LONDON Britons' real net incomes fell to their lowest level in a decade in the year ending in March 2012, annual data from the country's labour ministry showed on Wednesday.
Average net incomes including social benefits fell 3 percent during the 2011/12 tax year to their lowest level since 2001/02 on an inflation-adjusted basis.
"Income fell as earnings and benefit income grew more slowly than the cost of living as measured by RPI (retail price inflation)," the Department for Work and Pensions said.
The fall in living standards is likely to have continued into the current tax year, as wages have continued to grow at a slower pace than inflation, and many benefits have been raised by less than the rate of inflation.
The proportion of Britons in absolute poverty - defined as a weekly income of under 251 pounds - rose by one percentage point to 17 percent in 2011/12.
However the Institute for Fiscal Studies, a leading economic think tank, said the figures may be slightly less bleak than at first glance as the Office for National Statistics has said RPI overstates inflation due to outdated statistical methods.
Looking at changes in the cost of living as measured by the modernised RPIJ index, also produced by the ONS, median net incomes are the lowest since 2004-05, the IFS said.