Rich-poor gap grew by over one-quarter in 2010

 

THE GAP between the richest and poorest in Ireland grew by more than 25 per cent during 2010, new figures show.

A Central Statistics Office report on income and living conditions shows the average income of the top 20 per cent of earners was 5.5 times greater than those in the lowest 20 per cent.

This inequality ratio – up from 4.3 a year earlier – is the highest figure on record since this measurement was first used in 2004.

The CSO’s Survey on Income and Living Conditions in Ireland is the official source of data on household and individual income and also provides key poverty indicators. It found that average disposable income for Irish households in 2010 was €22,168, a 5 per cent drop from the 2009 figure of €23,326. This is the lowest figure recorded since 2006.

The survey shows poverty rates are on the rise in Ireland. The number of people experiencing consistent poverty rose from 5.5 per cent in 2009 to 6.2 per cent in 2010.

Consistent poverty is defined as having an income of less than €10,831 during 2010 and experiencing various forms of enforced deprivation on an ongoing basis.

This figure is based on 60 per cent or less of the median disposable income – €18,051 – combined with being unable to afford at least two of 11 recognised indicators of deprivation, such as sufficient heating or clothing.

Children were among the most exposed to consistent poverty when broken down by age. A total of just over 8 per cent experienced this form of poverty in 2010. By contrast, just under 1 per cent of over-65s were living in consistent poverty over the same period.

Out of all the different forms of households, those at work were the hardest hit, a reflection of how unemployment and wage cuts have affected standards of living.

Single adults of working age, for example, showed the highest consistent poverty rate at just over 11 per cent in 2010, up from 8 per cent in 2009.

There was also an increase in people at risk of poverty. This equates to a disposable income of €10,831 or less, but without indicators of enforced deprivation.

The at-risk-of-poverty rate rose from 14.1 per cent in 2009 to 15.8 per cent in 2010.

The threshold which is used to define “at risk of poverty” decreased by more than 10 per cent from €12,064 in 2009 to €10,831 in 2010, following a general drop in overall incomes.

In European terms, Ireland’s poverty indicators are mostly close to or below the EU’s average.

Ireland ranked 12 out of the 27 member states using the at-risk-of-poverty measure.

The highest at-risk-of-poverty rates were in Latvia and Romania (both 21 per cent), while the lowest rates were in the Czech Republic (9 per cent) and the Netherlands (10 per cent).

In the area of income inequality, the report shows Ireland had the sixth-highest measurement.

Lithuania had the most distribution of income, with the top 20 per cent of earners taking home more than seven times the average income of the bottom 20 per cent.

Slovenia and Hungary had some of the lowest levels of income inequality. In Hungary, for example, the top 20 per cent had an income that was three times that of the bottom 20 per cent.

Another form of measuring poverty is material deprivation. This measures the proportion of people unable to afford basics, regardless of their income, such as paying bills, keeping the home adequately warm or taking one week’s holidays.

It found that in Ireland 20 per cent of the population experienced at least three forms of this kind of enforced deprivation out of a total of nine indicators, slightly above the European average.

‘This Is Ireland’: Highlights From Census 2011

Tomorrow, the CSO will publish the first definitive results of the 2011 census. In Friday’s Irish Times Fintan O’Toole, Carl O’Brien, Frank McDonald and Dan O’Brien will analyse what the figures tell us about how Irish life has changed, who we are and where we live. Irish Times correspondents will look at changes in the Irish family, religious belief and lifestyle, while Kathy Sheridan and Rosita Boland will report from areas that saw the best and worst of the years when the boom turned to bust.