Ireland must finally address the real causes of poverty

The early 1990s was a period of significant change for Ireland. The economy grew at a rapid pace and unemployment fell dramatically, but poverty was still very high by international standards.

In April 1997, the then government launched Ireland’s first anti-poverty strategy. The foreword, signed by the three leaders of the rainbow coalition – John Bruton, Dick Spring and Proinsias De Rossa – signalled that poverty would be at the top of the national agenda and that the interests of the most marginalised would be central to the policymaking process.

Speaking at the launch, Bruton, the then taoiseach, said social exclusion was a pervasive phenomenon and highlighted how the “growth of the economy can leave large sections of the community untouched”.

The publication of the strategy was significant as it was the first time the broader impacts of poverty and social exclusion on society were articulated in national policy. It acknowledged that implementation would require making difficult policy choices to address the underlying structural issues which create and perpetuate poverty.

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The Human Development Report – published each year by the Human Development Report Office of the United Nations Development Programme – allows us see how poverty has fared in Ireland through a boom, bust and recovery 21 years later. In the early 1990s, 34 per cent of the population lived below the poverty line. The next worst performer was Spain at 21 per cent, followed by the Netherlands and the United States, both at 14 per cent.

In 2016, the rate of relative income poverty was 16.5 per cent in Ireland. Using this indicator, it seems the situation is much better than it was then – our rate is now lower than Spain and the US but still higher than in the Netherlands.

Nevertheless, this is still a significant proportion of our population.

The population in 1997 was 3.7 million and 1.4 million were below the poverty line. In 2016, the population had increased to 4.7 million with almost 800,000 below the poverty line.

This poverty measure also doesn’t give us the full picture, as it just shows the distribution of income in a given society but doesn’t tell us anything about living standards.

European survey

Data from the European Survey of Income and Living Conditions shows that 77 per cent of those living below the poverty line in Ireland stated they could not meet unexpected expenses – well above the EU average. Denmark had the lowest rate out of all 28 EU countries.

What these statistics illustrate is that the experience of living below the poverty line in Ireland is very different than in Scandinavian countries, where citizens benefit from high-quality, accessible public services and supports. Households in such countries have more disposable income to meet unexpected costs due to an overall lower cost of living.

The Society of St Vincent de Paul has first-hand experience of what it is like to live in poverty in a rich country such as Ireland. Every week members see how the lack of investment in housing, childcare, education and health impacts on people’s ability to get out and stay out of poverty.

Two weaknesses of the anti-poverty strategy were highlighted in a 1997 article in the The Irish Times by author and academic Peadar Kirby. The first was the need to ensure gender equality so that women do not continue to be bypassed by development, and the second was to ensure social equality so that the rich do not benefit disproportionately from economic growth. Once we dig a little deeper, it is clear these concerns are borne out in the data.

The Government has an opportunity to make sure that we don't repeat the same mistakes of the past

Without question, female labour participation has grown significantly in the past two decades. Yet a group that policy has failed, and continues to fail, is one-parent families – the majority of which are headed by women. Today, almost half of one-parent families live below the poverty line. This rate is the second highest out of all 28 EU countries, just after Bulgaria.

Since 2012, reforms of the one-parent family payment, which sought to increase employment among lone parents, the rate of “in-work” poverty has risen by almost 120 per cent among one-parent families but is falling among two-parent families.

While some progress is being made under the affordable childcare scheme, Irish parents continue to face the highest childcare costs in Europe. This, coupled with the higher propensity for lone parents to be engaged in low-paid and precarious work, has meant that employment is not always a route out of poverty for these families.

Wealth distribution

Kirby was also justified in his concerns around the distribution of wealth and income. Ireland has the highest rate of market inequality among all EU countries. Undoubtedly, without vital cash transfers, things would be a lot worse as almost half of our population would live below the poverty line, but it is not a sustainable approach as the underlying inequality remains.

Kirby’s salient point from 1997, therefore remains relevant today: “Without mainstreaming of poverty reduction into economic policy, our best efforts are likely to be blunted.”

At this critical juncture, when unemployment is falling and the economy is growing, the Government has an opportunity to make sure that we don’t repeat the same mistakes of the past, and needs to revisit the 1997 strategy and reflect on what happened during the intervening years.

Minister for Employment Affairs and Social Protection Regina Doherty recently indicated that the forthcoming National Action Plan for Social Inclusion will focus on “active inclusion”, which essentially means reducing poverty through integration into the labour market.

However, unless we address the structural inequalities which exist in our society, place a value on caring work, and make a sustained effort to deal with the issues that disproportionately affect women such as wage disparities and high childcare costs, it is very likely that Kirby’s forewarnings will once again ring true in another 21 years’ time.

Dr Tricia Keilthy is head of social justice at the Society of St Vincent de Paul