Poverty in Australia deals with the incidence of relative poverty in Australia and its measurement. The issue of relative poverty and its measurement are contentious political issues, with many on the left wing of Australian politics arguing that relative poverty ought to be the appropriate measure. [ citation needed ]Relative income poverty, for example, looks at the percentage of the population that earns less in comparison to average earnings. Many on the right of Australian politics argue that this relative measure is a mistake because it hides the existence of absolute poverty in Australia by looking only at those who, for whatever reason, earn relatively little.
Australia, officially the Commonwealth of Australia, is a sovereign country comprising the mainland of the Australian continent, the island of Tasmania and numerous smaller islands. It is the largest country in Oceania and the world's sixth-largest country by total area. The neighbouring countries are Papua New Guinea, Indonesia and East Timor to the north; the Solomon Islands and Vanuatu to the north-east; and New Zealand to the south-east. The population of 25 million is highly urbanised and heavily concentrated on the eastern seaboard. Australia's capital is Canberra, and its largest city is Sydney. The country's other major metropolitan areas are Melbourne, Brisbane, Perth and Adelaide.
Some of the latest information on poverty in Australia comes from a study conducted by the Australian Council of Social Service in 2012. The report, Poverty In Australia, shows that in 2010, after taking account of housing costs, an estimated 2,265,000 people or 12.5% of all people, including 575,000 children (17.3% of all children), lived in households below the most austere poverty line widely used in international research.however, the method to measure the line used an approach that is disputable, as explained below.
The Australian Council of Social Service (ACOSS) is an Australian organisation that advocates for action to reduce poverty and inequality, and is the peak body for the community services sector in Australia. It was formed in 1956.
In 2016, ACOSS released a new report revealing that poverty is growing in Australia, with an estimated 2.9 million people or 13.3% of all people living below the internationally accepted poverty line. It also estimated that there are 731,000 children in poverty, and 17.5% of children under the age of 15 are in poverty.
The main way of measuring poverty is to set a poverty line and then determine how many people fall below this line. Poverty lines can be set as either absolute poverty lines or relative poverty lines. Australia does not have an official poverty line, either absolute or relative. The 2012 report entitled Poverty in Australiaused two poverty lines and also took account of people's housing costs. One poverty line used by the OECD and in this study, referred to half of the middle income for all households, that is, 50% of median household income and the other is 60% of median income.
First introduced in 1990, the dollar a day poverty line measured absolute poverty by the standards of the world's poorest countries. The World Bank defined the new international poverty line as $1.25 a day for 2005 (equivalent to $1.00 a day in 1996 US prices).but have recently been updated to be $1.25 and $2.50 per day. Absolute poverty, extreme poverty, or abject poverty is "a condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services."
Extreme poverty, abject poverty, absolute poverty, destitution, or penury, was originally defined by the United Nations (UN) in 1995 as "a condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services." In 2018, extreme poverty widely refers to an income below the international poverty line of $1.90 per day, set by the World Bank. This is the equivalent of $1.00 a day in 1996 US prices, hence the widely used expression "living on less than a dollar a day". The vast majority of those in extreme poverty — 96 percent — reside in South Asia, Sub-Saharan Africa, the West Indies, East Asia, and the Pacific; nearly half live in India and China alone. As of 2018, it is estimated that the country with the most people living in extreme poverty is Nigeria, at 86 million.
The term 'absolute poverty', when used in this fashion, is usually synonymous with 'extreme poverty': Robert McNamara, the former President of the World Bank, described absolute or extreme poverty as, "...a condition so limited by malnutrition, illiteracy, disease, squalid surroundings, high infant mortality, and low life expectancy as to be beneath any reasonable definition of human decency".Australia is one of the world's wealthier nations. In his article published in Australian Policy Online, Robert Tanton notes that, "While this amount is appropriate for third world countries, in Australia, the amount required to meet these basic needs will naturally be much higher because prices of these basic necessities are higher."
