Thursday, June 25, 2015

What is poverty?

Many people will have read of the Tory government’s intention to redefine what child poverty actually is. The main official measure of poverty – which defines being poor as living in a household with a disposable income of less than 60% of the contemporary median – is narrowly financial. But there is more to poverty than lack of money, of course. Poverty figures for 2013-14. IFS projections suggest child poverty rose by 300,000 in that year, nowhere near meeting its child poverty targets. The Conservative plan to move to a new measure of the “root causes” of hardship, such as worklessness, debt and addiction, sounds reasonable, but the purpose is to cloud accountability. However there is a different approach.

The Global Multidimensional Poverty Index (MPI) complements measures based on income and reflects the overlapping disadvantages poor people can face across different areas of their lives all at the same time. They include poor health, a lack of education and low living standards. If people are deprived in at least one-third of ten weighted indicators, they are identified as multidimensionally poor. The index combines the percentage of people living in multidimensional poverty with the intensity of deprivations, or how much they are experienced. The findings suggest that the scale of global poverty is even greater than is often estimated using traditional measures based on income. In some countries, including Mexico, Pakistan and Egypt, the researchers found that the number of people living in multidimensional poverty is twice the number who live on less than $1.25 a day.

For example, the figures reveal that, of the 1.6 billion people living in multidimensional poverty: more than 1.2 billion people don't have adequate sanitation; over 1 billion are living on dirt floors; around 900 million do not have electricity; roughly 900 million people live in a household where someone is malnourished; and more than half a billion live in a home in which no-one has completed five years of school.

Analysis of the Global MPI 2015 also reveals that the world's poor do not necessarily live where you would expect. The findings show that over two thirds (70%) of people in multidimensional poverty actually live in middle-income countries, with just 30% living in low-income countries. More than 60% of people who are poor (according to the Global MPI) live in countries rated as having medium or high levels of development on the Human Development Index. 62% of the multidimensionally poor live in countries that are not in the three highest categories of alert on the Failed States Index.

Overall, South Asia is home to over half (54%) of the global MPI poor population, while 31% live in Sub-Saharan Africa. The country with the highest percentage of people in multidimensional poverty is South Sudan where 91% of people are MPI poor. The region with the highest poverty rate is Salamat in Chad, where 98% of people are living in multidimensional poverty.

As David Cameron himself fully explained “Even if we are not destitute, we still experience poverty if we cannot afford things that society regards as essential. The fact that we do not suffer the conditions of a hundred years ago is irrelevant. In the nineteenth century Lord Macaulay pointed out that the poor of his day lived lives of far greater material prosperity than the greatest noblemen of the Tudor period. But as Dickens observed, the poor of those days were still poor. Fifty years from today, people will be considered poor if they don't have something which hasn't even been invented yet. So poverty is relative - and those who pretend otherwise are wrong.””