Chapter 2 - Defining and measuring poverty
Poverty is essentially the lack of the means to live. At the
heart of any consideration of poverty lies the issue of what is needed to live "a
decent life" and, more fundamentally, what it is to be human.
This chapter provides an overview of issues relating to poverty and the
measurement of poverty. Specifically, it addresses issues related to the
differing definitions of poverty, the ways in which poverty may be measured and
various problems that arise in any attempt to measure poverty. These issues
have been the subject of extensive debate and controversy over many decades.
That this is the case is not surprising. As one submission noted 'in effect the
measurement of poverty and inequality seeks to quantify a set of values, and
value judgements, of a society'.
What is poverty?
Poverty as a concept is difficult to define and during the Committee's
inquiry there were differing views amongst participants as to what constitutes
poverty or how best to measure it (a problem shared with academic researchers
and the community generally). One study has argued that the only point of
general agreement is that people who live in poverty must live in a state of
deprivation, a condition in which their standard of living falls below some
minimum acceptable standard.
Submissions and other evidence to the inquiry provided a range of
approaches to the conceptualisation and definition of poverty. Poverty can be
broadly defined in absolute or relative terms. Absolute poverty refers to people
who lack the most basic of life's requirements and is measured by estimating
the numbers of individuals or families who cannot provide for the necessities
of life such as housing, food or clothing. Commentators have generally argued
that the meaning of poverty in a relatively advanced country like Australia is
quite different from the absolute deprivation or subsistence which exists in
many developing countries and therefore the concept of absolute poverty has
little relevance to conditions in Australia.
However, the Aboriginal and Torres Strait Islander Commission (ATSIC) noted
that some remote Indigenous communities are in absolute poverty in Australia,
measured by poor infrastructure with associated diseases that are largely
eradicated in other parts of Australia and with high child mortality rates.
Another submission also commented that instances of infant mortality and
malnutrition amongst Indigenous Australians, for example, indicate the presence
of absolute poverty in Australia.
Other examples of absolute poverty include the homeless or those at risk of
homelessness and/or those with very few material possessions who rely on social
security benefits and charities just to 'get by'.
In affluent Western countries like Australia poverty is usually
conceived in relative rather than absolute terms. Relative poverty refers to
individuals or families that have low incomes or other resources relative to
other individuals or families. Relative poverty is defined not in terms of a
lack of sufficient resources to meet basic needs, but rather as lacking the
resources required to participate in the lifestyle and consumption patterns
enjoyed by others in the society.
Evidence to the Committee has generally defined poverty in relative
terms as is illustrated in the definitions provided below.
Poverty is an enforced lack of socially perceived
necessities. This definition has three core elements:
- a lack of necessities;
- that necessities are socially
- that the lack of necessities is
caused by limited material resources.
163, p.38 (ACOSS).
St Vincent de Paul National
Poverty has two elements:
- financial and/or economic
disadvantage for an individual or household; and
- inequality of opportunity where
the expectations of the poor and disadvantaged are well below community norms
While financial disadvantage is an important part of
the problems for the poor and disadvantaged, equally important is the
inequality of opportunity. It is this lack of opportunity which brings about
poverty and/or prevents people from escaping the poverty cycle.
Submission 44, p.6 (St Vincent de Paul National Council).
Poverty includes social, psychological and spiritual
dimensions, in addition to financial hardship.
The inevitable consequence of adopting such an
inclusive understanding of the nature of poverty is to appreciate the breadth
of the impact which poverty has on a person's ability to function as a full
member of society. It is not just a matter of being unable to buy things, but
of being unable to participate – of being excluded and isolated from one's
fellow human beings.
p.8 (Mission Australia).
Poverty is essentially the lack of the means to live.
The Christian tradition understands that people have,
in addition to basic physical needs such as food, shelter and clothing, other
basic needs, such as the need for education, the need to participate in society
and contribute to the common good, the need for intellectual, cultural and
creative activity, the need to participate in religious activity and community
and the need for rest and recreation. Without these other basic needs being
met, human beings may survive but do not flourish.
p.3 (UnitingCare Australia).
Brotherhood of St Laurence
Poverty is both:
- the lack of access to an adequate
material standard of living (in terms of food, shelter, clothing and health)
resulting primarily, but not only, from inadequate income; and
- the lack of opportunity to
participate fully in society (for example through employment, education,
recreation and social relationships).
"Adequacy" is defined in relation to
community standards and may change over time, as do standards of living for the
community as a whole.
p.1 (Brotherhood of St Laurence).
While definitions of poverty vary, they generally share common features.
As noted above, ACOSS defines poverty as an enforced lack of socially perceived
necessities, which has a number of core elements which it shares with other
definitions of poverty.
Necessities are resources – goods and services – that people cannot
reasonably live without. The adequacy of resources and whether or not they are
necessary needs to be gauged according to people's needs. Poverty is usually
defined with reference to a set of basic human needs – physical survival and
comfort, and the need to participate in the economic and social life of the
community. This suggests that poverty has two forms which ACOSS refers to as 'subsistence
poverty' – an inability to meet basic physical needs, and 'participation or
social poverty' – an inability to meet social needs. Examples of subsistence
poverty include inadequate diet, sub-standard housing or denial of basic health
services. Examples of participation poverty include an inability to meet
regularly with family or friends, to travel to job interviews, to afford school
books and excursions for children, or to complete an education. These forms of
poverty are closely related but are distinct. People may have all the resources
they need to subsist but lack the resources required for social participation.
Participation poverty has much in common with the idea of social exclusion, a
term that usually refers to the exclusion of people from mainstream social and
Similar arguments were provided by Professor Peter Saunders of the
Social Policy Research Centre who argued that despite the apparent diversity in
the definitions of poverty most encompass a number of core features. These are
that poverty is a situation in which resources are not adequate to meet basic
needs and that any definitions usually embody community perceptions of poverty
in some way. He argued that a definition of poverty as an enforced lack of
socially perceived necessities captures the critical aspects of poverty
succinctly. It also emphasises the fact that poverty is a situation which is
forced onto people, not chosen by them.
This fundamental point was constantly raised in evidence to the inquiry.
Several submissions argued that the lived experience of the poor should
also be taken into account in defining poverty. One submission noted that
ideally submissions to a poverty inquiry such as this inquiry should not be
written by professional social analysts, economists or even welfare
practitioners but should be written by the poor themselves – 'only those who
are, or have been, genuinely poor can do justice to the experience of the
suffering of those economically disadvantaged'.