Robert Strange McNamara was an American business executive and the eighth United States Secretary of Defense, serving from 1961 to 1968 under Presidents John F. Kennedy and Lyndon B. Johnson. He played a major role in escalating the United States' involvement in the Vietnam War. McNamara was responsible for the institution of systems analysis in public policy, which developed into the discipline known today as policy analysis.
Malnutrition is a condition that results from eating a diet in which one or more nutrients are either not enough or are too much such that the diet causes health problems. It may involve calories, protein, carbohydrates, vitamins or minerals. Not enough nutrients is called undernutrition or undernourishment while too much is called overnutrition. Malnutrition is often used to specifically refer to undernutrition where an individual is not getting enough calories, protein, or micronutrients. If undernutrition occurs during pregnancy, or before two years of age, it may result in permanent problems with physical and mental development. Extreme undernourishment, known as starvation, may have symptoms that include: a short height, thin body, very poor energy levels, and swollen legs and abdomen. People also often get infections and are frequently cold. The symptoms of micronutrient deficiencies depend on the micronutrient that is lacking.
Infant mortality is the death of young children under the age of 1. This death toll is measured by the infant mortality rate (IMR), which is the number of deaths of children under one year of age per 1000 live births. The under-five mortality rate, which is referred to as the child mortality rate, is also an important statistic, considering the infant mortality rate focuses only on children under one year of age.
However, as the amount of wealth required for survival is not the same in all places and time periods, particularly in highly developed countries where few people would fall below the World Bank's poverty lines, countries often develop their own National poverty lines.
An absolute poverty line was calculated in Australia for the Henderson poverty inquiry in 1973. It was $62.70 a week, which was the disposable income required to support the basic needs of a family of two adults and two dependent children at the time. This poverty line has been updated regularly by the Melbourne Institute according to increases in average incomes; for a single employed person it was $391.85 per week (including housing costs) in March 2009.In Australia the OECD poverty would equate to a "disposable income of less than $358 per week for a single adult (higher for larger households to take account of their greater costs).
Poverty can also be measured in relative terms, where the poverty line is set as some proportion of the average income or wealth of the society.
There are many different ways to calculate relative poverty, resulting in different levels of poverty, and researchers often argue about where the line should be drawn. For example, a Smith Family and NATSEM (The National Centre for Social and Economic Modelling) report in 2000 indicated as many as 1 in 8 Australians are experiencing poverty. The Centre for Independent Studies (CIS) argues that their research indicates the figure is at least 1 in 12 and could even be as low as 1 in 20. This is because their poverty lines were determined in different ways:
The problem of these measures is that they focus exclusively on income. But poverty is also defined through other indicators such as education, health, access to services and infrastructure, vulnerability, social exclusion, access to social capital, etc.
The most widely used indicator to take non-income factors into consideration is the Human Development Index (HDI) compiled yearly by the United Nations Development Programme (UNDP), which combines measure for income, health and education. For advanced economies, the Human Poverty Index (HPI-2) was developed, which takes into consideration the higher levels of income, health and education in these countries. Australia ranks very high on these global indexes.
This section's factual accuracy may be compromised due to out-of-date information. (February 2012)
During the first decade of the twenty-first century, the notion of "the rich getting richer and the poor getting poorer" was increasing in popularity. Often, different conclusions have been reached depending on how relative poverty is measured.
According to the Smith Family in 2001:citation needed please
This report highlighted the relationship between poverty and unemployment with the under-employed facing greater risks of poverty particularly with the increasing casualisation of the workforce.
The last report, 2006, The UN Human Poverty Index (HPI) for 2006 only has a ranking for 18 of the 21 countries with the highest Human Development Index.citation needed
In the report, Australia is ranked 4th in the OECD, with a HPI of 12.8.
The value for the 'Population below 50% of median income (%)' for Australia was 14.3% (2.84 Million).
