ABSTRACT
As the basic safety net of the welfare state, minimum income schemes play a decisive role in the alleviation of poverty. The comparison of disposable income with a counterfactual income before means-tested transfers provides a powerful tool to evaluate the redistributive effects of social assistance and related schemes. The poverty gap measures the distance between a household's income and a given poverty line, in other words, it assesses the resources needed to eradicate poverty. Industrial welfare states have established a complex system of income redistribution in order to protect people from poverty. Housing benefits have been included in the income measure, since they constitute an vital income supplement for many families. The United Kingdom achieved the most marked success of means-tested benefits with an astonishingly high degree of effectiveness, especially among the lower poverty brackets.
