Poverty Line Statistics

Sep 4th, 2006, in Business & Economy, by

Those recorded as being under the poverty line rise in 2006.

The number of those below the poverty line has risen by 3.95 million from 35.1 million in February 2005 to become 39.05 million by March 2006, or 17.75% of the population of the country. The total population has at the same time increased by 2 million persons.

The greatest increase was seen at the village and rural level, with 2.06 million people being added while in the cities 1.89 million people saw themselves fall into poverty, according to the standards used by the Badan Pusat Statistik (BPS). In total 63.41% of those counted as poor live in provincial areas.

The rise in the raw numbers, says, according to Antara, Rusman Heriawan of the Badan Pusat Statistik, can be attributed to a change in the level of household expenditure used as the measurement for the poverty line. In February expenditure below Rp. 129.108 per capita per month was the measure, this rising to Rp. 152.847 in March.

Spending on food was the most influential factor in this, he said. In February 2005 food accounted for 70.54% of the total, rising to 75% this year. 23% of food expenditure went on rice, making any price fluctuations in the price of this commodity extremely influential on poverty measurements.

Rusman went on to say that the figures would have been considerably worse if the government had not instituted the Program Kompensasi Pengurangan Subsidi Bahan Bakar Minyak (PKPS-BBM), that is, the direct payments of cash to those believed most harmed by the government’s gradual reduction of its subsidies on fuel. Without this, he said, the number of poor would have been over 50 million. 100,000 rupiah per month is paid to 19.2 million families across the country via the PKPS-BBM program, accounting for 17 trillion rupiah in public expenditure.

Presidential spokesman Andi Malarangeng said that the government had predicted the increase and that it was only temporary and due to short term fluctuations in rice and fuel prices. The government, he said, planned to address problems in rice production.

Meanwhile government policy drew some criticism. The “Tim Indonesia Bangkit” complained that this was the first time in 8 years that poverty rates had risen. Revrisond Baswir of the TIB said:

The increase in poverty over the last year is out of this world. It reflects the government’s failure to carry out poverty reduction and pro-poor policies.

He said three factors were at play:

  • rise in fuel prices since October 2005.
  • failure of the PKPS-BBM program to prevent the nearly poor from falling below the poverty line.
  • government inability to stablise essential goods’ prices.

The Tim Indonesia Bangkit, along with some economists, also claim that the BPS figures are not accurate. The TIB specifically said that the real number of poor was 45.9 million people, or 20.6% of the population. Iman Sugema of the TIB and who is also the director of the International Centre for Applied Finance and Economics, said that the household expenditure level should be at 159.000 rupiah instead of the 152.847 set by the BPS.

7 Comments on “Poverty Line Statistics”

  1. Jakartass says:

    With contradictory stats and opinions in hyperspace, what do you think is the best source for such stats?
    April 23 ’08

  2. Rob says:

    I thought the Prez and his boys have been telling everyone that the good fiscal and monetary management policies of the government was finally showing the pot of gold at the end of the rainbow with “statistics” showing the level of poverty declining…

    Statistics, I guess, can be used anyway you want to make them show a particular point of view or outcome…

  3. David says:

    Jakartass, no idea frankly, if internal stats then they are likely ‘fiddled’ as Rob suggests, with stats compiled overseas maybe they suffer from lack of knowledge about things here.

  4. Jakartass says:

    Thanks guys.
    As I expected, I’ll have to rely on the above, albeit adding in extra factors such as the rapid rise in food prices which is pushing more below the poverty line.
    Ho hum.

  5. Rob says:

    SBY’s last “State of the Nation” address is in English and it has figures andpolicy positions relating to poverty…I think I have a soft copy floating around. I will try and find it and email it to you!

  6. Gloria says:

    a change in the level of household expenditure used as the measurement for the poverty line

    I always say this.. there is poverty almost everywhere. Even the rich is poor because they don’t know how to spend their money..

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