Australia's child poverty rate falls in the middle of the international rankings. In 2007, UNICEF's report on child poverty in OECD countries revealed that Australia had the 14th highest child poverty rate.
The child poverty rate is estimated at 0.13 (under 17 years of age) according to OECD statistics (using the median income) from 2013 - 2017. According to ACOSS, children under the age of 15 have a poverty rate of 17.3%, and young people aged 15 to 24 have a rate of 13.9% . They suggest the high poverty rate is related to the high poverty rate among single adults (estimated 25%) . This is high compared to the total national poverty rate of 12.8% according to OECD statistics . National Centre For Social And Economic Modeling (NATSEM) suggests another reason for high child poverty rates could be the unavailability of affordable housing for low income adults. They found that 39% of families with children under the age of 15 were presented with unaffordable mortgages, which suggests rising mortgage prices in Australia may be increasing the child poverty rate .
According to statistics by the OECD (using median household income), the poverty rates of citizens over 66 are more than double the national average at 0.257. To look at Australia’s elderly poverty rate comparatively, it ranks #4 among the OECD nations, 8 times the lowest ranking of 0.031 for France, the Netherlands, and Denmark. The rate is more comparable to that of other liberal economies, with the US at 0.229 and the UK at 0.142 . Although these elderly poverty rates are low, some sources indicate this may be because home ownership is high in Australia among the elderly. For example Australian Bureau of Statistics’ 2009-10 Survey of Income and Housing indicates that 33% of households own their homes without a mortgage, whereas 36% own a home with a mortgage (that’s 21% of homeowners with a mortgage) . This is relevant when compared with the Home-ownership in the United States, where the Washington Post estimates 66% of US homeowners have some type of mortgage . Australia’s high home ownership rates and low mortgage rates may be a factor in determining the wealth of citizens over 66 years of age, not reflected in the elderly poverty rate.
Indigenous and minority groups are sometimes referred to as the "Fourth World". They experience a lower life expectancy, higher rates of infant mortality, higher unemployment rates, a lower general standard of living (health, housing), high rates of arrest and imprisonment, plus problems of alcohol and other substance abuses.
Australian Indigenous people are no exception. In 2000, life expectancy of Indigenous Australians was some 20 years below that of other Australians.All the socioeconomic indicators such as income, employment, housing, education and health show considerable disparities between Australia's Indigenous and non-Indigenous populations. In fact, Australian Indigenous poverty ranks alongside countries as poor as Bangladesh where absolute poverty is real.
In the years following the end of the Second World War, and during Australia's long post-war economic boom, it was widely believed that the introduction of the welfare state together with the emergence of the affluent society had finally put an end to poverty in "the lucky country". The mid-to-late Sixties, however, saw a "rediscovery" of poverty, as it was found that many Australians had failed to share in the post-war economic boom.
A number of researchers and organisations highlighted the persistence of poverty in Australia. According to one academic in 1960, Helen Hughes, about a third of the half-a-million widows and aged and invalid pensioners in Australia were estimated by social workers to be living in poverty. In 1959, another academic by the name of James Jupp wrote about the "submerged tenth" of the Australian population left out of the country's economic prosperity, including Aborigines, shack dwellers, deserted wives, unemployed migrants, slum dwellers, pensioners, and "no-hopers". Research into the extent of poverty in Australia was also undertaken by the Victorian and Australian Councils of Social Service, while the church-based welfare agency, the Brotherhood of St. Laurence, carried out a number of studies into the needs of low-income families and pensioners.
In 1963, a Melbourne university lecturer called Ray Brown estimated that 5% of Australians lived in chronic poverty, with articles published in the radical magazine "Dissent" by David Scott, Leon Glezer, and Michael Keating coming to similar conclusions. In 1966 popular awareness of poverty was further extended by the publication of John Stubb's "The Hidden People", where he estimated that half-a-million Australians lived in poverty.
