Inequality between local areas

Inequality between local areas is rising with a growing gap between affluent and less affluent communities.  At its extreme, this is underlined in the development of exclusive gated communities within areas of deprivation.  These inequalities are likely to intensify with the agenda of neighbourhood empowerment and local decision-making (see localism agenda), as middle class and wealthy citizens increasingly identify with and shape local communities.  On a larger scale there is a growing divide between London and the South East of England, and the rest of the country in terms of levels of affluence.

What are the implications?

  • Potential increase in tension between socio-economic and ethnic groups.
  • Inequality in service provision between different areas (the ‘post code lottery’).
  • Increased demand for voluntary and community organisations to meet gaps created by inequality in service provision.
  • A risk that pockets of deprivation within affluent areas get missed by funders and regeneration initiatives.
  • The voluntary and community sector's own resources (ie local funding and volunteers) may not always be in the areas of greatest needs.

Moving forward

How might your organisation identify and respond to additional social and economic need created by local inequality?

How might you ensure your beneficiaries have equality of access to services in this environment? This could include lobbying and campaigning, providing different support to users to ensure that they are able to access the services.

National organisations, or organisations working across a large geographic area, may need to change how resources are targeted in order to address increasing local inequality.

Organisations working across an area which includes large inequality may wish to ensure that staff, volunteers or trustees are recruited from a more diverse local population.

Want to know more?

Indices of deprivation 2007

Published by: Department for Communities and Local Government

Date: 2007

Format: Word and Excel

What is it? Research and scoring carried out nationally to allow the comparison of 'deprivation' across areas in England.

How useful is this? The Index of Multiple Deprivation 2007 combines a number of indicators, chosen to cover a range of economic, social and housing issues, into a single deprivation score for each small area in England. This allows each area to be ranked relative to one another according to their level of deprivation. It is comprehensive and an interesting overview but one for the number crunchers! Also, the date of its provenance means it does not reflect changes brought by the 2008 recession.

Other comments: Previously carried out in 2004 and then in 2007, in 2010 there has been a consultation on the future of the indices. Whilst this may have been worth getting involved with, it has been placed in abeyance pending decisions following the 2010 election.

Multidimensional Poverty Index

Published by: Oxford Poverty and Human Development Initiative - an economic research centre based at the University of Oxford which focuses on providing evidence for poverty policy decisions.

Date: 2010

Format: Web

What is it? A newly developed international measure of poverty which examines multiple deprivations of: education, health and standard of living as a means of assessing poverty. Based on a method (Alkire Foster method) which measures outcomes at the individual level against multiple criteria.

How useful is this? The evolution of the UNDP’s pioneering Human Development Index, launched in the first Human Development Report back in 1990, which combined life expectancy, education (literacy + enrolment rates) and GDP per capita, this measurement paves the way for poverty to be considered more holistically. It operates alongside income poverty measures and helps deepen understanding of what constitutes poverty beyond financial levels.

Given the trend towards different ways of measuring happiness and wellbeing (see our wellbeing driver), the importance of this indication will increase. It also paves the way to a future of increasingly multi-faceted measurements.

Other comments: Keep an eye out for the release of the 2010 20th anniversary edition of the United Nations' Development Programme's Human Development Report. It will feature the MPI. The 2010 report is expected to generate an agenda for change to significantly advance human development thinking and policies.

Last updated at 16:34 Thu 03/Feb/11.

Recent comments

AuthorComment

Written as Policy Officer at NCVO

it might be useful to note here that the Government uses the indices of multiple deprivation to analyse patterns of deprivation, identify areas that would benefit from special initiatives or programmes and as a tool to determine eligibility for specific funding streams.

Does anybody know how accurate the 'indices of multiple deprivation' is? and how effective it is calculating the deprivation in smaller areas or rural areas?

David's picture

David

NCVO Research Team

Trevor - I'm a research officer at NCVO and have had some experience with the indices of multiple deprivation, so may be able to help with your question.

