New Ways to Measure Poverty Don’t Mask the Reality: London Housing Costs Trap at Least a Third of Children in Poverty
Today’s release of the Department for Work and Pensions (DWP) Households Below Average Income (HBAI) statistics for 2024/25 reveals a continuing, deep-rooted poverty crisis for children in London. While the government has transitioned to a new model to track income more accurately, we at The Childhood Trust are warning that a change in counting does not equal a change in circumstances for the 700,000 children living in poverty in London.
The new 2024/25 data confirms that London’s housing market and high living costs have created a structural trap, making it the most difficult place in the UK for families to escape poverty and for children to thrive:
- Child poverty in London stands at 20% Before Housing Costs but soars to 38% After Housing Costs.
- This 18-percentage-point jump is the largest in the UK and is proof that housing costs are the primary driver of child poverty in London, stripping away family income.
- Based on the new HBAI data, London constituencies Hackney North and Stoke Newington and Bethnal Green and Stepney are both in the top three UK constituencies with the highest child poverty rates after housing costs at 60% and 56% respectively.
Today’s new figures also shed light on the worrying depth of poverty in the UK’s capital. For the first time, the DWP has reported on ‘Deep Material Poverty’, which is a measure of families who cannot afford at least four out of 13 basic essentials, such as a warm home, fresh fruit, or a bed for every child.
Based on relative poverty rates, London is estimated to have the highest concentration of children in the UK living in Deep Material Poverty.
Josephine McCartney, Chief Executive of The Childhood Trust, said:
“While we welcome today’s more accurate data from the DWP, a change in methodology does not change the reality for families. Statistics have a new baseline but the daily barriers to overcoming poverty remain as high as ever.
“London’s housing crisis is a relentless driver of hardship and poverty, with rental costs engulfing the income of families before they can even consider the cost of food or heating. The data exposes this ‘London Poverty Trap’ where child poverty in the capital rises to 38% once housing costs are factored in.
“The stats highlight something we and our frontline charity partners see daily: a deep poverty where a quarter of children in London are living without the basics like a warm home or fresh food. This is an astounding systemic failure.
“It is a misconception that families can simply move to escape inflated housing costs. Families on low income are part of the very fabric of London; deeply ingrained in its society, culture and its economy. For many, moving would mean losing vital support networks, childcare from extended family, and employment, often only to find that the costs of commuting back into London for work or the lack of social housing elsewhere creates a new set of hurdles. To allow this to happen would be a gross erosion of the city’s diversity.
“We welcome better measurements, along with the recognition of material poverty, but what is really needed are targets to reduce child poverty backed by sustained collective intervention and action for change. We back calls for the Government to set specific targets to reduce child poverty following the release of the Child Poverty Strategy in December 2025.”
Our Commitment
At The Childhood Trust, we will continue to focus on the 38% of children growing up in poverty in London. We use our understanding of the impacts of poverty to advocate for action that will alleviate the impact of poverty and provide evidence for systemic change longer term.
Our mission is always the children behind the numbers.