Fair By Design and the Personal Finance Research Centre (PFRC) are collaborating on a project to assess the annual cost of the poverty premium at a local level.
The project will also provide a better understanding of what local communities stand to gain in financial terms if these extra costs were eliminated. It will build on PFRC’s practical guide on the poverty premium for business and policymakers, which estimated that £1.7m would be returned back to the community each year if the poverty premium was reduced by half in Washwood Heath, an area with high levels of deprivation in Birmingham. More generally, it was estimated that the elimination of the poverty premium “could potentially release an extra £4,000m every year into local communities and economies that need it most.”
The research will identify characteristics of households experiencing the poverty premium (for example, in terms of age, disability, and ethnicity) and figures will reflect the varying amounts of extra costs paid by different groups and in different essential services markets – building on past FBD/PFRC research.