Deprivation In The Unequal Recovery

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File Photo 5 euro increase in social welfare payments from next march.3/3/2009. Dole Queue. People queue down Cumberland Street, Dun Laoghaire to collect their social welfare payments. Picture James Horan/RollingNews.ie

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From top: Social welfare queue in Cumberland Street, Dun Laoghaire, County Dublin; Rory Hearne

Dr Rory Hearne tackles the statistics behind Ireland’s growing inequality and challenges the narrative that those on social welfare receive the majority of state benefits.

Dr Hearne writes:

In 2007, prior to the economic crash and austerity 11.8% of the Irish population (about 485,000 people) suffered from material deprivation. A decade later, and four years into a supposed economic ‘recovery’, 25.5%, over a quarter of our population (that is 1 million people) are suffering from material deprivation.

That is an additional half a million people affected by deprivation.

So how can any one seriously argue that austerity ‘worked’ in Ireland and that we are in a recovery?

In fact, for some of our most vulnerable and socially excluded groups things are even worse. Take lone parent families for example. In 2007, 35.6% of lone parent families suffered deprivation.

Today their deprivation rate is a shocking 57.9%. And while the general deprivation rate dropped from 29% in 2014 to 25.5%, the deprivation rate for lone parent families showed no significant change from 2014 (when it was 58.7%).

While our children – the future of our country – 31% of all children suffer deprivation, which is double the 2007 rate of 15.9%.

But what does suffering from material deprivation mean?

It means that an individual or household experiences two or more types of enforced deprivation from a list of eleven deprivation indicators such as being without heating at some stage in the last year, being unable to afford new (not second-hand) clothes, being unable to afford to keep the home adequately warm, being unable to afford to have family or friends for a drink or meal once a month, being unable to afford to buy presents for family or friends at least once a year or being unable to afford to have family or friends for a drink or a meal once a month.

The CSO provides a further break down of what proportion of people are affected by each of the deprivation indicators.

These show that there was in fact an increase in the proportion of people who have been unable to keep their home adequately warm in the last year, rising from 8.8% in 2014 to 9% of the population in 2015.

While 13.6% (almost 650,000 people) went without heating at some point in the last year (this is over double the rate in 2007). The most common types of deprivation experienced were an inability to replace worn out furniture (24.4%), afford a morning/afternoon/evening out (18.6%) and have family/friends over for a meal/drink (16.8%).

There are 257,000 people in Ireland (5.4% of the population) who are unable to afford to buy presents for family or friends at least once a year.

The recent Generation F’D documentary on RTÉ2 showed a father suffering the pain of looking to Christmas and being unable to buy his children presents. But among those at risk of poverty (16.9% of the population – they have an annual income below €11, 863, or 60% of the national median income), 14% were unable to buy presents for friends or family.

The inequality at the heart of the recovery is also shown by the fact that for this section of the population (approximately 800,000 people) who are ‘at risk of poverty’, there was an increase in the last year in eight of the eleven types of deprivation. But for those not at risk of poverty, there was a decline in all eleven types of deprivation.

If we look at deprivation by income decile we can also see the same pattern of inequality. 42% of the bottom income decile (they have an income less than €195 per week) suffer three or more forms of deprivation.

This is almost 13 times the rate of the top income decile (where just 3.3% suffer three or more forms of deprivation). The weekly income of the top decile is greater than €764 per week.

The figures also show the deeply unequal nature of our society and economy. They show that the top 20% get 40% of net income while the bottom fifth of our population get just 8% of all income.

Of course this doesn’t include wealth which is even more unequal. The top 20% have 73% of all wealth in Ireland in contrast to the bottom half of the population with just 5% of all wealth.

But a very interesting table, Table A 2, shows the average weekly equivalised income by decile and the composition of that income.

From this we can see that the bottom decile has a net disposable income of just €146 per week while the top decile has a net disposable income of €1,066 or 7.3 times the bottom decile.

But what’s really fascinating is that the table shows ‘social transfers’ from the state (unemployment benefits, pension, housing allowances received) received per decile and the results of this are not what you would expect.

It shows that the top decile received, on average, €164 per week in social transfers from the state. That is more than the bottom decile which received €119.99 per week in social transfers. So it shows that the state gives more to the wealthiest and highest income households than the bottom!

This challenges the narrative that it is those on social welfare receive the majority of state benefits and highlights that there is a significant welfare going to the wealthiest households as well.

In fact, the top decile pays, on average, €408 per week in tax, yet receives in social transfers (this is excluding tax reliefs etc), almost 40% of this total tax back in social transfers. So 40% of the tax being paid by the top income earners is being returned to them through social transfers.

This is very significant and challenges the argument that the top are being over taxed.

Barnardos, the children’s charity were absolutely correct in their response to the recent CSO figures to state that the “Continued lack of improvement in child poverty rates is a national scandal that requires urgent intervention.”

As they explain:

“Childhood is short, yet the experiences we have shape the adults we become and the lives we lead. Children living in poverty live life on the margins, excluded from opportunities and often unable to break the cycle of poverty. Poverty affects every aspect of a child’s life and has short and long term consequences on their development, health, education outcomes and life chances. Worryingly, children in lone parent households continue to experience poverty and deprivation at a far greater rate than children in two parent households”.

While, SPARK, the lone parent campaign group, has called on the Minister for Children, Katherine Zappone to establish an immediate task force to tackle poverty in lone parent families. They have set up a petition in response to the CSO data arguing:

“The recent CSO data shows consistent poverty in the state is 8.7%. For 2 parent families with 3 or less children this drops to 7.7% but for children in lone parent families it is 26.2%. It is fundamentally wrong that a child is almost 3 1/2 times more likely to live in poverty based purely on their family status. We know childhood poverty has long reaching effects and we owe it to all children to ensure they have a fair chance”.

