tag:theconversation.com,2011:/id/topics/poverty-line-17545/articlesPoverty line – The Conversation2023-08-14T19:37:44Ztag:theconversation.com,2011:article/2047162023-08-14T19:37:44Z2023-08-14T19:37:44ZCanada’s welfare system is failing mothers with infants<figure><img src="https://images.theconversation.com/files/541320/original/file-20230805-15-xi8j4t.jpg?ixlib=rb-1.1.0&rect=0%2C82%2C3670%2C2351&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Food insecurity can impact both a mother’s ability or decision to breastfeed, and also the ability to purchase baby formula.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><iframe style="width: 100%; height: 100px; border: none; position: relative; z-index: 1;" allowtransparency="" allow="clipboard-read; clipboard-write" src="https://narrations.ad-auris.com/widget/the-conversation-canada/canadas-welfare-system-is-failing-mothers-with-infants" width="100%" height="400"></iframe>
<p>The Canadian government issued a <a href="https://theconversation.com/federal-budget-2023-grocery-rebate-is-the-right-direction-on-food-insecurity-but-theres-a-long-road-ahead-201926">one-time grocery rebate</a> in July, targeted at low-income Canadians. While the rebate provided some relief to people struggling with soaring inflation, <a href="https://theconversation.com/federal-budget-2023-grocery-rebate-is-the-right-direction-on-food-insecurity-but-theres-a-long-road-ahead-201926">it is far from enough</a> to address the depth of poverty and intensity of food insecurity faced by the lowest income Canadians. </p>
<p>During the <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4981537/">most vulnerable time of life</a>, mothers and infants living on welfare are experiencing food insecurity, which can have <a href="https://www.healthaffairs.org/doi/10.1377/hlthaff.2015.0645">lifelong impacts</a>. Governments need to make policy changes to better serve mothers and their children. </p>
<h2>Infant food insecurity</h2>
<p>Food insecurity is defined as having “<a href="https://proof.utoronto.ca/food-insecurity/">inadequate or insecure access to food due to financial constraints</a>.” Maternal food insecurity can result in many health-damaging effects, ranging from <a href="https://bmjopen.bmj.com/content/10/1/e033296">adverse birth outcomes</a> to <a href="https://www.healthaffairs.org/doi/10.1377/hlthaff.2015.0645">mental health issues</a>. Infant food insecurity can result in long-term developmental impacts, including effects on <a href="https://doi.org/10.1016/j.pcl.2019.12.004">cognition and brain development</a>. </p>
<p>Experts have outlined how <a href="https://theconversation.com/why-are-babies-going-hungry-in-a-food-rich-nation-like-canada-165789">food insecurity can impact a mother’s ability or decision to breastfeed</a>. Food-insecure mothers might cease breastfeeding much sooner because they feel they have inadequate breastmilk supply. In addition, they might struggle to afford infant formula.</p>
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<a href="https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A woman feeding a baby from a bottle." src="https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/524793/original/file-20230508-29-dhs4uw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Mothers and infants living on welfare are experiencing food insecurity, which can have lifelong impacts.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
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<p>While food-insecure mothers initiate breastfeeding at the same rate as food-secure mothers, <a href="https://www.ctvnews.ca/health/study-finds-moms-living-in-poverty-struggle-to-breastfeed-their-babies-longer-1.3853616?cache=yes">rates drop steeply within the first two months</a>. Mothers who are undernourished themselves might perceive they have less than adequate milk supply and often stop breastfeeding for this reason, <a href="https://www.ubcpress.ca/out-of-milk">believing the baby will suffer because they have an inadequate diet</a>. </p>
<p>For low-income mothers, breastfeeding might seem to be the most cost-effective way of feeding their infants. However, other research shows that <a href="https://pubmed.ncbi.nlm.nih.gov/32162282/">both formula and breastfeeding are unaffordable to mothers who receive welfare</a>. </p>
<h2>Problems with the welfare system</h2>
<p>Approximately <a href="https://maytree.com/wp-content/uploads/Social_Assistance_Summaries_All_Canada.pdf">four to six per cent of people</a> in most provinces and territories receive welfare benefits. The number is slightly lower in the Yukon and Alberta and significantly higher in Nunavut where it is just under 28 per cent. </p>
<p>While some provinces and territories provide more financial resources to pregnant women and mothers than others, incomes remain low and inadequate to achieve food security. </p>
<p>For example, Nova Scotia welfare recipients receive a total of <a href="https://novascotia.ca/coms/employment/documents/ESIA_Program_Policy_Manual.pdf">$51 per month in maternal nutrition allowance</a> during pregnancy and up to 12 months after birth. However, this is often not enough support for low-income mothers to adequately feed their infants.</p>
<p><a href="https://proof.utoronto.ca/2023/new-data-on-household-food-insecurity-in-2022/">COVID-19 increased household food insecurity rates for households with children in both Canada</a> and the <a href="https://www.ers.usda.gov/amber-waves/2022/february/food-insecurity-for-households-with-children-rose-in-2020-disrupting-decade-long-decline/">United States</a></p>
<p>Allowances for pregnant women and mothers of infants receiving welfare are similarly low across Canada. These low rates create food insecurity for these vulnerable families and must be rectified via provincial, territorial and federal government policies. </p>
<h2>Charity alone is not enough</h2>
<p>Some might assume that charities and food banks will provide vital support for low-income families. A recent study found that during the peak of the COVID-19 pandemic, many community organizations <a href="https://doi.org/10.1080/14927713.2022.2054460">answered the increased call for food</a>. </p>
<p>While community organizations were critical in filling pandemic gaps, they alone cannot address the root cause of food insecurity: inadequate incomes. That problem continues, and the number of people relying on food banks has <a href="https://www.cbc.ca/news/canada/toronto/60-rise-use-of-food-banks-programs-canada-2023-1.6711094">increased exponentially in the past couple of years</a>.</p>
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<p>Additionally, many food banks are <a href="https://ca.style.yahoo.com/at-breaking-point-canadian-food-banks-struggling-insecurity-inflation-214221464.html">struggling to provide enough food</a>. The demand for food now far outstrips the donations most food banks receive. A sustainable solution to food insecurity is needed, particularly for pregnant women and mothers of infants. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A person in a grey t-shirt placing food items on a shelf" src="https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=402&fit=crop&dpr=1 600w, https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=402&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=402&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=505&fit=crop&dpr=1 754w, https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=505&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/541322/original/file-20230805-21-3ju57z.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=505&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">A volunteer places products on shelves at a food bank in Ottawa. Food banks alone cannot address the root cause of food insecurity: inadequate incomes.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Adrian Wyld</span></span>
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<h2>Child welfare laws</h2>
<p>In addition, child welfare laws need to be changed to stop them from unfairly penalizing poorer parents. In Nova Scotia, the <a href="https://policyalternatives.ca/sites/default/files/uploads/publications/Nova%20Scotia%20Office/2023/03/CCPAChildPovertyReportCardFINAL.pdf"><em>Children and Family Services Act</em> stipulates</a> that parents’ failure to provide adequate nutrition is grounds for child apprehension.</p>
<p><a href="https://policyalternatives.ca/sites/default/files/uploads/publications/Nova%20Scotia%20Office/2023/03/CCPAChildPovertyReportCardFINAL.pdf">The 2022 Report Card on Child and Family Poverty in Nova Scotia</a> recommended removing this stipulation. <a href="https://fernwoodpublishing.ca/book/ineligible">Experts have highlighted</a> the punitive nature of such requirements. These kinds of regulations punish mothers for their poverty and food insecurity, rather than increasing the financial support they receive.</p>
<h2>Impact of inflation</h2>
<p>There are also reforms that need to take place around welfare rates that would create a more liveable income source for mothers and infants in particular. </p>
<p>As the 2022 report card on poverty in Nova Scotia shows, welfare rates are not indexed to inflation in the province. This has resulted in <a href="https://www.cbc.ca/news/canada/nova-scotia/ns-income-assistance-rates-unchanged-1.6788662">benefits stagnating</a> despite a few modest increases in the past several years. Only three provinces and territories <a href="https://maytree.com/wp-content/uploads/Welfare_in_Canada_2021.pdf">index welfare rates to inflation:</a> New Brunswick, Québec and the Yukon. In Québec, <a href="https://inroadsjournal.ca/quebecs-distinct-welfare-state-on-poverty-among-families-with-children-quebec-%E2%80%A8and-the-rest-of-canada-have-taken-different-paths/">this has resulted in lower income inequality</a>. </p>
<p>The province has also recently launched a <a href="https://www.cbc.ca/news/canada/montreal/quebec-basic-income-program-begins-advocates-say-many-low-income-people-excluded-1.6730003">basic income program</a> and although the eligibility requirements exclude many, it does increase income recipients would otherwise receive from welfare benefits.</p>
<p>With inflation affecting the price of food, the depth of food insecurity for mothers receiving welfare payments will only grow. Welfare rates must reflect the income necessary to feed pregnant and new mothers and provide them the support they need to care for their children.</p><img src="https://counter.theconversation.com/content/204716/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Laura Fisher receives funding from the Social Sciences and Humanities Research Council of Canada.</span></em></p>Low-income mothers with infants are struggling with food insecurity, which can lead to long-term health impacts for both mothers and children.Laura Fisher, PhD student, Sociology, Dalhousie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2016292023-03-22T20:21:55Z2023-03-22T20:21:55ZGetting a fuller picture of poverty in Canada: why the government’s official poverty measure is insufficient<figure><img src="https://images.theconversation.com/files/516800/original/file-20230321-2579-gncbfx.JPG?ixlib=rb-1.1.0&rect=13%2C211%2C2842%2C1922&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A volunteer bags groceries to hand to people in need at a Sun Youth charity location in Montréal in July 2022. </span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Graham Hughes</span></span></figcaption></figure><iframe style="width: 100%; height: 100px; border: none; position: relative; z-index: 1;" allowtransparency="" allow="clipboard-read; clipboard-write" src="https://narrations.ad-auris.com/widget/the-conversation-canada/getting-a-fuller-picture-of-poverty-in-canada--why-the-government-s-official-poverty-measure-is-insufficient" width="100%" height="400"></iframe>
<p>Canada’s inflation rate has started to ease up <a href="https://www.cbc.ca/news/business/armstrong-inflation-bank-of-canada-cpi-1.6759782">after peaking at 8.1 per cent last summer</a>, but food and shelter prices are showing <a href="https://www150.statcan.gc.ca/n1/pub/11-631-x/11-631-x2023003-eng.htm">little sign of slowing down</a>. </p>
<p><a href="https://www150.statcan.gc.ca/n1/pub/11-631-x/11-631-x2023003-eng.htm">Increases in wages and earnings</a> only partially make up for lost purchasing power. Those working in lower paying industries are less likely to see their wages rise.</p>
<p>Many Canadians are struggling and those <a href="https://www150.statcan.gc.ca/n1/pub/75-006-x/2023001/article/00002-eng.htm">on tighter budgets with less financial leeway</a> are being hit especially hard. During fall 2022, one in four Canadians indicated they were finding it <a href="https://www150.statcan.gc.ca/n1/daily-quotidien/230307/dq230307b-eng.htm">difficult to meet food, shelter and other necessary expenses</a>, up from about one in five Canadians in summer 2021.</p>
<p>But these statistics are only part of the picture — Canada’s <a href="https://www.statcan.gc.ca/en/topics-start/poverty">official poverty measure</a> only focuses on income and ignores other important factors. This means millions of Canadians living in poverty are potentially going unseen and unheard.</p>
<h2>Canada’s official poverty measure</h2>
<p>Canada’s official poverty measure, the market-basket measure, <a href="https://www.canada.ca/en/employment-social-development/programs/poverty-reduction/reports/strategy.html#h2.15">is based on the cost of a specific basket of goods and services</a> representing a modest, basic standard of living. </p>
<p>This basket is priced for a family of two adults and two children and takes local prices into account. When a family’s disposable income is less than that of the basket, they are income poor. For other living arrangements, there is a formula that adjusts the poverty threshold using the households’ size. </p>
<p>Yet, people’s individual circumstances are often more diverse than the market-basket measure can handle. </p>
<p>The market-basket measure ignores when people’s spending is higher because they have non-standard needs, such as a food allergy, student loan payments or they are paying above-average market rent for low-cost housing.</p>
<p>Higher expenditures to attain a basic standard of living explains why some people experience material deprivation while having an income above the poverty threshold.</p>
<p>Alternatively, access to resources other than income can explain why some people can avoid material deprivation despite having low income. This is because the market-basket measure disregards financial resources, such as savings or credit, that help finance an acceptable living standard, despite low income. </p>
<p>The market-basket measure also misses when people have access to subsidized goods and services, and work-related benefits like health benefits, which reduce out-of-pocket spending. Canada’s official poverty measure makes mistakes on both sides by excluding many who probably should be counted and including many that probably shouldn’t be.</p>
<h2>A complementary poverty measure</h2>
<p>I work with <a href="https://foodbankscanada.ca/providing-a-fuller-picture-of-poverty-in-canada-the-material-deprivation-index/">Food Banks Canada to collect data that provides a broader picture of poverty</a> by focusing on a poverty measure called <a href="https://doi.org/10.3138/cpp.2020-011">material deprivation</a>. Material deprivation focuses on items that people with an acceptable living standard can afford, rather than just income.</p>
<p>We used opinion surveys and focus groups to identify socially perceived necessities for Canadians. An item is deemed a necessity when most respondents view it is necessary, or very necessary, for a decent standard of living.</p>
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<a href="https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A diagram that illustrates low-income and material deprivation indicators are added together to result in a material deprivation assessment" src="https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/516808/original/file-20230321-3159-ep26sh.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The material dimension of poverty is calculated by taking low-income and material deprivation indicators into account.</span>
<span class="attribution"><span class="source">(Geranda Notten)</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Examples of these necessities include a pair of properly fitting shoes and at least one pair of winter boots; the ability to eat meat, fish or another protein equivalent every second day; and the ability to buy small gifts for family or friends once a year. </p>
<p>People are considered item deprived when they cannot possess a necessary item or engage in necessary activities due to a lack of money. People are considered materially deprived when they lack more items than the deprivation threshold.</p>
<p>There is no question that poverty is increasing right now. The market-basket measure numbers will reflect this, but they will nonetheless miss a key part of the poverty story. </p>
<p>Our material deprivation data will tell that story. </p>
<p>Routinely collecting such data as a complement to income poverty statistics makes sense. Not only in times of record inflation but always. Not only for charitable organizations but also for Canadian governments.</p>
<h2>Policy that reduces poverty</h2>
<p>Inaccurate poverty measurement tools not only skew our understanding of how much poverty there is and who is at risk, but also <a href="https://doi.org/10.3138/cpp.2020-011">skew how policies contribute to reducing poverty</a>.</p>
<p>Since he was elected in 2015, Prime Minister Justin Trudeau has said <a href="https://www.canada.ca/en/employment-social-development/programs/results/poverty-reduction.html">poverty reduction</a> is a priority of the federal government. The government is now working towards <a href="https://www.canada.ca/en/employment-social-development/programs/agenda-2030/national-strategy.html">reducing poverty by 50 per cent by 2030</a>, as determined by the market-basket measure.</p>
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<img alt="A man in a dress shirt and tie speaks into a microphone while a smiling woman is displayed on a large screen behind him" src="https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=417&fit=crop&dpr=1 600w, https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=417&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=417&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=524&fit=crop&dpr=1 754w, https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=524&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/516801/original/file-20230321-14-1u5sk4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=524&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Prime Minister Justin Trudeau is joined virtually by Deputy Prime Minister Chrystia Freeland in Ottawa in May 2021 as they discuss the Canada Child Benefit.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span>
</figcaption>
</figure>
<p>Knowledge that poverty is more widespread than what is deemed low-income implies that eligibility tests Canadians must meet to access government supports may have to be less stringent.</p>
<p>Likewise, such knowledge cautions against reducing income-tested government transfers like the <a href="https://www.canada.ca/en/revenue-agency/services/child-family-benefits/canada-workers-benefit.html">Canada workers benefit</a>, a refundable tax credit for low-income workers.</p>
<p>Moreover, comparisons between the effects of an income transfer like the <a href="https://www.canada.ca/en/revenue-agency/services/child-family-benefits/canada-child-benefit-overview.html">Canada child benefit
</a> and subsidies like the <a href="https://www.canada.ca/en/employment-social-development/campaigns/child-care.html">Early Learning and Child Care system</a> may be skewed. Income poverty measures automatically account for the income transfer, but they might underestimate or ignore the poverty reduction effect of subsidies.</p>
<p>Currently, we can only speculate about the scope and magnitude of such biases. But, given the relatively large gaps between low-income and materially deprived households, they could be substantive.</p><img src="https://counter.theconversation.com/content/201629/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Geranda Notten works with Food Banks Canada to develop a Material Deprivation Index for Canada. The views in this article reflect those of the author only.</span></em></p>Canada’s official poverty measure only focuses on income and ignores other important factors, meaning there are millions of Canadians living in poverty that are ignored by the measure.Geranda Notten, Associate Professor, Graduate School of Public and International Affairs, L’Université d’Ottawa/University of OttawaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1804502022-04-07T10:18:51Z2022-04-07T10:18:51ZCost of living crisis: it’s not enough to know how many people are below the poverty line – we need to measure poverty depth<figure><img src="https://images.theconversation.com/files/456329/original/file-20220405-22-y2m2cu.jpg?ixlib=rb-1.1.0&rect=52%2C22%2C4940%2C3300&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/some-change-beggars-paper-cup-1747556105">sladkozaponi / Shutterstock</a></span></figcaption></figure><p>The UK government’s <a href="https://www.gov.uk/government/statistics/households-below-average-income-for-financial-years-ending-1995-to-2021/households-below-average-income-an-analysis-of-the-income-distribution-fye-1995-to-fye-2021">most recent</a> poverty statistics show that poverty rates declined during the first year of the pandemic. But this should offer little comfort to those concerned about the cost of living crisis.</p>
<p>The publication of these figures continues a longstanding trend of official poverty statistics being out of step with the dramatic socioeconomic upheavals affecting lowest income households the most. In part, this is because official poverty figures <a href="https://www.jrf.org.uk/blog/what-latest-income-and-poverty-stats-could-tell-us-and-what-they-cant">lag more than a year</a> behind the current situation. </p>
<p>The main problem, though, is that the government’s primary measure of poverty is set at a threshold of 60% below median incomes. In practice, anchoring poverty measures to the resources of those in the middle tells us more about what’s going on for average earners than it does about the living standards of those towards the very bottom. To fully understand low-income dynamics and the effectiveness of policy interventions, we need to look beyond the overall numbers below a given threshold and look at how far people are actually falling below the poverty line. </p>
<p>In recent years, research analysts and anti-poverty campaigners have become increasingly <a href="https://www.conservativehome.com/platform/2022/01/helen-barnard-poverty-is-spiralling-out-of-control-in-this-country-its-time-for-the-government-to-get-a-grip.html">concerned</a> about the changing severity of financial hardship in <a href="https://www.srpoverty.org/2019/10/16/spain/">high-income countries</a>. But there is little consensus on how to measure or address it. </p>
<h2>How deep does poverty go?</h2>
<p>In the UK, there are at least five measures of deep poverty currently in circulation. Independent organisations such as the <a href="https://socialmetricscommission.org.uk">Social Metrics Commission</a>, <a href="https://www.jrf.org.uk/report/uk-poverty-2022">Joseph Rowntree Foundation</a> and <a href="https://cpag.org.uk/policy-and-campaigns/report/dragged-deeper-how-families-are-falling-further-and-further-below">Child Poverty Action Group</a> have all adopted slightly different indicators. These capture varying degrees of hardship, with the typical incomes of those in deep poverty changing considerably depending on the measure chosen. </p>
<p>The average disposable income (after housing costs) of someone in poverty, according to the government’s main measure, is around £11,300 a year. But it can be as low as £5,800 a year for someone falling more than 50% below the poverty line. Two people with these respective incomes would both be categorised as “in poverty”, but the nature and severity of the hardship they experience would be radically different. </p>
<p>Depending on the measure chosen, different people are also more likely to be affected. Single people without children and younger adults are both heavily <a href="https://www.jrf.org.uk/report/destitution-uk-2020">over-represented</a> among those experiencing the deepest forms of poverty, highlighting where policy interventions could help reduce severe hardship most effectively.</p>
<p>However you choose to measure it, deep poverty has increased considerably over the last 25 years. Since the mid-1990s, the number of people falling below the poverty line in the UK has increased by 8%. But the number falling more than 50% below this line has jumped by 53% (from 2.6 to 4.1 million people). Over the last decade, those closer to the poverty line have seen their relative incomes improve, while the poorest have seen their incomes <a href="https://www.cambridge.org/core/journals/journal-of-social-policy/article/plumbing-the-depths-the-changing-sociodemographic-profile-of-uk-poverty/FC5AC6566CEE16F06D066E5B901BB29C#article">fall the furthest</a>. Women, children, larger families and black people are some of the worst affected by this trend.</p>
<figure class="align-center ">
<img alt="A chart showing how many people are in deep poverty over the past 26 years, based on different measures. The highest estimate for 2020 shows nearly 10 million people in deep poverty." src="https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=411&fit=crop&dpr=1 600w, https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=411&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=411&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=517&fit=crop&dpr=1 754w, https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=517&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/456145/original/file-20220404-12538-1ziypm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=517&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">There are five commonly used measures to determine ‘deep poverty’.</span>
<span class="attribution"><span class="source">Calculations based on Households Below Average Income statistics.</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<h2>One-size-fits-all approach ignores poverty depth</h2>
<p>Despite <a href="https://osr.statisticsauthority.gov.uk/the-trouble-with-measuring-poverty/">widespread calls</a> to improve reporting on low incomes, the UK government recently announced that it was <a href="https://www.gov.uk/government/statistics/development-of-a-new-measure-of-poverty-statistical-notice/development-of-a-new-measure-of-poverty-statistical-notice">cancelling</a> the development of a “wider measurement framework covering depth, persistence and lived experience of poverty”. This will also make it harder to target resources where they are most urgently needed in a cost of living crisis.</p>
<p>In the UK, public spending on social security has <a href="https://obr.uk/wtr/welfare-trends-report-march-2021/">steadily grown</a>, reaching around 12% of GDP last year. The fact that this has occurred alongside an increasing depth of poverty underlines a central contradiction of the UK welfare state. As a liberal welfare regime, centred on lower levels of state intervention, the UK is supposed to be focused on a more targeted, means-tested social security ideal – concerned much less with redistribution and more with poverty alleviation for those on low incomes. </p>
<p>However, the UK’s social security system is failing to protect the livelihoods of those who already have the least. <a href="https://www.distantwelfare.co.uk/food-insecurity-report">Food insecurity</a>, <a href="https://www.distantwelfare.co.uk/winter-report">debts and financial strain</a> are widespread among people who claim benefits. That said, the temporary £20 uplift to universal credit and working tax credit was particularly <a href="https://ifs.org.uk/publications/16010">effective</a> in helping some of the lowest income households weather the storm during the pandemic.</p>
<p>Those in deep poverty were <a href="https://socialmetricscommission.org.uk/wp-content/uploads/2020/08/SMC-Poverty-and-Covid-Report.pdf">most likely</a> to be negatively affected by income or job loss during the pandemic. And new <a href="https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householddisposableincomeandinequality/financialyearending2021#analysis-of-average-disposable-income">evidence suggests</a> their drop in original income was partially offset by measures such as the £20 uplift. </p>
<p>The ongoing cost of living crisis stands to affect the lowest income households most. Despite this, new policy measures announced (or a lack thereof) in the <a href="https://www.gov.uk/government/topical-events/spring-statement-2022">spring statement</a> last month are poorly targeted, with only <a href="https://www.resolutionfoundation.org/press-releases/chancellor-prioritises-his-tax-cutting-credentials-over-low-and-middle-income-households-with-2-in-every-3-of-new-support-going-to-the-top-half/">£1 in every £3</a> going to those in the bottom half of the income distribution.</p>
<p>The pandemic showed that a boost to targeted, working-age benefits can make a big difference. If the government does not learn those lessons and introduce policies to support those on the lowest incomes, poverty will deepen for those who already have the least.</p><img src="https://counter.theconversation.com/content/180450/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniel Edmiston receives funding from the British Academy and the Wolfson Foundation</span></em></p>Why the government’s main measure of poverty doesn’t tell us much about the lowest-income people.Daniel Edmiston, Lecturer in Sociology and Social Policy, University of LeedsLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1662512021-11-10T13:39:40Z2021-11-10T13:39:40ZThe federal poverty line struggles to capture the economic hardship that half of Americans face<figure><img src="https://images.theconversation.com/files/429733/original/file-20211102-29191-p6bxrc.jpg?ixlib=rb-1.1.0&rect=251%2C242%2C2452%2C1302&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Low-wage workers march in Washington on Aug. 2, 2021.</span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/the-poor-peoples-campaign-rallied-and-marched-in-washington-news-photo/1234447749?adppopup=true">Michael Nigro/Pacific Press/LightRocket via Getty Images</a></span></figcaption></figure><p>Michael Chase works two jobs in southeast Ohio: one as a hotel night clerk and one as retail support – sorting through donations, setting new merchandise out, cleaning – at a nonprofit. </p>
