The Facts

Poverty is multi-dimensional and it extends far beyond low income, indebtedness and other financial hardship, poverty tends to be characterised as a barrier to equal participation in society.  Its causes and symptoms are complex.

The National Anti-Poverty Strategy (NAPS) offers the following definition of poverty:

People are living in poverty, if their income and resources (material, cultural and social) are so inadequate as to preclude them from having a standard of living, which is regarded as acceptable by Irish society generally. As a result of inadequate income and resources people may be excluded and marginalised from participating in activities which are considered the norm for other people in society.
At risk of poverty/relative poverty

People or households are considered to be at risk of poverty when their income is less than a particular threshold. In the EU, the threshold has been set at 60% of the median income (mid-point in the scale of the highest to the lowest of all incomes in Ireland). Whether persons below the 60% threshold are actually experiencing poverty will depend on a number of factors. These include:

• The degree to which income is below the relevant thresholds;
• The length of time on this relatively low income – a long period can lead to real deprivation, as a person’s assets run down and cannot be fully maintained or replaced;
• Possession and use of other assets, especially one’s own home.

At risk of poverty threshold, per week, 2007 (EU SILC)
Single adult                €228.65
Couple + 2 children      €530.48
Lone parent + 1 child   €304.11

Consistent Poverty

The term ‘consistent poverty’ describes someone whose income is below the ‘at risk of poverty’ threshold, and who cannot afford at least two of the eleven deprivation indicators – these are items which most people define as necessities, which they themselves have, or if they don’t have them, it is only because they can’t afford them (i.e. not having an item does not reflect personal choice).  The 11 deprivation indicators are: (1)Two pairs of strong shoes (2) A warm waterproof overcoat (3) Buy new not second hand clothes (4) Eat meat, chicken, fish or a vegetarian equivalent every second day (5) Have a roast joint or its equivalent once a week (6) Had to go without heating during the last year through lack of money (7) Keep the home adequately warm (8) Buy presents for family or friends at least once a year (9) Replace any worn out furniture (10) Have family or friends for a drink or meal once a month (11) Have a morning, afternoon or evening out in the last fortnight for entertainment.

Poverty in Ireland

The most up-to-date data available on poverty in Ireland comes from the 2007 EU-SILC survey, conducted by the CSO (published in early December 2008). Using the EU poverty line set at 60% of median income, the findings reveal that in 2007 almost 16 out of every 100 people in Ireland were at risk of poverty. The 2008 edition of the CSO’s Statistical Yearbook indicates that out of approximately 1,050,000 children in Ireland aged less than 18 years, 19% are classified as being at risk of poverty. This amounts to approximately 200,000 children. More than half of all those at risk of poverty in Ireland today (55.9%) live in households headed by a person who is outside the labour force (i.e. people who are older or ill, or have a serious disability or are in caring roles). These are Ireland's most vulnerable people and they depend completely on social welfare payments for survival. There was an increase in the ‘at risk of poverty’ rate for older people. The rate rose from 13.6% in 2006 to 16.6% in 2007 (Source: EU-SILC survey, 2007).

 ‘At Risk of Poverty’    Consistent Poverty Ireland
                                            (EU-SILC)    EU(Eurostat)    Rates in Ireland (EU SILC)
Overall ‘at risk of poverty’ rate    16.5%           16%                    5.1%
Children                                  19   %           19%                    7.4%
People of working age                 16   %          15%                   4.7%
Older people (65+)                    16.6 %           19%                   2.0%
Employed                                  6.7 %            8%                    1.3%
Unemployed                             38.7 %           42%                  17.5%
Lone parent families                  37.6%            34%                  20.1%

The ‘working poor’

22.7% of those classified as being at risk of poverty in Ireland have a job. Translating this into numbers of people suggests that among Ireland’s employed in 2007 at least 115,000 were at risk of poverty.  Having a job is no guarantee of escaping poverty.

Poverty and Social Welfare

The results of CSO analysis that shows without the social welfare system Ireland’s poverty rate in 2007 would have been 41%. The actual poverty figure reflects the fact that social welfare payments reduced poverty by 24.5%.  The EU average is 36% reduction after social transfers, however Nordic countries secure 50% or more reductions after social transfers.

The role of Social Welfare (SW) payments in addressing poverty
                                                      2001    2004    2006    2007     EU 27 2007
Poverty levels before Social Welfare   35.6    39.8    40.3      41.0        52
Poverty levels after  Social Welfare    21.9    19.4    17.0      16.5        16
The role of Social Welfare                -13.7    -20.4   -23.3    -24.5        36

Social welfare rates and the cost of living

The government remains publicly committed to its target of ending consistent poverty by 2016.  In 2007 the consistent poverty rate was 5.1%, and significantly higher for many vulnerable groups.

A recent report Minimum Essential Budgets for Six Households 2008 published by the Vincentian Partnership for Social Justice highlights the challenges faced by people living on low incomes. Looking at different household types, it found that most households on social welfare or the minimum wage do not have enough income to sustain a basic standard of living.

According to the CSO in 2007 60% of median income poverty line for a single adult was €228.65 a week. Using predicted increases in average industrial earnings in order to update this figure to 2009 levels, produces a relative income poverty line of €229.47 for a single person. In 2009, any adult below this weekly income level will be counted as being at risk of poverty. The maximum social assistance paid to single people is currently €25.17 below the poverty line.