poverty compilation

7/23/2019 Poverty Compilation

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Should Singapore have a

poverty line?


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po e ty e

Should Singapore have a poverty line?


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In October 2013, a number of academics called on the Singapore

government to define and measure poverty, i.e. to establish some

form of poverty line.

However, the government was not receptive to this suggestion.

Singapore has instead relied on other indicators to track poverty. Using

material from the newspaper articles listed in the footnotes, summarize

the debate between the academics and the government, andexplain how well the alternative indicators work to identify the

poor.


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Poverty Line

The specified minimum level of income needed topay for basic necessities in life in anycountry/region.


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Poverty Line

Absolute poverty

Minimum level of income that is required to meet basic

needs

Typically represented as a numerical figure in the

relevant currency

Relative poverty

Minimum level of income needed to attain minimal

standard of living


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Poverty LineDefinition:

The poverty line is the minimum level of income deemed adequate to securethe necessities of life in a particular country. Generally, poverty line is

significantly higher in developed countries than in developing countries.

Singaporeans against Poverty Campaign

S$5 a day is what nearly 400,000Singaporeans are left with after paying forutilities, school, rent, loan instalments and

healthcare.


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Quick Facts (SINGAPORE)GDP (2013) S$ 372,813.9 millions

GDP per capita (2013) S$ 69,050

Poverty is a result of income disparities and consequentlylimited access to basic necessities for day-to-day living.

What is the cause of poverty?

Does poverty exist in Singapore?

How do we define poverty?

Singapore has 5 stars hotels, casinos, vibrant

financial centers and beautiful city skyline.

Yes. However, those who are unable to make ends meet arethe invisible and hidden population

Information taken from Statistics Department of Singapore

Singapore is the second-most unequal economy in the developedworld, behind Hong Kong, according to United Nations data in 2013.


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Summary of debate - Yes

Numbers of poor are increasing 2002: 16% to 2011: 26%

(Central Provident Fund annual report 2002 & 2011)

The poor are getting poorer Compare 1998 to 2012, real wage of bottom 20%

decreased by 8%, while the overall income

increased by 27%

Gini Coefficient: 0.442 in 2000, and 0.478 in 2012.


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Summary of debate - Yes

Knowing where to draw the line on absolute poverty will

allow us to critically examine if there are still citizens who

are falling below the minimum standards of living in spite of

various assistance schemes available"

-Care Corner Family Service Centre

"Better information and data on the poor will also help spur

philanthropy-Community Foundation of Singapore


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Academics: Advantages of Poverty Line

1. Increase Public Awareness

Relatively unseen, hence under-addressed (Eg. Intergenerational Poverty)

Greater public support - Spur philanthropy

2. Data Collection and Research purposes

Improve information on the poor who need societal help

Understand nature of problem, causes and solutions

Aids in policy making

3. Improve effectiveness of help made available to the poor

Define a specific group of people in need

More accurately assess their needs

Better evaluate programmes run by charities

Channel resources efficiently


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Summary of debate - No

A single poverty line is one-dimensional and

inadequate for identifying the poor or assessing the

effectiveness of assistance schemes.

-Minister for Social and Family Development Chan Chun Sing

Does not fully reflect the complexity of issues faced by

the poor


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Risk of exclusion

Cliff effect

Also excludes other issues that poor families face,

such as ill health and lack of housing


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Different countries can have different methods of

identifying the needy

E.g. New Zealand and Canada do not have poverty line

Singapore uses a broader definition of poverty by

setting different criteria to identify the needy -> multi

dimensional

Canada's "Low Income Cutoff", described later, is actually apoverty line, though it is not described as such


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Multiple lines of assistance instead of a single poverty

line

Assessment process is flexible

those who do not meet certain criteria in help

programmes are also able to receive assistance

no cliff effect


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Alternative Indicators (Singapore)

Benefits Shortcomings

Indicates totalnumber of suchhouseholds, and thepresence of aworking person

Reveals averagemonthly income andexpenditures

Does not differentiatebetween those whoown the flats and thosewho rent

No data on earnings of

households with noworking member.

1. Five-Yearly Household Expenditure Survey Data on 1& 2 room HDB flats


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Alternative indicators are not very

effective

2. Housing type

The household expenditure survey has data on one- and

two-room households.However, this group comprises not just families who rent

flats and have no assets, but also those who own their flats.


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Income (cont.)

Around 19,000 households living in one- and two-room

flats have no working member, but there is no specific

data on how much this group earns.

Almost a quarter of the bottom 5% are retiree

households. Many could be living in four-room or bigger

flats. -> Are they really poor?


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Alternative Indicators (Singapore)

Benefits Shortcomings

Provides statistics onthose who receivehelp

Possible double countingof beneficiaries.

3. Comcare Annual report Data on beneficiaries under 4 different schemes for lower-income

families


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Short term assistance6123 households

Medium term assistance4423 households

Long term assistance

3032 households

Supporting the communities

providing support to certain communities to

help the needy


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Distinct Indexes

Low Income Cut Off

Low Income Measure

Market Basket Measure

Supplements

Family Size Geographic Location

Low-Income Individuals


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(1) Low Income Cut Off

Source : http://www.statcan.gc.ca/pub/75f0002m/2012002/lico-sfr-eng.htm#n1

How does Canada track poverty?
http://www.statcan.gc.ca/pub/75f0002m/2012002/lico-sfr-eng.htm#n1http://www.statcan.gc.ca/pub/75f0002m/2012002/lico-sfr-eng.htm#n1


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(2) Low Income Measure

- Calculate equivalent household income- 50% of median income

(3) Market Basket Measure

- i) Nutritious diet as specified in 2008 National Nutritious Food Basketii) Basket of clothing and footwear ( 2 adults, 2 children)iii) Shelter cost ( median cost of 2 - 3 bedroom rental unit)iv) Transportation Cost

- Provide threshold for finer geographical level than LICO

Source : http://www.statcan.gc.ca/pub/75f0002m/2013002/mbm-mpc-eng.htm

How does Canada track poverty?
http://www.statcan.gc.ca/pub/75f0002m/2013002/mbm-mpc-eng.htmhttp://www.statcan.gc.ca/pub/75f0002m/2013002/mbm-mpc-eng.htm


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Alternative Indicators (Canada)

Information ontargetdemographics

Cliff Effect IncompleteInformation

Low IncomeCutoff

Low Income

Measure

Market Basket

Measure

Tracking

demographic

profiles


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Conclusion

Alternative indicators are generally useful and beneficial,

but there are some loopholes.

Singapore does not need a poverty line, but moreinformation should be released to identify poor.


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Conclusion

A combination of indicators required to achieve desiredpurposes

Having a more clear cut indicator could improve informationbut may keep others who may also require help out of theloop


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Conclusion

Singapore government should establish a poverty line yet remain flexible in constructingpolicies and schemes to provide social assistance to the poor.

Why?

Understand the severity of poverty in Singapore

Serve as a yardstick to evaluate existing schemes

Information is relevant to study other issues such as social mobility

Encourage more philanthropic effort in Singapore(eg. A packet of rice Project - self funded and initiated by a group of volunteer)

poverty compilation

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