Fuel and travel costs are pushing prices up again
Thursday 5 November 2026
Inflation has risen to 3.1%, meaning everyday spending is getting more expensive just as household budgets are already under pressure.
Absolute poverty
Having a household income below a line set using a reference year and then adjusted as prices change.
What it means
In UK income statistics, absolute poverty commonly refers to income below a line based on 60% of the median income in a chosen reference year. After that, the line is adjusted for inflation so it keeps roughly the same buying power; it does not stay at the same number of pounds forever. Income is adjusted for household size and can be counted before or after housing costs. Unlike the relative line, it does not move each year just because middle incomes change. The official reference year and methods can be updated, so use figures calculated on a consistent basis when comparing years. This income measure alone does not tell us whether every basic need is met.
Example
In a made-up series, suppose the reference-year line is £15,000. If prices rise by 10% and the same method is used, the corresponding line becomes about £16,500. It changes even if the middle household's income stays the same. These are illustrative figures, not official thresholds.
Why it matters
It helps show whether people on low incomes are gaining buying power over time. It answers a different question from relative poverty, which compares incomes with the middle of the same year.
Also known as
absolute low income
Related terms
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Equivalised income
Household income adjusted so that households of different sizes can be compared more fairly.
Read more -
Income after housing costs
Household income after taking off specified housing costs, including rent or mortgage interest.
Read more -
Inflation
A general rise in prices over time.
Read more -
Material deprivation
Going without things or activities considered part of a decent standard of living because you cannot afford them.
Read more -
Relative poverty
Having a household income below a set share of what the middle household receives in the same year.
Read more
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