300,000 1 & 2-member households

According to the Straits Times news report “Rise of one-person households” (May 23) – “the proportion of one-person households and those headed by a married couple who are childless or not living with their children has increased – from one in five, to one in four last year.

In absolute numbers, there were about 300,000 of these two household types last year”.

Household per capita income to measure poverty?

With the increase of one and 2-member households to 300,000 – it may be more subjective to use the household income and household per capita income statistics to conclude that the number of people living in poverty may not be very high.

30% in poverty

In this connection, Roy Ngerng’s article “The PAP has Caused 30% of Singaporeans to Live in Poverty” (May  19), citing various economists and academics – namely Yeoh Lam Keong, Tilak Abeysinghe, Tommy Koh, Mukul G Asher  and Hui Weng Tat – said that about 30 per cent of the population are in poverty.

As I have no experience or training as an economist or statistician – allow me to attempt to use a layman’s way to estimate poverty in Singapore.

Use ComCare criteria to measure poverty

Why not use the Government’s own benchmark under ComCare’s criteria for financial assistance? The criteria is $650 household per capita income or $1,900 household income.

According to the Department of Statistics’ Key Household Income Trends 2014 – the employed households’ per capita income of the bottom three deciles was $494, $971 and $1,353, respectively.

CPF included as income

However, these figures include the employer CPF contribution (unlike in the past). Let’s be realistic about this.  Both the employer and employee CPF cintributions are not disposable income that can be used for living expenses.

Also, no country in the world includes pension contributions as income for measuring poverty.

So, after adjusting for CPF – the household per capita income of the bottom three deciles becomes $336, $660 and $920, respectively.

20% households in poverty?

On this basis – does it mean that about 20 per cent of households are in poverty?

Unemployed & retiree households

Next, let’s look at the 3.4 per cent (41,100 households) and 7.0 per cent (84,000 households) of the total households which were Non-retiree Households With No Working Persons and Retiree Households, respectively.

Since there were a seasonally adjusted 56,500 unemployed residents as of March 2015, plus about another 9,000 discouraged (long-term) unemployed – some of the 3.4 per cent Non-retiree Households With No Working Persons may also be in poverty.

25% households in poverty?

If we assume that about 5 per cent (60,144 households) of the combined 10.4 per cent (125,100 households) Non-retiree Households With No Working Persons and Retiree Households – are in poverty – we may be looking at about 25 per cent (20 plus 5 per cent) of households in poverty.

About 25 per cent of the total number of households of 1.2 million is 275,124 households (adjusted for total employed households of 1,074,900).

With the average household size at 3.43 – these translates to about 943,675 people.

Half of median income in poverty?

If we use the generally accepted definition of half ($1,190) of the median household per capita income ($2,380) as the poverty line – we may be looking at about 30 per cent of households in poverty, as the per capita income (CPF adjusted) for the third decile was only $920.

This may mean that about 360,000 (30 per cent of 1.2 million households) or about 1.23 million people (360,000 x 3.43) are in poverty.

Win battles lose war

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