Another submission referred to a number of social surveys of disadvantaged
people which demonstrated their capacity to present a detailed and multifaceted
understanding of what it means to be disadvantaged in Australian society.
2.10 The Committee
recognises these issues and was deeply moved by the personal descriptions from
those people experiencing poverty and those working directly with the poor and
disadvantaged 'at the coalface'. The Committee's many hearings conducted
throughout urban and regional Australia provided an opportunity to hear directly
of the experiences and difficulties of people living in poverty and those
working closely with them, especially through welfare agencies. Their
collective insights were particularly valuable and provided a useful reference
point for framing many of the Committee's approaches to poverty alleviation. A
number of these individual contributions are provided below.
Means to be Poor
A lot of people that
have been here have spoken of how they came to be in poverty. I am speaking as
someone who lives in poverty...It does not matter how a person comes to live in
poverty, and it does not matter what it says in the dictionary as its
definition; poverty is everything. You cannot afford basic needs. The first
thing that you let go of is yourself...When you are sitting down trying to work
out a budget on $342, straightaway you see $48 for groceries and $28 for
toiletries and other necessities – that is $70 already. Then you add rent on to
that. That is not having a car – which is a luxury, I believe – or a telephone,
because it is not a necessity. The needs of life are not covered by what is put
in. It does not matter whether you are on unemployment or a pension. You break
it down: it is not enough for anybody to sustain a standard of living.
Committee Hansard 4.08.03, p.1198 (Miss Catherine Gammage, Brisbane).
live in a moderately middle-class suburb...It is not totally affluent but I know
some people around me in the cul-de-sac and up the street who cannot afford
heating. They go to bed at dark. They cook their dinner early, they turn on
their electric blanket and they take their dinner to bed with them so that they
will not have to turn on the heating. They cannot afford wood. They cannot
afford their oil heater and their oil heaters are sitting there unused and
going rusty. That is not just one or two people; there are many. People say, "What
a good idea! Right." So for quite a number of people that is the norm in
what is not a poor suburb. These are people who have worked hard all their
lives. They are not on pensions, they are not eligible for a pension, but they
cannot afford heating.
Committee Hansard 2.05.03, p.222
(Tasmanian Poverty Coalition).
I hear is absolute pain, the pain of poverty. Let us not walk away from that:
it is a very painful experience. I am still haunted by the story of a person
who did not appear at but whose story was told at a recent Just Jobs
conference. This was a man who lived in the Huon Valley who had become totally isolated by his poverty, to
the degree that he did not leave or very rarely left his home. He remained shut
up in his house because of the shame, the feelings of rejection and the sense
of isolation from his community. When we have people who are shut up in their
homes because of the experience of poverty, people who are not interacting with
others, then I think we have a serious problem on our hands.
Committee Hansard 2.05.03, p.212
(Tasmanian Catholic Justice & Peace Commission).
Like millions of other low-income Australians,
I am one of the hidden poor, just keeping afloat. We are flat out treading
water out here. We are making very little headway towards our aspirations, and
we are one crisis or catastrophe away from the poor box. We are living on the
We live in the shadows
of the dismal statistics. We are not mad, bad, sad or totally dysfunctionally
overwhelmed by our life circumstances. Many of us are highly skilled and well
educated. We are all doing what we can to contribute to society with the
resources we have. Our poverty is poverty of resources, services and
opportunities...it is getting too hard to make ends meet, let alone work towards
Committee Hansard 1.07.03, p.874 (Miss Margaret Clarke, Byron Bay).
I want to stress in relation to this delegation that
we are not policy experts but we are experts on the lived experience – the
lived experience of these people who have suffered the pain and heartache of
poverty in the city of Sydney. It is clear from the stories we will hear today that
poverty is on the increase. I have a clear example of this. I am a coordinator
of our night patrol service. Here tonight in Sydney – at Martin Place,
Kings Cross, Central Station and down the back of Kent Street we work with
homeless people. In 1998 we worked with 23,000 cases. In 2002 we worked with
43,000 cases. That is a 20,000 increase in the number of people we work with
every year. I am not just talking about men with alcohol and drug addiction, I
am talking about men, women and children. Only last Tuesday an unregistered
Commodore car followed us around the back of Kings Cross. It was a family of
three children and a single father, looking for something to eat and for some
kind of support from us.
Committee Hansard 26.05.03, p.357 (St
Vincent de Paul Society – Sydney Archdiocesan Council).
move on to poverty. Personal family stress, constantly juggling finances or
being in debt, no spare money to cover unexpected expenses, like the
broken-down fridge or hot water service, even birthdays and celebrations, never
being able to make lifestyle choices like going to the movies or going out for
dinner. Because of those sorts of things people never develop a real sense of
Committee Hansard 29.05.03, p.570
(Salvation Army, Newcastle).
memory of one instance of real poverty, which I guess is why we are all here
today, relates to a call for assistance we had from a client. We got a phone
call from this fellow and I said, 'Before we come and see you, what's your
problem?’ He said, 'I'm hungry' 'To save me the time, could you tell us what
your basic requirements are?' This will stagger you. His answer was, 'Seven
loaves of bread, some pasta, some vegemite, some cereal, three litres of milk,
some meat sauce and a couple of incidentals.' We went and bought it. It cost
So we went around to this chap's place in Pottsville,
which is a pretty nice area to live, but it was a run-down place. It was I
guess earmarked for redevelopment. We went inside with the client – and let us
call him Trevor – and he was there with his two young boys. These
kids were perhaps 10 and 12. We walked in with the bags of food and their eyes
just lit up. We sat down at a battered camp table with four chairs – you know
the fold-out gear – put the bags of food on the table and then started to talk.
The kids straightaway got the bags of food, looked inside them and started to
put the food away...So we were there and we were asking what else we could do for
him. 'You've done absolutely more than enough,' he told us. 'I'll be right.
There are more deserving people.' My companion on that day was the mayor of a
well-known inland town in central New South Wales...he came away, like me,
thinking that that was real poverty, just to see the way those kids operated.
That guy had pride. He did not want any further help. He reckoned that was his
help and that was going to get him over the line. They got all those loaves of
bread, and you can imagine what they were going to do.
Committee Hansard 1.07.03, pp.851-52 (St
Vincent de Paul Society – Tweed Byron Regional Council).
