WITH high economic growth rates and talk of Celtic Tigers, what has been happening to poverty in been happening to poverty studies have had to rely on information going back to 1987, but new survey results for 1994 have now been analysed in an ESRI study. The figure which has been most widely reported and commented on is that the section of the population receiving below 60 per cent of average income has risen to 35 per cent. Taken alone this over states the extent of poverty, misleads about what has been happening since 1987, and diverts attention from the real issues.
There is no one way of defining and measuring poverty on which everyone agrees, in Ireland or elsewhere. The most commonly used measure of poverty at EU level is the percentage of the population which is on below half of the average income. For Ireland this was just below 20 per cent in 1987 and just above that figure in 1994. This poverty threshold is about £69 per week for a single person in current prices, about the level which social welfare rates are to reach by the end of Partnership 2000.
Some would argue in favour of the higher relative income threshold. However, simply counting the number of persons below either income threshold takes no account of how far below it they fall. Poverty measures which do take that into account show a consistent fall in aggregate poverty between 1987 and 1994. People below relative income poverty lines are now a good deal closer to those lines than in the past, and the share of national income needed to bridge that gap, to bring everyone up to those lines, is lower.
Current income may not in any case accurately reflect a household's living standards, which will be influenced by resources over a much; longer long period. The percentage of households on low income and experiencing what is widely regarded as basic deprivation - such as not being able to afford a warm coat or a second pair of shoes - was little changed between 1987 and 1994, at about 15 per cent. In our view this is a better indicator of the scale of generalised deprivation or exclusion due to lack of resources - a widely accepted definition of poverty. It has the great merit of focusing attention firmly on those who are most in need of sustained and targeted intervention.
Finally, between 1987 and 1994 average household income rose substantially in real terms. The benefits extended to those on low incomes, so if one took 1987's income poverty lines and uprated them simply by the increase in prices, the poverty rate would have fallen sharply by 1994.
WHILE poverty has, in our view, to be seen primarily in relative terms, concentrating entirely on relative income poverty lines will miss the difference between this and a period where average incomes stagnated, as they did for much of the 1980s. It will also fail to highlight the seriousness of a situation where the real incomes of the poor actually fall, as apparently occurred in the UK during the 1980s.
The way social welfare rates for different schemes changed visa vis average income is crucial in understanding what has been happening since the mid 1980s. As recommended by the Commission on Social Welfare, priority has been given to raising the lowest social welfare rates, for Unemployment Assistance and Supplementary Welfare Allowance, and these have increased a good deal more rapidly than average earnings (contributing to policy makers increased concern about the need to "reward work").
This brought recipients of those schemes much closer, but not all the way to half average income, so although their relative position improved, their measured poverty rates did not fall. At the same time, social welfare rates for other groups, especially the elderly and widows, rose by a good deal less than average incomes - though still ahead of inflation.
Key conclusions about the types of household most affected by poverty, on which policy should concentrate, do not, depend on precisely how poverty is measured. Most importantly, the unemployed continue to be the largest single group in poverty no matter how it is measured, and constitute the core of the problem.
FURTHER research in our on going programme sponsored by the Department of Social Welfare and the Combat Poverty Agency will be an important input into policy formation in particular the development and monitoring of the Government's National Anti Poverty Strategy. It will continue to concentrate on increasing our understanding of the causes of poverty and social exclusion and the most effective means of combating them, rather than sterile debates about the precise definition and extent of poverty.
The central conclusion so far is that substantial numbers remain below, what most people would see as a minimum acceptable standard of living. While neither sustained economic growth nor increasing employment will be enough on their own to bring everyone up, to that level, they make it a realistic possibility if the opportunity is grasped.
