Down and out in Australia: the new way to define poverty

Being unable to afford one substantial meal a day and pay for home insurance are indicators of poverty. Flickr/27147

Poverty is about more than just a lack of income. Those who experience it face unacceptable restrictions on their material and social wellbeing. Research can no longer focus on defining a poverty line, but we must measure the real impact on living standards and people’s ability to participate socially.

The two key ideas which have dominated the new approach to studying poverty are deprivation and social exclusion.

Both have their roots in the work of European sociologists – the UK’s Peter Townsend in the case of deprivation, and French scholars like Serge Paugam in the case of exclusion.

As I show in my recent book, Down and Out: Poverty and Exclusion in Australia these ideas have transformed how poverty and other aspects of social disadvantage are conceived.

What is deprivation?

Deprivation exists where people face an enforced lack of socially perceived necessities. These are goods, activities, opportunities and capacities which are widely regarded as essential for those living in a particular society at a point in time.

In surveys conducted with colleagues at the Social Policy Research Centre (SPRC) we asked people to identify from an initial list “things that no-one in Australia should have to go without today”.

We then focused on only those items that a majority agreed were essential and asked if people had each item and, if they did not, whether or not this was because they could not afford it.

Those who did not have and could not afford items regarded as essential by a majority in the community were identified as deprived.

Modern essentials

The “essentials of life” include a substantial meal at least once a day, home contents insurance, a separate bed for each child, an ability to buy medications prescribed by a doctor and access to dental treatment when needed.

Those who are forced to go without these items are experiencing a standard of living that does not meet community standards of acceptability.

They are poor in the sense of deprivation, particularly if they lack several items.

Very few Australians are deprived of some essential items – around one per cent in the case of a substantial daily meal and less than 2% in the case of a separate bed for each child.

But almost 10% could not afford home contents insurance and 14% (around one-in-seven) could not afford dental treatment when needed.

Over one-quarter were deprived of two or more essential items and 14 per cent were deprived of four or more items. This latter figure corresponds roughly to how many fall below a conventional (income-based) poverty line.

Real hardships, not below a line

One can draw a threshold that identifies deprivation in terms of the number of essentials items that are lacking.

This involves making a judgment, but because the items have been identified by community opinion not imposed by researchers, any such threshold is less arbitrary than a poverty line.

Alternatively, one can examine the kinds of items where deprivation is most pronounced or of most concern (take for example those items that relate to the needs of children) and examine what kinds of public policies are needed to address these deficiencies.

Such debate is more constructive than arguing over where to set a poverty line.

Social exclusion

Unlike deprivation, social exclusion can result from factors other than a lack of economic resources. Here, the focus is on what people do not do rather than what they cannot buy.

Exclusion, like deprivation, is multi-dimensional and covers instances where people are denied the opportunity to participate in the full range of economic, social and political activities.

Lack of resources may be one contributing factor, but others include discrimination (in employment practices etc), lack of access to key services, and lack of information.

Exclusion can be imposed by the actions (or inactions) of others, or it may be self-imposed – as in the case of those older people who withdraw socially because of unsafe streets.

We identified three domains of exclusion: disengagement (a lack of social and community participation), service exclusion (a lack of appropriate services - public and private) and economic exclusion (a lack of resources or low economic capacity).

Many forms of social exclusion are widespread: 44% do not have a week’s holiday away each year, 26% do not have access to a bulk-billing doctor and 14% could not raise $2,000 in a week in an emergency.

Now do something

Again, the diversity of the evidence can set in train a fruitful debate about cause and response that avoids futile disagreement over measurement.

This represents the dawning of a new age of research on poverty and social disadvantage. Now all we need is for the government to take note and address the underlying issues.

Peter Saunders' book Down and Out: Poverty and Exclusion in Australia is launched today at the Australian Social Policy Conference.