Elderly bear the brunt of deprivation in the capital

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Photo: Kristo-Gothard Hunor ┃Shutterstock.com

Elderly people in London are being left behind in the fight against deprivation.

Over the past 5 years a number of boroughs that were among the most deprived local authorities in England have reduced multiple causes of deprivation in many neighbourhoods. Hackney, Newham, Tower Hamlets and Haringey have pulled themselves above the bottom 20 boroughs in England since 2010.

But in these districts and others in the capital thousands of older people are living in income deprived households.  This is a particular problem for London. Of the 10 boroughs in England with the highest level of over 60s living in income deprived households, 7 are in London including the 3 with the worst record, Tower Hamlets, Hackney and Newham.

Local authorities with the highest proportion of older people in income deprivation
1 Tower Hamlets 49.7%
2 Hackney 43.1%
3 Newham 41%
4 Manchester 36.3%
5 Islington 36.1%
6 Southwark 34.3%
7 Lambeth 33.2%
8 Liverpool 32.7%
9 Knowsley 32.6%
10 Haringey 31.8%

5 more are in the 20 most income deprived boroughs for older people – Brent, Barking and Dagenham, Hammersmith and Fulham, Camden and Lewisham.

In Tower Hamlets nearly half the old people are living in income deprived households. The borough also has the worst record on children in income deprived households with 39% of under 16s affected.  In 6 other boroughs (Islington, Hackney, Barking and Dagenham, Enfield, Lambeth and Southwark) at least 30% of children are living in income deprived households.

These figures are revealed in data gathered for the Department of Communities and Local Government for the Index on Multiple Deprivation – the government’s measure of levels of deprivation across England. The index looks at 7 areas – income, employment, education, health and disability, crime, housing and the living environment.

The government measures deprivation in small areas called LSOAs.  Each of these neighbourhoods has around 1,500 residents.  There are 32,844 of them in England and 4,835 in London.

275 of these neighbourhoods in London are among the 10% most deprived in England. London has done well in reducing deprivation over the past 5 years, but the borough map shows a clear divide with much higher levels of deprivation in the east.

Deprivation borough map

The most deprived neighbourhood in the capital, according to the index, is an area of Hackney to the south of Homerton High Street and west of Mabley Green.  This neighbourhood is home to 1,300 people.

Of the 5 most deprived neighbourhoods in London, 2 are in Hackney, 2 in Westminster and 1 in Islington. The least deprived neighbourhood, according to the index, is in Bromley.

Source data

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More than a quarter of UK tax revenue generated in London

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The budget makes everyone focus on how the tax burden falls on individuals, but what does it look like as a national picture? New research has developed a tax map of Britain that reveals where the money is generated, and it reveals the importance of cities, particularly London, in generating the country’s tax take.

In 2013/14 London generated £126 billion in tax, that’s a quarter of all the economy taxes generated in the country. Other cities generated £182 billion and non-urban areas £170 billion.

The Centre for Cities, a policy institute, looked at what is referred to as economy taxes. These include taxes on labour, such as income tax and national insurance; tax on consumption, in other words VAT; taxes on land and property, such as stamp duty and council tax; and taxes on investment. These make up 87% of the UK tax revenue and exclude things like duty on alcohol and tobacco. The total for economy taxes generated in the UK is £478 billion.

London produces 26% of the economy taxes, twice as high as it’s share of population, which is around 13%. And some London boroughs make an even more startling contribution. The City of London and Westminster generate £44 billion in tax, almost a tenth of all revenues.

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Much of London’s contribution is driven by the very high tax raised per worker through income tax and national insurance. London levels are much higher than those across the country and in the City of London are 3 times higher than average urban levels.

tax per worker

The borough of Tower Hamlets includes the financial services centre of Canary Wharf.

The Centre for Cities assigned taxes on labour to the location of the work not the home residence of the worker, hence the City with a small number of residents and a high numbers of workers generates a high level of taxes. Commuters into London account for around 16% of the capital’s tax generated from labour.

The tax mapping also revealed that some London areas have tax raising profiles very different from the national picture. While the City is dominated by labour taxes, a large proportion of Kensington and Chelsea’s contribution is made up of land and property tax.

tax profiles

This is a product of the high cost London property market and is predominantly stamp duty. London accounts for more than 40% of the stamp duty in the UK and Kensington and Chelsea along with neighbouring Westminster contributed 32% of the capital’s stamp duty in 2013/14.

Source data