<p>His schedule is not fixed in either job, and his hours are not guaranteed. Some weeks he works back-to-back eight-hour shifts. Some weeks he works fewer than 30 hours. Neither job offers sick leave, vacation time or health insurance. </p>
<p>Chase shares an apartment with three other people, something he finds stressful. And he is not always confident that he can make his portion of the rent. Between the two jobs, Chase earns less than US$16,000 a year. While it may not sound like a lot, that places him well above the federal <a href="https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines">poverty line for a single person</a>: $12,760. </p>
<p>As a <a href="https://cmpascale.org/">sociologist</a> concerned with inequality, I spent one year conducting field work and interviews across the country for <a href="https://www.researchgate.net/publication/351391040_Living_on_the_Edge_When_Hard_Times_Become_A_Way_of_Life">my recent book</a>, which examines how Americans cope with economic struggles amid stagnant wages and rising costs of living.</p>
<p>Nearly everyone I interviewed worked multiple service industry jobs. Yet I didn’t meet anyone who thought of themselves as poor. </p>
<p>More commonly they referred to themselves as the struggling class: They struggle economically and hold an often unfounded hope that things will get better. But you can’t work your way out of poverty in low-wage jobs.</p>
<p>Low-wage jobs in the 21st century are not only the lowest rung on a career ladder, they are often the only rung. </p>
<p>Across the country, <a href="https://www.cnbc.com/2021/03/02/the-7point25-minimum-wage-doesnt-help-families-pay-the-bills-in-any-state.html">millions of low-wage workers</a> like Chase struggle to pay their bills each month, despite holding multiple jobs. </p>
<h2>Defining poverty</h2>
<p>“I’m fine,” Chase told me. “I don’t consider myself poor … I guess I would say I am struggling a little bit. For me, people who don’t have food are poor. Or someone who can’t feed their kids, or you might not have running water or even electricity. You don’t have the right things you need to even survive.” </p>
<p>Chase was not unusual in his assessment of poverty. </p>
<p>The economic struggles of millions in the United States are erased by the federal definition of the poverty line and by outdated conceptions of low-wage work.</p>
<p><a href="https://www.brookings.edu/blog/the-avenue/2019/11/21/low-wage-work-is-more-pervasive-than-you-think-and-there-arent-enough-good-jobs-to-go-around/">A recent study</a> by the Brookings Institution defined low-wage work as a median hourly wage of $10.22, or $17,950 per year. By this measure, 44% of all workers in the U.S. are low-wage earners. </p>
<p>In 2021, according to the National Low Income Housing Coalition, a worker needs to earn <a href="https://reports.nlihc.org/oor">$20.40 per hour</a> to be able to afford a modest one-bedroom apartment anywhere in the country. That’s an annual salary of $40,800 – more than twice what Brookings refers to as the median wage for low-wage work. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="Low wage workers protest." src="https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=384&fit=crop&dpr=1 600w, https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=384&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=384&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=483&fit=crop&dpr=1 754w, https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=483&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/429734/original/file-20211102-54186-m0mg54.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=483&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Low-wage workers and supporters protest for a $15 an hour minimum wage on Nov. 10, 2015 at Foley Square in New York City.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/low-wage-workers-and-supporters-protest-for-a-15-an-hour-news-photo/496587478?adppopup=true">Cem Ozdel/Anadolu Agency via Getty Images</a></span>
</figcaption>
</figure>
<p>Federal data shows that roughly <a href="https://www.ssa.gov/cgi-bin/netcomp.cgi?year=2019">51% or workers</a> live on less than $35,000 annually. Low wages, unreliable hours and a lack of benefits have come to dominate the U.S. economic landscape. </p>
<p>To understand the economic hardship that more than half of Americans face, it is critical that researchers shift their thinking away from an outdated federal measure of poverty. Instead, they should focus on measures of self-sufficiency. </p>
<h2>Economic self sufficiency</h2>
<p>Economic self-sufficiency is the ability to reliably meet basic needs, including food, housing, transportation, child care, medical expenses and other necessities.</p>
<p>The <a href="https://www.epi.org/about/">Economic Policy Institute</a>, a nonpartisan think tank, provides a <a href="https://www.epi.org/resources/budget/">Family Budget Calculator</a> that calculates measures of economic self-sufficiency across the country. </p>
<p>The organization provides a transparent estimate of what it costs to be economically self-sufficient. It is not a calculation of poverty. </p>
<p>The calculations are based on <a href="https://www.fns.usda.gov/cnpp/usda-food-plans-cost-food-reports">Department of Agriculture data</a> such as food costs and <a href="https://www.huduser.gov/portal/datasets/fmr.html">Fair Market Rent</a>, a measure developed by the Department of Housing and Urban Development to determine payments for housing assistance programs. </p>
<p>In southeast Ohio, the self-sufficiency budget for Chase provided by the Economic Policy Institute calculator is $34,545 – more than twice what he earns and nearly three times the federal poverty line. </p>
<p>If Chase lived in San Francisco, his economic self-sufficiency budget would be $69,072. Across the bay in Oakland, California, it would be $57,383. Keep in mind that the federal poverty line for a single person living anywhere in the U.S. is $12,760. </p>
<p>For families, the gap between the federal poverty line and economic self-sufficiency is even wider. Self-sufficiency for two adults with two children who live in San Francisco requires an annual income of $148,440, while the federal poverty line for this same <a href="https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines/prior-hhs-poverty-guidelines-federal-register-references/2020-poverty-guidelines/2020-poverty-guidelines-computations">family of four in 2020 was $25,701</a>.</p>
<p>[<em><a href="https://theconversation.com/us/newsletters/politics-weekly-74/?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=politics-important">Get The Conversation’s most important politics headlines, in our Politics Weekly newsletter</a>.</em>]</p>
<p>Self-sufficiency calculations vary by region. For example, self-sufficiency for this same family of four in Athens County, Ohio, would require an income of $72,284; in the Sioux City metro area of South Dakota, this family would need $78,935 to meet all of their basic needs.</p>
<p>Self-sufficiency measures are not perfect. </p>
<p>The Economic Policy Institute calculations do not consider debt, which can be significant. Further, the calculation relies on Fair Market Rent, which designates regional rents in the 40th percentile as fair market. This means that in any area, 60% of housing is more expensive than Fair Market Rent. </p>
<p>For Chase in Ohio, a livable one-bedroom apartment runs $800 to $1,300 a month, but Fair Market Rent allocates only $605 for rent.</p>
<p>Despite these problems, measures of self-sufficiency are more effective than the federal poverty line. By delineating the costs of basic expenses, they draw a far more accurate line of where poverty begins.</p>
<p>It might seem like a matter of common sense that the nation needs to calculate how much families actually need to spend on basic expenses in order to understand where poverty begins. But policymakers still rely on the federal poverty line for calculating economic safety nets. A measure of self-sufficiency would enable the nation to identify levels of economic need as they exist – and therefore to establish effective safety nets.</p><img src="https://counter.theconversation.com/content/166251/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Celine-Marie Pascale does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Millions of Americans struggle to pay their bills each month, despite earning wages well above the federal poverty line and holding multiple jobs.Celine-Marie Pascale, Professor of Sociology, American UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1658132021-08-11T20:09:09Z2021-08-11T20:09:09ZAustralia was a model for protecting people from COVID-19 — and then we dumped half a million people back into poverty<figure><img src="https://images.theconversation.com/files/415610/original/file-20210811-13-14glvul.jpg?ixlib=rb-1.1.0&rect=1042%2C221%2C1954%2C1134&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>As the pandemic swept the globe in 2020, Australia stood out as a model for how to contain the virus and support its citizens. </p>
<p>A year later, Australia is struggling with vaccination and has abandoned the measures it put in place in 2020 to support the most vulnerable.</p>
<p>The <a href="https://ministers.treasury.gov.au/ministers/josh-frydenberg-2018/media-releases/covid-19-disaster-support-payment-boosted">A$750 per week</a> COVID disaster payment to Australians in jobs is as big as the biggest of last year’s JobKeeper payments. It has been extended to the casual workers employed for less than a year and visa holders who missed out last time.</p>
<p>And it’s being delivered direct to the recipients rather than via employers, some of whom appeared to have <a href="https://www.abc.net.au/news/2021-03-22/how-jobkeeper-turned-into-profit-maker-ian-verrender/100020236">pocketed</a> the money last time. So far, so good.</p>
<p>For the newly unemployed and people on parenting payments there’s an extra $200 per week — but only if they’ve lost more than eight hours’ per week work.</p>
<p>What’s missing is last year’s effective doubling of JobSeeker and related benefits for people who were already out of work: the $550 per fortnight add-on that lifted the payment up towards the poverty line. </p>
<p>An estimated <a href="https://www.acoss.org.au/media-releases/?media_release=with-hundreds-of-thousands-on-44-a-day-in-lockdown-focus-must-be-on-support-not-debt-recovery-or-arbitrary-eligibility-criteria">540,000</a> of the 720,000 adults locked down on such payments don’t get the $200 per week because they didn’t have paid work ahead of the lockdown. </p>
<p>They are unable to find it during the lockdown and have to live on $44 a day — well below the <a href="https://theconversation.com/there-are-lots-of-poverty-lines-and-jobseeker-isnt-above-any-of-them-158068">poverty line</a>.</p>
<h2>The COVID supplement changed lives</h2>
<p>Last year the so-called <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/coronavirus-supplement">coronavirus supplement</a> made all the difference, allowing those families to buy essential items including food and medical care that were previously out of reach.</p>
<p>An <a href="https://www.cfecfw.asn.au/covid-19-social-security-measures-enabled-job-seeking-but-payment-cuts-inhibit-this-once-more-finds-survey/">online survey</a> conducted by Swinburne University and the Australian National University found the money was used for basic needs and strategic expenditures to “improve their household’s long-term financial security”.</p>
<p>The Australian National University found poverty rates dropped markedly for couples with children, and even more for <a href="https://csrm.cass.anu.edu.au/sites/default/files/docs/2020/8/Impact_of_Covid19_JobKeeper_and_Jobeeker_measures_on_Poverty_and_Financial_Stress_FINAL.pdf">single parent households</a>. </p>
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Read more:
<a href="https://theconversation.com/what-happens-when-you-free-unemployed-australians-from-mutual-obligations-and-boost-their-benefits-we-just-found-out-157506">What happens when you free unemployed Australians from 'mutual obligations' and boost their benefits? We just found out</a>
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<p>Before COVID hit, the poverty rate in single parent households was 20.2%. In the absence of policy change and the advent of COVID-19 it would have climbed to 27.9%. The COVID stimulus payments cut it to just 7.6% in June.</p>
<p>A survey of single mothers found <a href="https://antipovertyweek.org.au/2020/09/parents-receiving-the-coronavirus-supplement-dreading-cuts-at-the-end-of-september/">88%</a> suffered less anxiety. More than two-thirds (69%) reported being healthier as a result of being able to buy enough and healthier food.</p>
<p>So valued was the $550 per fortnight it sparked a website, <a href="https://www.livingincomes.org.au/2020/08/13/550-reasons-to-smile/">550 Reasons to Smile</a>, showcasing stories of the changes it had wrought.</p>
<blockquote>
<p>An old gas heater died and thankfully to the $550 supplement I was able to go and purchase a new one straight away to keep my new baby and 2 other children warm at night (one has severe croup)</p>
<p>We could afford a new phone. We are both in our early 60s and our best skill was hiding our poverty after our small business, our life, went bankrupt. We would skip meals before the grandchildren would visit to afford those treats. </p>
</blockquote>
<p>When the $150 per fortnight that remained of the coronavirus supplement after it had been phased down ended on March 28 this year, it was replaced by a permanent increase in JobSeeker and similar benefits of only $50 per fortnight.</p>
<p>It plunged hundreds of thousands of children back into poverty. </p>
<h2>Toys and food matter to children</h2>
<p>Prior to COVID-19, I led a <a href="http://www.powertopersuade.org.au/blog/poverty-and-its-effects-on-school-aged-children-understanding-the-consequences-of-policy-choices/20/4/2021">research project</a> with children aged between seven and 12. Two-thirds lived in locations identified by standard indicators as disadvantaged.</p>
<p>We gave children the time to raise issues that mattered to them. There was discussion about favourite and longed-for toys, games, and devices; the most fun parks and playgrounds; and the ups and downs of friendships. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=968&fit=crop&dpr=1 600w, https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=968&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=968&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1217&fit=crop&dpr=1 754w, https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1217&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/415609/original/file-20210811-21-bzskwn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1217&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Children go without things they need for school.</span>
<span class="attribution"><span class="source">Yuganov Konstantin/Shutterstock</span></span>
</figcaption>
</figure>
<p>As the research unfolded and children felt more comfortable, they raised the challenges of not having enough money to meet the most basic needs. </p>
<p>Some had only one meal a day and not all were offered school breakfasts.</p>
<p>A nine-year-old boy described his neighbours as “good” and “always helpful”. He said they provided food when his family could not afford to buy it.</p>
<p>A common theme was the imperative to protect their parents by not asking for things they needed, including things for school.</p>
<p>This is the reality of poverty — a reality to which too many Australian children are currently being abandoned.</p><img src="https://counter.theconversation.com/content/165813/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sharon Bessell receives funding from the Australian Research Council, the Norwegian Research Council, and the Australian Government through the Department of Foreign Affairs and Trade.
This article was prepared with the assistance of Toni Wren.</span></em></p>An estimated 540,000 Australians didn’t have paid work ahead of lockdown, so missed out on COVID-19 support this year. They’ve been left to live on $44 a day — well below the poverty line.Sharon Bessell, Professor of Public Policy, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1636262021-07-12T12:29:11Z2021-07-12T12:29:11ZPoverty in 2021 looks different than in 1964 – but the US hasn’t changed how it measures who’s poor since LBJ began his war<figure><img src="https://images.theconversation.com/files/410488/original/file-20210708-27-1v5n3jy.jpg?ixlib=rb-1.1.0&rect=317%2C24%2C5115%2C4194&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Poverty in America has changed since the 1960s.</span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/news-photo/700185625?adppopup=true">Morton Broffman/Getty Images</a></span></figcaption></figure><p>In 1964, President Lyndon B. Johnson <a href="https://www.americanrhetoric.com/speeches/lbj1964stateoftheunion.htm">famously declared war on poverty</a>. </p>
<p>“The richest nation on Earth can afford to win it,” he told Congress in his first State of the Union address. “We cannot afford to lose it.” </p>
<p>Yet as the administration was to learn on both the domestic and foreign battlefields, a country marching off to war must have a credible estimate of the enemy’s size and strength. Surprisingly, up until this point, the U.S. had no official measure of poverty and therefore no statistics on its scope, shape or changing nature. The U.S. needed to come up with a way of measuring how many people in America were poor.</p>
<p>As <a href="https://brownschool.wustl.edu/Faculty-and-Research/Pages/Mark-Rank.aspx">I discuss</a> in my recently published book “<a href="https://us.sagepub.com/en-us/nam/confronting-poverty/book262548">Confronting Poverty</a>,” the approach that the government came up with in the 1960s is still – <a href="https://www.stlouisfed.org/publications/regional-economist/july-2012/understanding-poverty-measures-and-the-call-to-update-them">despite its many shortcomings</a> – the government’s official measure of poverty and used to determine eligibility for hundreds of billions of dollars in federal aid. </p>
<figure class="align-center ">
<img alt="A woman carries a box of food to a car waiting at a food bank in Los Angeles" src="https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=420&fit=crop&dpr=1 600w, https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=420&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=420&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=527&fit=crop&dpr=1 754w, https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=527&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/410489/original/file-20210708-23-1f7tex8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=527&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The need for food aid exploded during the COVID-19 pandemic.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/license/1297847903">Brittany Murray/MediaNews Group/Long Beach Press-Telegram via Getty Images</a></span>
</figcaption>
</figure>
<h2>Counting the poor</h2>
<p>Broadly speaking, poverty means not having the money to purchase the basic necessities to maintain a minimally adequate life, such as food, shelter and clothing.</p>
<p>The government came up with <a href="https://www.census.gov/topics/income-poverty/poverty.html">its official method for counting poor people</a> in the mid-1960s. </p>
<p>First, it asks, what does it cost to purchase a minimally adequate diet during the year for a particularly sized family? That number is then multiplied by three, and you have arrived at the poverty line. That’s it. </p>
<p>If a family’s income falls above the line it is not considered in poverty, while those below the line are counted as poor. </p>
<p>What about all the other basic necessities, such as housing, clothing and health care? That’s where the multiplier of three comes in. When the poverty thresholds were devised, <a href="https://www.ssa.gov/history/fisheronpoverty.htm">research indicated</a> that the typical family spent approximately one-third of its income on food and the remaining two-thirds on all other expenses.</p>
<p>Therefore, the logic was that if a minimally adequate diet could be purchased for a particular dollar amount, multiplying that figure by three would give the amount of income needed to purchase the basic necessities for a minimally adequate life. </p>
<p>Back in 1963, that <a href="https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-people.html">translated into a poverty line</a> of US$3,128 for a family of four. In 2019, the same family’s poverty line <a href="https://www.census.gov/content/dam/Census/library/publications/2020/demo/p60-270.pdf">stood at $26,172</a>. For an interesting contrast, <a href="https://news.gallup.com/poll/162587/americans-say-family-four-needs-nearly-60k.aspx">that’s less than half what the average American polled</a> in 2013 said was the “smallest amount of money” a family of four needed to get by, or $58,000.</p>
<p>The federal government adjusts the poverty line annually to reflect increases in the cost of living. The cutoff itself varies by the number of people in the household, while a household’s annual income is based upon the earnings of everyone currently residing within it. </p>
<p>Using this measure, <a href="https://www.census.gov/library/publications/2020/demo/p60-270.html">10.5% of the U.S. population</a> was in poverty in 2019, the most recent data available.</p>
<p>Keep in mind, though, these thresholds represent impoverishment at its most opulent level. Among those living below the poverty line, <a href="https://www.census.gov/data/tables/2020/demo/income-poverty/p60-270.html">45% live in “deep” poverty</a>, which means they live on less than half of the official poverty line.</p>
<p>The government uses the official poverty line as the base to determine who’s eligible for a range of social programs, from Medicaid to the <a href="https://theconversation.com/scaling-back-snap-for-self-reliance-clashes-with-the-original-goals-of-food-stamps-128839">Supplemental Nutrition Assistance Program</a>. For example, to qualify for SNAP, a household <a href="https://www.cbpp.org/research/food-assistance/a-quick-guide-to-snap-eligibility-and-benefits">must be below 130% of the poverty line</a> for its size. </p>
<p><iframe id="bQ8O1" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/bQ8O1/2/" height="400px" width="100%" style="border: none" frameborder="0"></iframe></p>
<h2>Other measures of poverty</h2>
<p><a href="https://ssir.org/articles/entry/beyond_the_poverty_line">Most analysts</a>, however, consider the official poverty line to be an extremely conservative measure of economic hardship.</p>
<p>A major reason for this is that families today have to spend much more on things other than food than they did in the 1960s. For example, <a href="https://fred.stlouisfed.org/series/CPIHOSNS">housing costs have surged over 800%</a> since then. </p>
<p>For that reason, some critics say the multiplier of three <a href="https://www.ssa.gov/history/fisheronpoverty.html">should be raised to four</a> or <a href="https://www.brookings.edu/testimonies/why-the-united-states-needs-an-improved-measure-of-poverty/">even higher</a>. Taking that step would result in a much larger percentage of the population being seen as in poverty, making them eligible for anti-poverty benefits. </p>
<p>In response, in 2011 the census bureau <a href="https://www.census.gov/library/publications/2020/demo/p60-272.html">developed an alternative measure of poverty</a>, called the Supplemental Poverty Measure. This method takes into account a number of factors that the official poverty measure does not, such as differences in cost of living across the country. The result pushes the poverty rate up just a tad, to <a href="https://www.census.gov/library/publications/2020/demo/p60-272.html">11.7% for 2019</a>. This measure is mostly used today by academics and researchers.</p>
<p>Another method, <a href="https://tcf.org/content/report/american-poverty-measured-relative-prevailing-standards-time/">common in many high-income countries</a>, ignores the cost of living calculations entirely.</p>
<p>The European Union, for example, defines poverty as the percentage of the population that earns below one half of whatever the median income is. For example, in the U.S., the <a href="https://www.census.gov/library/publications/2020/demo/p60-270.html">median income in 2019 was $68,703</a>, which means anyone earning less than $34,351 would be deemed poor. By that measure, the U.S. <a href="https://data.oecd.org/inequality/poverty-rate.htm#indicator-chart">would have a poverty rate of 17.8%</a>. </p>
<p>In fact, back in 1959, the poverty line for a family of four <a href="https://www.census.gov/content/dam/Census/library/publications/2020/demo/p60-270.pdf">was about half of median income in the U.S.</a> Today, it’s about a quarter, which means the federal government’s definition of who is poor hasn’t kept up with overall rising standards of living. </p>
<p>One other approach is based on the idea that poverty is more than just a lack of income and should reflect economic insecurity more broadly, such as not having unemployment or health insurance. The census recently calculated what poverty might look from this perspective and concluded <a href="https://www.census.gov/library/working-papers/2021/demo/SEHSD-WP2021-03.html">38% of Americans experienced</a> one or more aspects of deprivation in 2019. </p>
<figure class="align-center ">
<img alt="President Lyndon B. Johnson delivers his State of the Union address to a joint session of Congress in the House of Representatives as lawmakers and other look on." src="https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&rect=143%2C175%2C2851%2C1845&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=405&fit=crop&dpr=1 600w, https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=405&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=405&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=509&fit=crop&dpr=1 754w, https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=509&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/410478/original/file-20210708-19-1bv9f5w.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=509&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Lyndon B. Johnson declared a ‘war on poverty’ in 1964.</span>
<span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/LBJStateOfTheUnion/dbb222a20a4d4f6cb4d9fcf1842bcd4f/photo?Query=johnson%20war%20on%20poverty&mediaType=photo&sortBy=arrivaldatetime:desc&dateRange=Anytime&totalCount=19&currentItemNo=7">AP Photo</a></span>
</figcaption>
</figure>
<h2>The only way to win the war</h2>
<p>Why does it matter how a society measures poverty? </p>
<p>It matters because in order to address a problem, you must have a clear understanding of its scope. By using an extremely conservative measurement such as the federal poverty line, the U.S. minimizes the extent and depth of poverty in the country.</p>
<p>An inaccurate poverty line inevitably also limits the number of impoverished people who qualify for much-needed federal and state assistance. During the COVID-19 pandemic, <a href="https://www.pbs.org/wgbh/frontline/article/covid-poverty-america/">millions of people would have fallen into poverty</a> were it not for less conditional coronavirus aid from the federal government, such as the <a href="https://www.irs.gov/coronavirus/economic-impact-payments">three rounds of economic impact checks</a> and <a href="https://www.dol.gov/coronavirus/unemployment-insurance">supplemental federal employment insurance</a>. </p>
<p>Many Americans in the past have been rudely surprised at just how inadequate America’s safety net is, at least in part because it’s based on outdated federal poverty thresholds. Broadening the definition of poverty would ensure it’s more likely to be there to support people in a crisis. </p>
<p>Ultimately, poverty will touch the majority of Americans at some point in their lives. My own research shows that roughly 6 in 10 Americans will spend <a href="https://confrontingpoverty.org/poverty-facts-and-myths/most-americans-will-experience-poverty/">at least one of their adult years below the official poverty line</a>. </p>
<p>But if the U.S. ever hopes to finally win the war LBJ began in 1964, the poor need to be seen in order for the government to lift them out of poverty. </p>
<p>[<em>Insight, in your inbox each day.</em> <a href="https://theconversation.com/us/newsletters/the-daily-3?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=insight">You can get it with The Conversation’s email newsletter</a>.]</p><img src="https://counter.theconversation.com/content/163626/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mark Robert Rank does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Newer measures of poverty may do a better job of counting America’s poor, which is necessary to helping them.Mark Robert Rank, Professor of Social Welfare, Washington University in St. LouisLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1633022021-06-27T08:47:53Z2021-06-27T08:47:53ZNigeria’s poverty profile is grim. It’s time to move beyond handouts<figure><img src="https://images.theconversation.com/files/408367/original/file-20210625-19-sa134s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Nigeria's poverty profile is embarrassing </span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/two-men-riding-a-bike-get-stuck-in-the-traffic-created-by-news-photo/1127684190?adppopup=true">Luis TATO/AFP via Getty Images</a></span></figcaption></figure><p>Nigerians have been justifiably confused by conflicting poverty data presented by the Muhammadu Buhari administration and the World Bank. According to Buhari, his administration has <a href="https://www.premiumtimesng.com/news/top-news/467326-my-govt-lifted-10-5-million-nigerians-out-of-poverty-in-two-years-buhari.html">lifted</a> 10.5 million Nigerians out of poverty within the past two years. But no sooner had he made the statement than the World Bank <a href="https://dailytrust.com/w-bank-counters-fg-says-7m-nigerians-plunged-into-poverty">asserted</a> that inflation has plunged seven million Nigerians into poverty. </p>
<p>These statements might seem to be contradictory to non-economists.
