Today is the International Day for the Eradication of Poverty, a global day of awareness and action designed to help people all over the world overcome poverty.
Here in Australia we’re far from immune from the scourge of poverty. As the Australian Council of Social Service’s (ACOSS) most recent Poverty in Australia report highlighted, millions of Australians are currently living below the poverty line. Produced every two years this detailed study is a must read for anybody concerned with understanding just how prevalent poverty is in our country.
We strongly recommend taking the time to read the report in detail. But for those of you who don’t have time to go through the whole document we’ve distilled it down to 7 key and concerning findings.
Three million Australians live below the poverty line
Last year Australia celebrated 25 consecutive years of economic growth. There are few countries in the world – let alone the developed world – who can boast of such an achievement; however, the fruits of this prosperity have not been evenly shared across the community.
According to ACOSS there are now three million Australians living below the poverty line. Even without such a sustained run of economic growth this figure would be a concerning, but when you consider the overall state of the nation’s economy, it’s nothing short of shocking.
But what exactly is the report’s definition of ‘poverty’? According to ACOSS poverty is “defined to exist when a household’s income is so inadequate as to preclude them from having an acceptable standard of living. In practice, it is often identified when people are unable to afford socially perceived necessities – things that a majority in the community agrees that no-one should have to go without.”
The below table outlines poverty lines by family type as defined by the report.
We only need to look in our own backyard to realise that there’s a good chance this figure will grow by the time the next report is released in 2018.
The loss of automotive manufacturing jobs in northern Adelaide alone is estimated to be in excess of 6,800, but that only accounts for the cutting of direct automotive manufacturing jobs. In total, South Australia will lose approximately 23,900 jobs due to car industry closures.
The number of jobs to be lost and the consequent unemployment and flow-on effect in the surrounding communities is a debilitating legacy for those directly affected. And for the next generation coming through things will be particularly tough, as it’s currently hard for young people to see a future for themselves in which they are securely employed.
More than 730,000 of those are children
Probably the most concerning of the report’s findings is the revelation that more than 730,000 Aussie kids are living below the poverty line.
This alarming finding grabbed the media’s attention when the report was released last year; and to be honest, this was the report’s ‘golden egg’.
According to ACOSS this signifies a two percentage point rise in the number of children living in poverty when compared to data from 2003-04.
Children in single parent families are three times more likely to live in poverty
Nearly half of the 730,000 children who live below the poverty line come from sole parent households.
As the report states, “children in lone families are more than three times more likely to be living in poverty than their counterparts in couple families, with a poverty rate of 40.6% compared to 12.5%.”
More than 50% of people on Newstart live below the poverty line
Despite what the Federal Government often tells us about how generous our unemployment benefits are, the Poverty in Australia report paints a very different picture. Because the reality is that there hasn’t been an increase to Newstart (in real terms) since the mid-1990s. When compared to the wage increases that Australian workers have enjoyed over that same period (see the graph below), pay rises for Newstart recipients have been miniscule.
So with this in mind it isn’t all that surprising that 36% of people who currently receive social security payments are living below the poverty line, including 55% of those receiving Newstart Allowance.
Just under half of all recipients of the Disability Pension are living in poverty
Arguably the most shameful finding of the all is the discovery that so many disabled Australians are struggling to make ends meet.
While we all know that people with a disability tend to have poorer employment outcomes, it’s disappointing that our social security system doesn’t properly take this into consideration when calculating the disability support pension.
ACOSS believes that the introduction of the Welfare to Work policies of 2006 were a major contributor to forcing disabled people below the poverty line. This Howard era policy saw a large number of disabled Australians assessed as having a ‘partial work capacity’ (at least 15 hours or more per week).
This controversial policy shift forced many disabled Australians off of the Disabled Pensions and onto Newstart. According to Rick Morton from the Australian, “the Newstart Allowance is $173 weekly less than the pension.”
Only 16% of people living below the poverty line are homeowners
Just as full-time employment is a pretty reliable insurance policy against poverty, so is home ownership.
With only 15.5% of home owners in Australia living below the poverty line, the Poverty in Australia report reveals that the vast majority of Australians doing it tough are living in private rentals.
As ASCOSS’ findings reveal, “the majority of people living below the poverty line were renters (59.7%), including 44.2% in private rental and 11.4% renting publicly. While public tenants are a smaller group than private tenants, their high risk of poverty (48.4%), compared with 21.9% for pivate renters, indicates that they are deeply financially disadvantaged.”
Australia’s poverty rate is 14th highest in the OECD
In line with the historical contempt that we feel towards ‘tall poppies’, we’re remarkably average when it comes to keeping our citizens living above the poverty line.
Yeah we’re outperforming big brother, the United States, but we’re not performing as well as we should be. After 25 years of sustained economic growth – something that no other developed country has achieved – we should be trending closer to our Scandinavian counterparts when it comes to our poverty ratios.
Check out the OECD’s Social Expenditure Database to see how we compare to other OECD countries when it comes to ‘public social spending’ and/or ‘total net social spending’.
Don’t be discouraged, there’s cause for hope
Despite the fact that three million Australians are doing it really tough, we are seeing some improvements.
The 2007-08 global financial crisis forced huge amounts of people across the developed world into poverty, and here in Australia, we were no different. During the tumultuous GFC period our headline poverty rate actually skyrocketed to 14.4%.
We’ve managed to bring this down to 13.3%, however, while we’ve made some good short-term progress we still have more people living in poverty today than we did in 2003-04.
Photography by: Dan Romeo