INDIGENTS NOT IMPROVING

Social grants not enough to stave off poverty

LIVES of most of the people who lived in poverty in 2008 have worsened, this is according to a study by government and academic institutions.

Dubbed the National Income Dynamics Study (NIDS), the research began by tracking the lives of more than 28 000 people across the country in 2008.

The study – which has four waves – had in the last wave which ended in January 2015 interviewed 21 072 of the original 28 226 research participants.

“It was 5% more likely that people moved out of poverty between waves one and four than it was that they moved into poverty.

“Of those who were in severe poverty in wave one, about 78% were still in severe poverty or poor by wave four.”

The NIDS researchers used a cost-of-basic-needs poverty line of R1 283 per capita per month in January 2015.

Severe poverty is described as having a real household income of less than half the poverty line.

“Of those classified as poor in wave one, 27.5% moved down into severe poverty by wave four and 40% moved to the non-poor category.

“If you were non-poor in wave one, you were more likely to be in that category in wave four [as] 79% of the those who were non-poor in the first wave remained non-poor in the most recent wave,” read the report published yesterday.

The study discovered that 2 211 of the 28 226 original wave had died and 3 740 babies had been added to the families.

University of Cape Town economics professor Ingrid Woolard said the benefit of the study was to show that there are many people who are chronically stuck in poverty.

“There is something that is really structurally wrong with the economy of SA given that.

“What we are seeing is that education and access to the labour market are the pathways out of poverty,” she said.

Woolard said though social grants helped to rescue people from ultra-poverty, it was not enough to get households out of poverty.

Department of Monitoring and Evaluation’s project director for NIDS Professor Murray Leibbrandt said the country has to consider which jobs at the lower levels of income distribution the country needs to keep.

“And we need to increase more of those jobs,” she said.

Leibbrandt said the middle class was quite small and not many people had moved to higher income brackets.

She said a lot of jobs, compared to other developing countries, were not being created at the lower end of society.