But closer analysis suggests that Buhari and the World Bank are right – depending on how poverty is measured.</p>
<p>The first is income or monetary measure of poverty, what economists refer to as the ‘<a href="https://www.ilo.org/wcmsp5/groups/public/---americas/---ro-lima/---sro-port_of_spain/documents/presentation/wcms_304851.pdf">headcount index</a>’. It measures the proportion of the population that is poor based on a minimum personal income - for example $1.90 per day. This minimum amount is deemed adequate to maintain an acceptable living standard, given the cost of living in a given country. </p>
<p>Based on this measure, Buhari is right to claim that – by transferring cash to <a href="https://www.vanguardngr.com/2021/01/social-investment-programme-over-12-million-households-benefitted-from-project-in-last-5yrs-fg/">12 million households</a> during the past five years – a majority of these Nigerians have exceeded the income threshold. Therefore, they have escaped poverty. </p>
<p>The other measure is known as the <a href="https://www.un.org/en/development/desa/policy/wess/wess_dev_issues/dsp_policy_03.pdf">multidimensional poverty measure</a>. It measures poverty by income, and by the access people have to health, education and living standard indicators. These include sanitation, drinking water, electricity, and housing. It is therefore possible for someone to be regarded as non-poor under Buhari’s calculations, but poor when this measure is used. </p>
<p>This is the measure the World Bank appears to be applying. By <a href="https://blogs.worldbank.org/opendata/tackling-poverty-multiple-dimensions-proving-ground-nigeria">this measure </a> 47.3% Nigerians, or 98 million people, live in multidimensional poverty. Most of them are located in northern Nigeria. This poverty rate does not include Borno State, where insurgency has prevented data collection.</p>
<p>Aware of this, the Buhari administration has set the very ambitious goal of lifting <a href="https://www.premiumtimesng.com/news/more-news/444891-buhari-commits-to-lifting-100-million-nigerians-out-of-poverty.html">100 million Nigerians</a> out of poverty by 2030. This is a tall order, considering that another <a href="https://www.theafricareport.com/33300/pandemic-to-poverty-nigeria-in-the-post-covid-future/">five million</a> more Nigerians are expected to become poor as a result of COVID-19 in 2020. </p>
<p>The administration’s <a href="https://statehouse.gov.ng/policy/economy/national-social-investment-programme/">cash transfer programme</a> is commendable. But Buhari should turn his focus more on promoting structural transformation. This would move millions of poor Nigerians from low-productivity agricultural and informal-sector activities to high-productivity sectors such as manufacturing, agro-processing, as well as information and communication technologies.</p>
<h2>What is poverty?</h2>
<p>Poverty is an amorphous and subjective concept, which is influenced by what people consider to be more valuable in life. Those who value more money in their pocket would prefer a monetary measure of poverty. But Nigerians who care more about the healthcare, food, education, electricity, transportation, and security their money can buy would regard the World Bank’s figures as a more useful indicator. </p>
<p>Some economists have proposed the notion of a ’<a href="http://happyplanetindex.org/">Happy Planet Index</a>’ as a better measure of poverty. It measures poverty based on three indicators. These are average subjective life satisfaction, life-expectancy at birth, and ecological footprint. </p>
<p>An illiterate 80-year-old woman who lives on less than $1.90 per day but reports she has been happy all her life; lives in a small hut with no access to electricity; has never visited a hospital or seen a doctor, and consumes mainly organic products grown on her farm, would not be regarded as poor under the Happy Planet Index definition. But she would be poor under the headcount index and multidimension poverty measure. This means poverty is in the eye of the beholder. </p>
<p>Some <a href="https://d3n8a8pro7vhmx.cloudfront.net/acci/pages/145/attachments/original/1462859138/ACCI_Relief_-_Holistic_Understanding_of_Poverty.pdf?1462859138">analysts</a> perceive the stylised conceptualisations of poverty as Eurocentric. They claim that such reflect Western values and marginalise non-Western conceptions of a ‘good life’. </p>
<h2>High food prices</h2>
<p>One reason for the World Bank’s assertion that seven million Nigerians have been driven into poverty is <a href="https://www.nigerianstat.gov.ng/download/1241022">the 22% increase</a> in the price of food. Food prices <a href="https://dailytrust.com/w-bank-counters-fg-says-7m-nigerians-plunged-into-poverty">contributed</a> about 60% to Nigeria’s inflation rate of 18%. Rising food prices exacerbate poverty because it reduces the real purchasing power of households, and shifts expenditures away from essential items such as health, education and housing. </p>
<p>An average Nigerian household <a href="https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/">spends</a> about 56% of income on food, the highest in the world. Countries like US, UK, Canada, and Australia spend 6.4%, 8.2%, 9.1%, and 9.8%. Nigeria’s high expenditure on food implies that a slight increase in food prices would push more people into multidimensional poverty.</p>
<p>Food prices have been rising in Nigeria and pushing more people into poverty for a few reasons. First, the depreciation in the value of the Naira has resulted in steep increases in the prices of imported food items, such as rice, sugar, milk, beverages, and frozen food. The Naira has depreciated by <a href="https://www.focus-economics.com/country-indicator/nigeria/exchange-rate">about 13%</a> during the past year. </p>
<p>Second, because of Nigeria’s rapid population growth, food supply in the country may be lagging demand. Nigeria’s population has been growing by about 2.6% <a href="https://data.worldbank.org/indicator/SP.POP.GROW?locations=NG">per annum</a>, while agriculture value added has been growing <a href="https://tradingeconomics.com/nigeria/agriculture-value-added-annual-percent-growth-wb-data.html">at 2%</a>.</p>
<p>This means that agricultural output is barely keeping pace with consumption. Supply shortfalls have been exacerbated by instability, <a href="https://www.acaps.org/country/nigeria/crisis/northwest-banditry">banditry</a>, <a href="https://www.aa.com.tr/en/africa/more-than-dozen-killed-in-northeast-nigeria-boko-haram-terror-attack/2229568">terrorist attacks</a>, poor infrastructure and climate change. Also, the exodus of farmers to urban centres in search of illusive opportunities. </p>
<p>Regardless of who is right, Nigeria’s poverty profile is grim and embarrassing for a country endowed with humongous human and natural resources. The Nigerian National Bureau of Statistics <a href="https://www.reuters.com/article/us-nigeria-economy-poverty/forty-percent-of-nigerians-live-in-poverty-stats-office-idUSKBN22G19A">said</a> in 2020 that 40% or 83 million Nigerians live in poverty. Although Nigeria’s poverty profile for 2021 has not yet been released, it is <a href="https://blogs.worldbank.org/opendata/using-data-combat-ongoing-crisis-and-next-nigeria">estimated</a> that the number of poor people will increase to 90 million, or 45% of the population, in 2022. </p>
<p>If the World Bank’s income poverty threshold of $3.20 per day is used, Nigeria’s poverty rate is <a href="https://data.worldbank.org/indicator/SI.POV.NAHC?locations=NG">71%</a>. Compared to lower rates for some oil-producing developing countries like Brazil (9.1%), Mexico (6.5%), Ecuador (9.7%) and Iran (3.1%), this is grim. </p>
<p>The Nigerian National Bureau of Statistics data suggest that the number of poor Nigerians exceeds the total population of South Africa, Namibia, Botswana, Lesotho, Mauritius and Eswatini combined. </p>
<h2>What Nigeria needs</h2>
<p>Nigeria needs more industrial production, foreign and domestic investment, not just handouts. </p>
<p>There has been too much emphasis on cash transfers, and less on building the capacities of Nigerians to transition into the sectors and jobs of the future. </p>
<p>Cash transfers alone are inadequate and not pervasive enough for extricating a significant number of Nigerians from extreme poverty. Those who received cash payments under the national social investment programme risk falling back into poverty at the end of the programme. But structural transformation is more enduring, as it enables Nigerians to acquire and utilise productive capacities for permanently escaping poverty.</p><img src="https://counter.theconversation.com/content/163302/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stephen Onyeiwu does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Nigeria needs more industrial production, foreign and domestic investment, not just handouts.Stephen Onyeiwu, Andrew Wells Robertson Professor of Economics, Allegheny CollegeLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1592182021-04-19T20:14:12Z2021-04-19T20:14:12ZFinancial stress in 3 graphs: there’s fewer of us in it, but for those who are, it’s worse<figure><img src="https://images.theconversation.com/files/395677/original/file-20210419-15-1aulvz8.jpg?ixlib=rb-1.1.0&rect=67%2C0%2C2928%2C1594&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">HARRYZH/Shutterstock</span></span></figcaption></figure><p>The good news from new research conducted by the Australian National University for Social Ventures Australia and the Brotherhood of St Laurence is that <a href="https://csrm.cass.anu.edu.au/research/publications/financial-stress-and-social-security-settings-australia">fewer of us</a> are in severe financial stress, by which we mean missing meals, seeking help from charities or being unable to heat our homes.</p>
<p>The bad news is that for certain types of households the proportion in stress is growing, and for many the stress is getting worse.</p>
<p>It is well <a href="https://csrm.cass.anu.edu.au/research/publications/covid-19-jobkeeper-and-jobseeker-impacts-poverty-and-housing-stress-under">documented</a> that JobSeeker households are faring poorly with high rates of poverty but less well documented that other working age households are also suffering from high financial stress.</p>
<p>We have used as a measure of severe stress answers to questions in the
Bureau of Statistics household expenditure surveys in 1998, 2003, 2009 and 2015 about seeking assistance from charities, going without meals, and the ability to pay bills.</p>
<p>For households headed by wage earners and for age pensioners, financial stress remains low. </p>
<p>For households headed by recipients of non-age pensions such as disability, carers’ and single parent payments, and for households headed by Australians on unemployment and related benefits, the proportion in stress has been climbing.</p>
<hr>
<p><strong>Severe financial stress by source of income</strong> </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=220&fit=crop&dpr=1 600w, https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=220&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=220&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=277&fit=crop&dpr=1 754w, https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=277&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/395664/original/file-20210419-17-af1wzo.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=277&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="source" href="https://csrm.cass.anu.edu.au/research/publications/financial-stress-and-social-security-settings-australia">ANU Centre for Social Research and Methods</a></span>
</figcaption>
</figure>
<hr>
<p>Around 37% — more than one in three — households headed by Australians on allowances were in severe financial stress in 2015, up from one in four in 1998.</p>
<p>Twenty eight per cent of households headed by working-age pensioners were severely financially stressed, up from 19%.</p>
<p>The difference between a working-age pension and an allowance is that pensions are usually paid to people who aren’t expected to return to work for some time.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/there-are-lots-of-poverty-lines-and-jobseeker-isnt-above-any-of-them-158068">There are lots of poverty lines, and JobSeeker isn't above any of them</a>
</strong>
</em>
</p>
<hr>
<p>Allowances such as JobSeeker (previously Newstart) and Youth Allowance are usually paid to people who are expected to return to work, and are typically lower.</p>
<p>The reason households headed by both working-age pensioners and recipients of allowances are falling behind are complex. </p>
<p>Those on allowances struggle with incomes that climb only <a href="https://theconversation.com/top-economists-want-jobseeker-boosted-100-per-week-tied-to-wages-150364">in line with the consumer price index</a> and so until <a href="https://theconversation.com/the-50-boost-to-jobseeker-will-take-australias-payment-from-the-lowest-in-the-oecd-to-the-second-lowest-after-greece-155739">recently</a> have not increased in real terms for more than 25 years. </p>
<h2>Income matters, and the type of family</h2>
<p>Working-age pensioners have suffered from higher housing costs, limited liquid assets and tighter eligibility requirements which has meant those who have received working age pensions have been worse off.</p>
<p>Among households headed by age pensioners and wage earners, the incidence of financial stress was much lower, at 4% and 3%.</p>
<hr>
<p><strong>Severe financial stress by family type</strong></p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=202&fit=crop&dpr=1 600w, https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=202&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=202&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=254&fit=crop&dpr=1 754w, https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=254&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/395671/original/file-20210419-15-1lb3ucm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=254&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="source" href="https://csrm.cass.anu.edu.au/research/publications/financial-stress-and-social-security-settings-australia">ANU Centre for Social Research and Methods</a></span>
</figcaption>
</figure>
<hr>
<p>Twenty three per cent of households headed by single parents were in severe stress, compared to 3% of households headed by partnered parents.</p>
<p>Financial stress was at its most acute in households with children aged under five.</p>
<p>A lower 9% of single person households and 3% of couple-only households were in severe financial stress.</p>
<h2>Renters better off, but still badly off</h2>
<p>Renter households are much more likely to be in financial stress than homeowner households, but the proportion in severe stress has fallen from 15% to 12%</p>
<hr>
<p><strong>Severe financial stress by housing tenure</strong> </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=232&fit=crop&dpr=1 600w, https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=232&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=232&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=292&fit=crop&dpr=1 754w, https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=292&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/395675/original/file-20210419-17-1vwwxjz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=292&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="source" href="https://csrm.cass.anu.edu.au/research/publications/financial-stress-and-social-security-settings-australia">ANU Centre for Social Research and Methods</a></span>
</figcaption>
</figure>
<hr>
<p>Beyond these broad observations, we find considerable unexplained variation in financial stress. That might be because some households are better at managing money than others and some are more risk averse.</p>
<p>When we run our findings through our <a href="https://theconversation.com/cut-the-pension-boost-newstart-what-our-algorithm-says-is-the-best-way-to-get-value-for-our-welfare-dollars-108417">model</a> of the social security and tax system we find that while small increases in working-age payments would decrease the severity of financial stress, they wouldn’t do much to reduce the incidence of it.</p>
<p>A big increase in the overall social security budget would do a lot. </p>
<p>An increase of 10% could allow JobSeeker to increase from the current $620 per fortnight to $996 and disability support payments to increase from $953 per fortnight to $1060 and other working-age pensions to increase by similar amounts. Other payments would remain unchanged.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/as-one-gets-out-another-gets-in-thousands-of-students-are-hot-bedding-156589">As one gets out, another gets in: thousands of students are 'hot-bedding'</a>
</strong>
</em>
</p>
<hr>
<p>Our modelling shows that while increases to other payments could also lower severe financial stress, money spent on them would have less effect. </p>
<p>The scenario of a 10% increase in the social security budget that we put forward would cut the rate of severe financial stress among JobSeeker households by 16%.</p>
<p>The high rates of financial stress among households supported by working age payments is largely a policy choice. Extra money wouldn’t solve all of their problems but a decent safety net would go a long way.</p><img src="https://counter.theconversation.com/content/159218/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The ANU Centre for Social Research and Methods conducted research into financial stress for Social Ventures Australia and the Brotherhood of St Laurence.</span></em></p>The most stressed are Australians on JobSeeker and single parents.Ben Phillips, Associate Professor, Centre for Social Research and Methods, Director, Centre for Economic Policy Research (CEPR), Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1580682021-03-30T04:59:48Z2021-03-30T04:59:48ZThere are lots of poverty lines, and JobSeeker isn’t above any of them<figure><img src="https://images.theconversation.com/files/392428/original/file-20210330-15-14bjme9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Joel Carrett/AAP</span></span></figcaption></figure><p>This week, many Australians are holding their breath. </p>
<p>On Sunday, we saw the end of the JobKeeper payment, with an estimated <a href="https://www.news.com.au/finance/economy/australian-economy/150000-australians-jobs-at-risk-when-jobkeeper-ends-treasury/news-story/0a49dbb702008dd91498499edac3f221">150,000 people</a> expected to now lose their jobs as a result. On Wednesday, the Coronavirus Supplement (which boosted the JobSeeker payment) will also stop. </p>
<p>Taking into account a recent $50-a-fortnight rise in the base rate of JobSeeker, this will see most people on JobSeeker earn about <a href="https://www.abc.net.au/news/2021-03-18/how-much-is-jobseeker-when-does-it-end-what-are-new-rules/13259460">$620 a fortnight</a> or $44 a day. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/the-50-boost-to-jobseeker-will-take-australias-payment-from-the-lowest-in-the-oecd-to-the-second-lowest-after-greece-155739">The $50 boost to JobSeeker will take Australia's payment from the lowest in the OECD to the second-lowest after Greece</a>
</strong>
</em>
</p>
<hr>
<p>The Australian Council of Social Service has been among those advocating for <a href="https://www.acoss.org.au/media_release/cuts-will-plunge-millions-further-into-poverty/">more support</a> for unemployed Australians, arguing people will “plunge into poverty” with these latest payment changes. </p>
<p>But this week, when interviewed about the impact of the cuts, Social Services Minister Anne Ruston cast doubt over the concept of a poverty line. As <a href="https://www.abc.net.au/radionational/programs/breakfast/the-economy-needs-to-start-doing-the-heavy-lifting-jobkeeper/13279520">she told</a> Radio National’s Fran Kelly, </p>
<blockquote>
<p>I’m not entirely sure I agree [there is an established line]“. </p>
</blockquote>
<p>Last year, <a href="https://www.theguardian.com/australia-news/2020/oct/28/australian-measure-of-poverty-unnecessary-because-welfare-is-comprehensive-and-targeted">Ruston also said</a> the government has never sought to have a "narrow” definition of poverty and does not consider a poverty line when setting welfare payments. </p>
<p>Technically, Ruston is correct. There is no agreed poverty line for Australia and the setting of welfare payments requires more thought than just the calculation of a single poverty line. </p>
<p>However, there are various estimates for the poverty line, and all are well above the JobSeeker rate for April and beyond.</p>
<h2>How to calculate poverty</h2>
<p>There are two main approaches to calculating poverty — you can either look at absolute poverty or relative poverty. </p>
<p>Absolute poverty is a concept that largely relates to developing countries and is mostly defined around the ability of a person or household to provide the most basic necessities such as food, water and shelter. Relative poverty is usually defined as a percentage of average or median incomes. </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1321299809869979649"}"></div></p>
<p>A person or household in relative poverty would be one whose income is low enough that they will struggle to provide a living standard that is generally considered acceptable in our society. </p>
<p>For a developed country like Australia, the relative poverty concept is usually the most relevant. These families might struggle to afford items most people take for granted such as clothes to wear for job interviews, housing, the internet, or mobile phones. </p>
<p>Calculating relative poverty is usually based on the reported incomes from nationally representative household surveys such as the Australian Bureau of Statistics’ <a href="https://meteor.aihw.gov.au/content/index.phtml/itemId/657468">Survey of Income and Housing</a>. The usual definition used by researchers in Australia is any household whose income falls below 50% of the median (middle) income is in poverty. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/already-badly-off-single-parents-went-dramatically-backwards-during-covid-they-are-raising-our-future-adults-157767">Already badly off, single parents went dramatically backwards during COVID. They are raising our future adults</a>
</strong>
</em>
</p>
<hr>
<p>There are various minor complexities around the definition of income (disposable vs gross, whether to deduct housing costs, whether to use the median or 60% of income and how to adjust incomes for different household compositions and sizes). </p>
<p>Ultimately, the measures are all imperfect, but so long as they are consistent through time, they provide a useful guide. They show population-wide dimensions and trends about who is likely to be under considerable financial stress. </p>
<h2>The Melbourne Institute poverty line</h2>
<p>The only established “poverty line” in Australia is the <a href="https://melbourneinstitute.unimelb.edu.au/publications/poverty-lines">Melbourne Institute poverty line</a>. This measure is a mix of both absolute and relative poverty. Absolute, in that it was based on a basic basket of goods and services a person or family could survive on and relative in that it has been indexed through time using changes in per capita income. </p>
<p>This measure suggests the poverty line is around $1,100 per fortnight for a single person in the workforce and $891 for someone not in the labour force (such as a retiree). An unemployed person is considered to be part of the labour force. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/australia-has-a-long-history-of-coercing-people-into-work-there-are-better-options-than-dobbing-in-156296">Australia has a long history of coercing people into work. There are better options than 'dobbing in'</a>
</strong>
</em>
</p>
<hr>
<p>This poverty line is based on research from the Henderson Inquiry into poverty in the early 1970s. While this inquiry is out of date, the numbers nevertheless remain reasonably sensible and consistent. </p>
<p>Relative poverty measures don’t usually discriminate between employed or unemployed or the family type as does the Melbourne Institute measure. Most relative poverty estimates would put the single adult poverty line at around <a href="https://newsroom.unsw.edu.au/news/social-affairs/unsw-and-acoss-report-shows-3m-australians-living-poverty">$800 to $1,000</a> per fortnight. </p>
<h2>Our modelling</h2>
<p>Colleagues and I have been doing <a href="https://csrm.cass.anu.edu.au/research/publications/covid-19-jobkeeper-and-jobseeker-impacts-poverty-and-housing-stress-under">modelling</a> on the impact of these cuts on poverty in Australia, particularly for those who rely on JobSeeker payments as their main source of income. </p>
<figure class="align-center ">
<img alt="Social Services Minister Anne Ruston/AAP" src="https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/392429/original/file-20210330-13-7lz7ez.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Social Services Minister Anne Ruston has consistently dismissed calls for a significant, permanent rise to JobSeeker Payment.</span>
<span class="attribution"><span class="source">Lukas Coch/AAP</span></span>
</figcaption>
</figure>
<p>As we told a Senate committee earlier this month, before COVID, the poverty rate for people receiving Newstart (the old name for JobSeeker) was 88%. When JobSeeker was doubled during COVID, this dropped to 26%. From April 1, poverty will balloon out again to 85%. </p>
<p>Not all households are the same: some are single, some have couples, some have children and some get other payments such as rent assistance or family payments. However, the majority of households whose main income source is the JobSeeker payment will still fall well under the poverty line, whichever way you calculate it. </p>
<h2>The problem with JobSeeker</h2>
<p>The problem with JobSeeker is the payment has been indexed with inflation, rather than incomes, since the mid-1990s. Since then, incomes have increased by about 50% more than inflation, so the JobSeeker rate has fallen behind the general living standard in Australia. The JobSeeker payment is also about 35% below the age pension payment.</p>
<p>The evidence is compelling that the old JobSeeker rate of around $570 per fortnight required a much more significant increase than $50 per fortnight. This is particularly so because from April, there is likely to be a very large number of people — in the range of 1.2 to 1.4 million — on the payment. This is based on current JobSeeker recipient trends and the expected additional recipients transferring from JobKeeper.</p>
<p>So yes, there are different ways to define and calculate a poverty line. But there can be no doubt JobSeeker is not enough to keep people above it — or any honest assessment of a decent safety net and standard of living.</p><img src="https://counter.theconversation.com/content/158068/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben Phillips does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>With cuts to JobKeeper and JobSeeker set to bite, Social Services Minister Anne Ruston has cast doubt over the idea of a poverty line.Ben Phillips, Associate Professor, Centre for Social Research and Methods, Director, Centre for Economic Policy Research (CEPR), Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1572442021-03-23T18:50:01Z2021-03-23T18:50:01Z2.6 million face poverty when COVID payments end, rental stress soars<figure><img src="https://images.theconversation.com/files/391025/original/file-20210323-15-hartj3.jpg?ixlib=rb-1.1.0&rect=568%2C0%2C5173%2C3529&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/middleaged-family-having-difficulties-paying-utility-693706726">Shutterstock</a></span></figcaption></figure><p>Many Australians whose jobs were decimated by the COVID business shutdowns will soon be waking up to new income shocks and the prospect of rental stress. This is because people whose employers can’t afford to keep them on will suddenly lose more than A$300 per week when the <a href="https://www.ato.gov.au/general/jobkeeper-payment/">JobKeeper</a> scheme <a href="https://www.ato.gov.au/General/JobKeeper-Payment/JobKeeper-key-dates/">ends on March 28</a>. Worryingly, this income shock will happen just days before the payment to people on the <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/jobseeker-payment">JobSeeker</a> benefit is effectively <a href="https://www.ideas.org.au/blogs/jobkeeper-jobseeker-what-has-changed.html#:%7E:text=The%20JobSeeker%20Payment%20replaced%20the,This%20was%20announced%20in%20November.">cut by $100 per fortnight</a>. </p>
<p>At that point, all income support recipients – more than 2.6 million people – will be below the poverty line and many will face extreme rental stress.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/1-billion-per-year-or-less-could-halve-rental-housing-stress-146397">$1 billion per year (or less) could halve rental housing stress</a>
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</em>
</p>
<hr>
<p>This income shock has been anticipated for some time, but what does it means for rates of rental stress, particularly in Victoria? Despite <a href="https://www.theage.com.au/politics/federal/victoria-s-economic-recovery-to-outstrip-all-other-states-as-nation-bounces-back-20210115-p56ufo.html">promising signs of recovery</a>, Victorian jobs lost in the COVID-induced recession, such as in the hard-hit <a href="https://www.theage.com.au/national/victoria/business-tourism-on-its-knees-as-covid-19-casts-long-shadow-over-events-20210203-p56z2j.html">business tourism</a> and <a href="https://www.theguardian.com/culture/2021/feb/22/more-job-losses-ahead-for-australian-live-music-industry-operators-warn">live music industries</a>, have not bounced back at the same rate as others.</p>
