I understand that the Deputy is referring to a paper delivered in the course of a public consultation meeting of the Human Rights Commission, HRC, in November of last year. In the context of setting out how the HRC will engage with the national anti-poverty strategy, the question was raised as to whether it was appropriate that the global poverty reduction targets set out in that strategy should be expressed in terms of relative rather than consistent poverty.
While the paper referred to poverty lines based on weekly average incomes, the more commonly used income threshold, and the one adopted at EU level as the ‘at risk of poverty indicator', is based on 60% of median income. The proportion at risk of poverty in Ireland as measured by this EU indicator has increased from 18.2% in 1997 to almost 22% in 2001.
A wide range of factors influence the levels of income poverty at any given point in time. The factors giving rise to the increase in the ‘at risk of poverty' indicator include increased employment; an increase in the proportion of two income households; an increasing proportion of better quality, better paid jobs available to a more educated workforce; fewer dependants resulting from the decline in the birth rate; and a tax system designed to provide incentives for economic development and remove obstacles to employment participation by leaving people with more take home pay.
This approach has helped to generate the high levels of economic growth that Ireland has enjoyed over the past decade and to sustain the economy during the more recent economic difficulties. This growth has generated the resources required to significantly improve our social protection system and social services generally and to work on closing the gap with other EU countries on physical infrastructure. The fact that the level of growth in the economy generally and in incomes has been so high has meant that this particular indicator has disimproved, despite the major absolute improvements in social provision over this period.
The ‘at risk of poverty' indicator, particularly when viewed in isolation, needs to be interpreted very carefully if misleading results are to be avoided. As noted in the paper delivered by the HRC, this is the individual threshold at the 50% average income line. When the EU ‘at risk of poverty indicator' is used, the individual threshold at the 60% median income line was €164 in 2001. This does not, however, mean that more than one in five people in Ireland were living in households with incomes below €164 in 2001. Individuals in a household with one adult and one child would fall below the income threshold only where their household income was less than €218 per week or €11,336 per annum. In the case of a family with two adults and two children, the household income would have to fall below €380 per week or €19,760 per annum to cause the individuals in the household to fall below the income threshold. The equivalent figures for a family comprising two adults and two children are €489 per week or €25,428 per annum.
While the indicator provides us with valuable information on the proportion of our population at risk of poverty, we need to go further in order to define more precisely the numbers who are experiencing poverty in terms of being consistently deprived of goods and services regarded as essential for living in Ireland today. That is why the consistent poverty measure is employed in the national anti-poverty strategy, since it captures the position of those who are both on low incomes and who are also experiencing enforced basic deprivation.
The success of Government policies in tackling consistent poverties reflected in the sharp decreases observed in relation to this indicator in recent years — down from 15% in 1994 to some 5.2% in 2001.