Housing conditions also remained underdeveloped for many Australians. A census carried out in 1954 revealed that 49,148 families were living in huts and sheds, while by the end of 1972, more than 1.5 million people in the major cities were living in flats and houses that were not connected to a complete sewerage reticulation system. In 1971, the Institute of Applied Economic Research estimated that at least 1 million Australians lived in poverty. A report by Justice John A. Nimmo from the start of the Seventies estimated that there were about a million Australians living below a miserably poor "poverty line."
Labor parliamentarians provided numerous instances of social and financial deprivation in their own constituencies. As one Labor parliamentarian representing East Sydney asked the Minister for Social Services, Hugh Robinson, to see in May 1964
“if he would like to get up early one morning and go to Paddy's Market or the general City Markets area of Sydney he would see many pensioners going through rubbish heaps to pick out food scraps with which to supplement their meals. You will see pensioners buying second-hand clothing because it is cheap. You will see other pensioners trying on spectacles. Spectacles are not included in social service benefits and the pensioners go to Paddy's Market because glasses may be bought there for one or two shillings a pair. I have seen age pensioners in the market trying sets of false teeth which are sold there. These people go to the market and can be seen standing there actually trying false teeth to see whether they fit. This situation obtains in Australia at present and we should be ashamed of it and so should the Government."
Other studies on poverty carried out by the International Labour Office in Geneva also revealed high incidences of poverty in Australia. In 1973, using a national poverty line, it was estimated that 20.8% of Australians lived in poverty before benefits were taken into account, and 11.0% after benefits were taken into account. By contrast, using a standard poverty line, it was estimated that 24.3% of Australians lived in poverty before benefits, and 19.3% after benefits.
One academic whose work on poverty would galvanise both public and political opinion was that of Professor Ronald Henderson who, together with his fellow researchers from the Melbourne University Institute of Applied Economic and Social Research, carried out the "first systematic attempt to estimate the extent of poverty in Australia".
In 1966, Henderson and the Melbourne University Institute of Applied Economic and Social Research which he headed set out to measure the extent of poverty in the city of Melbourne. A poverty line was set at $33, which was close to the basic wage plus child endowment for two children. Based on this figure, 7.7% of all family units in Melbourne lived on or below the poverty line, while an additional 5.2% "hovered dangerously close to the minimum level".
A Commission of Inquiry into Poverty was set up in August 1972 by the Liberal Prime Minister William McMahon, and Henderson was appointed as Chairman of the inquiry. The Whitlam Government elected later that year expanded the size of the Commission and scope, giving it specific responsibility to focus on the extent of poverty in Australia together with the groups most at risk of experiencing poverty, the income needs of those living in poverty, and issues relating to housing and welfare services. These issues were addressed in the Commission's first main report, "Poverty in Australia", which was released in April 1975.
In this report, Henderson sought to identify the extent of poverty in Australia in terms of inadequate income relative to need, and the poverty line was defined as a percentage of average earnings, adjusted for household size. The poverty line was set at 56.5% of average earnings for a "standard" family (consisting of a male breadwinner, a woman not in paid employment, and two dependent children). According to the report, 8.2% of the population lived in poverty in 1972–73, or 6.4% when housing costs were taken into account.Before housing costs, over 10% of income units in 1972–73 were below the Commission's poverty line, while a further 8% were defined as 'rather poor', having an income of less than 20% above that line. After housing costs were taken into account, the percentage of income units living below the poverty line was about 7%.
The Henderson Commission of Inquiry into Poverty also estimated that more than 50% of Aborigines had living standards below the poverty line and less than 20% above it. The infant mortality rates among Aborigines in the period 1973–77 were 63 deaths per thousand live births in the Northern Territory and 71 per thousand in Queensland. This compared with a rate of 62 per thousand in South America, 59 per thousand in Africa, 41 per thousand in Central America, 68 per thousand in Asia, and 15 per thousand amongst non-Aboriginal Australians.
