Future poverty policies must include ‘new poor’, public health issues

While discussing poverty, we have so far focused on a narrow income-centric discussion of "poverty line". We have concentrated on income levels and seen the poverty rate dropping. This is how we have looked at poverty for the last two decades.

But the ongoing coronavirus crisis has shown that poverty cannot be understood by only measuring income levels ignoring other vulnerabilities including a very crucial issue like public health. The prevailing pandemic has exposed the fragility of our public health system.

Bangladesh Bureau of Statistics in its latest household income and expenditure survey done in 2016 put the country's poverty rate at 24.3 percent, which has been extrapolated to 21.8 percent in 2018 and again 20.5 percent in 2019. These are just projections drawn from 2016 trends, not real surveys.

But pandemic shocks put the way poverty is measured and understood in question. Our organisation, Power and Participation Research Centre (PPRC) and Brac Institute of Governance and Development (BIGD) jointly conducted a rapid response survey in the second week of April to assess the poverty impact of Covid-19.

The survey analysed economic shocks and coping mechanisms of urban and rural low-income populations since the pandemic brought economic activities to a complete halt.

From the survey, a new section of people has been detected, whom we may call "new poor" or "vulnerable non-poor", who used to be 40 percent above the poverty line, but now have gone below the line.

This group of people has so far been excluded from traditional poverty assessment which takes into account only two sections – the extreme poor and the moderate poor, living below the lower and upper poverty lines.

Our survey suggests that the "new poor" group of people need to be taken into account to have a real understanding of the country's poverty scenario.

The survey showed that the shutdown, enforced since March 26 to slow the spread of Covid-19, has sent 80 percent of the vulnerable non-poor below the poverty line.

People in the informal sector, like rickshaw-pullers, small shop-owners, shop assistants, have so far managed to stay slightly above the poverty line with whatever earnings they had. They lost their earnings due to the Covid-19 induced economic crisis.

These "new poor" people must be included in our future studies of poverty. We need to know the exact size of these three groups of people – the extreme poor, the moderate poor and the vulnerable non-poor – to understand poverty and devise development strategies.

Our estimate suggests that we have to add another 22-25 percent of "new poor" to the latest projection of 20.8 percent poverty rate. These new poor are those above a narrow margin from the upper poverty line but can fall into poverty if there is a system-wide shock as is currently the case.

Thus, we believe from now on, welfare of 45-50 percent of our population should be taken into account when we talk about poverty. How long these "new poor" will continue to remain below the poverty line depends on how quickly the economy will recover from the shocks.  

The lesson from the economic crisis stemming from the coronavirus outbreak is that we cannot afford to be complacent about the poverty rate and believe that 20.5 percent people are poor and all the rest are living comfortably.

There is another crucial lesson for us from the pandemic which has caught our health system off-guard. That is: the public health issue can no longer be ignored while we deal with poverty issues. We may look at an urban household with an average monthly income of Tk15,000. How is the hygiene standard there? What is the level of nutrition of the members of the family?

We say our average life expectancy has risen to 72 years. But what will we see if we survey the life expectancy of the rickshaw-pullers as a separate group?

We have to include these issues in our future talks on poverty. We need to go beyond just measuring poverty on income levels.

Dr Hossain Zillur Rahman, is an economist and executive chairman at the Power and Participation Research Centre (PPRC)