<h2>What will happen to rental affordability?</h2>
<p>To illustrate this point we have modelled housing affordability for single people who were on either the full-time or part-time JobKeeper rate. In this scenario, they could also get JobSeeker payments at a part-rate because of the temporary increase in the <a href="https://www.servicesaustralia.gov.au/individuals/topics/income-test-jobseeker-payment/29411">income-free threshold to $300</a>. This made them eligible for <a href="https://www.dss.gov.au/housing-support/programmes-services/commonwealth-rent-assistance">Commonwealth Rent Assistance</a> too. </p>
<p>The chart below shows the impacts on income and rental affordability when JobKeeper and <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/coronavirus-supplement">Coronavirus Supplement</a> payments end. Their incomes and the amount of rent they can afford are roughly halved.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=221&fit=crop&dpr=1 600w, https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=221&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=221&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=278&fit=crop&dpr=1 754w, https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=278&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/389972/original/file-20210316-16-19zylll.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=278&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Impacts of the loss of JobKeeper and Coronavirus Supplement on income and affordable rent.</span>
<span class="attribution"><span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Full-time and part-time single workers were able to afford weekly rent of $265 and $245 respectively before the withdrawal of JobKeeper. Afterwards, affordable rent goes down to $115 per week. That’s about $110 less than the <a href="https://www.dhhs.vic.gov.au/sites/default/files/documents/202011/DHHS%20Rental%20Report%20September%20quarter%202020.docx">$450 median rent</a> ($225 per person) for a two-bedroom share house in Melbourne.</p>
<p>Based on <a href="https://theconversation.com/city-share-house-rents-eat-up-most-of-newstart-leaving-less-than-100-a-week-to-live-on-123772">our earlier calculations</a>, this leaves these renters with only $17.57 per day to meet basic costs. They have a lavish $3.57 per day more than they did before the pandemic to pay for food, utilities and job-seeking costs such as mobile phone plans and travel cards (A$4.40 a day in Melbourne).</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/city-share-house-rents-eat-up-most-of-newstart-leaving-less-than-100-a-week-to-live-on-123772">City share-house rents eat up most of Newstart, leaving less than $100 a week to live on</a>
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</em>
</p>
<hr>
<p>What is different now than for pre-COVID unemployment was that business shutdowns thrust people who had reliable earnings – and accompanying high rents and mortgages in metropolitan areas – onto JobSeeker and JobKeeper payments.</p>
<p>The chart below shows the change in rental affordability for a number of household types before the pandemic and during the Coronavirus Supplement stages (i.e. payments of $550, then $250, then $150).</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=311&fit=crop&dpr=1 600w, https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=311&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=311&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=391&fit=crop&dpr=1 754w, https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=391&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/391075/original/file-20210323-19-yikwe6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=391&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Affordable rents by household types with supplement and without.</span>
</figcaption>
</figure>
<p>For example, when their income was highest during the $550 stage, two singles sharing could afford rent of $430 per week. Once the supplement ends and is replaced by the <a href="https://www.smh.com.au/politics/federal/it-breaks-my-heart-jobseekers-hit-back-at-25-a-week-dole-increase-20210225-p575p9.html">$25-a-week increase in JobSeeker</a> payment, affordable rent declines to only $230 per week or $115 each.</p>
<p>Rental affordability for single-parent households is notable here because the COVID Supplement was payable to one person only. Once the supplement is withdrawn, they will again be disadvantaged relative to other households because they will not be receiving the increase in the JobSeeker payment. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/after-covid-well-need-a-rethink-to-repair-australias-housing-system-and-the-economy-145437">After COVID, we'll need a rethink to repair Australia's housing system and the economy</a>
</strong>
</em>
</p>
<hr>
<h2>What sort of job losses can we expect?</h2>
<p>It is hard to predict exactly how many people will lose their jobs when JobKeeper ends. What we do know is the economic recovery in Victoria has lagged behind the other states. We also know that at the end of December 2020 <a href="https://theconversation.com/victorians-struggle-to-exit-jobkeeper-as-the-schemes-end-looms-155288">1.55 million people</a> were on JobKeeper and a large proportion of them (626,000) were in Victoria. </p>
<p>Economist Jeff Borland <a href="https://drive.google.com/file/d/1kE4f5qxNQwdh5Xp_6l2Cu-HrjiZvfkrB/view">conservatively estimates</a> national job losses could range between 125,000 and 250,000. It is reasonable to expect as many as half of these could be in Victoria.</p>
<p>Our analysis also shows there are worrying signs that the economic recovery celebrated in the January labour force data was not sustained in February. The latest data provided to a <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/COVID-19/COVID19">Senate inquiry</a> into COVID-19 show JobSeeker recipients increased by 7,267 between <a href="https://www.aph.gov.au/DocumentStore.ashx?id=60c91b42-dde2-415f-9f9b-7d5fd3935cb6">January</a> and <a href="https://www.aph.gov.au/DocumentStore.ashx?id=9c1805cb-fe51-419b-8a7b-61315c64c302">February</a>. The increase in Victoria could be attributed to the temporary Christmas retail boom, but in states like New South Wales and Queensland claims decreased slightly.</p>
<p>While <a href="https://www.abc.net.au/news/2021-03-17/jobkeeper-end-will-hit-these-postcodes-hardest/13242400?nw=0">fewer people</a> will lose their jobs in other states than in Victoria when JobKeeper is withdrawn, they are not immune to this income shock. We created the chart below to show the overall scale of the coming problem of rental stress when the fortnightly $150 Coronavirus Supplement disappears and is replaced by the $50 JobSeeker increase.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=339&fit=crop&dpr=1 600w, https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=339&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=339&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=425&fit=crop&dpr=1 754w, https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=425&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/391066/original/file-20210323-21-1c3civ6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=425&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Households and people on income support falling under poverty line as COVID supplement reduces (based on DSS data February 2021)</span>
</figcaption>
</figure>
<p>Once the supplement reduced to $250 per fortnight, singles and single parents with two children were below the poverty line. When it was reduced to $150, the number of household types in poverty increased again. From April 1, all income support recipients – covering more than 2.6 million people including children – will be waking up to poverty and the prospect of extreme rental stress.</p>
<h2>What can be done to avoid this?</h2>
<p>So how can governments prevent people from falling off the rental cliff? It is unlikely to be achieved by introducing <a href="https://www.abc.net.au/news/2021-03-10/tourism-coronavirus-pandemic-assistance-package-cheap-flights/13235432">cut-price flights</a> to Far North Queensland. </p>
<p>A new range of strategies will be needed. These include options <a href="https://www.acoss.org.au/wp-content/uploads/2021/03/Strengthening-Income-Support-Bill-2021.pdf">advocated by ACOSS and others</a> to increase the maximum rate of Commonwealth Rent Assistance by 50%, increase the JobSeeker base rate above the poverty line and introduce rental stress grants targeted at individuals who need help.</p>
<p>Over the longer term, there is also a need to adopt strategic approaches to increase the supply of affordable rental housing such as those <a href="https://www.ahuri.edu.au/housing/policy-analysis/increasing-affordable-rental-supply">recommended by researchers</a> at the Australian Housing and Urban Research Institute (AHURI).</p><img src="https://counter.theconversation.com/content/157244/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Liss Ralston receives funding from AHURI</span></em></p><p class="fine-print"><em><span>Simone Casey does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>JobKeeper and the COVID Supplement to JobSeeker benefits will be gone in a week. The combined effect will be to halve some recipients’ incomes and the rent they can afford.Simone Casey, Research Associate, Future Social Service Institute, RMIT UniversityLiss Ralston, Adjunct associate, Swinburne University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1249352019-10-15T13:13:08Z2019-10-15T13:13:08ZSouth African study shows how unhealthy ageing takes its toll on health and income<figure><img src="https://images.theconversation.com/files/296851/original/file-20191014-135513-rp018q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The relationship between income and health underlines the need for strong government policies to break the cycle.</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Population ageing is often associated with health-related challenges. But its effects also reach other spheres of life. In particular, an ageing population has a big impact on countries’ economies. <a href="https://www.nber.org/papers/w16705">Research</a> shows how it can influence a country’s economic growth. And a similar effect can be found at the <a href="https://www.cambridge.org/core/journals/ageing-and-society/article/ageing-income-and-living-standards-evidence-from-the-british-household-panel-survey/3825CF5F118D6AFC9C3F0A9BFBFDE592">household level</a>. </p>
<p>This is of greater relevance given there is a greater share of the population reaching older age across the world. This had made it even more important to understand how ageing influences household well-being, what challenges exist, and – more crucially – how policies can be designed to improve general welfare. </p>
<p>Our <a href="https://www.sciencedirect.com/science/article/pii/S2212828X18300768">research</a> in South Africa seeks to understand how different social policies can influence health and income at older ages. The idea is to contribute to the development of evidence based policy making. We believe that our findings are relevant to other developing countries too. </p>
<p>Our research has been conducted under the umbrella of the <a href="https://haalsi.org/">Health and Aging in Africa: A Longitudinal Study of a community in South Africa</a>. It’s been conducted in 31 villages in rural northeast South Africa, close to the border with Mozambique since 2013. The study, which is ongoing, has involved collecting income and health information on older people approximately every two years. </p>
<p>This is the first study of its kind in Africa but joins a large family of studies that follow the same methodology to explore the links between ageing, income, and health across many countries.</p>
<h2>Ageing, jobs and health</h2>
<p>Ageing can influence a households’ economic well-being because it has a bearing on employment. In our study we have seen employment rates drop off even before people reach retirement age. In South Africa there is no legal retirement age, but men and women qualify for an <a href="https://www.sassa.gov.za/Pages/Older-Persons-Grant.aspx">old age grant at 60</a>.</p>
<p>This means that a large share of older people who are still in active age do not participate in the labour force. </p>
<p>There are two potential explanations for this. One is the very high levels of <a href="https://www.statssa.gov.za/publications/P0211/P02112ndQuarter2017.pdf">unemployment</a> in South Africa. This is affecting older people too. Being out of the labour force is strongly associated with lower incomes and thus a lower capacity to consume.</p>
<p>Health is the other factor affecting the economic well-being of households. This can happen in two ways. First, unhealthy ageing is strongly associated with greater need for health services. This, in turn, is often coupled expenditure that reduces the amount of income available for other needs like food. This can even lead to medical impoverishment – when a household’s income falls below the poverty line due to the fact that money has been spent on health services. </p>
<p>In our research we found that most of the people living in the study communities are already living below the South African poverty line. </p>
<p>Unhealthy ageing can also impact economic well-being by forcing other household members out of work to provide care for the elderly – compounding the burden on the household. </p>
<p>It’s also important to remember that economic well-being itself can have an impact on health. It’s evident from our research that while health influences economic well-being, the inverse is also true - economic well-being influences health. </p>
<p>Results from the baseline wave of the our study show that individuals in the highest wealth quintiles – defined either by wealth or consumption – are more likely to be in better health. For example, an individual in the <a href="https://www.sciencedirect.com/science/article/pii/S2212828X18300768">highest wealth quintile </a>is approximately two times less likely to be in the bottom quintile of disability. </p>
<p>And there’s <a href="https://link.springer.com/article/10.1007%2Fs00038-018-1173-8">evidence</a> that individuals in the lower wealth quintile are less likely to access health care or follow the correct guidelines for disease prevention. This can be either due to knowledge or financial capacity reasons. </p>
<p>This implies that already impoverished households can be made worse due to the health consequences of their economic position.</p>
<h2>Breaking the cycle</h2>
<p>The relationship between income and health underlines the need for strong government policies to break the cycle. </p>
<p>A myriad of policies could be considered. In South Africa the focus has been on establishing an extensive social grant net. The country’s old age pension system is one of the largest and <a href="https://www.oecd.org/finance/private-pensions/42052117.pdf">more generous</a> – in proportion to local income – in the developing world.</p>
<p>South Africa has three social grants to protect households from the financial consequences of ageing: </p>
<ul>
<li><p>Old age state grant provided to all individuals over the age of 60, </p></li>
<li><p>disability grant to those that have a disability that prevents them from working and,</p></li>
<li><p>carer grant which is provided to individuals that need to care for disabled adults. </p></li>
</ul>
<p>These grants have become strong pillars in the South African welfare system and most importantly a valuable tool for <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1754420">tackling poverty</a> among older people. Over <a href="https://www.sassa.gov.za/Statistics/Documents/Fact%20Sheet%20-%20Issue%20No.21%20-%20September%202018.pdf">17 million</a> grants are paid out every month.</p>
<p>But there are still important challenges. The main one is that administration isn’t perfect – some people who are eligible aren’t getting them. For example, around 10% of those eligible for the old age grant aren’t receiving it. This number increases to over 85% for both the disability and carer grant according to our estimates in the town of Agincourt, Mpumalanga province. The reasons for this sub-optimal uptake are either lack of knowledge, stigma, or lack of the required documentation such as a national identity card. </p>
<p>What’s clear is that there’s a need to improve access.</p>
<h2>What’s needed</h2>
<p>As the population ages in developing countries like South Africa it is vital to remember the dual relationship between health and income. This can prove helpful in the development of strong social policies that contribute to healthy ageing as well as protect and improve the economic well-being of households. This is important given that that poverty rates and bad health are often greater for older people. </p>
<p>Evidence gathered in South Africa suggests where policy interventions can have a larger impact. And it can be a source of knowledge for other developing countries.</p><img src="https://counter.theconversation.com/content/124935/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Carlos Riumallo Herl receives funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska Curie grant agreement No 707404</span></em></p><p class="fine-print"><em><span>David Canning receives funding from National Institutes of Health of the USA.</span></em></p><p class="fine-print"><em><span>Mark A. Collinson receives funding from the National Department of Science and Innovation</span></em></p>It’s evident from research that while health influences economic well-being, the inverse is also true, economic well-being influences health.Carlos Riumallo Herl, Assistant Professor, Erasmus University RotterdamDavid Canning, Richard Saltonstall Professor of Population Sciences, Harvard UniversityMark A. Collinson, Reader in Population and Public Health, MRC/Wits Rural Public Health and Health Transitions Research Unit, School of Public Health, University of the WitwatersrandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1161322019-05-07T23:21:39Z2019-05-07T23:21:39ZThe Ontario government’s shameful snub of affordable housing<figure><img src="https://images.theconversation.com/files/271620/original/file-20190429-194606-gtb5l5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Prime Minister Justin Trudeau, left, speaks with Toronto Mayor John Tory before a recent news conference announcing funding for affordable housing in the Toronto area. </span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Nathan Denette</span></span></figcaption></figure><p><a href="https://www.ontario.ca/page/more-homes-more-choice-ontarios-housing-supply-action-plan">Ontario Premier Doug Ford’s new housing policy</a> offers us a lot of things, but what it fails to mention might hurt vulnerable Canadians the most.</p>
<p>Prime Minister Justin Trudeau and Toronto Mayor John Tory recently <a href="https://www.thestar.com/news/city_hall/2019/04/05/ottawa-pledges-13-billion-for-toronto-community-housing-repairs.html">announced</a> a $1.3 billion federal investment in the <a href="https://www.torontohousing.ca/">Toronto Community Housing Corporation</a>, the city’s largest affordable housing provider. According to the federal government, the $1.3 billion will go toward renovating some 58,000 housing units across 1,500 buildings. It is the largest federal transfer of housing funds to a municipality in the country’s history.</p>
<p>The investment follows on the heels of Trudeau’s announcement of the federal government’s first-ever <a href="https://www.placetocallhome.ca/">National Housing Strategy</a> in 2017. Trudeau pledged to spend $40 billion to address the problems of inadequate housing and chronic homelessness in Canada over a 10-year period.</p>
<p>For his part, Ontario Premier Doug Ford recently <a href="https://www.cbc.ca/news/canada/toronto/ontario-government-commits-to-repair-affordable-housing-1.5101858">pledged</a> $1 billion to repair Ontario’s affordable housing stock and streamline the application process as part of the provincial government’s <a href="https://www.ontario.ca/page/community-housing-renewal-strategy#section-1">Community Housing Renewal Strategy</a>. Exactly how much Toronto Community Housing will receive is unclear.</p>
<p><a href="http://budget.ontario.ca/2019/index.html">Ontario’s recent budget</a> is silent on the issue as well. It doesn’t mention Toronto Community Housing once. Instead, the budget seems focused on boosting the overall housing supply while cutting access to social programs like affordable housing, income support and homelessness prevention by $550 million per year. Funding for the Ontario Ministry of Municipal Housing and Affairs has been cut by 25 per cent overall.</p>
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<img alt="" src="https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/271621/original/file-20190429-194620-na54e1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Ontario Finance Minister Vic Fedeli presents the 2019 budget as Premier Doug Ford looks on at the legislature in Toronto on April 11, 2019.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Frank Gunn</span></span>
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<p>When Trudeau first <a href="https://www.cbc.ca/news/politics/trudeau-housing-rights-human-rights-1.4414854">announced</a> the National Housing Strategy, he famously declared that “housing rights are human rights.” The federal government’s investment in Toronto Community Housing is an important step toward fulfilling this promise. Now it’s the province’s turn to step up as well.</p>
<h2>More than just a landlord</h2>
<p>Affordable housing providers in Canada are facing an identity crisis. </p>
<p>Some critics have argued that Toronto Community Housing should behave like any other landlord. They argue its main job should be to collect rents, enforce leases and promptly evict tenants who fail to comply with the rules, regardless of their personal circumstances. </p>
<p>Toronto Community Housing has faced <a href="https://www.thestar.com/news/city_hall/2019/02/21/toronto-community-housing-removes-ceo-amid-contract-controversy.html">accusations</a> of wasteful spending in the past. Residents and taxpayers should demand a crackdown, the critics say. A <em>Toronto Sun</em> columnist <a href="https://torontosun.com/2017/08/06/outstanding-rent-arrears-grows-by-14/wcm/ccc77ca6-3154-457d-b21c-7feea76b5acb">suggested that it should behave like a private landlord</a>: “Clearly, private landlords are in business to make money. (Toronto Community Housing) officials really couldn’t care less.” </p>
<p>Ford would seem to agree. One of the hallmarks of Ontario’s new housing policy is a change to the application rules. Toronto Community Housing would be empowered to <a href="https://globalnews.ca/news/5178035/ontario-government-community-housing-criminals/">turn away prospective tenants</a> who were previously evicted for criminal activity. Apparently Tory has campaigned for the rule change as well. </p>
<p>Toronto Community Housing is home to 110,000 people, including 30,000 youth and children and 20,000 seniors. The <a href="https://www.torontohousing.ca/events/Documents/Item%2010%20-%20Attachment%201%20-%20TCHC_AnnualReport-FINAL.pdf">vast majority</a> of residents live below the poverty line. Nearly 60 per cent of them are women, and one third of them self-identify as either having a disability or living with mental health challenges. For many people, eviction from Toronto Community Housing would mean they have nowhere else to live. Homelessness, poverty rates, and mental health are <a href="https://homelesshub.ca/about-homelessness/homelessness-101/causes-homelessness">closely interrelated</a> in Canada. </p>
<p>Properly understood in this light, Toronto Community Housing is more than just a private landlord. And the federal government’s investment is more than just a commitment to repairing bricks and mortar. Affordable housing is one of the planks of a more fair and just society. Ontario’s new housing policy fails to recognize this.</p>
<h2>Affordable housing matters</h2>
<p>Since the federal and provincial governments downloaded responsibility for affordable housing to municipalities in the late 1990s and early 2000s, Toronto Community Housing has lacked stable, long-term sources of funding and support from every level of government. </p>
<p>As a result, Toronto Community Housing faces a <a href="https://www.torontohousing.ca/capital-initiatives/Documents/Third-party%20economic%20impact%20study.pdf">capital repairs shortfall</a> of $2.6 billion over the next 10 years since it inherited a large stock of buildings without the resources to maintain them. The city’s affordable housing stock is <a href="https://www.thestar.com/news/gta/2015/04/06/shower-of-bricks-reveals-tchcs-ruined-faade-keenan.html">literally crumbling</a>.</p>
<p>The <a href="https://www.toronto.ca/community-people/employment-social-support/housing-support/rent-geared-to-income-subsidy/">waiting list</a> for a rent-subsidized unit in Toronto Community Housing is currently tens of thousands of families long. Most applicants can expect to wait seven years or more for a bachelor unit and longer than 10 years for a larger unit. The waiting list includes people experiencing homelessness, survivors of intimate partner violence and human trafficking and terminally ill people with fewer than two years to live.</p>
<p>A combination of factors has meant that Toronto Community Housing has failed to provide shelter for many <a href="https://www.thestar.com/news/gta/2018/05/17/this-great-grandmother-was-forced-from-her-home-of-31-years-hers-is-the-the-face-of-a-broken-system.html">people who need it most</a>. Research shows that racialized women, Indigenous peoples, immigrant populations, and persons with disabilities, among others, are most likely to face <a href="https://homelesshub.ca/about-homelessness/legal-justice-issues/discrimination">housing discrimination</a> in Canada. Homelessness is a barrier to the social advancement of historically marginalized groups in our society, particularly those who fall at the intersection of multiple systems of oppression and can face the greatest challenges in obtaining safe and adequate housing. </p>
<p>Police services are not equipped to contend with the complex issues facing people who experience poverty and homelessness. The criminal justice system is increasingly exclusionary of people with mental health challenges, among others, who comprise a large part of Toronto Community Housing’s population. Shifts in public policy surrounding poverty, homelessness and mental health have resulted in the <a href="https://www.homelesshub.ca/about-homelessness/legal-justice-issues/criminalization-homelessness">criminalization of homelessness</a> in Canada.</p>
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Read more:
<a href="https://theconversation.com/a-taxing-problem-canadian-cities-desperately-need-new-sources-of-revenue-115689">A taxing problem: Canadian cities desperately need new sources of revenue</a>
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<p>Faced with this reality, the federal government’s recognition that “housing rights are human rights” is a commitment to addressing the city’s increasingly competitive and inaccessible housing market. It’s a commitment to improving the safety, housing conditions and quality of life for thousands of city residents. It’s a commitment to empowering some of the most vulnerable members of our society by increasing their access to vital social services like job placement assistance and local community-building initiatives. Affordable housing providers can help to provide these services.</p>
<p>The provincial government’s new housing policy, on the other hand, fails to reflect the same values as the federal government’s plan.</p>
<p>Ontario should have allocated more for affordable housing in its budget, not less. To match the federal government’s investment, the province should have earmarked funds for Toronto Community Housing specifically. Mental health supports and other social programs aimed at homelessness prevention should have been made a top priority throughout. And the province should have recognized that housing rights are human rights, not privileges. This means they should extend to everyone. Prospective tenants who were previously evicted for criminal activity should not be denied access to affordable housing in the future. </p>
<h2>Building for the future</h2>
<p>Affordable housing providers should be funded and supported toward the goal of <a href="https://www.homelesshub.ca/about-homelessness/education-training-employment/poverty">breaking the cycle of poverty</a> in Canada. The federal government’s investment in Toronto Community Housing is a good start, but more funding and support from every level of government is needed to fulfil Trudeau’s promise that “housing rights are human rights” across the country.</p>
<p>At the same time, affordable housing providers should be held more accountable in meeting their human rights mandate. The National Housing Strategy is not a blank cheque. The promise of the policy requires that we spend residents and taxpayers’ money in socially responsible ways.</p>
<p>Canadians should invest in affordable housing. It’s a commitment to lifting the most vulnerable members of our society from the ground up — and lifting our entire country up in the process.</p><img src="https://counter.theconversation.com/content/116132/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniel's research is funded by scholarships from the Pierre Elliott Trudeau Foundation, SSHRC and the Canadian Bar Association. Before entering academia, Daniel worked as Legal Counsel at Toronto Community Housing Corporation.
