More than 660,000 people in poverty in 2020, over 210,000 are children
- 661,518 people in Ireland are living in poverty, of which 210,363 are children.
- 133,627 people living in poverty are in employment; the “working poor”.
- 781,794 people are experiencing deprivation, of which 250,956 are children.
661,518 people are living in poverty in Ireland today. Of this number, around 210,363 are children under the age of 18. These CSO figures give us the first insight into the impact of COVID-19 on poverty and deprivation in Ireland. Without COVID-19 income supports the at risk of poverty rate would have been almost 21 per cent, one in five people in Ireland. While the Wage Subsidy Schemes and the Pandemic Unemployment Payment have helped to support people from the worst economic impact of the pandemic, today’s figures are very concerning and point to the long term economic and social impact of the pandemic on households.
The sheer scale of the numbers of people living in poverty is worrying, particularly when we consider the impact of the Government pandemic income supports in cushioning households from the worst effects of the pandemic. Today’s figures show we are not making progress in addressing poverty and social exclusion. The scale of poverty is still far too high and presents some serious policy challenges. In addition, the number of people experiencing deprivation, including one in four children, is a clear sign that despite several years of sustained economic growth, many people’s circumstances have not improved at all.
Impact of Social Welfare Payments
Social welfare payments play a crucial role in reducing poverty. Today’s figures show that without the social welfare system almost four in every ten of the Irish population would have been living in poverty. However, welfare payments reduced the poverty rate by almost 25 percentage points to 13.2 per cent. Social Justice Ireland called on Government to increase core social welfare rates by €10 per week in Budget 2022 and to commit to benchmarking core social welfare rates to 27.5 per cent of average earnings over two years. Government’s failure to raise core social welfare rates by €10 a week and to commit to this benchmark means that many of those depending on social welfare payments will fall further behind the rest of society in the years ahead as today’s CSO figures indicate.
A lesson from past experiences of economic recovery and growth is that the weakest in our society get left behind unless welfare increases track increases elsewhere in the economy. Today’s figures show that households on the lowest incomes are falling further behind. Delivering a fair recovery means that no-one should be left behind, especially those who are most vulnerable. When Budget resources are focused on the welfare system they assist those who need most help. Conversely, when a Budget provides limited resources to the welfare system, as Government did in Budget 2022, it undermines the living standards and needs of the weakest in our society.
The CSO figures show that in-work poverty is 6.2 per cent. This equates to approximately 133,627 people in employment living below the poverty line. However this figure may be an underestimation as, at the time of the household interviews in early 2020, no one foresaw the impact Covid would have on the labour market. It is telling, however, that income tax receipts decreased by just 1 per cent in the year to January 2021, indicating it was the lowest income earners who were most impacted by pandemic-related employment and wage losses.
The previous two Budgets did little to help low income families. A couple with one earner on €30,000 per year saw an increase of just 39c in total. This situation is even worse for a couple with one earner on €30,000 with two children who would significantly higher costs, but who also only received an increase of 39c.
The in-work poverty figure has remained consistently over 100,000 for several years now, indicating that in-work poverty is a trend which policy-makers and successive Governments have thus far failed to make any impact on. The idea of a job as an automatic poverty reliever is clearly contradicted by our analysis. The job must be well paid with decent conditions. Specific interventions are required to tackle the issue of the ‘working-poor’. Until Government makes tax credits refundable, it will not have an efficient mechanism by which it can address the issue of the working poor.
The deprivation figures published today show that almost 781,794 people still struggle to achieve a basic standard of living. Almost one in ten people went without heating due to financial circumstances which show the impact that the increased cost of living is having on households. Combined with the figures released today on income, these trends are very concerning and require immediate action.
Children are one of the most vulnerable groups in any society. The issue of child poverty deserves particular attention. In 2020, 210,313 children lived in households that were below the poverty line. One in four children (250,956) were living in households experiencing deprivation. This just is not acceptable. The fact that such a large proportion of our children are living below the poverty line has obvious implications for the education system, for the success of these children within it, for their job prospects in the future and for Ireland’s economic potential in the long-term.
Also a cause for concern are poverty rates for those unable to work due to long-standing health problems. This group again have the highest risk of poverty at 33.7 per cent. There is a very strong case to be made for the implementation of a cost of disability payment for this cohort, and improved services and other supports detailed in the ‘The Cost of Disability in Ireland – 2021’ report. The Department of Social Protection must act on the findings of this report and implement the recommendations.
National Poverty Targets
2020 marks a year when a number of recent poverty-related targets were to have been met. Sadly, none of these will be achieved. Ireland’s national target is to reduce ‘consistent poverty’ (a combined deprivation and poverty indicator) to 2 per cent or less by 2020. The CSO figures released today suggest that, yet again, we will miss this target. Our persistent failure to meet our own poverty targets, and address poverty and deprivation among children, single parent households and people with a disability is unacceptable. These vulnerable groups are falling further behind the rest of society.
If poverty and deprivation rates are to fall in the years ahead, Social Justice Ireland believes that in the period ahead Government, and policymakers generally, should:
- Acknowledge that Ireland has an on-going poverty and deprivation problem.
- Adopt targets aimed at reducing poverty and deprivation among particularly vulnerable groups such as children, lone parents, jobless households, and those in social housing.
- Examine and support viable alternative policy options aimed at giving priority to protecting vulnerable sectors of society.
- Carry out in-depth social impact assessments prior to implementing proposed policy initiatives that impact on the income and public services on which many low-income households depend. This should include the poverty-proofing of all public policy initiatives.
- Recognise the problem of the ‘working poor’. Make tax credits refundable to address the situation of households in poverty which are headed by a person with a job.
- Support the widespread adoption of the Living Wage so that low paid workers receive an adequate income and can afford a minimum, but decent, standard of living.
- Introduce a cost of disability allowance to address poverty and social exclusion of people with a disability.
- Recognise the reality of poverty among migrants and adopt policies to assist this group. In addressing this issue, replace direct provision with a fairer system that ensures adequate allowances are paid to asylum seekers.
- Accept that persistent poverty should be used as the primary indicator of poverty measurement and assist the CSO in allocating sufficient resources to collect this data.
- Move towards introducing a basic income system. No other approach has the capacity to ensure all members of society have sufficient income to live life with dignity.
- Acknowledge the failure to meet repeated policy targets on poverty reduction and commit sufficient resources to achieve credible new targets.
The 'Survey on Income and Living Conditions (SILC) 2020 Results' on which these numbers are based, was published today by the CSO.
Poverty Insights – Income Reference Periods 2018-2020 was also published by the CSO today.
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