APPENDIX
DEFINING AND MEASURING POVERTY
A.1 CPAG, alongside most UK commentators, accept
Townsend's definition that "Individuals, families and groups
in the population can be said to be in poverty when they lack
the resources to obtain the types of diet, participate in the
activities and have the living conditions and amenities which
are customary, or are at least widely encouraged and approved,
in the societies in which they belong."[24]
A.2 Three key issues should be drawn from this
conceptualisation. First resources can come through both incomes
and services. However the marketised nature of Scottish society
means that income is central to discussions about poverty. Second,
poverty is relative to the needs and wants of the wider society.
This means that poverty in Scotland is a qualitatively different
thing to that in the global south. Thirdly; poverty in Scotland
in the 21st century is not only about survival and minimum subsistence
to avoid starvation, it is about a standard of living that allows
participation within society.
A.3 Approaches to the measurement of poverty
vary significantly and studies often combine measures. Commonly
used approaches include measures of income poverty and position
in relation to an income threshold; measures of material deprivation;
measures of numbers claiming key means tested benefits; measures
of occupational background or socio-economic classification; and
measures of those living on levels below a defined budget standard.[25]
A.4 Government at UK and devolved level has
used a relative low-income approach to measure progress in reducing
child poverty. Children have been considered to be in poverty
where they are living in households with less than 60% of the
median income before and after housing costs are taken into consideration.
Between 1998-99 and 2004-05 policy delivered a reduction in child
poverty across Great Britain of 17% from 4.1 to 3.4 million after
housing costs (AHC) and down 23% from 3.1 to 2.4 million (before
housing costs (BHC) (both falls well short of the 25% target).[26]
Using the same measure child poverty in Scotland fell over the
same period by 25% from 320,000 to 240,000 after housing costs,
and by 34% from 290,000 to 190,000 before housing costs.[27]
A.5 The Government has announced three new measures
of child poverty to replace the existing measures. These are absolute
low income (counting children living in households with a before
housing costs income of less than 60% of the 1998-99 median income);
relative low income (counting children living in households with
a before housing costs income of less than 60% of the contemporary
median) and material deprivation and low income combined (counting
children in households with a before housing costs income of less
than 70% of the contemporary median and lacking and unable
to afford defined material necessities.
A.6 before housing costs income of less than
60% of the 1998-99 median income); relative low income (counting
children living in households with a before housing costs income
of less than 60% of the contemporary median) and material deprivation
and low income combined (counting children in households with
a before housing costs income of less than 70% of the contemporary
median and lacking and unable to afford defined material necessities.
A.7 CPAG is concerned that BHC data is a less
effective measure of income poverty than AHC data, since it takes
no account of the costs of housing which bear particularly heavily
on families with children and which both significantly reduce
disposable incomes whilst affecting work incentives through housing
benefit. Both before and after housing cost data include housing
benefit as income but only the latter deducts for actual money
spent on housing. The effect of the additional housing benefit
for those entitled to it reduces poverty rates by increasing BHC
income, even though families see none of this income and no improvement
in their children's quality of life.
A.8 The third measure, material deprivation
and relative low income combined, has not yet been defined, but
a PSA is promised to halve this measure by 2010-11 in line with
the relative income level. CPAG believes this new measure needs
to pick up those children redefined as not poor by the shift away
from using after housing cost data and for its baseline to be
set in line with the numbers of children previously counted as
poor under the after housing cost relative low income measure.
John Dickie
Childer Poverty Action Group
October 2006
24 Townsend, P, Poverty in the United Kingdom, 1979,
p 31. Back
25
See Poverty: the stats; CPAG, 2006. Back
26
See Poverty: the stats; CPAG, 2006 Figure 1. Back
27
See http://www.scotland.gov.uk/Publications/2006/03/08155404/0
Table 4. Back
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