</span></em></p>Canadians should invest in affordable housing. It’s a commitment to lifting the most vulnerable members of our society from the ground up — and lifting our entire country up in the process.Daniel Del Gobbo, Adjunct Professor at Osgoode Hall Law School and SJD Candidate, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1084172018-12-12T19:11:36Z2018-12-12T19:11:36ZCut the pension, boost Newstart. What our algorithm says is the best way to get value for our welfare dollars<figure><img src="https://images.theconversation.com/files/250186/original/file-20181212-76983-x9yzxr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Newstart should be lifted by mush more than usually proposed, a new ANU algorithm finds.</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>It would be unlikely if our current welfare system gave us the best possible value for the A$120 billion we hand out in benefits each year.</p>
<p>For one thing, we live, work, and arrange families differently to what we did in earlier decades, but the size and nature of the payments has barely changed.</p>
<p>What if we could eliminate more poverty than we do at the moment while spending no more, or what if we could spend less and leave poverty no worse off?</p>
<p>Until now, these have been hard questions to answer.</p>
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Read more:
<a href="https://theconversation.com/dont-believe-what-they-say-about-inequality-some-of-us-are-worse-off-102332">Don't believe what they say about inequality. Some of us are worse off</a>
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<p>Examining the impact of up to 20 welfare payments and 55 supplementary payments and concessions with multiple withdrawal rates across a range of family types has been time-consuming to near impossible.</p>
<p>At the ANU Centre for Social Research and Methods, we have developed <a href="http://csrm.cass.anu.edu.au/research/publications/optimal-policy-modelling-microsimulation-methodology-setting-australian-tax">a new algorithm</a> that can calculate it almost instantly. </p>
<p>The first such tool in Australia, we have first used it to work out how to optimise a subset of benefits to get the biggest bang for the bucks.</p>
<h2>What matters is the poverty gap</h2>
<p>Our target is the poverty gap. The poverty gap is a similar concept to the poverty rate except that it is based not only on <em>whether</em> a household is in poverty, but also <em>how deep</em> in poverty that household is.</p>
<p>The most commonly used standard says a single-person household is in poverty if its income is below about A$450 per week (half the median disposable income).</p>
<p>The less commonly used standard, which we prefer, defines a single-person household as being in poverty if its income is below half the median disposable income <em>net of housing costs</em>, producing a threshold of A$370 per week.</p>
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Read more:
<a href="https://theconversation.com/new-evidence-suggests-we-may-need-to-rethink-policies-aimed-at-poverty-92268">New evidence suggests we may need to rethink policies aimed at poverty</a>
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<p>The poverty gap is the dollar shortfall below these thresholds. A household above them has no poverty gap. </p>
<p>As in real life, our algorithm has a budget constraint. If it didn’t, governments could just give everyone lots of money and there would be no poverty. </p>
<p>It finds that if the aim is to minimise the poverty gap, we need to make quite dramatic changes in how we spend welfare dollars.</p>
<h2>We need to raise the rate, big time</h2>
<p>To minimise the most commonly used measure of poverty, the Newstart unemployment benefit would have to climb from its current A$551 per fortnight to A$821 – a jump of 50%, and a far bigger hike than the A$150 per fortnight that crossbench Senators are calling for with the backing of the <a href="https://www.acoss.org.au/raisetherate/">Raise The Rate</a> campaign.</p>
<p>The Age Pension would stay about the same, Family Tax Benefit A for children aged less than 13 years would fall from A$218 per fortnight to A$154, Family Tax Benefit B would fall by a similar proportion, rent assistance would stay about the same, and the parenting payment would fall modestly. </p>
<h2>And probably cut the pension</h2>
<p>The results are different when we try to minimise poverty as defined by our preferred measure – half of median disposable income, net of housing costs.</p>
<p>To do this, we would have to cut the age pension from A$902 per fortnight to A$836, lift Newstart less substantially to A$751 per fortnight (still an increase of around A$100 per week, and still more than crossbenchers are asking for), lift rent assistance from a maximum rate of A$137 per fortnight to A$161, and leave family payments about where they are.</p>
<h2>We could cut poverty by 11%, at no cost</h2>
<p>The algorithm suggests that reductions in the poverty gap of as much as 11% could be achieved simply by spending more on Newstart and less on other benefits, without any extra spending on the overall bundle of payments.</p>
<p>Alternatively, we could cut our spending on the bundle by about 7% and leave the poverty gap no worse. Lifting the budget for the bundle could lead to even larger reductions in poverty.</p>
<p>A 10% increase in the budget those benefits could reduce poverty by more than 20%.</p>
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<a href="https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=347&fit=crop&dpr=1 600w, https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=347&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=347&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=435&fit=crop&dpr=1 754w, https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=435&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/250190/original/file-20181212-76974-1p8p3tw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=435&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">The Council of Social Service supports an increase of $150 a fortnight. It should probably be bigger.</span>
<span class="attribution"><a class="source" href="https://www.acoss.org.au/raisetherate/">ACOSS</a></span>
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<h2>But there is more to benefits than poverty</h2>
<p>There are arguably sound reasons why we pay more to people on long-term benefits such as the pension than to people on short-term benefits such as Newstart, meaning that poverty reduction isn’t the system’s only goal.</p>
<p>However, it should be noted that the difference in indexation arrangements between the two benefits has pushed down Newstart from about 90% of the age pension in the early 1990s to just 60% today, meaning Newstart is highly likely to be genuinely out of whack, whatever the system’s objectives.</p>
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<a href="https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=357&fit=crop&dpr=1 600w, https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=357&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=357&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=449&fit=crop&dpr=1 754w, https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=449&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/248108/original/file-20181130-194947-11yjbjx.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=449&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="attribution"><span class="source">ACOSS</span></span>
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<p>Also, our analysis finds that many households in apparent poverty are not on benefits, and so can’t be helped by changes to the bundle of payments.</p>
<p>On the other hand, while some of these households are legitimately in poverty, others are asset-rich. Around 56% of the apparent gap in poverty resides in households whose main source of income is something such as shares, rental income or superanuation, suggesting they might not need as much help as our algorithm suggests. </p>
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Read more:
<a href="https://theconversation.com/its-not-just-newstart-single-parents-are-271-per-fortnight-worse-off-labor-needs-an-overarching-welfare-review-107521">It's not just Newstart. Single parents are $271 per fortnight worse off. Labor needs an overarching welfare review</a>
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<p>We believe our new methodology is an Australian first. </p>
<p>It provides a very efficient means of deriving optimal social security payment settings from a variety of policy objectives. </p>
<p>We expect to broaden it to more policy objectives in the future and to a broader range of payments and elements of the social security system, and to include personal income tax.</p>
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Read more:
<a href="https://theconversation.com/new-budget-standards-show-just-how-inadequate-the-newstart-allowance-has-become-82903">New budget standards show just how inadequate the Newstart Allowance has become</a>
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<p>Our method is in its infancy. </p>
<p>We have provided one illustration of how it can be used, and the results are striking: the best way to cut poverty when constrained by a budget is to boost Newstart while pushing down either the pension or family benefits by a modest amount.</p><img src="https://counter.theconversation.com/content/108417/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben Phillips receives funding from the Australian Research Council and has receive funding from a broad range of government and non-government organisations. </span></em></p><p class="fine-print"><em><span>Matthew Gray has received funding for many Commonwealth, State and Territory governments and a range of other organisations.</span></em></p><p class="fine-print"><em><span>Richard Webster does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A new ANU computer algorithm can provide near instant answers about how to get the best bang for welfare dollars. It says we should boost Newstart and cut either pensions or family benefits.Ben Phillips, Associate Professor, Centre for Social Research and Methods, Director, Centre for Economic Policy Research (CEPR), Australian National UniversityMatthew Gray, Director, ANU Centre for Social Research and Methods, Australian National UniversityRichard Webster, Senior research officer, ANU Centre For Social Research & Methods, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1049632018-10-17T11:43:03Z2018-10-17T11:43:03ZWhy the World Bank’s optimism about global poverty misses the point<figure><img src="https://images.theconversation.com/files/240995/original/file-20181017-41153-1bv35dq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A different measure of poverty shows 70% of the world's poor live in what the World Bank considers middle-income countries. </span> <span class="attribution"><span class="source">EFE-EPA/Onome Oghene</span></span></figcaption></figure><p>The World Bank’s latest annual report on <a href="http://www.worldbank.org/en/publication/poverty-and-shared-prosperity?cid=EXT_WBSocialShare_EXT&ogImage=http%3A%2F%2Fwww.worldbank.org%2Fcontent%2Fdam%2Fphotos%2F780x439%2F2018%2Foct-1%2FEPD2.png">poverty and shared prosperity</a> has an unsurprisingly positive message that only 10% of the world’s population lived in extreme poverty in 2015, which is the most recent year that available data allows for global poverty estimates to be made. </p>
<p>As World Bank President Jim Yong Kim points out in the foreword to the report, this is “the lowest poverty rate in recorded history”. </p>
<p>This is a story that we have become accustomed to hearing from the Bank, and other significant participants in the debate about poverty and development in the global South (Asia, Africa, and Latin America). But does the story actually hold true? For example, the World Bank measures extreme poverty in terms of the number of people who live on less than USD$1.90 a day. But is this in fact a meaningful measurement of poverty? </p>
<p>World Bank poverty estimates have come in for a lot of criticism. For example, Jason Hickel, an anthropologist at the London School of Economics, <a href="https://www.penguin.co.uk/books/111/1113531/the-divide/9781786090034.html">has pointed out</a> that there’s often a large gap between national poverty lines and the international poverty line stipulated by the bank. </p>
<p>For example, more than 55% of South Africa’s population lives below the country’s upper poverty line, of R1,138 (USD$80) a month. But, according to the World Bank, only 18.85% of the South African population lives in poverty. This suggests that the international poverty lined touted by the World Bank systematically underestimates the extent of global poverty.</p>
<p>This point is partially acknowledged in this year’s report. Accordingly, the World Bank proposes new and higher poverty lines - USD$3.20 and USD$5.50 a day, respectively. According to the report, almost half the world’s population lives below the USD $5.50 a day poverty line. However, we need to go further than this – indeed, the World Bank’s widely touted story of historically low poverty levels must be rejected.</p>
<p>If we are to have a serious debate about world poverty on <a href="http://www.un.org/en/events/povertyday/">End Poverty Day</a>, we have to start by acknowledging that the global problem of poverty is far more extensive than World Bank rhetoric would have us believe. Two big factors need to be confronted. The first is that the majority of the world’s poor live in countries that have experienced strong economic growth. The second is that the growth strategies these countries have practised create and reproduce poverty. </p>
<h2>Unequal distribution</h2>
<p>The World Bank attributes the supposed historical decline in poverty in large part to the rising wealth of several Asian countries. But, this is a problematic argument. In his recent book <a href="https://global.oup.com/academic/product/global-poverty-9780198703525?cc=za&lang=en&">Global Poverty</a>, development economist Andy Sumner shows how a new geography of poverty has emerged in the global South.</p>
<p>Whether we use monetary estimates – Sumner uses a poverty line of $2.50 a day – or estimates of multidimensional poverty; that is, poverty measured according to health indicators, education levels, and economic standards of living – as many as 70% of the world’s poor currently live in what the World Bank refers to as middle-income countries. </p>
<p>As Sumner points out, poverty in middle-income countries cannot be attributed to an absolute lack of resources. These are countries that have experienced strong economic growth since the 1990s. What it boils down to in middle-income countries like <a href="https://edition.cnn.com/2018/06/26/africa/nigeria-overtakes-india-extreme-poverty-intl/index.html">India</a>,<a href="https://theconversation.com/beating-poverty-needs-partnerships-and-collaboration-not-just-money-101145">Nigeria</a>, and <a href="https://www.theglobeandmail.com/news/world/the-illusion-of-brazils-incomeequality/article37536515/">Brazil</a> is the issue of distribution. </p>
<p>The economic growth that has lifted countries from low-income status to middle-income status is profoundly unequally distributed. As a result, large parts of the populations in these countries are excluded from the benefits that accrue from this growth.</p>
<p>This in turn has implications for how we think about growth strategies and poverty reduction in the global South.</p>
<h2>Global growth and development</h2>
<p>Much of the economic growth that has lifted countries from low-income status to middle-income status has resulted from the emergence of global production networks and global value chains since the late 1970s. Poorer countries have been integrated into these networks in large part due to their large reservoirs of cheap labour. It is this process of industrialisation that has turned low-income countries into middle-income countries. </p>
<p>But if global production networks come with so many developmental benefits, why is it that world poverty is concentrated in countries that have experienced economic growth precisely because they are integrated in these networks? To understand this paradox, it is important to remember that global production networks are comprised of different value tiers, and that different countries and different groups capture different amounts of the value that is created in these networks.</p>
<p>This obviously leads to a <a href="https://www.cambridge.org/core/journals/review-of-international-studies/article/poverty-reduction-through-liberalisation-neoliberalism-and-the-myth-of-global-convergence/FAC3F9EDA9C6B87938804D260B795412">reproduction of inequality</a> – countries in the global South tend to be integrated in lower value tiers. </p>
<p>This is evident in the fact that the distribution of national incomes and wealth at a world scale is still characterised by a pronounced North-South hierarchy. But it is more important still to be aware that countries in the global South that have witnessed strong economic growth have also experienced marked escalations in national levels of inequality. In India in 2016, for example, the richest 10% of the population received 55% of all income. This is an increase of <a href="https://www.aljazeera.com/indepth/opinion/india-wealth-inequality-growing-rapidly-180125084201143.html">more than 20% since 1980</a>.</p>
<p>This pattern of development clearly shows how poverty is a matter of distribution that is related to the kind of employment opportunities that are created when southern countries are embedded in global value chains. The factory jobs that are established when transnational corporations set up shop in countries like Mexico or Vietnam are fundamentally precarious. And it is precarious workers who capture the least of the value that is created in global production networks. This is why <a href="https://www.plutobooks.com/9780745335995/southern-insurgency/">precarious workers live in poverty</a> in middle-income countries in the global South.</p>
<p>What’s clear from this is that we have to ask ourselves what a development policy based on redistribution in favour of the working classes in the global South might look like – because that, ultimately, is the key to ending poverty in an unequal world.</p><img src="https://counter.theconversation.com/content/104963/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alf Gunvald Nilsen receives funding from the Research Council of Norway. </span></em></p>The global poverty plot is thicker than what the World Bank would have us believe.Alf Gunvald Nilsen, Associate Professor of Development Studies, University of AgderLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/922682018-02-23T02:00:39Z2018-02-23T02:00:39ZNew evidence suggests we may need to rethink policies aimed at poverty<figure><img src="https://images.theconversation.com/files/207444/original/file-20180222-152348-1f4ort1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Fewer people who were homeless or at risk of being homeless exited poverty than in the general population</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Poverty is <a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0010/2437426/HILDA-SR-med-res.pdf">often perceived</a> as an ongoing problem for only a very small number of people, and for most households it is a temporary phase that does not last long.</p>
<p>But less than 15% of the most disadvantaged people in Australia exit poverty from one year to the next, according to data from the <a href="http://melbourneinstitute.unimelb.edu.au/journeys-home">Journeys Home survey</a>, run by the Melbourne Institute. </p>
<p>The view that poverty is largely a transitional experience has influenced the design, implementation and even the evaluation of welfare policy in Australia. If poverty is a temporary phenomenon, then support can take the form of an insurance scheme to supplement income during the limited time spent in poverty. </p>
<p>However, our research suggests that income poverty is persistent for a small group of Australians and is combined with other forms of disadvantage. Supporting these people in finding a pathway out of poverty requires deeper interventions, including targeted health, education and social policies.</p>
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Read more:
<a href="https://theconversation.com/politics-podcast-brian-howe-on-revisiting-henderson-poverty-and-basic-income-91677">Politics podcast: Brian Howe on revisiting Henderson, poverty and basic income</a>
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<p>Most of the evidence we have on the persistence of poverty is based on long-term surveys designed to be representative of the entire population. Although these surveys offer broad coverage of the population, such surveys are typically limited in their ability to capture the most disadvantaged groups because they constitute only a small part of the general population. </p>
<p>This makes it difficult to produce reliable estimates of the extent of poverty among extremely disadvantaged households. </p>
<p>The <a href="http://melbourneinstitute.unimelb.edu.au/journeys-home">Journeys Home survey</a> followed nearly 1,700 welfare recipients from across the country who were identified by Centrelink as homeless or at high risk of experiencing homelessness and housing insecurity. </p>
<p>These are the types of people who have always been particularly difficult to survey, let alone follow through time. As a result, they are likely to be under-represented in general surveys used to study poverty. The Journeys Homes project allows a more precise examination of the prevalence and persistence of poverty among those groups. </p>
<p>We found that significantly fewer people exit poverty every year than the equivalent estimate based on data from the <a href="http://melbourneinstitute.unimelb.edu.au/hilda">Household, Income and Labour Dynamics in Australia</a> (HILDA). This is a general population survey that has followed a sample of 17,000 Australians since 2001. </p>
<p><a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0010/2437426/HILDA-SR-med-res.pdf">Research</a> based on HILDA shows that more than 2 million Australians were below the poverty line in 2015. </p>
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Read more:
<a href="https://theconversation.com/whos-on-the-outer-uncovering-povertys-many-faces-44574">Who's on the outer? Uncovering poverty's many faces</a>
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<p>Our study used a poverty line equal to 60% of the median household income, which is a <a href="http://www.poverty.ac.uk/definitions-poverty/income-threshold-approach">widely used</a> measure in high-income countries. To get an idea, the poverty line in Australia for a single person in 2014 sat at A$517 per week. The threshold for a couple was A$776. </p>
<p>The gap between HILDA and Journeys Home in estimating poverty persists even when we change the level of the poverty line. </p>
<p>Journeys Home’s participants are not only more disadvantaged than the poor in HILDA, but much more likely to report several forms of disadvantage. For example, the poor in HILDA have higher education levels and are, on average, more likely to be employed than those interviewed in Journeys Home. </p>
<p>Rates of imprisonment and mental illness are also higher in Journeys Home than in HILDA. </p>
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Read more:
<a href="https://theconversation.com/australians-support-universal-health-care-so-why-not-a-universal-basic-income-91572">Australians support universal health care, so why not a universal basic income?</a>
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<p>The HILDA results show that most Australians who fall below the poverty line do so for a relatively short time, which is good news. However, it is also clear that among chronically disadvantaged people the chances of poverty becoming an enduring feature of life are much higher than previously thought. </p>
<p>If people are trapped below the poverty line for a long time, the sorts of interventions needed to get them out of poverty are likely to be quite different than when the experience of poverty is transitory. </p>
<p>The evidence suggests those who get stuck below the poverty line also have numerous disadvantages, so perhaps we need to rethink interventions designed to assist the most vulnerable members of the community. </p>
<p>A common thread dating back to the 1990s has been to frame long-term reliance on welfare as welfare dependency. Australia’s welfare system might do better if it avoided stigmatising those who get “stuck” and recognised the systemic and structural barriers that make leaving poverty particularly difficult for some households. </p>
<p>For these households, much deeper forms of assistance are needed to help them make a permanent transition out of poverty.</p><img src="https://counter.theconversation.com/content/92268/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Nicolas Herault works for the Melbourne Institute of Applied Economic and Social Research. The Melbourne Institute manages the Journeys Home survey as well as the Household, Income and Labour Dynamics in Australia (HILDA) survey.</span></em></p><p class="fine-print"><em><span>Francisco Azpitarte is the Ronald Henderson Fellow, a joint position between the University of Melbourne and the Brotherhood of St Laurence. </span></em></p><p class="fine-print"><em><span>Guy Johnson does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Less than 15% of the most disadvantaged people in Australia exit poverty from one year to the next. We need to design policy to tackle this.Nicolas Herault, Academic, Melbourne Institute of Applied Economic and Social Research, The University of MelbourneFrancisco Azpitarte, Ronald Henderson Research Fellow Melbourne Institute of Applied Economic and Social Research & Brotherhood of St Laurence, The University of MelbourneGuy Johnson, Professor, Urban Housing and Homelessness, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/915722018-02-12T19:07:57Z2018-02-12T19:07:57ZAustralians support universal health care, so why not a universal basic income?<iframe sandbox="allow-same-origin allow-scripts allow-top-navigation allow-popups" scrolling="no" width="100%" height="185" frameborder="0" src="https://embed.radiopublic.com/e?if=politics-with-michelle-grattan-WRElBZ&ge=s1!e9abfe70744672039ef3317ba55fe8b709d8e0a8"></iframe>
<p>In Australia, the idea of a universal basic income has floated in and out of our political arena for years, but remains only that, an idea.</p>
<p>The concept of a universal basic income has always been controversial. This notion – that the government should pay everyone a regular payment to meet their basic needs, despite their income – has been touted as <a href="http://library.bsl.org.au/jspui/bitstream/1/10141/2/Bowman_etal_Basic_income_2017.pdf">a solution to inequality</a>.</p>
<p>In the 1970s, the idea of a universal basic income looked as though it could become more.</p>
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Read more:
<a href="https://theconversation.com/politics-podcast-brian-howe-on-revisiting-henderson-poverty-and-basic-income-91677">Politics podcast: Brian Howe on revisiting Henderson, poverty and basic income</a>
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<p>In 1972, the inaugural Director of the <a href="http://melbourneinstitute.unimelb.edu.au/">Melbourne Institute, Applied Economic and Social Research</a>, Professor Ronald Henderson, chaired the Australian government’s poverty inquiry. It was tasked by then Prime Minister Gough Whitlam, to investigate all aspects of poverty affecting Australians, including race, education, health and law.</p>
