On poverty indicators in 2007

26.11.2008

In Latvia at-risk-of-poverty rate characterising the share of population living under the at-risk-of-poverty threshold [1] has decreased from 23% in 2006 to 21% in 2007 or by 2 percentage points, according to data of survey ‘’Community Statistics on Income and Life Conditions’’ (EU-SILC) [2] conducted by the Central Statistical Bureau.

Calculations of poverty indicators are based on previous calendar year income data. In 2007 in calculation of poverty indicators income data of 2006 were used, and at-risk-of-poverty threshold was calculated basing on these data. In 2006 employment rate increased, dynamic increase witnessed not only wages and salaries, but also state social benefits and pensions. Rapid growth (by 42%) was observed in average value of birth allowance, and child care benefit granted for a child aged under 2 years increased by 35%. Average net wages and salaries rose by 23%. Such proportional increase of both main household income items (wages and salaries and social transfers) furthered the income growth of low-income population (also of those largely dependent on pensions and allowances granted by the state), and that, in turn, provided opportunity for this part of the population to leave the poverty risk zone. Households with dependent children and single parents with dependent children were main part of such population groups.

At-risk-of-poverty rate in households of various demographic types 2005 – 2007 (per cent)

Results of the EU-SILC survey show that, with the improvement of state social benefits system, poverty risk decreases, but still some additional activities directed towards the household groups with the highest poverty risk, which continues to grow, have to be taken. Retired persons, at-risk-of-poverty rate of which has grown from 35% in 2006 to 38% in 2007, as well as single person households should be mentioned as examples. According to the data of EU-SILC 2007 third person (33%) aged 65 and over was subjected to poverty risk, but, if the person lives alone – three fourths of their total number (75%). High at risk of poverty rate (57%) was observed among unemployed.

At-risk-of-poverty rate varies significantly amongst the regions. High at-risk-of-poverty rate was recorded in Latgale, but the lowest – in capital and region of Pierīga.

At-risk-of-poverty rate in Latvia and regions in 2007 (per cent)

At-risk-of-poverty rate in 2007 in rural areas comprised 33%, and it is two times higher than in urban areas (16%).

[1] In all Member States of the European Union at risk of poverty threshold is defined as 60% of the median of equivalent disposable income. It is calculated diving disposable income of the household with the number of equivalent consumers in household. By ranking equivalent all household income per equivalent consumer in ascending order from the lowest to highest, in the centre of this list median is set (value in centre of the list) and 60% of this median is at-risk-of-poverty threshold. This threshold is calculated each year. At-risk-of-poverty threshold, e.g., for single person household in 2007 comprised LVL 117 per month, but for household consisting of two adults with two children aged under 14 (taking into account equivalent scales) - LVL 245.

[2] EU-SILC is the main data source in European Union characterising poverty and social exclusion. Running EU-SILC survey was carried out in 2007. Totally 4471 household was surveyed. In accordance with the practice used in the Statistical Office of the European Communities (Eurostat) information on poverty indicators is published with reference to the year when survey was carried out – 2007.

Prepared by Social Statistics Department
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