Poverty and inequality
2.11 'Poverty' and 'inequality'
are distinct concepts although the terms are often used interchangeably. One
submission has defined 'poverty' as a state where people lack access to the
resources required to maintain a socially-defined 'acceptable' standard of
life, whereas 'inequality' may be defined as a condition where people have
fewer resources than others in society. It has been noted that poverty may
increase even as inequality is reduced. This may occur, for example, if
reductions in income inequality are brought about by increasing taxation to the
point where it undermines economic incentives. Equally, it is possible for
poverty to be reduced even as inequality widens. This has been the case in
recent years in the United States, where child poverty has been progressively
reduced since the 1980s even though tax cuts have almost certainly widened
2.12 The acceptance
of poverty as a relative concept means that poverty and inequality are related.
One study notes that:
Relative poverty can exist only where there is inequality, but
this does not mean that poverty and inequality are the same. Not all forms of
inequality will imply relative poverty, only those in which some individuals or
groups fall well below the average. The eradication of relative poverty will
require some reduction in inequality, but how much and at what cost will depend
upon the nature and severity of the poverty problem.
2.13 Many approaches
to poverty are based on drawing a 'poverty line' which makes a distinction
between the poor and the non-poor. Other researchers however tend to focus on
questions of inequality rather than poverty per se, giving emphasis to
the continuum of low incomes rather than to a single poverty line cut-off
point and focus on the consequences of low incomes for standards of material
well-being and social participation. Inequality of income, alone, then assumes
relatively less importance as a precondition for poverty, being combined with
other dimensions of inequality, including inequality of access to stable employment,
affordable housing, quality health care and government services more generally.
2.14 Submissions to
the inquiry noted that when discussing inequality it is important to consider
all aspects influencing the various dimensions of inequality, including but not
limited to income levels.
One submission noted that measures of inequality that focus on income can be
misleading if they exclude other indicators such as access to education,
health, government services and infrastructure.
Submissions also noted that traditional forms of inequality such as income
inequality have been expanded in recent years to include 'new' inequalities
such as the 'digital divide'.
2.15 Submissions also
emphasised that poverty in many cases is a precursor to other forms of disadvantage.
A study for Jesuit Social Services identified a concentration of disadvantage
using a composite measure of social disadvantage, including income levels,
educational levels, unemployment, low birth weight, child maltreatment,
childhood injuries, psychiatric admissions, mortality, crime and emergency
relief. The study found most of these indices of disadvantage to be cumulative
and mutually reinforcing. The broad concentration of disadvantage has been
confirmed by a range of other studies.
2.16 There are a
number of ways in which poverty may be identified:
- The development of income-based poverty lines to measure income
- The development of budget standards – determining the income
level necessary to afford a clearly defined 'basket of goods' which are
required to maintain a minimum acceptable lifestyle.
- Consensual approach – determining what members of the community
think is a minimum necessary income and to draw a poverty line at this point.
- Living standards studies – attempts to directly measure the
living standards of low income people and compare them to those in the wider
Each of these approaches is discussed below.
2.17 As noted
earlier, estimates of poverty are usually estimates of relative poverty.
Relative poverty is generally measured by drawing a 'poverty line' at an income
level considered necessary to maintain an 'acceptable' standard of living. Professor
Saunders pointed out that any measure of poverty adopted must be independent
of the government of the day. He added:
...independent of government in the sense that we do not want to
prejudge what we get out of it at the end of the day. If we are going to
develop a measure that is going to endure, it has to last under today's
government, tomorrow's government and the government in 10 or 20 years time,
and we need to recognise that.
Income-based poverty lines
2.18 Most Australian
poverty research relies on income based poverty lines. These measures set a
poverty line at some fraction of a statistically derived reference point
derived from the overall distribution of income. They usually take the form of
measures such as incomes below half the mean (average) income, or half the
median income (that point where half earn more and half earn less than).
2.19 A common method
of setting these poverty lines is to base the standard used on a measure of
average community income. Generally some group in the population, such as a
family comprising two adults and two children is chosen as the standard. For
them, poverty is defined as having an income less than some fraction of the
mean or median income. This is sometimes referred to as the 'headcount' index
and can be used to measure the incidence of poverty among particular groups in
the population, for example, the elderly, single adults, or couples with
children. This approach was adopted by Professor Ronald Henderson when he
developed his 'poverty line' which was originally set equal to the minimum wage
plus child endowment in Melbourne in 1966.
2.20 The advantage of
income benchmarks are that they can be defined in terms of well-known
statistical indicators and the poverty line which results is simple to update
and understand. It also places the concept of poverty in the context of the
distribution of income or resources within the community. But the choice of a
particular proportion of average incomes to represent a 'low' income is
necessarily an arbitrary decision.
2.21 A major
limitation of this measure of poverty is that it is sensitive to the level at
which the poverty line is set. As poverty lines are typically set in income
ranges where large proportions of social security recipients are clustered,
small movements in the poverty line can result in large apparent increases or
decreases in poverty. Another disadvantage of the headcount index is that it
takes no account of the severity of poverty, that is, how far below the poverty
line the poor actually are. As a result, government policies that raise the
income of the very poorest will have no discernible impact on the headcount
poverty rate if they do not raise the incomes of the poor above the poverty
2.22 There remains a
continuing debate as to whether such an approach should be based on the mean or
median income level. The most frequently used measures include:
- 50 per cent of median income – this is the most frequently used
in international studies, such as those undertaken by the OECD;
- 60 per cent of median income – this benchmark has been used by
Eurostat, the European statistical agency, as its main indicator, and has been
adopted by the Social Protection Committee of the EU as the first of its
primary indicators of social exclusion; or
- 50 per cent of mean income – this is mainly used in the United
Kingdom where there has been a long tradition of publishing data on
households with below half mean income. This was also the main indicator used
in the recent Smith Family reports into financial disadvantage in Australia.
2.23 As noted above,
many studies of relative poverty base their poverty line on some proportion of
the median income of the population. This is calculated by ranking all income
in descending order, establishing the income of the person in the middle of the
income distribution ranking, and then defining the poverty line as some
proportion of the income that they receive. As noted above, the proportion of
median income chosen varies between studies.
2.24 The main
argument in favour of the median is that it is less sensitive to extreme (very
low or very high) incomes. Against this, while mean income is more sensitive to
extreme incomes it is dependent on the level of all incomes. A rise in the
incomes of all those in the upper half of the income distribution would, for
example, cause mean income but not median income to rise. If the poverty line
were tied to median income, such a change would thus have no impact on the
poverty line and hence on poverty, even though the relative position of those
on low incomes would clearly have worsened.
