7.2

• Poverty definition

  The state of being extremely poor and not having enough money or income to meet basic needs
• what does World Bank describe poverty as?

  • not having enough food - hunger
  • lack of shelter
  • lack of medical care
  • lack of employment opportunities
  • fear of the future
  • living one day at a time
• absolute poverty definition

  a condition characterised by severe deprivation of basic human needs, including food, safe drinking water, sanitisation facilities, health, shelter, education and information. it depends not only of income but also access to services
• relative poverty definition

  occurs when income is below a specified proportion of average income, e.g below 60% of median income
• although income plays a role, it is not the key defining feature of poverty
• what are the causes of poverty ?

  • old age
  • unemployment
  • low wages
  • taxes
  • natural disasters
• Why are older people at risk of poverty?

  Many pensioners rely only on the state pension and have no private savings. often means they have less income than working-age people
• why have state pensions contributed to poverty over time?

  since the 1980s, pensions were linked to inflation (RPI), not to average earning. as a result, pensioners’ incomes didn’t rise with national living standards
• what does the ’triple lock’ (2011) guarantee for pensions?


  state pensions rise in line with:

  • earnings growth
  • inflation (CPI)
  • 2.5%

  this helps protect pensioners’ incomes
• how does unemployment increase poverty?

  • benefits usually lower that previous wages, and people lose their main income
  • in 2013, a benefit cap limited how much households could claim, worsening poverty for many
• why are some working people still in poverty?

  • the low-waged earn very little - especially in unskilled jobs or sectors like manufacturing and coal
  • face relative poverty even though they’re employed
• how has the UK government tried to reduce in-work poverty?

  introducing national minimum wage (now the national living wage) to boost earning of low-paid workers
• how can taxes increase poverty?

  • In the UK, some taxes regressive - those of lower incomes bear a larger burden of the tax
  • Can increase inequality and relative poverty
• how can natural disasters increase poverty?

  • natural disasters e.g floods and earthquakes can destroy people’s livelihoods
  • Nepal earthquake in 2015 pushed even more people into poverty
  • Nepal was already one of the poorest counties and their weak infrastructure was easily damaged
  • Estimated 1 million people pushed below the poverty line afterwards
• impacts of poverty

  • health
  • Society
  • Poor sanitisation
  • Education
  • Economy
• What impact does poverty have on health?

  • lower life expectancies, poorer standards of health and underdeveloped infants
  • Malnutrition results in poor cognitive development in children so they’re not as productive as adults
  • Malnutrition makes children more vulnerable to infections which increases their risk of death
• what impact does poverty have on society?

  • poverty can lead to poor housing, crime and mental health issues
  • social unrest becomes common and it can create problems within communities
  • children in poverty almost twice as likely to live in bad housing
  • children miss school trips and can’t invite friends over
• what impact does poverty have on poor sanitisation?

  • many people living in poverty can’t afford basic levels of sanitisation, and clean water is a rarity
  • people more vulnerable to fatal diseases
  • usually diseases contracted from poor sanitisation are avoidable, but simply can’t afford to improve situation
• what impact does poverty have on education?

  • sometimes families have to choose between educating children and eating
  • children might be sent to work to support family - poor literacy skills later on in life
  • limits their ability to escape poverty as an adult
  • by age of 14, and by 16, children receiving free school meals achieve 1.7 grades lower at GCSE
• what impact does poverty have on the economy?

  • without basic levels of education, the higher paying jobs, with opportunities for career progression, are not accessible
  • Hinders economy’s ability to improve its productive potential
  • E.g roughly 22% of India’s population is still in poverty, which is limiting rate of economic growth