Having lived in one of the poorest countries on earth, I’m not too sure that £1.60 a day is that bad.
The first thing to see is that £1.60 buys a lot of things in a 3rd world country – if that is their average, then, in their own country, they are comparatively as wealthy as the family on £38,000.
The comparison is deceptive – we are talking Family income per year versus personal income per day – if the average UK family is 3.5, then the average income is only around £10,000 per year or £27 ($44) per person per day.
In the 3rd world, they do not spend money on heating, clothes, cars, electricity, rent, rates (local taxes), mortgage, travel, health, computers, shoes, ice-cream, cigarettes, beer, washing powder, refrigerators, etc. Their retailers’ profit margins are minimal – here food has a 300% mark up at the supermarket over what they buy it in for, and the people who are supplying the food also make a profit – the third world gets food direct from the producer or they produce it themselves.
Example – 1 banana in UK = £0.60; 1 banana in Bangladesh = £0.005
1 Apple in UK = £0.60; in Bangladesh = £1.00 (they don’t grow them nor do they import them in any numbers.) so they don’t buy apples.
Of the list of spending above, how many do you really need? Or, to put it another way, If I agreed to give you all those things, how much of the £27 ($44) per day that the average UK person earns would you really need?