Sunday, February 22, 2009

How poor is poor?

It is ostensibly hard to tell who is poor these days. The lack of micro figures on poverty is said to be hindering efforts to pinpoint the actual segment of the population that are genuinely poor.

DO you consider yourself poor?

Most people have difficulty answering this question. Poverty is hard to define because it is multi-dimensional. In most practical settings, the inability to afford an adequate diet is the central element of the Poverty Line Index (PLI) and it’s not surprising the UN Millennium Declaration (UN 2000) links together the twin aims of eradicating extreme poverty and hunger.

But individuals may also consider themselves poor if they lack access to school or healthcare or if they have no access to safe drinking water or sanitation services, aspects of daily life that most people take for granted.

In Malaysia, poverty is based on comparison of household income with the PLI. Typically, income shows more short-lived variation overtime and it makes little sense to consider a household poor if its income only temporarily falls below the PLI.

Young individuals often have low income while they acquire essential skills through education or on-the-job training. By a life time income criterion, such individuals are not poor but during an income survey, they might be counted as among the poor.

A similar issue arises with households whose income is highly seasonal. For instance, the income of households engaged in farming might fall dramatically in some months and if they are sampled in those months, they might well be thought poor even when their annual income is well above the PLI.

It is ostensibly hard to tell who is poor these days.

For instance, walk into a temporary settlement or squatter area within the city and you are likely to see children of all races playing in the alleyways, and hear the noise from TV sets blaring from houses, some of which have Astro satellite dishes on the roofs. But a closer look reveals a different story — dilapidated houses unfit for human habitation, blocked drains that breed mosquitoes and the stench of uncollected rubbish piled up by the houses.

Thousands of urban residents have been forced to call these settlements home — many even pay for the privilege.

Yet statistically, their numbers do not seem to matter, let alone those in the rural areas.

The PLI based on the 9MP considers a family poor if it earns below RM720 in Peninsular Malaysia, RM960 in Sabah, and RM830 in Sarawak. Households with incomes below the poverty line are considered poor. Earnings of RM430, RM540 and RM520 fall respectively into the hardcore poverty category in the three territories.

Prime Minister Datuk Seri Abdullah Ahmad Badawi, while tabling the 2009 Budget on 29 Aug 2008, announced the number of hardcore poor households in Malaysia had declined by 43 per cent over three years — from 67,300 in 2004 to 38,400 in 2007.

He said the government was confident that hardcore poverty would be eradicated by 2010. All this may give the impression that poverty is a non-issue, both in rural and urban areas, and that Malaysia is well on course to be rid of it completely. The reality, however, is quite different.

The lack of micro figures on poverty is said to be hindering efforts to pinpoint the actual segment of the population that needs aid. The macro figures — much more concerned with reflecting ethnic equity — are not very helpful to the people on the ground actually trying to tackle the problem of poverty.

The UN Development Programme (UNDP) macro figure statistics reveal that from 1976 to 2004, the number of households living below the poverty line in Sarawak fell from 60 per cent to just eight per cent and the vast majority of which were rural indigenous communities. Ibans and Bidayuhs account for the large majority of hardcore poor.

The 2007 Human Rights Commission of Malaysia Report on the Human Rights Approach to Poverty Reduction in the country (Suhakam HRAPR) had proposed to the government that when dealing with poverty and equal access to development, it was important to ensure there was no discrimination.

The authorities, the report said, should take a human-rights approach to dealing with the matter.

Dr Mohd Hirman Ritom, one of Suhakam’s commissioners, agreed Malaysia had a good track record on poverty eradication but it did not really paint the whole picture.

“Statistically, we have achieved a very significant drop in poverty rate — from 49 per cent in 1970 to 5.7 per cent in 2004. It certainly speaks volumes of what the government has done to improve the living standards of the people.

“But in reality, the micro figures are not very good. From the plight and experience of both the urban and rural lower income groups, there are still many poor among us,” he said.

Dr Ritom said poverty in Sarawak was still very much in the rural environment, pointing out that last year, Suhakam did micro studies in four areas — two in Kuala Lumpur, one each in Sabah and Sarawak — and found 84 per cent of the 100 families surveyed in the East Malaysian states were earning less than the PLI.

“Our studies in two rural villages in Sarawak and Sabah showed high incidence of poverty. Of course, some people were upset with our studies but that’s the reality.

“Those who participated in the survey in Sarawak were mostly farmers and fishermen. The studies involved only one village. I agree statistically we have done well but we could have left behind certain communities such as farmers, fishermen and the Penan in the rural areas.

“Incidence of poverty could be very high among the groups which we don’t know about as there are hardly any micro studies being carried out,” he added.

Dr Ritom said in a human-rights perspective, poverty reduction was about giving people access to everything like a business cycle.

He said Sarawak, in particular, had solid a development plan and training programme. There are many human development programmes to meet the needs of Sarawak Corridor of Renewable Energy (SCORE) and to try to reduce poverty.

He pointed out that Suhakam was not stopping development from taking place but something worthwhile to the community must be done to ensure they get access to everything like clean water, good education, transportation and communication services as well as sufficient income from the project.

“Because without all these, they are living in poverty,” he added.

Dr Ritom said many in the rural areas claimed they had not benefitted from poverty eradication programmes and suggested the delivery of these services and benefits be re-examined and made available to all the targeted groups.

“Allocations, funds, loans and grants meant to help reduce rural poverty should reach the rural people. Rural-based industries, hardly seen in Sarawak, should be set up to provide jobs for the rural people.”

He said the oil palm industry would be of great help if more rural people were directly engaged in the sector.

He suggested the private sector and government agencies involved in the industry give the local people better pay to help reduce poverty.

“Yes, the agencies were paying out million of ringgit for dividends but these were divided among hundreds or thousands of families,” he noted.

Quality education is another critical issue to be looked into seriously. The rural population is always at a disadvantage when it comes to this.

Dr Ritom suggested the best students from the rural schools be selected to further their studies in the urban schools which have good facilities — like what was done in the old days.

“As far as rural education is concerned, the quality is nowhere near its urban counterpart. In urban areas, they were talking about 13As in SPM while in the rural areas, only three or four As.

“Now the competition into university is very keen, and if no serious efforts were taken, rural poverty would remain a lasting problem as rural students would find it difficult to enter public universities and get better jobs,” he said.

He stressed the government also had to start somewhere to bring information and communication technology (ICT) to the rural communities.

Dr Ritom conceded achieving zero poverty was impossible as there would be sectors that would always be in poverty group.

“That’s why there must be a safety net for these people. A more efficient welfare policy has to be put in place. The young and elderly must be taken care of.

“For government servants, it may be ok as they still receive their pension but what about others who have no pension?” he asked

Meanwhile, whatever policy we settle on, we must ensure our citizens are healthy and well, both physically and mentally. If they are too depressed to work and learn, at the end of the day, it is our country that suffers from unused and unrealised potential.

It’s good to note the government is addressing the concerns of the lower-income group, especially in the light of higher food, electricity and transport costs.

The 2009 Budget includes several provisions targeted at this group, one of which is raising the eligibility criteria for welfare assistance under the Welfare Department from a monthly household income of RM400 to RM720 for Peninsular Malaysia, RM830 for Sarawak and RM960 for Sabah.

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