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Poverty Level Decreases, Pattern Explained

Poverty is defined by the Merriam Webster as “the state of one who lacks a usual or socially acceptable amount of money or material possessions.” Poverty in Fiji is a
30 Jan 2016 08:29
Poverty Level Decreases, Pattern Explained

Poverty is defined by the Merriam Webster as “the state of one who lacks a usual or socially acceptable amount of money or material possessions.”

Poverty in Fiji is a significant concern even though our economy is growing.

We can say that Fiji falls under relative poverty since most of us have the basic needs which are food, water and shelter.

Can we blame people in poverty for their own predicament?

It has been noted that for Fiji, a challenge faced is that families who are poor remain in a poverty cycle.

This is because they are not able to access good quality education so chances of obtaining a decent employment is highly unlikely.

They either are employed with very low income, earning below the poverty line or become part of the mass of unemployed youth with the likelihood that they will remain in poverty and transmit this to their own children and the cycle continues.

Let us look at some figures in relation to poverty levels in Fiji and whether it has increased or decreased over the years.

For this report, the basic needs poverty lines used were: $55.12 per adult living in an urban area and $49.50 per adult for rural dwellers.

 

Poverty by geography

It can be noted that poverty has decreased over the years and this can be a result of better education which has led to secured jobs, foreign investments that has provided more job opportunities, etc.

Total poverty decreased from 35 per cent in 2002-03 to 31 per cent in 2008-09 and further decreased to 28.1 per cent in 2013-14.

The incidence of Urban Poverty increased from 18 per cent in 2008-09 to 19.8 per cent in 2013-14.

The Western Urban rate showed the biggest increase of 4.6 percentage points (from 17% to 21.6%) while the Northern Division showed the biggest decline of 4.2 percentage points (from 38% to 33.8%).

The Eastern Division declined by 0.6 percentage points (from 30% to 29.4%) while the Central Division increased by 0.9 percentage points (from 16% to 16.9%).

Incidence of poverty in the urban areas for the Eastern and Northern Divisions are relatively higher than that of the Central and Western Divisions.

The incidence of Rural Poverty decreased from 43 per cent in 2008-09 to 36.7 per cent in 2013-14.

The Western Division recorded a significant  decline of 16.4 percentage points (from 43% to 26.6%) while the Eastern and Northern Division increased by 2.1 percentage points (from 40% to 42.1%) and 1.6 percentage points (from 51% to 52.6%) respectively.

The Central Division increased by 0.9 percentage points from 36% to 36.9%.

It is estimated that over a third of the poor population (33.9%) reside in the Central Division.

The estimated number of 80,497 is the highest by Division and is closely followed by the 76,337 (32.2%) poor residents of the Western Division.

Slightly less than half of Fiji’s population (49.2%) reside in the Rural areas.

However, rural dwellers are over represented as far as the Rural and Urban distribution of Fiji’s poor is concerned, with 62.2% of the poor population being Rural dwellers.

 

Household Income Types

Estimates derived from the 2013-14 Household Income & Expenditure Survey (HIES) shows that Households in Fiji received close to $3.7 billion from various income sources.

Of this $2.143 billion was for Permanent Wages and Salary.

The share of Permanent Wages and Salary increased significantly in 2013-14 when compared to the prior survey periods that is from 43% in 2002-03 to 44% in 2008-09 and to 61% in 2013-14.

The share of household receipts from Casual Wages declined from 10% in 2008-09 to 7.3% in 2013-14.  Further details are provided in Table 1.

The big drop in the percentage share of Other Income is more a result of greater probing during the data collection phase of the survey.

 

Income distribution

The top earning 10% of households received 31.0% of total household income in 2013-14.

This was a decrease of 3.7 percentage points when compared to the 2008-09 period.

This share progressively decreases as we move down to the poorest 10% of households.

The poorest 10% of households received a mere 3.2% of total household income in 2013-14 which is an increase by 1.2 percentage points when compared to the 2008-09 period.

There is a significant difference in the distribution of income among Urban and Rural households.  Some of the differences are as follows:

The poorest 10% of urban households accounted for 2.9% of total urban household income compared to 4.4% among rural households

The richest 10% of urban households accounted for 31% of total urban household income compared to 24.2 among rural households

The highest earning 30% of urban households accounted for 57.5% of total urban household income compared to 49% among rural households.

Next week we will dwell further into Poverty and its relation to Household Size, Educational Attainment and more.

 

Common ways to define poverty:

Absolute poverty – is the extreme kind of poverty whereby they lack basic food, water, shelter, etc.  This type of poverty is usually passed down from generation to generation and hardly exists in developed countries.

Relative poverty – is usually defined by society, even though they may have assistance from the government for medicine, housing, etc., they are considered poor just because the rest of the community have access to superior services and amenities.

 

 

This is an informative publication, sponsored by The Fiji Sun, Fiji Bureau of Statistics and HFC Bank. All views expressed or implied are purely of the Treasurer at the HFC Bank, Peter Fuata.



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