Poverty

Ms. C. RughooburAfrica Statistics Day 18 November 2013

Poverty measurement

Poverty is a multi dimensional phenomenon

No single definition

No single measurement

Two approaches – Monetary & Non monetary

Poverty measurement

Monetary approach

• Absolute poverty line e.g ‘minimum vital’

• Relative poverty line (lower income group relative to higher income group)

Absolute poverty World Bank $1.25 & $2 a day poverty linesVery few households below these lines in Mauritius

2012

$1.25 (PPP) a day per person

Monthly equivalent (Rs per person) 1,020

Proportion of poor persons <1%

$2 (PPP) a day per person

Monthly equivalent (Rs per person) 1,640

Proportion of poor persons < 2%$1 PPP ‘Purchasing Power Parity’ = Rs17.73 based on 2005 International Comparison Program

$1.25 a day poverty line % poor persons, 2010-2011

$2 a day poverty line % poor persons, 2009 - 2011

Relative poverty

Poverty line: Half median household income per adult equivalent, i.e. adjusted for household size, age composition and economies of scale

Poverty line 2006/07 2012

1-person household Rs 3,821 Rs 5,652

Average household (2 adults and 2 children) Rs 9,000 Rs 13,300

Number %

Poor households 33,900 9.4%

Poor persons 126,900 9.8%

How many are in relative poverty?

Who are more likely to be poor?

Households:with 3 or more childrenWith one parent and unmarried childrenWith 1 person only & elderly living aloneheaded by: women, divorced / separated

persons, persons with low educational level, persons who are economically inactive

Who are more likely to be poor By type of households

Who are more likely to be poor?By profile of head

Children are more likely to be in poverty

Income Poor households are more dependent on transfers

Poor households

All households

Average household size 3.7 3.5

Average number of income earner 1.5 2.0

Average monthly household resources* (Rs) 9,800 33,800

% of monthly employment income 51% 73%

% of monthly transfer income 29% 13%*Household resources include imputed rent, a rental value for non-renting households

Expenditure Poor households spend a higher of share of their budget on food, clothing and housing

Poor households

All households

Average monthly household Consumption expenditure* (Rs) 8,300 21,200

of which

Average monthly consumption expenditure on food, clothing and housing (Rs)

5,400 9,700

% of food, clothing and housing 65% 45%

* Figures on total consumption expenditure have not been adjusted for under reporting on items like alcoholic beverages and tobacco, etc..

With Government transfers, 9.4 % poor households in 2012

Without Government transfers % poor households

Old age pension 16%

Widow’s pension 10%

Invalid pension 11%

Social Aid and other social security benefits 11%

All Government transfers 19%

Basic pensions contribute to poverty reduction

With Government free services, 9.4 % poor households in 2012

Without Government free services % poor households

Free education (primary & secondary) 16%

Free health services 14%

Free transport (elderly, students and disabled persons)

10%

All Government transfers 20%

Government free services contribute to poverty reduction

Relative poverty increases2001/02 2006/07 2012

Relative poverty line – RPL (Rs) 2,804 3,821 5,652

Estimated number of poor households 23,700 26,400 33,900

Proportion of poor households 7.7% 7.9% 9.4%

Estimated number of poor persons 93,200 104,200 126,900

Proportion of poor persons 7.8% 8.5% 9.8%

Has the poverty level increased?

Relative poverty line (RPL)

Uses• Provides a snapshot of the poor Who are they? What are their characteristics?

Limitations• Poverty line not easily understood• Not relevant for measuring trends• Focus on income inequality

Absolute poverty line

Uses• Useful to track evolution of poverty • is fixed at a point in time, and is usually

updated with price changes

Relative poverty – limitatione.g.

Households Monthly income (Rs)

Year 2013 Year 2014

1 6,000 60,000

2 9,000 90,000

3 20,000 200,000

4 25,000 250,000

5 50,000 500,000

Median 20,000 200,000

Half median (Relative poverty line) 10,000 100,000

No. of poor households 2 2

Trend in poverty Using 2012 RPL as a fixed threshold

2001/02 2006/07 2012

Poverty line (Rs) 3,171 4,250 5,652

Proportion of poor households 11.7% 11.7% 9.4%

Proportion of poor persons 11.8% 12.3% 9.8%

Trend in poverty Using 2001/02 RPL as a fixed threshold

2001/02 2006/07 2012

Poverty line (Rs) 2,804 3,757 4,997

Proportion of poor households 7.7% 7.5% 6.1%

Proportion of poor persons 7.8% 8.2% 6.5%

Trend in poverty Using 2006/07 RPL as a fixed threshold

2001/02 2006/07 2012

Poverty line (Rs) 2,851 3,821 5,082

Proportion of poor households 8.0% 7.9% 6.5%

Proportion of poor persons 8.1% 8.5% 7.0%

Other poverty related indicators

Non monetary - Relative Development Index (RDI)

• An adapted version of the UN HDI• A composite index for small areas based on

Housing and living conditionsLiteracy and educationEmployment• From 0 (low devpt.) to 1 (high devpt.)

Relative Development Index (RDI)

Based on Housing and Population 2000 & 2011

The level of development has improved

RDI

2000 2011

Republic of Mauritius 0.57 0.77

Island of Mauritius 0.68 0.77

Island of Rodrigues 0.35 0.56

CENSUS 2011 CENSUS 2000

Relative Development Indices by Municipal Ward and Village Council Area – Censuses 2000 & 2011

Quality of Life indicators

1. Economic sustainability and material living standards 2. Health3. Education4. Personal activities including work 5. Political voice and governance6. Social connections and relationships7. Environment8. Insecurity http://statsmauritius.gov.mu/English/StatsbySubj/Pages/quality-of-life.aspx

What next?

• Public consultation on the QOL indicators• Subjective indicators: well-being and

happiness• Possibly a composite index

How happy are Mauritians?

UN World Happiness index 2013

Factors: GDP per capita, healthy life expectancy, having someone to count on, perceived freedom to make life choices, freedom from corruption, and generosity

Country Rank Index (0-10)

Denmark 1st 7.7

Mauritius 67th 5.5

Togo 156th 2.9

Thank you