<p>Henderson’s work led to what is now widely referred to as the <a href="http://melbourneinstitute.unimelb.edu.au/research-programs/labour-economics-and-social-policy/henderson-poverty-line">Henderson Poverty Line</a>, which measures the extent of poverty in Australia in terms of the income of families and individuals relative to their essential living costs; and he advocated a guaranteed minimum income scheme for Australia, similar to a universal basic income.</p>
<p>More than 40 years have passed since Henderson began his report of the Commonwealth <a href="https://trove.nla.gov.au/work/9644541?q=+henderson+main+report&c=book&sort=holdings+desc&_=1516753376999&versionId=45676580">Commission of Inquiry into Poverty</a> with the line:</p>
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<p>“Poverty is not just a personal attribute: it arises out of the organisation of society.”</p>
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<p>Is his call for welfare reform still relevant today?</p>
<h2>The suggestion of a guaranteed minimum income scheme</h2>
<p>At the heart of the Henderson inquiry’s final recommendations was a guaranteed minimum income scheme, in which payments to pensioners (at a high rate) and payments to all other income units (at a lower rate) would be balanced by a proportional tax on all private income. The report states:</p>
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<p>We believe that these reforms are the best way of reconciling the conflicting ends of policy on income support… They recognise that disabilities which hinder the earning of a private income warrant favoured treatment, but also provide support for people without disabilities in this sense, and who may still easily become poor – particularly the large family. Again, support is provided in a way which does not discredit those who claim it… so that income support may be seen as a right rather than a favour.</p>
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<p>Professor Henderson was strongly in favour of universality in social policy – as exists in Medicare today in Australia. And that’s tangible in his idea of a universal minimum payment which would have ensured that incomes for individuals and families were in excess of the poverty line.</p>
<p>Instead of means testing – which he opposed as it creates a separate system for the disadvantaged that can be stigmatising – he wanted to use the tax system to withdraw income from higher earners, rather than means testing pensions and benefits.</p>
<p>But this didn’t happen.</p>
<p>Instead, the Whitlam government was dismissed in 1975 – around six months after the inquiry delivered its final report, and the new government, headed up by Malcolm Fraser, hardly considered its recommendations.</p>
<h2>Far from universality</h2>
<p>At the time of Henderson’s pivotal work, post-war Australia had pursued the creation of an industrial economy where male workers played the dominant role. For the most part, employment then meant permanent full-time jobs in industry regulated and protected against foreign competition.</p>
<p>But, since that time, the country has pursued a very different course. </p>
<p>The key challenge is how Australia can maintain its commitment to fair and equitable wealth generation and distribution, in a modern world. </p>
<p>The <a href="https://theconversation.com/we-lost-the-house-we-lost-everything-what-dealing-with-financial-stress-looks-like-69788">precarious nature of modern labour markets</a> puts enormous pressures on families and households, making it important to create a system that works in the interests of the truly disadvantaged.</p>
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<a href="https://theconversation.com/universal-basic-income-the-dangerous-idea-of-2016-70395">Universal basic income: the dangerous idea of 2016</a>
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<p>Professor Henderson distrusted a targeted social security system, and therefore recommended a basic income so that “income support may be seen as a right rather than a favour” for Australian citizens.</p>
<p>Since then, despite the example of universality in the key public institution of Medicare, to which all are entitled, the social security system has become more conditional, and arbitrary, with benefits now well below the poverty line.</p>
<p>There is growing evidence, for example, that social security payments for unemployed people, like Newstart, now <a href="https://www.sharethepie.com.au/">barely meet the necessities of life</a> – let alone cover expenses involved when people are looking for work.</p>
<p>In this country, we increasingly celebrate entrepreneurial self-reliance, but for disadvantaged people, the certainty of an adequate income is a fundamental foundation. It may not be sufficient, but it is necessary.</p>
<p>As Henderson said during a speech at a Remembrance Day rally in 1984, “we all have a right to a decent minimum income: to a fair share”.</p><img src="https://counter.theconversation.com/content/91572/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brian Howe does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>We increasingly celebrate entrepreneurial self-reliance, but for disadvantaged people, the certainty of an adequate income is a fundamental foundation. It may not be sufficient, but it is necessary.Brian Howe, Professorial Associate in the Centre for Public Policy, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/780012017-07-26T01:45:22Z2017-07-26T01:45:22ZThe hidden extra costs of living with a disability<figure><img src="https://images.theconversation.com/files/177584/original/file-20170710-5928-xbqobi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Costs of transportation and accessibility are just two factors that increase cost of living for persons with disabilities. </span> <span class="attribution"><span class="source">Corepics VOF/shutterstock.com</span></span></figcaption></figure><p>Disability is often incorrectly assumed to be rare. However, <a href="http://www.who.int/disabilities/world_report/2011/report.pdf">global estimates</a> suggest than one in seven adults has <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2329676">some form of disability</a>. </p>
<p>The term “disability” covers a number of functional limitations – physical, sensory, mental and intellectual. These can range from mild to severe and might affect someone at any time across the lifespan, from an infant born with an intellectual impairment to an older adult who becomes unable to walk or see.</p>
<p>What is perhaps less well-known is that studies consistently show that people with disabilities are disproportionately poor. They are more likely to become poor and, when poor, are more likely to stay that way, because of barriers to getting an education, finding decent work and participating in civic life. Taken together, <a href="http://www.who.int/disabilities/world_report/2011/report.pdf">these barriers</a> significantly and adversely impact their standard of living. </p>
<p>However, a new body of research reveals another major barrier, previously missing from most studies: People living with disabilities also face extra costs of living. Our team’s recent review of the evidence suggests that living with a disability may cost an additional several thousand dollars per year, adding up over time to be a significant financial burden on households.</p>
<h1>Calculating the cost</h1>
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<img alt="" src="https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/178874/original/file-20170719-13593-1a9eskd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">People with disabilities may have more basic necessities than people without.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/pretty-aged-granny-using-blue-cane-628135925?src=kI-X2eUyNwk5Y3w9dH5ZGg-3-64">Antonio Diaz/Shutterstock.com</a></span>
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<p>Governments draw poverty lines at a level of income that they believe is sufficient to meet a minimum standard of living. Someone at the poverty line presumably has just enough resources to house, clothe and feed themselves at an acceptable level, and participate in the basic activities of being a citizen. Increasingly, countries provide <a href="http://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/documents/publication/wcms_245201.pdf">cash benefits or food transfers</a> to people below this poverty line so they are able to reach this minimum standard for basic resources. </p>
<p>The problem is that people with disabilities have extra costs of living that people without disabilities do not have. They have higher medical expenses and may need personal assistance or assistive devices, such as wheelchairs or hearing aids. They may need to spend more on transportation or modified housing, or be restricted in what neighborhoods they can live in to be closer to work or accessible services.</p>
<p>When this is the case, then some people with disabilities might appear “on paper” to live above the poverty line. But in reality, they don’t have enough money to meet the minimum standard of living captured in that poverty line.</p>
<p>In <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2967775">our recent review of the literature</a>, we found that people with disabilities in 10 countries face large extra costs of living. These costs can range widely, from an estimated US$1,170 to $6,952 per year. In a developing country such as Vietnam, for example, the estimate stands at $595 for additional health costs alone.</p>
<p>We used a method called the standard of living approach, which estimates extra costs based on the gap in assets owned by households with and without disabilities. Extra costs accounted for a large share of income, from a low of 12 percent in Vietnam to 40 percent for elderly households in Ireland. </p>
<p>Comparing the costs of disabilities across countries is challenging. Recent studies measure what is actually spent, not what needs to be spent. Estimated costs might be less in developing countries not because it is less expensive to accommodate the needs of people with disabilities in those countries, but because the goods and services needed are not available. If wheelchairs or hearing aids are nowhere to be found, then a person cannot spend money on them. </p>
<p>This could lead to the paradoxical finding that, as a country starts becoming more inclusive, the measured costs of living with a disability could increase. But hopefully, at the same time, the ability of people with disabilities to work and go to school will also increase.</p>
<h1>Unanswered questions</h1>
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<img alt="" src="https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/177577/original/file-20170710-5952-1ohs79m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">A woman is escorted from protest opposing cuts to Medicaid in front of Senator Mitch McConnell’s office on Capitol Hill on June 22, 2017.</span>
<span class="attribution"><span class="source">AP Photo/Jacquelyn Martin</span></span>
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</figure>
<p>There is much we still don’t know about what it costs to live with a disability. In our comprehensive review of the literature, we found only 20 studies that estimated increased costs of living with a disability. The vast majority were from developed countries. </p>
<p>We need better information on how these extra costs may vary by type of disability, and how they may be affected by efforts to remove barriers to participation. For example, how would building a fully accessible public transportation system impact the extra transportation costs that people with disabilities face?</p>
<p>Our work also suggests we may need different income tests for people with disabilities when it comes to social protection programs. For example, should the income limit for receiving cash transfers or subsidized housing be higher for families with disabilities because they face these extra costs? Some countries, such as Denmark and the United Kingdom, provide benefits to support families with disabilities who bear these costs. </p>
<p>Another important question is whether these benefits are adequate. Do they allow people with disability and their families to reach at least a minimum threshold for standard of living? To what extent does this improve their participation in society or the economy?</p>
<h1>Supporting people with disabilities</h1>
<p>To address these questions, we need to monitor these issues over time. For that, we need more and better data on disability in different countries linked to good data on income, assets and expenditures. We recommend adding well-formulated disability questions to the standard household surveys currently used by most countries to chart their citizen’s wellbeing. The best example of such questions was developed under the aegis of the U.N. Statistical Commission via <a href="http://www.washingtongroup-disability.com">the Washington Group on Disability Statistics</a>. </p>
<p>It’s also important to undertake qualitative research. For instance, focus groups and in-depth interviews would help researchers better understand the needs of people with disabilities in their own terms.</p>
<p>Policymakers also need to make social programs sensitive to the issue of extra costs associated with disability – for instance, in income tests and benefit amounts or through social health insurance programs. Our review has led us to believe that even well intended anti-poverty efforts and social protection schemes that do not take into consideration the additional costs of living with a disability will leave millions of people who have disabilities, and their families, in poverty.</p><img src="https://counter.theconversation.com/content/78001/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Nothing to disclose.</span></em></p><p class="fine-print"><em><span>Daniel Mont, Hoolda Kim, Michael Palmer, and Sophie Mitra do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Depending on where you live, having a disability can cost thousands of additional dollars per year. Government programs often don’t account for that.Sophie Mitra, Associate Professor of Economics, Fordham UniversityDaniel Mont, Principal Research Associate in Epidemiology and Public Health, UCLHoolda Kim, Graduate Student in Economics, Fordham UniversityMichael Palmer, Senior Lecturer in Economics, RMIT University VietnamNora Groce, Chair of Disability and Inclusive Development, UCLLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/746102017-07-11T06:31:02Z2017-07-11T06:31:02ZUniversal basic income could work in Southeast Asia — but only if it goes to women<p>The <a href="https://theconversation.com/universal-basic-income-is-it-really-what-todays-youth-need-72979">universal basic income</a> debate has been raging for some years, with politicians and people hotly divided over the notion of their government paying every citizen a set amount of money on a regular basis, without requiring work to be completed.</p>
<p>The idea of everybody, including society’s most marginalised, being able to afford their basic needs is <a href="http://www.independent.co.uk/voices/basic-income-pilots-scotland-ubi-glasgow-finland-canada-ontario-switzerland-referendum-refuses-to-a7505561.html">popular with mostly libertarian and progressive politicians</a>, and there is some empirical evidence that it can quickly <a href="https://www.theguardian.com/commentisfree/2017/jan/12/universal-basic-income-finland-uk">increase a country’s productivity and reduce domestic inequality</a>. </p>
<p>Conservative economists, however, reject the idea, <a href="http://knowledge.wharton.upenn.edu/article/universal-basic-income-good-idea/">citing its “impossibly expensive” nature</a>. </p>
<p>Economic feasibility is a critical question for any government program, of course, and it is particularly relevant in the developing world, where universal basic income (UBI) has been suggested as a development tool. </p>
<p>One reason that Southeast Asian countries, for example, have <a href="http://asiasociety.org/education/women-southeast-asia">struggled to improve gender equality (despite avowals of committment to the idea</a>) is increased economic insecurity, which has widened the gap between men and women and separated women from opportunities. </p>
<p>Might UBI be one way to both empower women and reduce hunger in the region? </p>
<h2>Money in the hands of women</h2>
<p>My research focuses specifically on women from the region who live below the poverty line, which, for East Asia and the Pacific, the World Bank defines as living on less than <a href="http://povertydata.worldbank.org/poverty/region/EAP">US$3.20 a day</a>. </p>
<p>In Cambodia, Laos, the Philippines, Indonesia and Vietnam – among the poorest Southeast Asian nations – between <a href="http://povertydata.worldbank.org/poverty/region/EAP">13% and 47% of the population</a> is living in poverty. The number is significantly lower in better-off Brunei and Singapore.</p>
<p>On the whole, women in these countries fare well enough <a href="http://asiasociety.org/education/women-southeast-asia">compared to their peers in other developing regions</a> in terms of literacy, employment, political participation and the right to organise. But this has not translated into greater gender equality. </p>
<p>Here, <a href="https://www.academia.edu/7724345/Social-Political_Movements_Homosexuality_and_Queer_Identity_Movements_Southeast_Asia">heteronormativity</a> reigns, dictating that men and women (and only men and women; all other gender identities are discounted) have distinct and complementary roles in life, from economics and education to politics. </p>
<p>Women are primarily seen as wives and mothers, a gender stereotype reinforced in both everyday experiences and <a href="http://asiasociety.org/education/women-southeast-asia">in the theological texts</a> of the main religions in the region. </p>
<p>That perspective also seems to dominate within <a href="http://asean.org/">the Association of the Southeast Asian Nations</a> (ASEAN). Though women feature strongly in ASEAN’s <a href="http://asean.org/storage/2016/01/ASCC-Blueprint-2025.pdf">socio-cultural community</a> line of work, there is very little debate about the role of women in the <a href="http://asean.org/wp-content/uploads/archive/5187-10.pdf">economic</a> or <a href="http://asean.org/wp-content/uploads/images/archive/5187-18.pdf">political</a> sphere. </p>
<p>By giving women the financial freedom to act as “agents” of development in the region, universal basic income could be a tool that ultimately paves the way for their future economic and political involvement. </p>
<h2>Women as agents of development</h2>
<p>This process would start with something simple (and seemingly uncontroversial): women being able to put food on the table.</p>
<p>In poor families in Southeast Asia, up to <a href="http://www.fao.org/news/story/en/item/12660/icode/">80% of household income</a> is spent on food, yet
<a href="http://www.un.org/apps/news/story.asp?NewsID=53554#.WV5_qtPyulM">undernutrition</a> remains a huge problem in Cambodia, Laos, the Philippines, Indonesia and, to a lesser extent, in Vietnam. </p>
<p>If women were provided with sufficient income to feed their families, it would translate into <a href="http://www.womensworldbanking.org/wp-content/uploads/2014/07/CaseForSupportWomensWorldBanking.pdf">better nutrition, health and general well-being for children and others entrusted in their care</a>, and by extension, their communities. </p>
<p>Creating economic security for women is also key to a country’s development. Southeast Asian women in poorer income brackets generally have access to very few jobs, outside of traditional occupations such as farming and housekeeping. And, today, even these jobs are threatened by climate change and a growing movement to <a href="http://www.straitstimes.com/opinion/indonesias-dilemma-over-foreign-domestic-workers">ban the export of foreign domestic workers</a>. </p>
<p><a href="https://theconversation.com/how-3d-printing-could-disrupt-asias-manufacturing-economies-69633">Digitisation</a> may lead to further unemployment among men, particularly in Southeast Asian manufacturing economies, exacerbating hunger and malnutrition. </p>
<p>There is evidence that giving women a specifically calibrated amount of money – regularly, and with no strings attached – could make a big difference in such settings.</p>
<p>After the NGO GiveDirectly first started its UBI program in a Kenyan village in 2016, it offered some residents US$22 a month The entire community quickly saw positive effects, according to a February 2017 assessment of the program in the <a href="http://www.nytimes.com/2017/02/23/magazine/universal-income-global-inequality.html?r=0">New York Times</a>. And residents hope that the experiment, which is scheduled to last for 12 years, will gradually lift them out of poverty. </p>
<h2>UBI in Southeast Asia</h2>
<p>Tacked onto the state’s existing social safety nets, UBI can give much needed specific attention to women’s broader economic empowerment, which is vital to a developing country’s growth. </p>
<p>The first step toward doing so in Southeast Asia would be to identify women living below the poverty line. Next, as in Kenya, each of these woman would be given <a href="https://www.weforum.org/agenda/2017/01/why-we-should-all-have-a-basic-income/">a sum of money in the form of electronic cash transfers</a>. </p>
<p>Accessible through cheap mobile phones, this money can be used to purchase food and other basic necessities in participating shops, which may be incentivised to participate with credits or subsidies of their own.</p>
<p>To prevent abuse of a program intended to empower women and support families, the cash transfers must be either non-transferrable or transferrable only to another female family member, and only women will be able to spend the money (in approved shops).</p>
<p>Evidence from other countries suggests that, in some cases, men <a href="https://blogs.wsj.com/indiarealtime/2017/01/31/india-considers-fighting-poverty-with-a-universal-basic-income/">waste</a> this “free pay” on alcohol, gambling and other non-essentials.</p>
<p>Programs must also be designed to be cognisant that, when women in traditional societies are <a href="http://www.unfpa.org/resources/issue-7-women-empowerment">empowered</a>, violence against them may increase, as men see women with money as a threat to their role in family and society. </p>
<p>Finally, women must be able to “graduate” from a UBI scheme. The idea is to empower participants, giving women a leg up to become active members of society – not to incapacitate them. </p>
<p>In the <a href="https://www.nytimes.com/2017/02/23/magazine/universal-income-global-inequality.html?_r=0">Kenyan case</a>, for example, many women (and men, too) used the allocated income to start small businesses. This opportunity could be developed as part of a potential UBI in Southeast Asia, considering both public- and private-sector partnerships. </p>
<p>If a universal basic income program really works, then women may even become contributors to programs in the future, and not just their beneficiaries.</p><img src="https://counter.theconversation.com/content/74610/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tamara Nair does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>It could make women agents of change and development in Southeast Asia.Tamara Nair, Research Fellow in Non-Traditional Security Studies at RSIS, Nanyang Technological UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/632282017-01-26T16:02:15Z2017-01-26T16:02:15ZHow globalisation brought the brutality of markets to Western shores<figure><img src="https://images.theconversation.com/files/154386/original/image-20170126-30410-ceuiut.jpg?ixlib=rb-1.1.0&rect=377%2C33%2C1394%2C938&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/47997385@N00/16671154594/in/photolist-rpb2rU-74XjFQ-5wNCES-aBQ9y2-7XcmS6-myDGwt-dntUxm-pUqfBY-hxmBDe-a4u7aw-oa7E4y-8kwtZq-4VzhLz-a8cdrz-3bBbZj-j98JBn-r97Fj9-dq8sDC-6M9YVu-cjHsFb-4FGfCU-7KVXw5-bzRQ6K-CUfqpT-9NGKPy-7E3Hgu-dq8iog-aStPtP-9itvqs-cjHrvS-j9akRg-dugFe5-dSTNGi-ecAx9o-aCBqaF-qpbhaE-ikgqdz-rpaWxq-fQZ5Sd-5bHe6b-soLxR8-dGtnhq-pE6aCK-aPbg7V-3LzLci-9cmtqw-i7kAN1-spx285-snpxA1-s4zRjC">objectivised/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-sa/4.0/">CC BY-NC-SA</a></span></figcaption></figure><p>The story of contemporary globalisation is, at its heart, the story of how we created a vast and impoverished working class. It is abundantly clear that the dynamics behind this have now hit home. First <a href="https://theconversation.com/uk/eu-referendum-2016">Brexit</a>, then Donald Trump. We have been told that these votes were a primal scream from those forgotten parts of society. </p>
<p>Both campaigns identified immigration as a core cause of worker impoverishment and social exclusion. Both argued that limiting immigration would reverse these disempowering trends. It is true that poverty remains high and has even been expanding <a href="https://www.theguardian.com/society/2015/jun/20/child-poverty-rise-uk-halts-progress-charities-claim">in the UK</a> <a href="https://www.theguardian.com/money/us-money-blog/2014/sep/16/us-census-bureau-stagnant-report-figures">and the US</a>, but the cause, and the solution, lie far deeper. </p>
<p>According to the charity Oxfam, one in five of the UK population live below the official poverty line, meaning that they experience life <a href="http://policy-practice.oxfam.org.uk/our-work/inequality/food-poverty">as a daily struggle</a>. In the US, the richest country in world history, one in five children <a href="https://www.theguardian.com/money/us-money-blog/2014/sep/16/us-census-bureau-stagnant-report-figures">live in poverty</a>. In the UK, austerity has played a role but is not the only cause. According to a Poverty and Social Exclusion project published early in <a href="https://www.parliament.uk/biographies/commons/george-osborne/1458">George Osborne’s</a> first wave of austerity, the proportion of households that fell below society’s minimum standards <a href="http://www.poverty.ac.uk/pse-research/going-backwards-1983-2012">had already doubled</a> since 1983. </p>
<p>Poverty pay and working conditions are proliferating across the UK. A recent study of the clothing manufacturing sector around the city of Leicester found that employers often consider welfare benefits as a “wage component”, forcing workers to supplement sub-minimum wage pay with welfare benefits. In this sector 75-90% of workers <a href="http://www2.le.ac.uk/offices/press/for-journalists/media-resources/Leicester%20Report%20-%20Final%20-to%20publish.pdf/">earn an average wage</a> of £3 an hour. Companies get round the law by paying cash-in-hand and by grossly under-recording the hours worked. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154368/original/image-20170126-23867-y1xtpb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Worker rights no longer set in stone.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/warsaw-poland-august-12-social-realist-557580751?src=53nRAmdcgiIhVP8F6EXM6Q-1-23">Martyn Jandula/Shutterstock</a></span>
</figcaption>
</figure>
<p>Recent news <a href="https://theconversation.com/hermes-inquiry-shows-how-unions-are-finding-new-forms-of-leverage-67411">about working conditions</a> at Sports Direct, Hermes, Amazon, and others show that far from being an isolated case, the Leicester example is part of an increasingly common trend towards low-wage, exploitative practices, greatly facilitated by a state-directed <a href="https://theconversation.com/how-relevant-are-the-tuc-and-unions-today-65183">reduction in trade union power</a>. </p>
