Inflation squeezes ordinary Britons' pockets
A single person now needs a minimum yearly income of £14,400 (before tax) to afford an acceptable standard of living, says the Joseph Rowntree Foundation (JRF).
A couple with two children, require £29,200 per year.
These figures, which form part of the charity's yearly minimum income survey, show an increase of 3-4% in the cost of a minimum household budget in the year to April 2010, compared with last year's figures.
Over the past 10 years, according to the JRF, the minimum budget required for a decent standard of living has increased by 38%, despite general inflation of only 23%.
The rising cost of food (up 37%), public transport (buses are up by 59%) and other essentials have been blamed by the charity for this increase.
The implication of this is that an individual who in 2000 could afford a sample basket of goods and services, and whose income rose in line with inflation, would now find themselves £19 short for the same basket of goods.
The JRF stresses that its minimum income calculation does not only include the amount required for an individual to survive, but also allows for participation in society.
Julia Unwin, chief executive of the charity, says: "This research shows what ordinary members of the public think is needed not just to survive, but to take part in society.
"It provides powerful evidence for the new government to use as they develop policies to deal with poverty."
In compiling the basket of goods and services, the JRF asks a number of focus groups what they feel should be included.
This year's findings show, despite the recession, people's tastes have changed very little - they still think a basic budget for going out should be included, as well as a budget for a week's holiday away each year, although not abroad.
Internet access in the home was also deemed a necessity, to allow people to participate fully in society.
The JRF has developed an online budget calculator to help you work out if your income is enough for an acceptable standard of living.
What income do you think is necessary to have an acceptable standard of living? Do you think the JRF's report classifies luxuries as necessities? Have your say in our forum now.
An increase in the general level of prices that persists over a period of time. The inflation rate is a measure of the average change over a period, usually 12 months. If inflation is up 4%, this means the price of products and services is 4% higher than a year earlier, requiring we spend and extra 4% to buy the same things we bought 12 months ago and that any savings and investments must generate 4% (after any taxes) to keep pace with inflation. Since 2003, the Bank of England has used the consumer prices index (CPI) as its official measure of inflation (see also retail prices index).