Official data may overstate numbers living in poverty

A new study indicates official figures may overstate the number of people living below the poverty line by tens of thousands.

The latest EU-wide survey on income and living conditions (EU Silc) reported 15 per cent of the Irish population – almost 700,000 people – were at risk of poverty in 2013.

But a technical paper by the Department of Social Protection and the Economic and Social Research Institute questions the adequacy of the survey to capture the real number of working households in Ireland.

Instead, it says the Central Statistics Office’s quarterly national household survey (QNHS) appears to provide a more accurate measure when compared with census figures.

In 2012, for example, the report says the EU Silc survey found 23.5 per cent of the population were living in a “very low work intensity household”.

By contrast, the CSO’s household survey found 17 per cent of people were living in a jobless household.

“This has potentially serious consequences, not only for the indicator of household joblessness calculated on the Silc data, but also because it raises questions about the adequacy of the data in representing the income distribution in Ireland,” the report states.

Median household income

"Since the bulk of household income comes from employment, if working households are under-represented, then the media level of household income, which is used for the calculation of at-risk-of-poverty, is likely to be understated."

In response to questions from The Irish Times, the Department declined to comment on what is believes the real at-risk-of-poverty figure may be.

Well-placed sources, however, claim the headline at-risk- of-poverty figures may be overstated by between 1 and 2 per cent, or between 40,000 and 80,000 people.

The rate is calculated based on the number of people living in households whose income is 60 per cent of the median.

The effect on the consistent poverty rate, however, is likely to be significantly less.

Just over 8 per cent of the population – or 375,000 people – are estimated to be living in consistent poverty, based on the latest Silc data for 2013.

Consistent poverty combines the at-risk-of-poverty measure with the enforced lack of two or more basic necessities, such as a second pair of shoes and home heating.

In a statement, the department said it did not have any influence on the design of either the EU Silc or QNHS surveys, both of which are conducted by the CSO.

“As major users of [of both surveys], the department collaborated with ESRI in producing the recently published technical paper. It’s important to state that, in producing the paper, the authors also engaged extensively and productively with the CSO statisticians responsible for both surveys,” it said. It added that the CSO was also undertaking a project to explore the reasons for the data divergence between the surveys.

In the meantime, it said the CSO had advised that the QNHS is the “definitive source of employment data, including household joblessness”.