2.25 Some studies
calculate poverty lines based on mean or average incomes. As many people
receive fairly modest incomes but only a relatively few earn very high incomes,
the mean income in the population is usually higher than the median. Basing the
measurement of poverty on some proportion of the mean income will therefore
usually produce a higher, more generous poverty line.
2.26 Defining poverty
as some proportion of mean income is as arbitrary as using a median-based
measure. Because the mean is sensitive to extreme values at either end of the
income distribution, it follows that if a small number of people at the top of
the distribution significantly increase their incomes this will inflate the
mean and will therefore increase any poverty line based on it. This will in
turn increase the number of people found to be 'in poverty', even though most
people's living standards will not have changed.
2.27 In an attempt to
overcome the disadvantages of the headcount approach an alternative poverty
indicator – the poverty gap – is sometimes used. The poverty gap takes account
of both the numbers below the poverty line and the depth of poverty. The
poverty gap estimates the total gap between actual incomes and the poverty line
for those who are in poverty. The poverty gap gives more weight to those whose
financial situation is worst relative to their poverty line. The aggregate
money value of the poverty gap indicates the minimum financial cost of raising
all poor families to the poverty line.
2.28 As a measure,
the poverty gap overcomes some of the shortcomings of the headcount ratio. It
changes not only when people are moved from one side of the poverty line to the
other, but also as a result of any change that increases the income of any poor
family, where this is not offset by equal income reductions for other poor
2.29 The poverty gap
is useful when analysing the impact of changes to income support payments on
income poverty. The use of poverty gaps also makes poverty estimates less
sensitive to small changes in the incomes of those close to the poverty line.
This is because the poverty gap gives less weight to those closest to the
poverty line and is thus less sensitive to changes in their income relative to
the poverty line. A difficulty that the poverty gap does not overcome is that
it is unaffected by redistributions of income among the poor.
2.30 A second
research method is the budget standards approach. This approach to defining
poverty attempts to calculate 'objectively' what level of income people need to
buy the goods and services they require to maintain an 'adequate' standard of
living and construct a poverty line around this measure. The approach uses a
combination of expert judgements and surveys of actual expenditures of people
on low incomes to develop detailed 'minimum' household budgets. This approach
prescribes a basket of goods and services that fulfils the 'necessities' of a
standard family and then determines the average or minimum price of the basket.
The basket of goods is usually defined in terms of food, clothing, shelter and
other items needed for basic survival.
2.31 A number of
studies have argued that this minimum income approach appears to provide a
commonsense, simple and objective approach to poverty. One study notes that it 'appears
to be divorced from personal values of either harshness or compassion. It seeks
to describe poverty objectively as lack of the income needed to acquire the
minimum necessities of life. Those who lack the necessities to sustain life are
by definition poor'.
2.32 Professor Saunders
argued that the principal strength of this approach is its explicit attempt to
derive the cost of meeting needs at a given standard of living across all areas
of consumption. In addition, the fact that every item that enters the budget is
identified precisely, as are the assumptions used for costing, means that the
approach can be used to check what differences it makes if particular items are
changed or omitted altogether. The approach also utilises prevailing social
norms and standards to develop the budgets, thus building on existing knowledge
about minimum standards where they exist. Finally, the budgets can be
disaggregated to examine how much is needed to meet the standards in a limited
range of areas, or to explore differences in the consumption levels of
individuals within the family.
2.33 An example of
this approach is the project completed in 1998 by the Social Policy Research
Centre (SPRC), funded by the former Department of Social Security, which
produced a low cost 'indicative budget standard' for Australia. The work was
based on focus groups of low income people and by examination of the actual
expenditures of low and middle income households from ABS surveys.
The standard was derived by compiling a comprehensive list of items which most
people buy or are deemed to need. The standard was calculated by pricing each
item and calculating the total income which households of varying compositions
require to pay for these items. ACOSS commented on the usefulness of this
approach and that the next step was going to be a major study of living
standards 'to look directly at what essentials people miss out on'. This
project, however, was not undertaken which ACOSS argued was regretable as 'it
leaves us to rely too heavily on income based poverty lines'.
2.34 Several problems
have been identified with this approach. A major problem is disagreement
amongst researchers over what constitutes a 'minimum' amount of goods and
services that would provide an acceptable standard of living. Specifically, it
has been rarely possible for experts to specify minimum standards for
necessities other than food. Allowances for other items are usually based on
observation of the spending pattern of low income households – a procedure that
is inconsistent and unsatisfactory. One study notes that 'the claim that the
subsistence approach is scientific and pays minimum attention to value
judgments is denied by the arbitrary judgments which have to be made in
Professor Saunders also argued that this approach is very complex to
operationalise and requires a large number of assumptions and judgements before
the budgets can be specified and priced.
2.35 Moreover, a
subsistence standard has seldom been maintained over time – poverty lines based
on this approach have generally become more generous in their poverty
definitions in the light of changing circumstances. It is also argued that
this approach has little relevance in a society as diverse as Australia where
living standards are generally far above the minimum required for merely
2.36 One study notes
that a further problem with this approach is that there may be an 'upward bias'
in the minimum income estimate because it does not allow sufficiently for the
choices that are made between items that meet similar needs. The study suggests
that the SPRC's calculation of a minimum low cost budget may be much higher
than what is actually required to maintain a reasonable standard of living.
2.37 Another approach
to measuring poverty is to base it on the opinion of the general population.
Under this approach, sometimes referred to as the 'consensual approach',
surveys are conducted where people are asked what they consider to be the
minimum amount of income they need to 'make ends meet', and a poverty line is
estimated around the point where the answers converge.
2.38 A number of
studies have argued that these survey-based approaches to defining poverty
lines appear logical given that the concept of relative poverty is defined with
reference to prevailing social norms. If poverty is a standard of living below
a socially accepted norm, it would appear to make sense to ask members of the
public to define what that level should be.
2.39 However, it has
also been argued that these approaches have major difficulties. The answers to
the questions asked have been found to be very sensitive to the wording used in
the surveys. The studies also generally find that there is little consensus
over what a minimum income might be – partly because people tend to be
over-generous when defining minimum incomes for others which they will not have
to pay for themselves, and partly because people's perceptions of what is 'necessary'
for others tends to reflect the standard of living to which they themselves are
accustomed. 'Poverty lines' based on this method tend as a result to be set at
relatively 'generous' levels.
