British public sector workers claiming to be stricken with poverty are a bit like people with migraines claiming they have brain tumours. But it is not entirely their fault - they have been given licence to make claims of poverty thanks to the ineffectual way our government defines it. This problem is exacerbated by the fact that according to a recent BBC bulletin, there are apparently "over 13 million people in the
What does it actually mean to be in poverty, and how has
the government got it so wrong? To see how they have got it wrong, let's first
see a definition of 'poverty' that gets it just about right. Here's a
definition as an absolute measurement on a global scale: a person is in poverty
if they are eating less food than is required to sustain the human body
(approximately 2000–2500 calories per day). That's an efficient measure of
poverty, because anybody in the world can have their well-being measured
according to daily consumption of food (the same could be applied to access to
clean drinking water).
Sadly, unlike the global definition I just described, the
UK
measurement of poverty is nothing like as efficient - it is actually pretty
meaningless. Officially, the UK Child Poverty Act 2010 measures poverty as:
"Each
household income that is below 60% of the median income"
Not only is it the case that, when translated into real
terms, no one in this country is in absolute poverty compared with developing
world poverty - it is also the case that making UK 'poverty' relative poverty
based on having earnings below 60% of the median income is a meaningless
statistic because you could literally double every single person's household
income and still have exactly the same number of people in poverty in the UK.
To tell us that poverty is on the increase in the UK we hear that:
"Studies show
that in 2012, 33% of people in Britain
were living below the poverty line. It has more than doubled since 1983, when
the figure stood at 14%."
Alas, this tells us no such thing. All that means is that
there were 14% of the population below the median line in 1983 and now there
are 33%. This statistic misses the most important factor - it doesn't factor in
absolute growth, and how each person's absolute situation is different to 30
years ago. In reality, there can be more people below the median in the present
day, while their absolute wealth is still greater than it was in 1983. You could even reduce poverty by lowering the median, because that would bring lower earners closer to the median, even though in real terms their wages remained unchanged.
Furthermore, aside from the aforementioned absurdity that
the government could double every single person's
household income and still have exactly the same number of people in poverty -
what's even more foolish about the median line definer is that the government
could actually reduce poor people's poverty by taking some of their money as
long as they took more money from those richer than them.
In evaluating their 'poverty' status the
public sector workers are concentrating on their disposable income when they
should be focusing on their overall consumption. If escaping poverty is about
having the basic necessities in life - food, drink, housing, heating, education
and health care, then household income is not an accurate measure of whether someone
is in poverty. I know public sector managers who earn much more than the average
public sector worker but whose disposable incomes are less than those earning
an average wage. Are we to conclude that because some managers have only half
as much disposable income as their co-workers that they are to be classified as
being in poverty? Clearly not.
This is a good analogy for British people in general
- most of the basic necessities obtained (either from earnings, government
spending or government welfare) constitute consumption, not disposable income. It
is easy to exaggerate the differences in the former by focusing on the
differences in the latter - but this is absurd because it is the former that is
the proper indicator of poverty. Until the government sorts its definition out, disgruntled workers will be only too willing to claim poverty for themselves, and these absurd incongruities will endure.
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