<h2>Income attacks</h2>
<p>Mainstream portrayals of globalisation present it as a relatively benign market expansion and deepening. But this misses out the bedrock upon which such growth occurs: the labour of new working classes.</p>
<p>Following the end of the Cold War, the global incorporation of the Chinese, Indian and Russian economies served to <a href="http://eml.berkeley.edu/%7Ewebfac/eichengreen/e183_sp07/great_doub.pdf">double the world’s labour supply</a>. De-peasantisation and the establishment of export processing zones across much of Latin America, Africa and Asia has enlarged it even further. The International Monetary Fund calculates that number of workers in export-orientated industries <a href="https://www.imf.org/external/pubs/ft/weo/2007/01/pdf/text.pdf">quadrupled between 1980 and 2003</a>.</p>
<p>This global working class subsists upon poverty wages. Forget the problems in the clothing sector around Leicester, The Clean Clothes Campaign found that textile workers’ minimum wages across Asia equate to as little as 19% of their <a href="http://www.cleanclothes.org/resources/national-cccs/shop-til-they-drop">basic living requirements</a>. To survive they must work many hours overtime, purchase low quality food and clothing, and forego many basic goods and services. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154375/original/image-20170126-10546-1v68t1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Cut from the same cloth? Workers in Asia.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/asiandevelopmentbank/15927526085/in/photolist-3yUhPb-qgsJAH">Asian Development Bank/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-nd/4.0/">CC BY-NC-ND</a></span>
</figcaption>
</figure>
<p>A core element of globalisation has been the outsourcing of production from relatively high-wage northern economies to these poverty-wage southern economies. This enables firms to pay workers on the other side of the world 20 to 30 times less <a href="http://example.com/">than former, “native” workers</a>. They can then pocket the very significant cost difference in profits. For example, Apple’s profits for the iPhone in 2010 constituted over 58% of the device’s final sale price, while <a href="http://pcic.merage.uci.edu/papers/2011/value_ipad_iphone.pdf">Chinese workers’ share was only 1.8%</a>. </p>
<p>Outsourcing is celebrated by proponents of globalisation because, they argue, rather than produce goods expensively, they can be imported much more cheaply. This is true for many economic sectors in the global north, of course, but the downside is that wages and working conditions in remaining jobs are subject to colossal downward pressure. </p>
<h2>Not working</h2>
<p>What can be done? Limiting immigration will have no effect on these global dynamics, and may exacerbate them. You see, if wages are pushed up by labour shortages after any block on immigration, then the pressure and the incentive for firms to further outsource production, or to relocate, will increase. The anti-immigrant rhetoric and the mooted solutions of Donald Trump, UKIP, and much of the UK Conservative party will not help native workers one bit. Nor are they intended to. Rather, they represent a divisive political strategy designed to keep at bay any criticism of a decades-long assault on workers’ organisations. </p>
<p>For a problem brought about by globalisation it should shock no one that the progressive solution to poverty wages at home and abroad must be a global one. One thing that could work is the establishment of living wages across global supply chains. This would increase the price of labour in the global south, which in turn would limit some of the downward pressures that poverty wages here exert upon global north workers’ pay and conditions. </p>
<p>Doubling the wages of Mexican sweatshop workers would increase the cost of clothes sold in the US <a href="https://academic.oup.com/cje/article/28/2/153/1681263/Global-apparel-production-and-sweatshop-labour-can">by only 1.8%</a>. Increasing them ten-fold would raise costs by 18%. That cost increase can either be borne by northern consumers, who are themselves increasingly suffering from the wage-depressing dynamics of globalisation, or by reducing, only slightly, outsourcing firms’ profits. The outcome depends on politics and an understanding from voters that the dynamics that pushed towards Brexit and Trump are rooted in the systemic dynamics of corporate-driven globalisation. Contrary to its supporters claims, this mode of human development is based upon the degradation of labour worldwide. </p>
<p>The key question here is whether companies can be convinced to raise, significantly, their workers’ wages? Given capitalism’s cut-throat competitive dynamics, probably not right now. But there are many workers’ organisations toiling to achieve such objectives across the globe. Recognising that success in these struggles would contribute to improving the conditions for workers in the global north is a small, but necessary, first step towards realising these goals.</p><img src="https://counter.theconversation.com/content/63228/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Benjamin Selwyn does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>In work poverty is a sign the icy tide of capitalism is now lapping at our ankles in the global north.Benjamin Selwyn, Professor of International Relations and International Develpoment and Director of the Centre for Global Political Economy, University of SussexLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/587712016-05-10T04:07:09Z2016-05-10T04:07:09ZLessons from living below the extreme poverty line on $2 a day<figure><img src="https://images.theconversation.com/files/121668/original/image-20160509-20612-1xaqw62.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">$2 a day bought me a lacto-ovo-pesco vegetarian style diet (milk, eggs and fish) but with very small quantities of protein foods. </span> <span class="attribution"><a class="source" href="http://www.shutterstock.com/pic-241618879/stock-photo-australian-currency-lady-counting-coins.html?src=y7TMhYiPq_REtrqwwFqwJA-1-30">Peterfz30/Shutterstock</a></span></figcaption></figure><p>Around <a href="http://acoss.wpengine.com/poverty-2/">2.5 million Australians</a> live below the poverty line on less than $400 a week for a single adult or A$841 for a couple with two children. </p>
<p>I joined 8,500 Australians on the <a href="https://www.livebelowtheline.com.au/">charity challenge</a> last week to live below the extreme poverty line, spending just $2 a day on food for five days. </p>
<p>This is my third year doing the challenge and this year my husband joined me. Having $20 between two seemed to stretch much further than $10 for one person. But it was still tough and my diet was far from complete. </p>
<h2>Budgeting and food choices</h2>
<p>Essentially, $2 a day bought me a lacto-ovo-pesco vegetarian-style diet (milk, eggs and fish) but with very small quantities of these protein foods. </p>
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<p>Dried chickpeas and a legume-based soup mix added to the protein content and provided a nutritious and tasty soup. The inclusion of flour in the food budget meant I could have damper to accompany my meals. </p>
<p>Vegetable choices were limited to the cheaper ones such as potatoes, butternut, onions and Italian pureed tomato sauce – nothing green in sight. </p>
<p>I had to select cage eggs rather than free range, limiting my choice about animal welfare. </p>
<p>In addition to the limited variety of foods, the exclusion of fruit meant this diet didn’t meet the <a href="https://www.eatforhealth.gov.au/guidelines/australian-guide-healthy-eating">Australian dietary guidelines</a>. There were no healthy fats such as avocado, oily fish or olive oil. Nor did this diet result in weight loss because it was not low in kilojoules. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/121633/original/image-20160508-2519-1irshn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Weekly food rations for two: my 2016 choices.</span>
</figcaption>
</figure>
<h2>Long-term implications</h2>
<p>Over five days these nutritional inadequacies would be of little consequence. But over time this type of intake would lead to serious health problems. </p>
<p>Around <a href="http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/4364.0.55.005Chapter7002011-12">760,000 Australian</a> adults (4.5%) are at risk of iron deficiency anaemia. My iron intake averaged 9 milligrams a day, which is only half the recommended dietary allowance of 18 mg a day.</p>
<p>Adequate folate intake is essential in women of childbearing age to prevent neural tube defects in their offspring. My intake was only half of the <a href="https://www.nrv.gov.au/nutrients/folate">recommended 400 ug/day</a>. Similarly, my iodine intake, which is needed for normal thyroid function and is particularly important in pregnancy for fetal brain development, was only half the <a href="https://www.nrv.gov.au/nutrients/iodine">recommended amount</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/121636/original/image-20160508-2513-1afzu54.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Dinner meal: bean soup and damper.</span>
</figcaption>
</figure>
<p>Had I substituted my homemade damper for commercial bread, I would have received higher amounts of both of these nutrients since <a href="https://www.foodstandards.gov.au/consumer/nutrition/folicmandatory/documents/Mandatory%20Fortification%20Brochure%20for%20Health%20Professionals.pdf">bread is required</a> to contain folic acid and iodine. </p>
<p>If I was pregnant, I would not have been able to purchase <a href="http://www.mdpi.com/2072-6643/4/9/1317">supplements</a> containing folic acid and iodine, as recommended by <a href="http://www.health.gov.au/internet/main/publishing.nsf/Content/phd-antenatal-care-index/$File/ANC_Guidelines_Mod1_v32.pdf">clinical antenatal guidelines</a>. As such, policymakers should investigate making these supplements available free of charge on the <a href="http://www.pbs.gov.au/pbs/home">Pharmaceutical Benefits Scheme</a> for vulnerable groups. </p>
<h2>Variety is the spice of life</h2>
<p>By far the most difficult part of living below the extreme poverty line is the lack of variety. The diet was bland in colour because of the lack of variety, thereby indicating a <a href="https://www.betterhealth.vic.gov.au/health/healthyliving/fruit-and-vegetables">poorer quality diet</a>. </p>
<p>I repeated the same meal because it’s cheaper to buy in bulk. Leftovers simply cannot be thrown away, so food waste becomes much less than the average <a href="http://www.foodwise.com.au/foodwaste/food-waste-fast-facts/">41% of household garbage</a>.</p>
<p>Spending money on beverages was not an option. I drank only water – hot and cold. Next year, teabags will be an essential item. </p>
<h2>Time management and forward planning</h2>
<p>Another difficulty is the need to plan ahead. Having only $2 a day means that all foods eaten outside of the household need to be prepared beforehand. </p>
<p>I also spent hours more than usual doing the weekly shop. I visited three different grocery stores to compare prices, including a large greengrocer, Aldi and IGA. It pays to shop around but those on low incomes would ill afford the transport costs associated with going from shop to shop. </p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/121637/original/image-20160508-2548-837id.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Another dinner meal: tinned tuna and potato fishcakes with chickpeas.</span>
</figcaption>
</figure>
<h2>Australian households’ spending on food</h2>
<p>Contrary to popular belief, Australian households spend more on current (unhealthy) diets than required to purchase healthy (recommended) diets. The <a href="http://download.springer.com/static/pdf/864/art%253A10.1186%252Fs12889-016-2996-y.pdf?originUrl=http%3A%2F%2Fbmcpublichealth.biomedcentral.com%2Farticle%2F10.1186%2Fs12889-016-2996-y&token2=exp=1462723413%7Eacl=%2Fstatic%2Fpdf%2F864%2Fart%25253A10.1186%25252Fs12889-016-2996-y.pdf*%7Ehmac=f46978e01ae784ea2199d0d87d99304fe5f81c9e00b2af35cb8357a79868657f">majority (53-64%)</a> of food budgets is spent on “discretionary” choices: foods that aren’t essential to health that are high in saturated fat and sugar (this includes take-away foods and alcohol). </p>
<p>There has been much <a href="https://theconversation.com/making-the-case-for-gst-on-fresh-food-36130">debate</a> about the impact of changing the goods and service tax (GST) to encompass basic healthy foods. This would increase <a href="http://download.springer.com/static/pdf/864/art%253A10.1186%252Fs12889-016-2996-y.pdf?originUrl=http%3A%2F%2Fbmcpublichealth.biomedcentral.com%2Farticle%2F10.1186%2Fs12889-016-2996-y&token2=exp=1462723413%7Eacl=%2Fstatic%2Fpdf%2F864%2Fart%25253A10.1186%25252Fs12889-016-2996-y.pdf*%7Ehmac=f46978e01ae784ea2199d0d87d99304fe5f81c9e00b2af35cb8357a79868657f">the cost of healthy diets by around 10%</a>. In real terms, a healthy diet would cost a family of two adults and two children an extra $56.39 per week. </p>
<p>Since low-income families spend a higher proportion of their disposable income on food, around 30%, this tax change would hit the poorest hardest. Such a change would have a devastating impact on people living below the poverty line. </p>
<p>After five days living on $2 a day for food, I have a much greater respect for those living on a tight budget. And I will think twice before spending two days’ allowance on a coffee, or even buying a bottle of water.</p><img src="https://counter.theconversation.com/content/58771/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Karen Charlton does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Last week I joined 8,500 Australians on the charity challenge to live below the extreme poverty line, spending just $2 a day on food for five days. It was tough and my diet was far from complete.Karen Charlton, Associate Professor, School of Medicine, University of WollongongLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/570132016-04-01T11:31:19Z2016-04-01T11:31:19ZWhy the living wage won’t compensate for tax credit cuts<figure><img src="https://images.theconversation.com/files/116794/original/image-20160330-28443-1fcc92n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Will government cuts to tax credits hit Britain's poorest the hardest?
</span> <span class="attribution"><span class="source">Becky Stares/shutterstock</span></span></figcaption></figure><p>Wage poverty is endemic in Britain because wages are <a href="http://www.lancaster.ac.uk/news/articles/2016/wage-supplements--price-for-a-job-or-means-of-earning-a-living/">thought</a> of as a price for a job, rather than as a means of earning a living. </p>
<p>The introduction of the so called “<a href="https://www.livingwage.gov.uk/?gclid=CInk8e3T6MsCFQ0SGwodSWUMtg">national living wage</a>” – what really should just be viewed as an increase in the national minimum wage for the over 25s – will raise wages for the lowest-paid workers by 50p an hour. This should be good news for those receiving the increase, but it seems some businesses are using the national living wage as <a href="https://www.change.org/p/don-t-use-living-wage-as-excuse-to-cut-pay-benefits">an excuse to cut overall pay</a> and rewards for staff. </p>
<p>Pair this with concerns that businesses are <a href="http://www.theguardian.com/business/2015/sep/08/living-wage-fears-sending-shockwaves-through-uk-labour-market">scaling back recruitment</a> to make allowances for wage increases and it’s clear the higher minimum wage isn’t all it’s cracked up to be.</p>
<p>It isn’t only businesses that are playing hard ball. Alongside the introduction of this higher wage the government is moving forward with its cuts to wage supplements through the introduction of <a href="https://www.gov.uk/universal-credit/overview">universal credit</a> – a new benefit which is set to replace job seekers’ allowance and other means-tested benefits.</p>
<p>It is recognised that the cuts to wage supplements brought about by the introduction of universal credit will not be made up by the increases planned for the minimum wage. The Resolution Foundation, for instance, <a href="http://www.resolutionfoundation.org/media/press-releases/low-income-working-families-on-universal-credit-set-to-lose-1300/">calculates</a> that when all of the tax, benefit and minimum wage changes announced in 2015 are taken into account the average loss for the poorest half of households will be £650 a year by 2020.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=565&fit=crop&dpr=1 754w, https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=565&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/116812/original/image-20160330-15137-1i8341v.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=565&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Poor show for the low-paid.</span>
<span class="attribution"><span class="source">1000 words/Shutterstock</span></span>
</figcaption>
</figure>
<p>Wage supplements such as <a href="http://revenuebenefits.org.uk/tax-credits/guidance/how-do-tax-credits-work/">tax credits</a> help to address the problem of low wages, by adjusting the incomes of low-paid households to the number of people living in them. In this sense, wage supplements allow people to “earn” an income that is more related to their living costs than wages alone.</p>
<p>The reduction of these supplements alongside an increase in minimum wage, will do little to solve Britain’s longstanding problem with wage poverty.</p>
<p>As benefits for unemployed people are being eroded in value, working poor families face a bleak future. And while the shift to a higher minimum wage should increase the incentive to work, the mechanism that attempted to link wages to need is being put under pressure. </p>
<h2>A history of wage supplements</h2>
<p>Wage supplements have a <a href="http://www.palgrave.com/gb/book/9781137293961">chequered history</a> in Britain. At various points they have been interpreted as being both deeply problematic and highly beneficial for working people – and for the economy and society more generally. </p>
<p>To understand the problems we face today with wage supplements, we need to go back in time in the 1800s when this difficult relationship with benefits was first unfolding. Between 1834 and 1971, the main thrust of policy was that the supplementation of wages by the state – at least on a means-tested basis – would destroy the incentive for people to work and would encourage employers to pay low wages. </p>
<p>The <a href="http://www.nationalarchives.gov.uk/education/resources/1834-poor-law/">1834 Poor Law Commission</a> report’s argument, that wage supplements made working people “<a href="https://books.google.co.uk/books?id=BPw9AAAAcAAJ&pg=PA69&lpg=PA69&dq=idle,+lazy,+fraudulent+and+worthless&source=bl&ots=pKMKnu4zA-&sig=8uliiyIeZ5KS564SLLCI0Lw47Gg&hl=en&sa=X&ved=0ahUKEwjireuf6ujLAhWBPhQKHSJBDVEQ6AEIHTAA#v=onepage&q=idle%2C%20lazy%2C%20fraudulent%20and%20worthless&f=false">idle, lazy, fraudulent and worthless</a>”, cast a long shadow over policy. </p>
<p>But from the 1970s the position was reversed – it was argued that wage supplements had the potential to encourage people to do low-paid work and to reduce pressure on employers to increase wages. During the <a href="http://www.telegraph.co.uk/finance/recession/4323064/UK-recession-in-1980-What-was-it-like.html">mass unemployment</a> of the late 80s wage supplements came into their own as a way to encourage people into <a href="http://blog.britac.ac.uk/understanding-tax-credits-in-debates-about-wage-supplements-from-the-past/">low paid work</a> in the hope of reducing unemployment levels.</p>
<p><a href="https://en.wikipedia.org/wiki/Central_Policy_Review_Staff">The Central Policy Review Staff</a> (the Conservative think tank of the time) argued this could be done through the further development of wage supplements – which was introduced in 1988 as family credit.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/116814/original/image-20160330-28445-11f5l7o.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Replacing tax credits with the living wage will leave many people worse off.</span>
<span class="attribution"><span class="source">Yulia Grigoryeva/Shutterstock</span></span>
</figcaption>
</figure>
<p>Whether wage supplements are considered to be negative or positive, what has often been missing from arguments about them is reference to the way in which they might address in-work poverty.</p>
<p>It is not that such issues have been completely absent from debates about supplementing wages – quite the opposite in fact. The first benefit ever aimed specifically at people in low-paid work – family income supplement – which was introduced 1971, was the consequence of policy debates that had been revitalised by the “rediscovery of poverty” in the mid-1960s. Later, for New Labour governments, tax credits were partly a means of addressing child poverty.</p>
<p>However, in both these instances, concerns about poverty were either usurped by wider concerns with incentivising people to take low-paid work – in the case of family income supplement – or sat uneasily alongside them in the case of tax credits. </p>
<p>And of course attempting to incentivise unemployed people to take low-paid work is a very different exercise to addressing in-work poverty.</p>
<h2>Waging war</h2>
<p>It is because of this history surrounding wages supplements that the conservative government has found itself in difficulties in recent times. The government’s focus has been on shifting the incentive to work by taking away tax credits and increasing the national minimum wage, alongside lowering the real and relative level of benefits for workless people. </p>
<p>In this approach, the government’s belief is that the need for wage supplements is reduced. The problem with this belief is that even if it was not their original intention, wage supplements are important in relieving the poverty of poorly paid workers, as many people argued when resisting the cuts to tax credits. </p>
<p>The current proposal to reduce universal credit payments in favour of a higher minimum wage will not help to address the <a href="http://www.palgrave.com/gb/book/9781137293961">longstanding poverty</a> of many people in paid employment. In fact it will only make things worse for those already living on the breadline.</p><img src="https://counter.theconversation.com/content/57013/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Chris Grover received funding from the British Academy for research into wage supplements in the inter-war period and the 1980s. </span></em></p>Plans to stop universal credit payments in favour of a ‘national living wage’ will not address the long-standing poverty of many people in paid employment.Chris Grover, Senior Lecturer in Social Policy, Lancaster UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/553382016-02-24T16:37:19Z2016-02-24T16:37:19ZSouth Africa’s finance minister tackles wastage, boosts confidence<figure><img src="https://images.theconversation.com/files/112763/original/image-20160224-16416-dpntdp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">South Africa's Finance Minister Pravin Gordhan delivers his 2016 budget address to parliament in Cape Town.</span> <span class="attribution"><span class="source">Reuters/Mike Hutchings</span></span></figcaption></figure><p><em>A great deal was at stake for South Africa when its Finance Minister Pravin Gordhan delivered his much-anticipated <a href="http://www.treasury.gov.za/documents/national%20budget/2016/speech/speech.pdf">2016 Budget</a> speech. The political stakes for the governing African National Congress are high as it battles charges of corruption and a failure to deliver services to communities. The Conversation Africa Politics and Society editor Thabo Leshilo asked political scientist Keith Gottschalk to highlight the most important elements of the speech, and to assess whether Gordhan addressed the pressing challenges facing the country.</em> </p>
<h2>Corruption, spending cuts and education</h2>
<p>First, the finance minister announced more stringent procedures for state tenders to ensure that there was transparency in the way they are awarded. This will make predation from <a href="http://www.gov.za/tenderpreneurship-stuff-crooked-cadres-fighters">“tenderpreneurs”</a> - business people who enrich themselves through government tenders, often dubiously - and <a href="http://www.news24.com/SouthAfrica/Politics/Political-hyenas-in-feeding-frenzy-20100826">“political hyenas”</a> - the country’s corrupt political elite - more difficult. </p>
<p>It has been <a href="http://www.dailymaverick.co.za/article/2015-08-20-npa-realignment-step-2-willie-hofmeyr-out-of-asset-forfeiture-unit/#.Vs3B0Pl97IU">estimated</a> that funds lost to corruption in South Africa could well have increased to <a href="http://www.corruptionwatch.org.za/why-is-corruption-getting-worse-in-south-africa/">one-fifth of the budget</a>.</p>
<p>Second, the minister announced that the budget deficit will be reduced each year for the next three years.</p>
<p>Gordhan’s formal qualification is as a pharmacist and it’s fair to say that he dispensed exactly the medicine ratings companies and credit agencies are watching for. The cuts on public sector travel, cars, accommodation, and conferences sends the right signals. The freeze on the hiring of public sector workers comprises the bulk of the freeze in expenditure. This will keep the <a href="http://www.brettonwoods.org/page/about-the-bretton-woods-institutions">Bretton Woods</a> institutions at bay.</p>
<p>Third, Gordhan announced the two-decade overdue project to ensure that all schools are built of brick, and supplied with water and electricity. He also announced acceleration in the provision of early childhood development schooling. At the other end of the education spectrum he announced a substantial increase in funding for the National Student Financial Aid <a href="http://www.nsfas.org.za/">Scheme</a>. This provides support for indigent students at colleges and universities.</p>
<h2>Skillful tax hikes</h2>
<p>Fourth, the finance minister committed to unspecified reductions in the cost of doing business, and regulatory challenges that deter investors.</p>
<p>Fifth, there is no increase in VAT. He took this decision in a year in which working class families will be hit badly by inflation as food prices rise due to both the drought and the decline of the rand’s exchange rates.</p>
<p>Instead, Gordhan fell back on that favourite of the <a href="http://www.gresham.ac.uk/lectures-and-events/the-dutch-east-indies-company-the-first-100-years">Dutch East Indies Company</a> - excise duties. New levies on sugar and tyres, and higher levies on fuel and plastics.</p>
<p>Overall, his team has skillfully cut expenditure and raised taxes where it will hurt least. The paragraph seeking to rationalise and privatise certain state-owned enterprises will help concentrate the mind of <a href="http://www.news24.com/Travel/Flights/SAA-leadership-rocked-by-scandal-again-20140521">South African Airways</a>, the troubled national airline.</p>