Given the diversity of opinion elicited in surveys the formulation of a
'consensual' poverty line is difficult to identify. Consequently, few studies
have produced results using such poverty lines.
Living standards studies
2.40 The weaknesses
of income-based and budget standards methods have led many researchers to
advocate direct measurement of poverty through surveys of people's access to
various necessities of life.
2.41 While no
Australian study has systematically attempted to measure deprivation (as
distinct from living standards generally) across the community as a whole, many
research studies commissioned by community agencies and Governments have
examined aspects of deprivation within particular groups and communities. Some
have used survey questionnaires, while many are anecdotal in nature. In Australia,
a number of national studies relating to living standards in general (as
distinct from deprivation) have been conducted since Professor Henderson's Melbourne
The Australian Standards of Living
2.42 This study was
conducted in the late 1980s by Richardson and Travers. It used a set of
indicators to evaluate the living standards of a representative sample of all
Australian households. The indicators ranged across economic resources,
housing, employment, education, family and social relations, and recreation.
The indicators were clustered into groups of common themes (e.g. social
participation) and the population was grouped according to households' scores
in regard to each cluster. The scores were then compared across a number of
clusters to establish whether some people were consistently better or worse
2.43 The main
advantages of this study were the breadth of indicators used, the ability to
check whether the different dimensions of deprivation were related in a
consistent way, and to compare them with the resources available to people in
terms of income, assets, and family support.
2.44 However, the
study had a number of drawbacks. The first is common to most general studies of
living standards. Although many questions were asked to gauge people's general
standard of living, few were developed specifically to measure deprivation.
The second drawback was the essentially arbitrary nature of the choice of
indicators of living standards, and the development of indices of deprivation
from the data. A third problem was that people were not asked whether they
lacked an item through choice or lack of resources, a critical question for
2.45 The study found
that there were consistent relationships between deprivation in different
dimensions of life, such as lacking material goods, poor health, and social
participation. The study also found that there was a consistent relationship
between income and disadvantage especially at the lowest income levels.
The Australian Living Standards
2.46 This study was
conducted by the Australian Institute of Family Studies in the early 1990s. It
was also a comprehensive study of general living standards – using similar 'dimensions'
of well-being to those adopted by Richardson and Travers.
2.47 One of the
strengths of this study was the emphasis placed on how the respondents
perceived the importance of each item, which somewhat reduced the reliance on
the judgements of the researchers themselves. The researchers also asked people
whether they lacked items through choice or a lack of resources.
2.48 The ALSS study
shared a major drawback of the ASLS discussed above. It is a general living
standards study with few indicators that go directly to deprivation. Moreover,
it was also narrower in scope in that it covered only households with children
in certain outer urban areas of Australia.
2.49 The ALSS study
also found a consistent set of relationships between different dimensions of
deprivation, and a clear relationship between deprivation and low income. The
bottom 20 percent of households ranked by equivalent disposable income were
found to consistently lack 'basic' resources and experience financial stress to
a much greater extent than the top 80 per cent. This included such items as
lacking money for school excursions, getting behind with bill payments and
living in overcrowded housing.
The ABS financial stress study
2.50 In the mid
1990s, the former Department of Social Security and the ABS collaborated to
develop an official Australia-wide living standards survey, although public
funding was not secured to complete this project. However, on the basis of the
developmental work already under way, the ABS developed a module of 16
indicators of financial stress, which it added to its regular Household
Expenditure Survey. The questions asked in the financial stress module included
possession of certain household 'essentials', participation in social
activities, the capacity to pay bills, raise money for an emergency, save, and
action taken by people when they lacked resources to meet their needs (for
example, pawning goods).
2.51 The main
advantage of this survey is that it was incorporated into the ABS collection of
major surveys of income and expenditure, providing a rich data source for comparing
financial stress with the income and expenditure of different groups. The same
survey (the HES) is often used by researchers to estimate the number of people
with household incomes below income-based poverty lines. The ABS found that
people's level of financial stress was inversely related to income, with much
higher levels of stress being experienced among the bottom 20 per cent of
households, although only a minority of them suffered moderate or higher
2.52 ACOSS argued
that the main weakness of the survey from the standpoint of poverty research is
its small number of questions and narrow scope. Financial stress is only one
indicator of deprivation, and it may mislead if used on its own. The survey did
include indicators of a lack of basic household goods and restrictions on
social life. However, these were so few in number as to heighten the general
concern about the arbitrariness of the indicators used in deprivation studies.
In such a small survey, the choice of indicators, and the way in which indices
of deprivation are derived from them, is even more critical than in the larger
living standards studies discussed above.
2.53 A study by Bray
used the financial stress study to measure the extent of deprivation across the
This study found consistent relationships between people's responses to certain
clusters among the 16 indicators of financial stress. One cluster including
items such as 'going without a meal' suggested a more severe form of
deprivation, while another including such items as 'not having family and
friends over once a month for a meal' suggested a less severe form of
deprivation. On this basis, Bray developed two separate sets of indices of 'hardship'
and 'missing out'. ACOSS argued that while these methodological judgements made
sense conceptually, they were judgements based on limited data. The 'hardship'
index relied on just four indicators, the lack of one of which constituted 'some
hardship' while the lack of two or more constituted 'multiple hardship'. The
results would be highly sensitive to the choice of indicators and the method
used to develop the indices.
Problems in measuring poverty
2.54 There are a
number of difficulties in measuring poverty. These relate to the data sources
used, questions related to the appropriate measure of income and other
resources, the use of expenditure data, the income unit and time period used
and the choice of equivalence scales. These issues are discussed below.
2.55 Most poverty
analysis in Australia is based on surveys of household income conducted by the
Australian Bureau of Statistics (ABS). The ABS has conducted periodic income
surveys since 1969. Detailed information relating to income from these surveys
was first released for the 1982 Income and Housing Survey, allowing organisations
to conduct analyses of income distribution and poverty. Since then, information
has been released for the 1986 Income Distribution Survey, the 1990 Survey of
Income and Housing Costs and Amenities and the Surveys of Income and Housing
Costs conducted from 1994-95 to 2000-01, except for 1998-99.
2.56 Limitations in
the scope and methodology of the income surveys affect the accuracy of poverty
measurement. Although the methodology used for each survey has remained
substantially the same over the years, the surveys have varied not only in
frequency but also in scope, sample size and definitions used. In particular,
there was a significant change in approach after 1990. The frequency of surveys
was increased – they were conducted annually for four years and are currently
conducted bi-annually – and the sample size has been halved. The definition of 'dependent
children' has also changed over time.
