potentially forcing them to cut back on other essentials such as heating and food in order to remain informed, entertained, stimulated and connected to the world beyond their doorstep”.
Age UK calculated that forcing over-75s to start paying for BBC services could hit disposable incomes and leave tens of thousands of households facing a choice between being able to watch television or being pushed into relative poverty, which is defined as households with less 60% of median household income.
Relative poverty is defined by income, not expenditure.
But that larger problem. Let us accept disposable income as our measure. The TV licence is indeed a tax, so, OK. We’ve the claim that people having to pay it will drive some into that relative poverty. OK. So, where in our measurements of poverty and or inequality is the value of those services which they currently do not have to pay for?
We all gain access to the same medical services at the same price through the National Health Service. This reduces both poverty and inequality substantially. So too free education for all to the age of 18. Even equal access to the road network is an economic leveler. Yet none of these appear in any of our poverty nor inequality statistics.
Which means two things. Firstly, it’s a bit off to claim increased poverty or inequality as a result of withdrawing such things if we’re not equally claiming reduced such by their existence. Secondly, it makes a mockery of the claim that either are up to historical levels, Victorian say. Simply because those equally available services and public goodies mean that we’re not anything like those times at all.