<p><em>*This article has been republished to correct a misattribution.</em></p><img src="https://counter.theconversation.com/content/55338/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Keith Gottschalk is affiliated with the ANC. This critique is written in his individual capacity as a political scientist.</span></em></p>South Africa’s finance minister delivered a good mix of macro and micro-economic strategies to ensure the country survives economic uncertainty, restores confidence and achieves some growth.Keith Gottschalk, Political Scientist, University of the Western CapeLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/535882016-02-04T06:15:25Z2016-02-04T06:15:25ZRehousing homeless people: our study reveals long-term support needed to rebuild lives<figure><img src="https://images.theconversation.com/files/109999/original/image-20160202-32240-3ddqiq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">from www.shutterstock.com</span></span></figcaption></figure><p>Homelessness in England has been a growing problem over the last five years. The number of people sleeping rough <a href="https://files.datapress.com/london/dataset/chain-reports/CHAIN%20Greater%20London%20full%20report%202014-15.pdf">has doubled</a>, and the number of homeless households seeking help from local authorities <a href="https://www.gov.uk/government/statistical-data-sets/live-tables-on-homelessness">has also increased</a>.</p>
<p>Homelessness can have a devastating impact on a person’s health and well-being, and since the early 1990s successive governments made <a href="http://www.kcl.ac.uk/sspp/policy-institute/scwru/pubs/2003/Warnes-et-al-2003-Factfile.pdf">large investments in services</a> to tackle the problem. But after 2010, <a href="https://www.nao.org.uk/report/the-impact-funding-reductions-local-authorities/">funds were cut</a> for many homelessness and housing support services. Several radical changes to housing and welfare policies were also introduced, which presented further challenges for formerly homeless people.</p>
<p>In an effort to assess the outcomes of rehousing homeless people, and learn how best to meet their longer-term support needs, the <a href="http://www.sscr.nihr.ac.uk/">National Institute for Health Research (NIHR) School for Social Care Research</a> funded <a href="http://www.kcl.ac.uk/sspp/policy-institute/scwru/pubs/2016/reports/RebuildingLives2016Report.pdf">Rebuilding Lives</a>. This study has sought to understand the experiences of 297 formerly homeless people, five years after they made the transition from hostels and other temporary accommodation, into independent housing. </p>
<p><a href="http://www.kcl.ac.uk/sspp/policy-institute/scwru/index.aspx">Colleagues at King’s College London</a> and I carried out the study, the largest of its kind in the UK. Our research followed up <a href="http://www.kcl.ac.uk/sspp/policy-institute/scwru/res/hrp/past/for-home.aspx">an earlier study</a>, which investigated the experiences of 400 single homeless people over 18 months after they were resettled.</p>
<h2>What we found</h2>
<p>Once they are rehoused, many homeless people are able to rebuild their lives. After five years, many participants in our study had settled into their accommodation, and made considerable progress. Some had become involved in education, work-training programmes or had attained employment, and for many family and social relationships had improved. Several young people had started their own family.</p>
<p>But we found that a significant proportion remained vulnerable during the first few years, and required long-term support in order to maintain a tenancy and prevent a return to homelessness. By the end of the Rebuilding Lives study, 89% of our participants were housed, although 16% had become homeless at some time during the five years since they were resettled. </p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=900&fit=crop&dpr=1 600w, https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=900&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=900&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1130&fit=crop&dpr=1 754w, https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1130&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/110160/original/image-20160203-5865-3lj377.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1130&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">It can be hard to keep up.</span>
<span class="attribution"><span class="source">from www.shutterstock.com</span></span>
</figcaption>
</figure>
<p>Living independently was not easy for them. Even after five years, some were still finding it hard to cope. One quarter were struggling to look after their accommodation and manage everyday tasks, and were living in dirty or squalid conditions. Many of these had mental health or substance misuse problems, and had little or no experience of living alone. A few were hoarding, and parts of their accommodation had become inaccessible. </p>
<p>For just over a third (35%) of our participants, their accommodation was in serious disrepair: they were experiencing problems with damp and mould, faulty heating or wiring, or damage caused by floods and leaks. People in both social housing and the private-rented sector were affected by poor living conditions. </p>
<h2>Financial difficulties</h2>
<p>Many formerly homeless people faced new financial demands immediately after they were resettled, as they tried to set up a home and rebuild their lives. When interviewed after five years, many of those who were housed were on low incomes (65% were living below the <a href="http://www.cpag.org.uk/content/uk-poverty-line">UK poverty line</a>), and struggling to meet everyday living expenses. Around a half ran short of money for food at times, and did not have enough money to heat their home. </p>
<p>Over the course of our study, the prevalence of debts among the participants gradually increased. Five years after being resettled, 75% owed money, including almost a third who had debts of more than £1,000. The debts were mainly due to the cost of living expenses, such as rent, household bills and council tax. Young people aged under 25 years were most likely to have built up large debts – just over half of them (55%) owed £1,000 or more. </p>
<p>One of the key factors contributing to the participants’ financial difficulties was the suspension or withdrawal of social security benefits. Three quarters of our participants were reliant on such benefits and, at the time of their five-year interview, 24% of these had had their <a href="https://www.gov.uk/jobseekers-allowance/overview">Jobseeker’s Allowance</a> (JSA) or <a href="https://www.gov.uk/employment-support-allowance/overview">Employment and Support Allowance</a> (ESA) benefits suspended or stopped in the preceding 12 months.</p>
<p>In some cases, JSA was stopped because the participants missed appointments at the Job Centre or failed to attend training or apply for jobs. Some did not understand what they should do when their ESA – which was time-limited – ended, and failed to complete a new claim form. </p>
<p>Benefit sanctions led to great difficulties, as many people had no family or friends who could help them financially. For some people, this resulted in eviction for rent arrears as their housing benefit was also stopped – even though housing benefits should not be affected by JSA sanctions.</p>
<p>Many participants were keen to work, but finding a steady job with sufficient hours was problematic and contributed to financial difficulties. Some worked casually or under “zero-hours” contracts: their working hours were irregular and their income low. </p>
<p>Although zero-hours contracts may offer flexibility to employers and suit the circumstances of some people, such insecure hours can be problematic for formerly homeless people who have no other source of income and are trying to re-establish themselves and live independently. Most study participants employed under zero-hours contracts would have preferred to work more hours, but the option was unavailable to them. </p>
<h2>Building a home</h2>
<p><a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/335753/EHS_Profile_of_English_housing_2012.pdf">Changes to the housing market in England</a> over the last few years are also affecting on the resettlement of homeless people. With a shortage of available social housing, single homeless people are now more likely to be resettled into the private rented sector. </p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=904&fit=crop&dpr=1 600w, https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=904&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=904&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1136&fit=crop&dpr=1 754w, https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1136&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/110166/original/image-20160203-5840-120nzkv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1136&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A source of instability.</span>
<span class="attribution"><span class="source">from www.shutterstock.com</span></span>
</figcaption>
</figure>
<p>Yet among the study participants, those resettled in the private rented sector had poorer housing outcomes than those who moved to local authority or housing association tenancies. They were more likely to have changed tenancy several times, and 36% of those resettled in the private rented sector became homeless again.</p>
<p>Factors contributing to their housing instability included fixed-term tenancy agreements, difficulties with rent payments, poor conditions in the accommodation, and conflicts with landlords regarding repairs.</p>
<p>After five years, 32% of participants were receiving housing-related support from services. People who received this support were predominantly those who had longer histories of homelessness, and health and substance misuse problems. Young people were least likely to receive support from services, yet they were also least likely to have had previous experience of living alone and managing a tenancy. People living in the private rented sector were also less likely than others to have received support. </p>
<p>Our study has shown that planned resettlement for homeless people works, and should be encouraged. But many homeless people require long-term tenancy support after they are rehoused. In many areas, there have been cuts to tenancy support services, and increasing pressures to restrict how long support can be provided. Yet taking into account the difficulties that many study participants were facing after five years, they are highly likely to need help for the foreseeable future, if further homelessness is to be prevented.</p><img src="https://counter.theconversation.com/content/53588/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The views expressed in the report and this briefing are those of the authors and not necessarily those of the NIHR School for Social Care Research, Department of Health, NIHR, the NHS or the Economic and Social Research Council. The FOR-HOME study was funded by the Economic and Social Research Council. </span></em></p>A new study reveals just how tough it can be to rebuild a life after homelessness.Maureen Crane, Reader in Applied Social Research, King's College LondonLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/523222016-01-11T04:35:49Z2016-01-11T04:35:49ZWhy reaching and staying middle class is a lifetime challenge<figure><img src="https://images.theconversation.com/files/107258/original/image-20160105-28988-1hzuttf.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Many people aspire to live a middle class life. Once they attain it, sustaining it is a big challenge. </span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Many people are born into the middle class, but for those born in poverty the lifetime challenge is reaching middle class status.</p>
<p>The definition of middle class status is a challenge in itself. People in poverty are often described as those surviving on less than US$1,25 (some R17,50) <a href="http://econ.worldbank.org/WBSITE/EXTERNAL/EXTDEC/EXTRESEARCH/0,,contentMDK:22510787%7EpagePK:64165401%7EpiPK:64165026%7EtheSitePK:469382,00.html">per day</a>. But that does not imply that middle class simply starts just above this threshold.</p>
<p>The wealthy are easy to describe. Wealthy people have lots of money and lots of things. Naturally the wealthy will have their own ranking among and between themselves; you probably have to be wealthy to understand this.</p>
<p>This is well illustrated by the rumour that John D. Rockefeller, the American businessman, supposedly <a href="https://critiqueofcrisistheory.wordpress.com/responses-to-readers-austrian-economics-versus-marxism/paul-volckers-banking-reform-proposals-and-socialist-revolution/">commented</a> on J P Morgan’s estate of US$80 million (some US$1,2 billion in current value) after his death in 1913 by saying: </p>
<blockquote>
<p>“And to think, he wasn’t even a rich man.” </p>
</blockquote>
<h2>Who makes up the middle class</h2>
<p>Likewise there are different categories of “middle class”. In the US an annual household income ranging from US$25 000 (R350 000) to US$75 000 (R1 million) will probably place people in the lower to upper middle <a href="https://www.aei.org/publication/middle-class-disappeared-higher-income-groups-recent-stagnation-explained-changing-household-demographics/">class</a> range.</p>
<p>Economist <a href="http://www.econ3x3.org/article/who-are-middle-class-south-africa-does-it-matter-policy">Justin Visagie</a> describes the South Africa middle class as a household of four persons with a total household income of between R5 600 and R40 000 per month after direct income tax. This covers the range from lower to upper middle class as in the US.</p>
<p>A general definition for a middle class existence in South Africa is discretionary expenditure. Middle class families can typically buy the things they need and will have money to spend as they please after they have purchased all necessities.</p>
<p>If this description is accepted, it is clear why people in poverty surviving on R17,50 per day (R2 100 per month for a family of four) desperately aspire to reach the middle class, albeit then the lower middle class.</p>
<p>Likewise, it is a long reach from the lower middle class to the upper middle class. An upper middle class family is nearly seven times better off than a lower middle class family in terms of the classification above.</p>
<p>But with reaching middle class status comes new challenges. Middle class status results in a particular lifestyle. A household equipped with gadgets and equipment using electricity (fridges, freezers, TV and the like). A motor vehicle. A better house and better schools for the children.</p>
<p>Simply put: in a middle class existence, expenditure follows income. More middle class trimmings follow a middle class existence. What was good enough before is no longer good enough. And definitely not good forever.</p>
<p>And with what is good enough, often comes debt. Middle class people borrow money to purchase things associated with middle class existence. </p>
<h2>The challenges of the middle class</h2>
<p>The first challenge to stay middle class is therefore to retain a middle class job. It is unfortunately true that the average middle class South African is only two pay cheques away from financial hardship.</p>
<p>There are many examples of middle class people living above their means. One is expensive and flashy cars. The neighbours must see that middle class has arrived. </p>
<p>Another is neglecting to budget annually for house maintenance. The cost of maintaining a house inevitably amounts to 1% per annum of the replacement value of that house.</p>
<p>A simple calculation shows that a family living in a house worth R1,2 million should budget annually R1 000 per month for the upkeep of its property. Naturally this amount is not used every month, but should be accumulated for periodic expenses to maintain the property and improvements.</p>
<p>But the middle class challenge goes beyond keeping a middle class job. It also entails sufficient provision for retirement that will continue to support a middle class lifestyle.</p>
<p>Transnet pensioners who get a pension from the Transnet Second Defined Benefit Fund are the best example in South Africa of people who have slipped out of the middle class.</p>
<p>In brief, this Transnet fund stipulates that pensioners get an annual pension increase of 2% per annum. In a period where inflation averages nearly 6% per annum (5,8% per annum since 2002), these pensioners get poorer every year.</p>
<p>A simple example illustrates this point: the real income of a person who retired in 2002 and received increases of only 2% per year since would have decreased by 40% over the ensuing period.</p>
<p>Inflation is therefore a clear and present danger for people who want to protect a middle class lifestyle, particularly after retirement. </p>
<h2>Live within your means</h2>
<p>The sustained protection of a middle class lifestyle therefore not only entails the discipline of living within your means, but also requires diligent saving over a lifetime. People who attained middle class status often live above their means in their enjoyment of this newly attained status. Avoidance of this pitfall will help to ensure a sustained middle class lifestyle.</p>
<p>The challenge of our time is therefore twofold. The first is reaching a middle class lifestyle. This is a challenge in itself that many people can only dream of.</p>
<p>The second is to retain middle class status over a lifetime and into retirement. With households facing financial pressure from all directions, retaining middle class status should not be taken for granted. It will increasingly require careful planning, hard work and diligent saving.</p>
<p><em>This article was written in collaboration with Carina Rossouw, a BAcc LLB student at the University of Stellenbosch.</em></p><img src="https://counter.theconversation.com/content/52322/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jannie Rossouw does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Reaching middle class status and sustaining it into retirement is a major challenge. The key is to live within your means.Jannie Rossouw, Head of School of Economic & Business Sciences, University of the WitwatersrandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/467042015-09-03T04:42:29Z2015-09-03T04:42:29ZHow current measures underestimate the level of poverty in South Africa<figure><img src="https://images.theconversation.com/files/93505/original/image-20150901-25717-1i6d974.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Unused cooling towers overlooking an informal settlement in Soweto. A new study suggests that poverty in South Africa is actually higher than the figures usually quoted.</span> <span class="attribution"><span class="source">Reuters/Siphiwe Sibeko</span></span></figcaption></figure><p>Unlike many other countries, South Africa does not have one recognised “official” poverty line. Instead, a number of different thresholds are used, and there’s little clarity on the appropriateness of each threshold.</p>
<p>A study we recently undertook suggests that Statistics South Africa’s <a href="http://beta2.statssa.gov.za/publications/Report-03-10-11/Report-03-10-11.pdf">upper-bound poverty line</a> underestimates poverty. The Stats SA line indicates that approximately 53% of South Africans are poor, but ours suggests that this is closer to 63%. In 2011 Rands, the Stats SA line is R779 per person per month while ours is R1042 per person per month. </p>
<p>Our upper-bound line is equivalent to R43 per person per day in March 2015 prices. Our food poverty (or extreme poverty) line is equivalent to about R15 per day.</p>
<p>A poverty line generally refers to an amount of money per month or day that sets a boundary between being “poor” and “non-poor”. These lines are often correctly criticised as a crude way of understanding poverty, but they are frequently a necessary evil when one does empirical work on the topic. </p>
<p>Our study is a <a href="http://www.opensaldru.uct.ac.za/bitstream/handle/11090/784/2015_151_Saldruwp.pdf?sequence=1">methodological review</a> of South Africa’s existing poverty lines. The approach we followed is the internationally recognised “Cost of Basic Needs” method. The method is used to produce three lines: </p>
<ul>
<li><p>a food poverty line; </p></li>
<li><p>a lower-bound poverty line; and </p></li>
<li><p>an upper-bound poverty line. </p></li>
</ul>
<p>Our view is that the lower bound is not an appropriate threshold for measuring poverty, and thus we omitted it from our proposed new poverty lines. </p>
<h2>The food poverty line</h2>
<p>The method is based on the cost of some minimum sufficient caloric requirement, which we set at 2100 kilocalories per person per day. This is then used to calculate the cost of necessary non-food expenditure. </p>
<p>With the caloric requirement set at this level, the food poverty line is then calculated by determining how much 2100 kilocalories worth of food would cost, while respecting the prevailing food consumption habits of the poor. This is quite an involved process, but we ultimately calculated a figure similar to Stats SA’s. </p>
<p>While Stats SA calculates the food poverty line to be R335 per person per month in March 2011 prices, we calculate it to be R337 per person per month. The food poverty line should be understood as the minimum expenditure needed for sufficient calories if people spend their money only on food. Stats SA calls this an “extreme poverty” line.</p>
<h2>The upper-bound poverty line</h2>
<p>This is calculated by looking at the non-food expenditure of households which have per person food expenditure close to the food poverty line. In our paper, this meant looking at households which had food expenditure close to R337 per person per month in 2011. Their non-food expenditure is then added to the food poverty line to give the upper bound. In our case, this meant adding R705 of non-food expenditure to the food poverty line of R337 to get an upper-bound poverty line of R1042 per person per month. </p>
<p>The assumption is that households which just achieve their essential food needs, and therefore spend close to R337 per person on food, will also just achieve their essential non-food needs. While this assumption is certainly contestable, this method is probably the best way for researchers to approximate and include the cost of essential non-food needs, out of the few alternatives that exist. </p>
<p>The line can alternatively be interpreted as the level of total expenditure at which households tend to buy sufficient food. We propose that the upper-bound be understood as a measure of what might be called general poverty.</p>
<h2>How we differ with Stats SA</h2>
<p>The main difference between our lines and Stats SA’s is due to one methodological decision. Stats SA originally calculated its upper-bound poverty line to be R959 per person per month, which is close to our estimate. It then decided that this figure was implausibly high, and revised it downwards by disregarding the non-food expenditure of households in expenditure deciles 1 and 8-10. This led to the R779 figure.</p>
<p>The Stats SA concern about the upper bound being implausibly high is based on legitimate data concerns. Using the same data as Stats SA, we found that some households which reported food expenditure close to the food poverty line also reported non-food expenditure as high as R11 000 per person per month. This is clearly a data reliability issue, and it has the potential to skew the upper-bound poverty line. However, we argue that Stats SA’s fix for this issue seems to make the poverty line more unrealistic, rather than improving it. </p>
<p>With a food poverty line of R335 a month, the unadjusted Stats SA line of R959 suggests that poor people allocate 35% of their expenditure to food. The reduced line of R779 per month, together with the food poverty line of R335, suggests that poor people allocate 43% of their expenditure to food. We show in our paper that the 35% food share is much more representative of poor people’s actual expenditure habits than 43%.</p>
<h2>Implications of the new poverty lines</h2>
<p>Table 1 below shows the existing South African “Cost of Basic Needs” lines, and compares them to our new set of lines, listed under ‘SALDRU’. The table also shows each line’s “headcount ratio”, which is the percentage of South Africa’s population classified as poor. All of the rand values are in 2011 prices.</p>
<p>Table 1: Different poverty lines and associated poverty headcount ratios.
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=273&fit=crop&dpr=1 600w, https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=273&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=273&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=343&fit=crop&dpr=1 754w, https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=343&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/93424/original/image-20150831-25763-1k8a50f.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=343&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
</figcaption>
</figure></p>
<p>Comparing our and the 2015 Stats SA upper-bounds, it’s clear that each line implies a substantially different picture when it comes to the proportion of South Africans that are poor. Our estimate is closer to the headcount ratio suggested by the <a href="http://wdi.umich.edu/files/publications/workingpapers/wp739.pdf">Hoogeveen and Ozler</a> (HO) upper-bound poverty line, which is an older measure based on data from 2000. </p>
<p>HO’s figures suggest that around 35% of the country lives in extreme poverty, while our lines, similarly to the Stats SA lines, suggest that it is closer to the 21%, which is obviously still very high. </p>
<h2>Three things to note</h2>
<p>While we argue that the Stats SA’s upper-bound line is too low, this is not by itself sufficient basis to assert, as some have done, that the Stats SA lines were affected by political considerations. Though we disagree with the methodological decision which lowered their upper bound, the decision was motivated by an understandable technical concern. </p>
<p>Secondly, the conceptualisation of poverty discussed in this paper is just one way of thinking about who is poor and who is not. It may not even be the best way to think about the issue. But this method has been particularly influential in South Africa, and we think it valuable to get as accurate a measure of this kind of poverty as possible. </p>
<p>Lastly, the poverty lines developed here are not estimates of a “decent living level”. These are just subsistence measures, and living just above the poverty line can hardly be seen as desirable.</p><img src="https://counter.theconversation.com/content/46704/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ingrid Woolard receives funding from the National Research Foundation, the Department of Labour and the Department of Planning, Monitoring and Evaluation. </span></em></p><p class="fine-print"><em><span>Murray Leibbrandt receives funding from the National Research Foundation, the Department of Planning and Monitoring and Evaluation and the National Treasury. </span></em></p><p class="fine-print"><em><span>Joshua Budlender does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A review of South Africa’s methodology to measure poverty shows that 60% of people in the country are poor. This is way higher than the figures that are usually quoted.Joshua Budlender, Researcher at the Southern African Labour and Development Research Unit , University of Cape TownIngrid Woolard, Professor in the School of Economics and a Research Associate of the Southern Africa Labour and Development Research Unit (SALDRU) , University of Cape TownMurray Leibbrandt, Pro-Vice Chancellor, Poverty and Inequality; NRF Chair in Poverty and Inequality Research; and Director of the Southern Africa Labour and Development Research Unit, University of Cape TownLicensed as Creative Commons – attribution, no derivatives.