Reporting on the 2000-01 income survey, the ABS stated that it had incorporated
a range of methodological improvements in household income distribution and
measurement designed to bring the data into line with international best
Definition of income
2.57 The ABS income
surveys measure gross cash income, which includes income from wages and
salaries, self employment, government cash benefits, investments and other
categories such as workers compensation, superannuation and royalties.
2.58 Some limitations
of the ABS definition of income have been noted in several studies:
- The ABS collects data on only cash receipts, whereas household
income can include both cash and in-kind receipts from government (such as
fringe benefits and pensioner concessions), private businesses and other
- The ABS excludes most one-off payments, for example, loans,
legacies and capital gains and losses, but it includes regular annuities,
private pensions and superannuation.
- ABS income surveys do not provide data for how incomes have
changed for the same sample of people. Successive income surveys comprise a
series of cross-sectional surveys rather than a longitudinal survey, which
would ask the same people questions in relation to their incomes at regular
intervals. As a consequence, it is not possible to determine whether a large
number of people are moving into and out of poverty or whether most of the poor
remain in poverty for extended periods.
- Intra-household transfers of income are excluded.
The measure of resources
2.59 A person's
standard of living depends on a number of factors both tangible – such as
access to income and/or wealth – and intangible such as the degree of
satisfaction derived from work and other activities, or the extent of
interaction with friends and/or the wider community. Such factors are difficult
to measure directly so poverty measurement relies on some proxy or 'indicator
of resources' that can provide a reasonable approximation of each person's
standard of living.
2.60 Most poverty
research examines the cash income received by families on the assumption that
income provides a good guide to living standards. One study notes, however,
that income is an indirect measure of poverty because it examines the resources
on which living standards depend but does not directly measure the living
standards actually experienced by families.
2.61 Other studies
have, however, emphasised the importance of income. The Henderson poverty
inquiry emphasised the point that an adequate income is fundamental to a person's
security, well-being and independence. It enables a person to provide for the
basic essentials of life, permits freedom of choice and freedom to participate
in activities of choice. It also contributes greatly to personal freedom and
the extent of opportunities available.
2.62 There are
several measures of income that can be used to indicate a person's standard of
living, including private income (such as wages and salaries, self-employment,
interest, rent and dividends); gross income (private income plus government
cash benefits); disposable income (gross income minus income tax); and final or
social income (disposable income plus government non-cash benefits such as
health or education services). Final income ought to provide the most
comprehensive indication of a person's well-being but it is difficult to define
and measure. Disposable income is easier to measure and like social income,
reflects income after government interventions, thus giving a better indication
of the income people have available to spend. Consequently, disposable income
is the predominant indicator of resources used in poverty studies.
2.63 As noted above,
the living standards of individuals and families are affected by a range of
other factors in addition to their cash income, including the receipt of
in-kind income such as fringe benefits and pensioner concessions and the
provision of partially or fully subsidised government services such as
Medicare. A recent study by the Smith Family, discussed further in chapter 3,
analyses the impact of not only cash incomes and government transfer (social
security) payments but also indirect taxes and indirect benefits, such as
health, education, housing and welfare.
The ownership of assets may also be important. The economic wellbeing of two
individuals on a similarly low income may be very different if one owns their
home while the other is renting. This is an important issue when looking at
poverty amongst the aged.
commentators have argued that expenditure on items that are essential to living
costs, such as costs related to housing, health, childcare, work-related costs
and child support payments, should be subtracted from income to give a better
indication of 'discretionary income'. Australian studies that have attempted to
measure discretionary income have generally adjusted income for only housing
costs. This is primarily because the income surveys only include housing costs
and because the Henderson poverty inquiry set an important precedent by
calculating poverty both before and after housing costs had been taken into
2.65 The case for
using after-housing income relies on the fact that housing is such a large and
essential expenditure for most families.
Families who are purchasing their home or renting privately will have much of
their income 'locked up' in housing costs, reducing their other general
consumption and associated standard of living. Their 'after-housing income' is
significantly lower than their disposable income and so they are more likely to
be in 'after-housing poverty'. By contrast, those families who own their own
home or are in government housing typically have much lower housing costs. More
of their income is available for general consumption than would otherwise be
the case and so they are less likely to be in after-housing poverty. Another
advantage of using the after-housing income approach is that it will vary with
the different costs of housing in different regions, thereby reflecting one of
the sources of regional variations in the cost of living.
2.66 An argument
against the after-housing income approach is that, although having some form of
housing is essential and not discretionary, there remains discretion in the
quality of housing and the corresponding housing costs. A family that places a
high priority on housing relative to other goods and services will spend more
on housing and thus will have lower after-housing income. In effect, the
after-housing measure distorts poverty measurement so that the families that
place a high value on the quality of housing are more likely to be in poverty.
Alternative measures of poverty
2.67 Given the
difficulties involved in devising a comprehensive measure of a person's
standard of living, several researchers have suggested that studies of poverty
and deprivation should attempt to examine poverty using several indicators, try
to incorporate qualitative studies of the non-monetary factors that affect
poverty and incorporate life cycle and wealth studies that estimate the
well-being of people over the course of their lifetime. In practice, such
comprehensive studies are rarely conducted and poverty researchers generally
content themselves with reporting on one facet of the complex mix of elements
that influence the standard of living of members of society.
One study notes that a full understanding of poverty can come only from taking
account of these varying approaches and attempting to blend them to give an
overall picture of deprivation in society.
2.68 Two main
alternative approaches to income poverty measures have been suggested – these
are the development of deprivation indicators and the use of expenditure data.
2.69 A number of
submissions argued that deprivation indicators need to be developed as
alternatives to, or complementary measures to, income poverty statistics.
Observing the level of deprivation experienced by those on low incomes is a way
of identifying the income level that corresponds to poverty.
2.70 Professor Saunders
stated that deprivation measures provide a direct indicator of poverty status
because they reveal that basic needs are not being met. This is in contrast
with resource-based poverty indicators such as income, which are indirect in
the sense that they imply that poverty is present, but do not actually confirm
this through direct observation. Because deprivation reflects a situation of
unmet need that is actually observed and thus experienced, it provides strong
support for the claim that poverty exists. At the same time, it is possible to
identify which forms of deprivation are regarded as unacceptable in the
community by surveying public opinion, thus giving increased credibility to the
indicators need to be broadly defined to include not only the material goods
needed to meet minimum consumption standards, but also those activities that
are broadly regarded as necessary to support participation in society. The list
thus needs to include such items as being able to send a child on school
excursions; having enough to afford to buy presents for family members on
important occasions; having enough to pay household bills on time; and not
having to rely on welfare agencies, or food or clothing banks to get by.
