More than 637,000 people are still living in poverty in Ireland despite modest improvements in poverty rates

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• 637,000 people in Ireland are living in poverty, of which 193,600 are children.
• 98,100 people living in poverty are in employment; the “working poor”.
• 886,000 people are experiencing deprivation, of which 293,200 are children.

637,000 people are living in poverty in Ireland today. Of this number, around 193,600 are children under the age of 18. Despite wage growth, increased employment and very high rates of economic growth last year, these figures show that a significant proportion of the population is still living in very difficult circumstances.  We expect that the impact of Covid-19 will simply make this situation worse.

We welcome the improvements in poverty rates, but despite the fall in numbers, the scale of poverty is still far too high and presents some serious policy challenges.  The reality is that hundreds of thousands of people are living in poverty, this is unacceptable after several years of sustained economic growth.

Social welfare payments play a crucial role in reducing poverty. This means that Government’s decision not to increase core welfare rates in Budget 2021 will inevitably reverse any gains that these vulnerable people have seen in recent years. Today’s figures reinforce just how critically important welfare is in addressing poverty. Without social welfare payments 41.4 per cent of Ireland’s population would be living in poverty, instead of 12.8 per cent. Such an underlying poverty rate suggests a deeply unequal distribution of income.

The government knows how important social welfare payments are when it comes to addressing poverty as the improvements in 2018 and 2019 attest. Yet Ireland’s poorest people were left behind in Budget 2020, and again in Budget 2021 as Government decided not to increase core social welfare rates. Despite allocating more resources than any previous Budget in the history of the State, the distribution of those resources was such that the gap between the poor and the better off will widen in 2021 and inequality will increase. This is a totally unacceptable outcome.

People on core social welfare payments depend on the Budget alone to increase their incomes. In 2021 it is important to realise that people with jobs are likely to see increases in their take-home pay in the coming year.  Public servants will see an increase of 2% while the pay of other sectors is also expected to increase. In this context it is not acceptable that core social protection rates remained unchanged, which, given estimates for inflation in 2021, will mean a real term reduction in the value of the core payments.

2020 marks a year when a number of recent poverty-related targets were to have been met. Sadly, none of these will be achieved this year. 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 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.

Deprivation

The deprivation figures published last month show that almost 900,000 people still struggle to achieve a basic standard of living. The yearly increase was more than 140,000, and the fact that deprivation is increasing for almost every socio-demographic group is of real concern.  Combined with the figures released today on income, these trends are very concerning and require immediate action.

If we are to cope with the social and economic fallout of Covid-19 and prevent the large increase in poverty and deprivation that occurred after the 2008 crash we need to see an increase in core social welfare payments, equity of social welfare rates, adequate payments for children, refundable tax credits, decent rates of pay for low paid workers, a universal state pension, and a cost of disability payment.

Policy recommendations:

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) 2019 Results' on which these numbers are based, was published today by the CSO.