Seamus Brennan - "Report Is Not An Accurate Reflection Of An Ireland In Which More Than 250,000 People Have Been Lifted Out Of Poverty In Less Than A Decade"
The Minister for Social Affairs, Séamus Brennan TD, and the Minister of State for Irish Aid, Conor Lenihan TD, today jointly launched the United Nations Development Programme Human Development Report for 2006, Beyond scarcity: Power, poverty and the global water crisis.
Minister Brennan welcomed Ireland’s overall ranking on the UN Human Development Index for 2006 which has risen four places from last year’s index to fourth in the world, compared with as recently as 2000 when Ireland was in 17th place.
However, he said there were very serious question marks over the Human Poverty Index in the report which ranked Ireland 17th out of the 18 selected high income OECD countries that were surveyed.
Specifically addressing the poverty index results, Minister Brennan said: "Some of the figures used in reaching the conclusions on Ireland are more than 10 years out of date, while others distort the reality because of Ireland's exceptional economic performance over several years and the significant progress that has been made in confronting and tackling poverty."
"In less than a decade more than 250,000 people, including 100,000 children, have been lifted out of deprivation and hardship. The report fails to reflect the positive impact of increases of over 55% in social welfare payments in the past five years alone and the many other increases and improvements targeted at alleviating poverty. Different reports can cause confusion, distort real progress and be a distraction by sending the wrong signal to the public and policy makers who are determined to further focus and strengthen the measures now needed to eradicate poverty from 21st century Ireland. We have travelled some distance towards achieving that goal but there are still unacceptable levels of hardship and deprivation in Ireland and my emphasis now is on targeting those areas with increased payments, supports and services so that we can make poverty history."
The Human Poverty Index reached its conclusions based on a combination of four elements:
- Life expectancy [probability of not surviving to age 60];
- Adult literacy;
- Long-term unemployment; and
- 'Risk of Poverty' [population below 50% median income].
The two main dimensions accounting for Ireland's low ranking are Adult Literacy and Risk of Poverty.
Minister Brennan said that there are serious problems with both of these dimensions, which badly distort the ranking for Ireland.
"In relation to the adult literacy measure, the figure shown for Ireland, at 22.6%, is more than ten years old. In addition, this figure does not take account of the fact that, since 1997, Government expenditure on adult literacy has increased from €1 million to €23 million. In the same period school completion rates have also seen significant increases. The reality has to be that in the prosperous Ireland of 2006 that figure of 22.6% must have dropped considerably".
Minister Brennan said that he had stressed many times the problems in using the "at risk of poverty" or "relative poverty" measure alone in making comparisons between countries. These figures distort the real picture because they are not comparing like with like. Also, the "at risk of poverty rate" in the UN report is based on data prior to 2002.
Minister Brennan said: "Last year's edition of the UN report itself contained a clear statement of these problems, when it stated that, in countries where economic conditions change rapidly, as has been the case in Ireland, the risk of poverty measure fails to provide a complete picture of the way in which economic growth leads to real improvements in people's lives. Levels of relative income poverty are related to increases in incomes generally and this is why Ireland, which has experienced rapid and dramatic increases in incomes over the past number of years, continues to have a high 'at risk of poverty' rate. The reality is that these increases in income outstripped even substantial real increases in the incomes of households with relatively low earnings or on social welfare".
The Minister said that partly as a result of the limitations of the 'at risk of poverty' indicator, Ireland had chosen the 'consistent poverty' measure as the national indicator used to identify those experiencing basic deprivation and who are most in need. This measure is calculated by identifying from among people at risk of poverty those who are also deprived of basic goods and services regarded as essential for living in Ireland today. The latest available survey data show that consistent poverty fell from 8.8 per cent in 2003 to 6.8 per cent in 2004.
Minister Brennan said that in the light of Poverty Index findings in this report it was important to draw attention to an article in June 2006 in the prominent journal "Development and Transition", published by the UN Development Programme - which commissioned today's report - and the London School of Economics and Political Science. This article insisted that relative poverty indicators cannot be used for international comparisons unless countries are similar in their level of economic development.
That article concluded: "The "risk of poverty" label sends the wrong signal to the public and policy-makers. According to the European Commission, Ireland has the highest poverty rate in the European Union and the figure is rising. Yet Ireland has had stellar record of growth in jobs and income over the last 15 years. The standard of living for nearly everyone has increased since the early 1990's at a rate unprecedented in recent European history. What's the catch? Income growth has been slightly larger in the upper 80% of the population than it has in the lower 20%. Therefore, according to the Commission's indicators, although hundreds of thousands of people have been lifted out of actual poverty, Ireland is not a success story, but a basket case".
(Source: "Make Spurious Poverty Statistics History" by Kalman Mizsei, Assistant Administrator and Director, United Nations Development Programme, Regional Bureau for Europe and the CIS and Miroslav Beblavy, State Secretary, Ministry of Labour, Social Affairs and Family, Slovakia.)
Note: Copy of article attached. Article can also be accessed on
Overall, the article concluded that reliance on the "risk of poverty" indicator causes four conspicuous problems:
- The results too often belie common sense.
- The "at risk of poverty" label sends the wrong signal to the public and policy makers.
- The "risk of poverty" logic doesn't lead to effective national policy.
- The message of this methodology is that within the EU there should be no cross-country social solidarity.
Minister Brennan said that Ireland had performed very well under the two other elements on the Human Poverty Index: Long-term unemployment and life expectancy. The current long-term unemployment rate is 1.4%, lower than the figure used in the report, and overall Ireland continues to have one of the lowest unemployment rates in the EU at 4.3%. The life expectancy rate, at 8.7%, reflects the rapid progress being made and puts Ireland on a par with, or well ahead of, the majority of countries surveyed.