2.72 The deprivation
approach has been employed in a number of recent European poverty studies,
particularly in the United Kingdom. The UK Poverty and Social Exclusion
Survey (PSE) provides a framework for defining poverty in terms of deprivation
and exclusion indicators. The survey conducted in 1999 measured different
dimensions of poverty and social exclusion in the lives of adults and children.
The PSE poverty measure was developed in two stages. In a first survey, adults
were asked which of a list of items and activities for children, and a second
list for adults, they considered everyone should be able to afford in Britain
today and which they should not have to go without. The list included food and
clothing items; items and activities to allow children and adults to
participate in society; and for children, items to assist educational
development. In the second survey a different group of respondents were asked
to identify items and activities that children and adults did not have because
they could not be afforded. Results from both surveys were used to construct a
poverty measure based on items or activities that children and adults had to go
without to be defined as poor. For children and adults, a threshold of lacking
two or more items or activities was established for this poverty measure.
Several submissions commented that the PSE was a good example of a recent
survey along these lines.
2.73 A variation on
this approach is the Irish 'consistent poverty' approach, which combines an
income-based approach and a deprivation approach. The concept of consistent
poverty forms the basis of the Irish Government's National Anti-Poverty Strategy
and defines a household as being in poverty if they have both low incomes and
have a score of 1 or more on the deprivation scale. The Irish scheme is
discussed further in chapter 18.
2.74 In Australia,
the 1998-99 HES undertaken by the ABS collected data on a number of indicators
of financial stress. These items may be considered a form of 'deprivation'
measure in that they largely focus on items which a household may have gone
without due to financial constraints. In the HES, information was collected on
a number of items such as how households compared their standard of living with
that of two years ago; if households are usually able to afford such things as
a week's holiday away from home; have a night out once a fortnight or have
friends over for a meal; and whether in the previous year, because of shortage
of money, a household was unable to pay utility or insurance bills; sought
financial help from family or friends or a community organisation; or went
without a meal or heating.
analysis of the HES survey was reported in the study by Bray referred to
earlier. This analysis identified that the set of financial stress questions
used by the ABS fell into three discrete components. These are:
- missing out on 'accepted' social, cultural and recreational
activities – reported by 38.3 per cent of households;
- experiencing cash flow problems – reported by 22.1 per cent of
hardship – where households have missed out on a meal, heating,
have had to pawn or sell items or obtain assistance from welfare agencies –
reported by 8.2 per cent.
argued that a comprehensive set of deprivation indicators should be developed
in Australia. ACOSS noted that they should be designed to measure the lack of
key necessities required for subsistence as well as social and economic
participation. Ideally, these should be clustered into a number of dimensions
of living standards, or capacities to meet basic physical and social needs, for
example, access to education and shelter. ACOSS argued that the appropriateness
of these indicators in Australia should be tested by surveying the public as to
whether they represent community opinion as to what constitutes a lack of
necessities according to the definition of poverty used.
2.77 Professor Saunders
suggested that a step in this direction has already been taken by the ABS
through the inclusion of a series of questions on financial stress and hardship
in the latest 1998-99 HES (referred to above). He suggested that the ABS should
expand its coverage in future HES and other household surveys or that a special
social survey focusing on deprivation and its relationship to other indicators
of living standards similar to the UK Poverty and Social Exclusion survey could
be undertaken .
2.78 FaCS suggested
that deprivation approaches – although current data are relatively limited – as
well as longitudinal analysis of household incomes, offer greater potential for
policy and program development than income poverty measures.
Use of expenditure data
2.79 Some submissions
argued that expenditure data could also be used to supplement income data to
measure living standards, given that reported incomes may be an unreliable
indicator of a person's actual standard of living.
2.80 An expenditure
poverty measure would rank people according to their expenditure, such that
people with particularly low spending would fall into the category of 'expenditure
poverty'. Evidence from ABS household expenditure surveys indicates that
expenditure is consistently more unevenly distributed than income. This appears
to be the case because people on high incomes devote some of their incomes to
savings while people on low incomes, especially those temporarily on low
incomes, may borrow to maintain their standard of living.
2.81 A recent study
for the Smith Family focused on the spending patterns of low income households,
based on the 1998-99 HES. The study found that:
- Low-income households devoted proportionately more of their total
budget to the necessities of life than high-income households. More than half
of the weekly budget of low-income households is devoted to three spending
categories – food, housing and transport.
- Low-income sole parent households devoted almost half of their
weekly spending to just two of the necessities of life – housing and food.
Almost half of them were in housing stress (paying more than 30 per cent of
their income on housing).
- Low-income single persons living by themselves aged less than 30
years were in severe financial disadvantage, with almost half of their weekly
budget devoted to two items – food and housing.
2.82 The use of
expenditure data, however, has a number of problems. The most notable is that
generally expenditure on consumption rather than consumption itself is being
measured. Furthermore, it may be possible to sustain a standard of living
during periods of low income by running down past savings or incurring debts,
but this situation will not be sustainable. Low consumption may thus conceal
rather than reveal the existence of poverty.
Professor Saunders suggested that it may be fruitful to consider income and
expenditure not as alternative indicators of poverty, but rather as
The income unit
2.83 While poverty
calculations rank people according to income and then identify those who fall
below a predetermined poverty line it is also important to establish whose
income they should be ranked by. The income unit refers to the group within
which income is assumed to be shared. The assumption widely accepted in
academic research is that in most families the income earned by each member of
the family is shared.
2.84 Possible income
units include the individual, the nuclear family, the extended family or the
household. The income unit used in poverty studies can make a major difference
to poverty estimates. Generally, the broader the definition of the income unit,
the lower the level of poverty is likely to be. The most common income unit in
Australian poverty research is the 'ABS income unit' The ABS defines an 'income
unit' as a couple (married or de facto) with dependent children; a couple
without dependent children; a sole parent; or a single person. Income is
assumed to be shared by one person or a group of related persons within a
household. Income sharing is assumed to take place within married or de facto
couples, and between parents and dependent children.