Take a minute to sign their petition here

Dr Rory Hearne is a policy analyst, academc, social justice campaigner. He writes here in a personal capacity. Follow Rory on Twitter: @roryhearne

26 thoughts on “Deprivation In The Unequal Recovery

  1. Anomanomanom

    Yeah sorry but apart from the heating, its a necessity, the rest of those things dont mean you live in poverty.

  2. DubLoony

    I come from a family of 7 kids. Growing up there were bags sent around from 2 other large families on our street, one winter bag, one summer bag.
    They were second hand clothes. We just assumed that everyone did this as normal. I was 23 before I had all new clothes that I bought myself.
    Our mothers were smart at managing the resources that they had.
    We in no way felt deprived.

    1. DubLoony

      I also work but have a mortgage. In the early days, I could not afford holidays or social events.
      I know that there are people in dire circumstances but I’ll quibble with how that is measured in these particular terms.

      1. No more mr nice guy

        When I was a child we had lettuce leaves we used to crawl into at night and use as blankets. I thought everyone lived this way and made best use of the lettuce they had? No?!!!

      2. nellyb

        deprivation: “damaging lack of material benefits considered to be basic necessities in a society”
        are you suggesting our society’s level of basic necessities should equate to that of impoverished nations? If that’s your premise, then you’re stinking rich on that scale. dirty 1percenter :-)

        1. Cian

          “3.3% [of the top decile] suffer three or more forms of deprivation). The weekly income of the top decile is greater than €764 per week.”
          This is a crazy methodology if 3.3% of people earning 40K and more are suffering three or more forms of deprivation!

    2. Clampers Outside!

      I came from a family of five siblings. When I first hit my teens I got new jeans that summer…..

      Or should I say, I got ‘knew’ jeans, because I knew they belonged to my sister before me.

      Good times :)

    3. TheFerg

      Yep, I scored 10/11 on that and so did everyone else I grew up with. Didn’t feel deprived but also glad to see my nieces and nephews score a 0/11 – gives me the right to start with “..well back in my day we didn’t have…”

  3. Louis Lefronde

    The problem with the stats is that it doesn’t reflect the fact that 20% of the population pay 80% of the tax. This is the tax which the middle class pays for the very rich (who can afford advisors to help them avoid tax) and that large proportion who don’t pay direct income tax because politicians have excluded them (votes bought with middle income taxes) ‘Progressive taxation’ is just code for making the squeezed middle pay more and get nothing in return

    The left have no solutions to solving ‘inequality’ problem either here or all over the western world, and that’s what’s fuelling in part the rise of the Alternative Right elsewhere and the casual slide towards authoritarianism.

    1. DubLoony

      A huge chunk of the problem is that so many people are on low pay. They are just about treading water but not earning enough to pay tax.
      For all the tech, pharma, financial sector jobs, there’s hundreds of thousands more in low pay service sector.
      We have 45% of adults on some form of welfare payment be it pensions, carers, disability or lone parents payments.
      – Raise median pay for anyone working, this is the #LivingWage campaign.
      – Focus on training / skills / education for those who are low skilled or unemployed. Building industry now saying that there are not enough trades to cop with the uptick in construction, yet we have 20% youth unemployment.
      – Childcare is a huge barrier to lone parents entry into workforce. It needs to be taken seriously.

      1. Louis Lefrondet

        If you think things are bad now, just you wait. Increased automation, robotics and artificial intelligence is going to make large sectors of the economy redundant with no concomitant replacement jobs. This will hit doctors, lawyers, even computer programmers who won’t be exempt. And while there may be some who think this dystopian future won’t happen, don’t be so sure of yourself.

        So if you think inequality is bad now, and if you think fuzzy left-wing academics stating the obvious are going to solve this, think again.

        1. DubLoony

          Just need to look at the checkout machines in supermarkets to see that change happening.
          Growth areas are construction, renewable energy systems, health care with aging population etc.

          Tax justice for transnational companies needed. And billionaires.

        1. wearnicehats

          This living wage idea is utter nonsense. If it were to come in 99% of all businesses that rely on being staffed by minimum wage staff or supplied by companies who rely on minimum wage staff eg all coffee shops & restaurants will either close or double their prices. So let’s assume that people would be willing to pay €12 for a takeaway coffee and scone and the shops stay open then all that has happened is that the new wonderful #living wage is now the new not so wonderful #minimum wage and you’re back at square one.

  4. dav

    These stats would warm the cockles of the blushirts of this site. THey believe that the poor deserve the misery that government austerity creates. So long as the vulture funds and tax evading corporates are happy, blushirts are happy.

  5. Diddy

    Even in times of prosperity you have a breed of people who have disgusting instincts. Spending vast amounts of money on drink and drugs. Then fighting. No amount of equality is going to solve that.

  6. Jake38

    The strongest predictor for childhood poverty is a deadbeat absent father. Fix that and we might get somewhere.

  7. Water Boy

    Material deprivation cries St Rory, the actual measure is consistent poverty and it fell in 2015 to 8.7% from the previous year as the numbers of unemployed fall sharply, one has a 22.2% probability of consistent poverty if unemployed versus 2.1% if working and 3.2% if retired.

    Instead of welcoming improvement in the figure we get a hard core trot behind the walls of the monastery style university translating what he reads on Facebook into an article, where the sky is falling versus people’s lives being improved by finding work and escaping real poverty, not a convenient relativity fest devised by the poverty industry, whose captains are all very well paid.

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