A Challenge to Work and Welfare: Poverty in Australia in the 1990s

Abstract

This paper discusses issues associated with the measurement of poverty and how future trends in work and welfare will affect poverty in Australia, One of the main aims is to illustrate why and in what sense the measurement of poverty remains important in the broader policy debate. The role of budget standards in the development of poverty benchmarks is discussed, as are the limitations of the current method of updating the poverty line. Some possible ways of dealing with these are explored with the help of empirical data. The relationship between labour force status and poverty status is then explored using data from the latest (1990) household income survey. This is followed by a discussion of how income units at different points in the income distribution, and according to whether they are above or below the poverty line, evaluate their own perceived level of happiness and health status. Many of the differences revealed in the data are shown to vary significantly with the poverty status of the unit. Finally, the paper canvasses some of the issues associated with labour market changes and what these imply for future trends in poverty and income support policies.