In 2017 Australian Council of Social Service released a new report revealing that poverty is growing in Australia, with an estimated 2.9 million people or 13.3% of all people living below the internationally accepted poverty line. The report also estimated that there are 731,000 children in poverty, and 17.5% of children under the age of 15 are in poverty.
Poverty is the scarcity or the lack of a certain (variant) amount of material possessions or money. Poverty is a multifaceted concept, which may include social, economic, and political elements. Absolute poverty, extreme poverty, or destitution refers to the complete lack of the means necessary to meet basic personal needs such as food, clothing and shelter.
The poverty threshold, poverty limit or poverty line is the minimum level of income deemed adequate in a particular country. In practice, like the definition of poverty, the official or common understanding of the poverty line is significantly higher in developed countries than in developing countries. In 2008, the World Bank came out with a figure of $1.25 a day at 2005 purchasing-power parity (PPP). In October 2015, the World Bank updated the international poverty line to $1.90 a day. The new figure of $1.90 is based on ICP purchasing power parity (PPP) calculations and represents the international equivalent of what $1.90 could buy in the US in 2011. The new IPL replaces the $1.25 per day figure, which used 2005 data. Most scholars agree that it better reflects today's reality, particularly new price levels in developing countries. The common international poverty line has in the past been roughly $1 a day. At present the percentage of the global population living under extreme poverty is likely to fall below 10% according to the World Bank projections released in 2015, although this figure is claimed by scholars to be artificially low due to the effective reduction of the IPL in 2015.
The basic needs approach is one of the major approaches to the measurement of absolute poverty in developing countries. It attempts to define the absolute minimum resources necessary for long-term physical well-being, usually in terms of consumption goods. The poverty line is then defined as the amount of income required to satisfy those needs. The 'basic needs' approach was introduced by the International Labour Organization's World Employment Conference in 1976. "Perhaps the high point of the WEP was the World Employment Conference of 1976, which proposed the satisfaction of basic human needs as the overriding objective of national and international development policy. The basic needs approach to development was endorsed by governments and workers’ and employers’ organizations from all over the world. It influenced the programmes and policies of major multilateral and bilateral development agencies, and was the precursor to the human development approach."
Median income is the amount that divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group. Mode income is the most frequently occurring income in a given income distribution.
Child poverty refers to the state of children living in poverty. This applies to children that come from poor families or orphans being raised with limited, or in some cases absent, state resources. Children that fail to meet the minimum acceptable standard of the nation where that child lives are said to be poor. In developing countries, these standards are lower and when combined with the increased number of orphans the effects are more extreme
Affordable housing is housing which is deemed affordable to those with a median household income or below as rated by the national government or a local government by a recognized housing affordability index. Most of the literature on affordable housing refers to mortgages and number of forms that exist along a continuum – from emergency shelters, to transitional housing, to non-market rental, to formal and informal rental, indigenous housing, and ending with affordable home ownership.
Being one of the fastest-growing economies in the world, poverty has been on a decline with close to 44 Indians escaping extreme poverty every minute, as per the World Poverty Clock. India has been able to lift significant percentage of its population out of poverty but many still live in it. It had 73 million people living in extreme poverty which makes up 5.3% of its total population according to Brookings report. The World Bank reviewed and proposed revisions on May 2014 to its poverty calculation methodology and purchasing power parity basis for measuring poverty worldwide.. Although, it was a minimal 3.6% in terms of percentage. As of 2014, 58% of the total population were living on less than $3.10 per day. According to the Modified Mixed Reference Period (MMRP) concept proposed by World Bank in 2015, India's poverty rate for period 2011-12 stood at 12.4% of the total population, or about 172 million people; taking the revised poverty line as $1.90.
