Written answers

Thursday, 30 June 2005

Department of Social and Family Affairs

Anti-Poverty Strategy

8:00 pm

Photo of Fergus O'DowdFergus O'Dowd (Louth, Fine Gael)
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Question 22: To ask the Minister for Social and Family Affairs if he does not accept relative income and consistent poverty as measures of poverty; and if he will make a statement on the matter. [22925/05]

Photo of Pat BreenPat Breen (Clare, Fine Gael)
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Question 23: To ask the Minister for Social and Family Affairs the progress to date on the eradication of consistent poverty; and if he will make a statement on the matter. [22884/05]

Photo of Fergus O'DowdFergus O'Dowd (Louth, Fine Gael)
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Question 34: To ask the Minister for Social and Family Affairs if he will list and outline the current data on poverty here; and if he will make a statement on the matter. [22926/05]

Photo of Michael NoonanMichael Noonan (Limerick East, Fine Gael)
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Question 52: To ask the Minister for Social and Family Affairs if he is concentrating his efforts on dealing with consistent poverty and not relative income poverty; and if he will make a statement on the matter. [22924/05]

Photo of Séamus BrennanSéamus Brennan (Dublin South, Fianna Fail)
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I propose to take Questions Nos. 22, 23, 34 and 52 together.

The relative income poverty indicator measures the proportion of people below the threshold of 60% of median income. People with income below that threshold are considered by the EU to be "at risk of poverty". The consistent poverty indicator identifies those below the 60% median income threshold who are also experiencing deprivation in goods and services considered essential for a basic standard of living in Ireland. There are eight indicators of deprivation chosen on the basis of surveys of what Irish people consider essential for a basic standard of living.

Across EU member states a new EU survey on income and living conditions, EU SILC, is the principal source of data on these and other indicators. The survey is conducted in Ireland by the Central Statistics Office. It replaces the living in Ireland survey, LIIS, which was conducted by the Economic and Social Research Institute, ESRI, until 2001. Ireland was among the first set of five countries to introduce EU SILC in 2003.

That survey reported that 22.7% of persons were at risk of poverty in 2003, which represents a slight increase on the 2001 figure of 21.9%. It is the case that when countries experience rapid economic growth, as occurred in Ireland in the 1990s, the incidence of relative poverty can increase as a result of the increase in incomes generally, for example, it rose in Ireland from 15.6% to 20.9% during a period of high economic growth between 1994 and 2000. However, if we use the "anchored poverty line approach" over the same time frame based on increases of the poverty threshold by the rate of increases in consumer prices only, the level of poverty actually falls by 55.9%.

The impact of general rises in income is also illustrated by a recent EUROSTAT study. This gives the monetary value of the 60% median threshold for a household with two adults and two children in 2003 in terms of purchasing power standards. It shows that the value for Ireland is above the EU average and eighth highest overall. This means that many households in Ireland with incomes below the 60% threshold have a better standard of living than similar households classified as not at risk of poverty in other member states.

The relative income approach, of course, only measures income. It does not take account of the high level of home ownership, especially among the elderly, and consequently of the value to households of owning their own home. It also does not reflect access to household allowances in kind such as electricity, fuel, telephone rental and TV licence.

The EU-SILC survey reported that 10.2% of households experienced consistent poverty in 2003, up from 5.2% in 2001 under the earlier LIIS survey. However, both the CSO and the ESRI have made it clear that methodological differences between the two surveys mean that the figures for 2001 and 2003 are not comparable and that it is, therefore, not possible to conclude from them how consistent poverty changed during this period.

There is no reason to believe that there has been a worsening in basic deprivation levels in recent years. Between 2001 and 2005, spending on social welfare has increased from €7.8 billion to €12.2 billion. During the same period the lowest social welfare rates have increased by 40% while the consumer price index has increased by just over 13%. As a result of budget 2005, welfare payments have increased by three times the expected rate of inflation.

Nevertheless, what is not in question from the survey results are the groups who are identified as being most at risk of poverty and deprivation. EU- SILC confirms the findings of earlier surveys in this regard. The most vulnerable groups are families with children, especially lone parents and larger families, those who are unemployed or with disabilities and the elderly, especially women living alone.

For those of working age the best route out of poverty is employment and this includes lone parents and those with disabilities, as well as the unemployed. This requires ensuring that social welfare payments are organised and administered in ways that are employment friendly. It also involves providing the necessary supports, such as education and training, employment services and affordable child care. The development of policies to meet these challenges is now a top priority with, for example, high level working groups examining how best to enable lone parents overcome the obstacles to employment they face and on how best to further develop the provision of affordable child care. Similar strategic and coordinated approaches are being developed for those with disabilities and the elderly.

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