2.85 No income unit
can capture the 'income-sharing group' precisely. One problem common to the ABS
income unit, the extended family and the household is the appropriate treatment
of dependent children. As they get older, children gradually gain greater
financial independence but the exact point at which they are predominantly
self-sufficient will vary greatly between families. This suggests that each of
the potential income units may be too broad because they include people where
little income sharing remains.
commentators have argued that common definitions of the income unit are too
narrow. For example, young people living away from home, and therefore treated
as separate income units, may well receive substantial financial support from
their parents and thus not really be an independent unit. Similarly, it has
been argued that different cultural attitudes towards income-sharing,
particularly among Indigenous communities, often mean that income is shared
much more widely amongst these communities than the ABS income unit or even the
2.87 FaCS indicated
that with most income analysis it prefers the household as the basis of
analysis. One reason for this is the structure of income support payments, for
example living at home rates, which acknowledge the presence of others in the
household. Further, even where income pooling might be partial, people living
in the house generally gain some benefits from the expenditure and assets of
others, ranging from the use of household appliances to sharing transport.
2.88 There has been
little research undertaken in Australia that examines the most appropriate
definition of the income unit for poverty analysis as such a study requires
information on the intra-household allocation of resources – for which there is
2.89 As household
incomes fluctuate over time, the period over which the income is received can
influence results. The time period used is frequently dictated by the available
data. Time periods that are frequently used within sample surveys include the
week, the month, and the year. Generally, longer time periods result in more
equal income distributions. The ABS income surveys include both 'current weekly
income' (that is, income in the week immediately preceding the relevant survey)
and annual income from the previous financial year.
2.90 FaCS noted that
Australian income distribution analysis is unusual because of the general
reliance placed on using current income rather than annual income. The main
reason for this is the general view that current income is more accurately
reported, especially in relation to income support payments. The consequence of
this is that poverty estimates using current income may indicate greater income
inequality whereas the use of annual income would smooth out fluctuations in
2.91 Equivalence scales
attempt to account for the differences in the size and composition of different
income units – they show the amount of income required by families of different
size and composition. Larger income units need a greater income than a small
income unit to attain the same standard of living. The composition of income
units also needs to be accounted for as some members of the income unit create
greater 'costs' than others. For example, it is likely that an income unit
needs a greater income to support older children than younger ones. Equivalence
scales show how much more income a couple requires to reach the same standard
of living as a single person. For instance, if an equivalence scale gives a
single adult a value of 1 and a couple with no children a value of 1.7, then
the assumption is that the couple requires 70 per cent more income than the
single person to reach a comparable standard of living. The value is less than
2 because of assumed economies of scale, such as the sharing of housing costs.
The equivalence scale used can have an important impact on the apparent degree
of poverty and on the characteristics of those deemed to be in poverty, thus an
equivalence scale that ascribes high costs to children will tend to place more
families with children in poverty.
2.92 There is no
agreement in Australia about what is the most appropriate equivalence scale to
use. The Henderson equivalence scale has been used in many poverty studies in Australia.
The detailed Henderson scales take account of the needs of families that vary
with the age, gender, labour force status and number of adults and children
within a family.
2.93 The trend in
international comparative studies has been towards simpler equivalence scales
that only vary with the number of people – or sometimes the number of adults
and children – within a family. The equivalence scale adopted by the EC
Eurostat poverty studies allows the assumed needs of a family to vary in line
with the number of adults and children – with the first adult being given a
value of 1, second and subsequent adults a value of 0.5 and children a value of
0.3 each. One disadvantage of this equivalence scale is that it does not allow
for economies of scale, so that, for example, four children cost four times as
much as one child.
Updating poverty lines
2.94 Once a poverty
line has been established it is important to determine how it should be updated
over time, especially to determine trends in poverty over time and for
assessing the adequacy of income support payments. Poverty lines can be updated
according to movements in prices or movements in incomes. Updating by movements
in prices adjusts the poverty line for changes in the cost of living whereas
updating for movements in incomes adjusts for changes in the standard of
living. The consumer price index (CPI) is typically used to update poverty
lines in accordance with movements in prices.
2.95 There are
several ways to update poverty lines in accordance with movements in incomes.
Studies in Australia have variously used average weekly earnings, household
disposable income per capita and movements in average or median equivalent
disposable incomes. While there is debate about which of these methods is most
appropriate, updating in accordance with movements in incomes has generally
been preferred to movements in prices in Australia. This is related to the
preference for relative poverty lines.
2.96 The poverty line
used by the Henderson poverty inquiry to estimate poverty in 1972-73 was set at
56.5 per cent of seasonally adjusted AWE in 1972-73. The Henderson poverty line
was designed to be compared with after-tax or disposable income but the poverty
line was updated (until the 1980s) according to movements in before-tax
seasonally adjusted AWE. In response to criticisms of this method of updating
the poverty line, since 1981 the Henderson poverty line has been updated by
increases in seasonally adjusted household disposable income per capita. It had
been argued that movements in disposable income per capita provides a better
measure of changes in community living standards than movements in pre-tax
average weekly earnings.
2.97 This measure has
in turn been criticised by some researchers because it has led to a substantial
increase in the value of the poverty line, well in excess of increases in the
CPI or AWE – 'this means that the Henderson poverty line has become less and
less 'austere' as time has gone on, for it has been inflating at twice the rate
of the CPI'.
Other commentators have suggested, however, that if it is accepted that poverty
is relative, then it is logically appropriate that the poverty line should
increase in real terms when real community incomes are growing and that
seasonally adjusted household disposable income per capita or a similar index
is the appropriate measure to use in these circumstances.
2.98 Poverty is
difficult both to define and to measure. The varying concepts of 'poverty'
employed, data limitations and different methodologies all impose limitations
on the degree to which poverty can be quantified. Poverty relates to individual
standards of living which are influenced by a range of tangible factors – such
as access to income and other financial resources – and intangible factors,
such as social and family ties, which are largely unquantifiable but which can
influence a person's overall standard of living. Despite these limitations,
research into poverty and the development of measures of poverty are important
in establishing the nature and extent of poverty in the community and in the
development of appropriate policy responses.
2.99 Further research
in the area of poverty can only lead to a broader understanding of its causes
and effects and lead to improved ways to address the problem. The St Vincent
de Paul Society noted that 'regrettably, the polemical debate over poverty lines
has distracted rational discussion on solutions to a known problem'.
The Committee concurs with this sentiment and firmly believes that protracted
debate over various poverty measures or the suitability of different poverty
lines should not overshadow a thorough and ongoing discussion of solutions to a
very serious national problem.
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