THE very poor are not as poor as they were in 1987, but the number of those who fall below the poverty line remains much the same, according to a new survey on poverty in Ireland.
Poverty in the 199Os, jointly published by the Economic and Social Research Institute and the Combat Poverty Agency, is a study of evidence from the 1994 Living in Ireland Survey.
This is the first major household survey since 1987, and is part of the European Community Household Panel. It will allow comparison with poverty statistics and policies in other EU states.
The study considers the contentious question of the measurement of poverty. A poverty line of £63 per week for a single person in 1994 was set on the basis of this being half the current average income. It found that the number of those falling below that figure was up by between one and two percentage points since 1987.
However, this takes no account of how far people fall below the poverty line. While average income rose by 50 per cent in those seven years, prices rose only by 21 per cent. When prices are taken into account, the number of people below the price-adjusted poverty line falls from 20 per cent to 8 per cent over that period.
Public policy on social welfare since 1987 has concentrated on raising the lowest levels of benefits. This brought recipients of Unemployment assistance and supplementary welfare allowance in 1994 much closer to, though not above the poverty line, compared with their position in 1987.
But support for other groups, notably the elderly and widows, fell in relative terms, and their poverty rates have risen.
Farm households are at a much lower risk of poverty than in 1987, both because 1987 was a bad year for farmers and because of a substantial rise in farm incomes since then.
The elderly, and households headed by a single adult, a female or an unemployed person, face an increased risk of poverty. Children are more likely than adults to suffer poverty.
The ESRI also published another study yesterday, A Review of the Commission on Social Welfare's Minimum Adequate income.
This re-examined the 1985 report of the Commission on Social Welfare, which recommended that a minimally adequate basic income for a single person should be £50 to £60 a week in 1985.
At the time the commission defined this as follows: "To be adequate, payments must prevent poverty, and in our view poverty must be judged in the light of the actual standards of living in contemporary Irish society."
The 1996 report estimates a minimum adequate income for a single adult as between £75 and £96 a week. At the moment the basic rates of social welfare payment for a single adult range between £62 and £75 a week.
The survey points out that in
1985 the bottom rates of social welfare were only 64 per cent of the bottom rate recommended by the CSW, and that they have been brought much closer to its minimum recommendations since. Social welfare payments in Ireland are now generally above those in the UK, relative to income, though below those in other EU countries.
The authors examined the impact of increasing social welfare payments both on reducing poverty and on taxation levels. These are related, as increased welfare payments would increase tax which, under the current system, would cut the take-home pay of the lower-paid as well as of everyone else.
Increasing the minimum rate to £68 a week would require a tax increase of about 1 per cent. Increasing it to £90 a week would lead to a tax increase of about 11 per cent.
The lower rate would not represent a major disincentive to work on the part of recipients, according to the authors, but the higher rate, when combined with the increased tax rate, would. "Estimates of the likely behavioural response to such changes in incentives are not currently available," they add.
If the adequacy of social welfare payments is assessed against the standards of the society at a given time, then the target will move up along with those standards, they say. However, there is wide scope for debate about how adequacy should be measured, along with an assessment of the efficiency and incentives aspect of social welfare policy.