The indices of deprivation are made by combining statistics across seven areas ("domains") including income, crime, employment. These domains are weighted to produce a combined score.

The statistics used are sourced from ONS and are national statistics - so based on large scale surveys of the population and administrative data. This makes it possible for the data to remain accurate even at quite small scales - ONS includes data to the level of "Lower Super Output Areas (LSOA)" which have populations of around 1,500. It's worth remembering that the data is generally from 2005 - the latest available.

ONS has some guidance on how they might be used.

You could think about combining these indices with the the rural statistics produced by DEFRA.

Hope this is some help.

Joh's picture

Joh

The most obvious in-equality between areas is when the wages are so high and the living costs are so low and vice versa. Savings can be made by people and they can then retire to the more expensive living cost wise places, whereas the people in areas where living costs are high and wages are low cannot...

Hi,

It would be great if this stub could be completed - I've pointed it out to the members of The Learning Exchange, which I manage and moderate. However, I've also pointed this link out to our members - [http://www.cpag.org.uk/info/Povertyarticles/Poverty128/place.htm]

and perhaps you want to do so for your members here?

However, I'm sure you have a lot more to say about this issue. I look forward to reading it! all the best.

Kathryn's picture

Kathryn

Third Sector Foresight

Hi Paddy!

The only details remaining that we intended to add to this driver were under the Further Reading section. This is where we signpost to other resources and articles that continue the debate, as it were.

You'll see that I've added one about indices of deprivation, but we're always keen to use the wisdom of crowds for these! So links such as the one you point out there Paddy from Child Poverty Action Group are great.

To maximise the value for our website users, of for example information such as the CPAG report, I'd be thinking 'So what does this mean for charities?' The concluding comments or recommendations that reports often end with are usually useful for this!

Hi Kathryn - thanks for answering this - and apologies for not replying for soooo long. I am looking for the Further Reading section - haven't found it yet; if I don't, I'll be back. I'll get round to putting a pic up soon... gulp. all the best!

In the South West, inequality between different areas is a real problem, but can be difficult to measure. Standard measures of deprivation (such as the government’s Indices of Multiple Deprivation) do not work very well for rural areas. This is because deprivation in rural areas is much more dispersed, with very poor people living in areas with very rich people. In urban areas poverty tends to be more visible and focussed on certain geographical areas.

As Stephen Wright of the South West ACRE Network reported at our anti-poverty conference earlier this year, twenty-five per cent of people receiving benefit in the South West live in rural areas. However, if you measure poverty by the Index of Deprivation, only 4% of the most deprived areas in our region are rural. This shows that the Index of Deprivation does not work well for rural areas (and for our region). This is due to the fact that the Index of Deprivation was developed based on an urban model.

Inequality and invisible poverty has major implications for people’s lives. One of the most critical issues for the South West is the shortage of affordable housing. House prices have been pushed up to unsustainable levels by people on high incomes (often in jobs outside the local area) buying properties. This has made it practically impossible for people on average incomes for the area to afford homes.

Inequality has been on this increase for several years and we see no signs of this changing. Indeed the government’s ‘austerity budget’ is likely to increase inequality further. Cuts to public services are likely to hit rural areas harder as many depend on public sector funding for both public and private sector jobs. For example, 38% of small firms in the region rely on public service contracts.

What does this mean for voluntary and community organisations?

• Voluntary organisations working with people living in poverty will continue to see an increase in demand for their services.

• Organisations that work across urban and rural areas need to make sure that rural communities are not excluded from their support, and that their services are designed around both rural and urban needs. See NCVO’s ‘rural proofing’ resource for more on this.

• Organisations in the South West can join South West Stakeholders, which is speaking up for the region and ensuring that the South West’s deprived people and communities are not overlooked.

Join the discussion!

How will this affect your organisation? Have you considered it during your strategic planning? Can you share any interesting relevant links?

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