It's a measure of inequality, not poverty as such, sure.

But practically it's obvious just by looking at the lives of "poor" people that, yeah, they are materially still struggling. I can't speak for Britain but I can speak for the USA: if you did both the "relative poverty" analysis and the "basket of goods" analysis, you'd find a lot of overlap. Splitting hairs over how exactly poverty is defined is just being dismissive of the actual people who are actually experiencing some form of material poverty, and shifting focus away from making things better.