Despite being a developed country, those who are living at the lower end of the income distribution in the United Kingdom have a relatively low standard of living. Data based on incomes published in 2016 by Department for Work and Pensions (DWP) show that, after housing costs have been taken into consideration, the number of people living in the UK in relative poverty to be 13.44m. In 2015, a report by Institute for Fiscal Studies reported that 21.6% of Britons were now in relative poverty. The report showed that there had been a fall in poverty in the first few years of the twenty-first century, but the rate of poverty had remained broadly flat since 2004/5.
Poverty can be and is measured in different ways by governments, international organisations, policy makers and practitioners. Increasingly, poverty is understood as multidimensional comprising social, natural and economic factors situated within wider socio-political processes. The capabilities approach also argues that capturing the perceptions of poor people is fundamental in understanding and measuring poverty.
Poverty in France has fallen by 60% over thirty years. Although it affected 15% of the population in 1970, in 2001 only 6.1% were below the poverty line.
Poverty in Switzerland refers to people who are living in relative poverty in Switzerland.
Poverty in Canada remains prevalent within some segments of society and according to a 2008 report by the Organisation for Economic Co-operation and Development, the rate of poverty in Canada, is among the highest of the OECD member nations, the world's wealthiest industrialized nations. There is no official government definition and therefore, measure, for poverty in Canada. However, Dennis Raphael, author of Poverty in Canada: Implications for Health and Quality of Life reported that the United Nations Development Program, the United Nations Children's Fund (UNICEF), the Organisation for Economic Co-operation and Development and Canadian poverty researchers find that relative poverty is the "most useful measure for ascertaining poverty rates in wealthy developed nations such as Canada." In its report released the Conference Board.
In terms of global poverty criteria, the United Kingdom is a wealthy country, with virtually no people living on less than £4 a day. In 2012–13, median personal income was approximately £21,000 a year but varies considerably by age, location, data source and occupation. There is both significant income redistribution and income inequality; for instance, in 2013/14 income in the top and bottom fifth of households was £80,800 and £5,500, respectively, before taxes and benefits (15:1). After tax and benefits, household income disparities are significantly reduced to £60,000 and £15,500 (4:1).
Israel's standard of living is significantly higher than that of most other countries in the region, and is comparable to that of other highly developed countries. Israel was ranked 19th on the 2016 UN Human Development Index, indicating "very high" development. It is considered a high-income country by the World Bank. Israel also has a very high life expectancy at birth. The population still suffers from poverty, though these rates vary.
Poverty is a state of deprivation, lacking the usual or socially acceptable amount of money or material possessions. The most common measure of poverty in the U.S. is the "poverty threshold" set by the U.S. government. This measure recognizes poverty as a lack of those goods and services commonly taken for granted by members of mainstream society. The official threshold is adjusted for inflation using the consumer price index.
The poverty line for 2014 marked a per capita income of 100,534 pesos a year. According to the data from the National Statistical Coordination Board, more than one-quarter of the population fell below the poverty line the first semester of 2014, an approximate 78 percent increase since 2013.
Between 1982 and 2011, New Zealand's gross domestic product grew by 35%. Almost half of that increase went to a small group who were already the richest in the country. During this period, the average income of the top 10% of earners in New Zealand almost doubled going from $56,300 to $100,200. The average income of the poorest tenth increased by only 13% from $9700 to $11,000.
Japan, despite being the world's third largest economy, has a rising problem of poverty. Poverty figures are very hard to find in Japan because of its reputation as a developed country, it is generally assumed that the levels of poverty are relatively low. However several media reports contrast this.
Poverty in South Korea has been in drastic decline since the mid-20th century, particularly the absolute poverty rate. Relative poverty was also in decline until the late 1990s, but has risen since then. While only about 2% of South Koreans are affected by absolute poverty today, about 14-15% of these 2% are elderly and are affected by relative poverty.
Poverty in Poland has been relatively stable in the past decades, affecting about 6.5% of the society. There have been noticeable increases in poverty around the turns of the decades, offset by decreases in poverty in the years following those periods.