Leslie Massey
Despite being one of the wealthiest countries in the world, Australia has an estimated 3.3 million people living in poverty, with numbers soaring due to the cost of living crisis. With no official method of measuring poverty, researchers use a range of poverty lines to estimate the number of people in stressed financial circumstances. The most famous measurement is the Henderson poverty line, which states that the poverty line for a single person is $616.62 per week, including housing.
| Characteristics | Values |
|---|---|
| Total population living in poverty | 3.3 million (13.4%) |
| Children living in poverty | 761,000 (16.6%) |
| Child poverty rate | 17.3% (under 15 years old) |
| Young people aged 15-24 living in poverty | 13.9% |
| Single adults living in poverty | 25% |
| People in wage-earning households living in poverty | 7% |
| Indigenous Australians living in poverty | 31% (2016) |
| Aboriginal and Torres Strait Islander Australians living in poverty | 34% (2006), 33% (2011), 31% (2016) |
| People in Australia facing severe food insecurity | Over 2 million households |
| People in households with children affected by poverty | 37% of single-parent households |
| Australia's rank in poverty rate among OECD countries | 15th highest |
| Australia's poverty rate (OECD estimate) | 12.6% |
| Australia's poverty rate (2019-2020) | 13.4% |
| Australia's poverty rate (March 2020) | 14.6% |
| Australia's poverty rate (June 2020) | 12% |
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Child poverty
Australia is one of the wealthiest countries in the world, yet sources indicate that an estimated one in six children (between 16.2% and 17.1%) in the country live below the poverty line. This amounts to between 624,000 and 761,000 children, with a total of over 1.2 million under the age of 24.
The poverty line is defined by the Organisation for Economic Cooperation and Development (OECD) as half of the median household income of the total population. In Australia, this means a single adult living on less than $426.30 per week, and for a couple with two children, less than $895.22 per week.
Single-parent households are at a much higher risk of poverty than couple households. Forty-one per cent of children in single-parent households live in poverty, compared to 8.8% in two-parent households. Single-parent families represent 14.7% of families in Australia, with 367,000 children living below a 50% median poverty line. The risks of significant and severe poverty are also much higher for children in single-parent households. In Western Australia, 25,000 children live in severe poverty, with families surviving on less than $40 per day after housing costs.
The COVID-19 pandemic and the subsequent increase in the cost of living have exacerbated the issue of child poverty in Australia. Temporary income support measures introduced during the pandemic helped bring 245,000 children out of poverty. However, once these measures were lifted in 2021, 124,000 more children were plunged into poverty. Rental costs for lower-income families rose by 17.8% between 2020 and 2022, pushing nearly 21,000 more children into poverty in Western Australia alone.
To address the issue of child poverty in Australia, UNICEF Australia and others have called on the government to expand child-sensitive social protection. This includes raising social welfare payments, improving access to essential services, boosting opportunities for decent work, and implementing family-friendly policies. Strong and sustainable social protections are essential for preventing children from falling into poverty.
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Income support
Australia's income support system is designed to help people through difficult times and provide support in finding suitable employment. Income support payments are administered by Services Australia and include:
- Age Pension: For those who have reached the eligible age pension age.
- Austudy: For individuals aged 25 or older who are studying or undertaking an Australian apprenticeship.
- Carer Payment: For those who care for someone with a severe disability, illness, or who are frail and aged.
- Disability Support Pension: For people with permanent physical, intellectual, or psychiatric conditions that prevent them from working.
- JobSeeker Payment: For individuals between 22 and age pension age who are actively seeking employment.
- Parenting Payment: For the primary caregivers of young children.
- Special Benefit: For those who are ineligible for other forms of income support.
- Farm Household Allowance: Financial assistance for farming families experiencing financial hardship.
- Youth Allowance: Support for individuals aged 24 or younger who are studying, Australian apprentices, or aged 21 or younger and seeking employment.
In 2020, temporary income support measures, such as the Coronavirus Supplement and Economic Support Payment, were introduced during the COVID-19 pandemic. These initiatives provided income increases for low-income households and helped pull 646,000 people out of poverty. However, the phasing out of these support packages in 2021 contributed to a subsequent growth in financial stress.
The income support system in Australia has been criticised for not adequately supporting people with disabilities and single parents. Campaigns have advocated for raising the rate of payments like Newstart and Youth Allowance to cover basic living costs and ease financial stress.
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Cost of living
Australia is one of the wealthiest countries in the world, yet about one in eight people, or 13.4% of the population (3.3 million people), live below the poverty line. The poverty line is defined as 50% of median household after-tax income, which amounts to $489 a week for a single adult and $1,027 a week for a couple with two children. This figure varies depending on the costs of housing, as housing is typically a household's largest fixed cost.
In the first year of the pandemic (2019-20), the poverty rate in Australia soared to 14.6% in the March quarter of 2020 due to COVID-19 restrictions. This rise in poverty was driven by a combination of factors, including job losses, reduced incomes, and higher living costs. The pandemic's economic impacts hit low-income households the hardest, pushing many already vulnerable people further into poverty.
However, the poverty rate fell to 12% in the June quarter of 2020, a 17-year low, due to boosted income support payments. These temporary income supports, such as the Coronavirus Supplement and Economic Support Payment, pulled 646,000 people out of poverty. This figure includes 245,000 children, demonstrating the significant impact of these measures in alleviating poverty, especially for families.
Despite these improvements, the poverty gap remains significant. The average 'poverty gap', which represents the difference between the incomes of people in poverty and the poverty line, is $304 per week. This indicates that people in poverty are falling further behind the rest of society, with their average weekly incomes dropping even lower relative to the poverty line.
Child poverty is a particularly concerning issue in Australia. The child poverty rate rose from 16.2% in the September quarter of 2019 to 19% in the March quarter of 2020. This means that one in six children, or 761,000 kids, are living below the poverty line. The high cost of living, including essential expenses like housing, food, and education, puts a strain on families, impacting the well-being and future prospects of children growing up in poverty.
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Technology poverty
In Australia, a wealthy country, more than one in eight people (13.4%) lived below the poverty line in 2019-20, amounting to 3,319,000 people. This figure includes 761,000 children, or 16.6% of all Australian children.
While technology has been used to combat poverty, unequal access to technology can also contribute to it. This is known as "technology poverty".
On the other hand, technology has been used to combat poverty in several ways. Fintech, or internet finance, has helped people in rural Africa secure their money without needing bank accounts. Mobile technology has also presented new opportunities for women.
Geospatial technology, including satellite imagery, GPS, and geographic information systems (GIS), has been a game-changer in agricultural development and poverty reduction efforts. It provides accurate, up-to-date information about land use, crop health, and environmental conditions, enabling more informed decision-making and targeted interventions.
Artificial intelligence (AI) and machine learning (ML) are also being used to support smallholder farmers and entrepreneurs. For example, AI can provide real-time feedback to coffee farmers, helping them harvest their coffee at the optimal time and increasing the value of their crops.
Technology has also improved access to energy, education, and healthcare, helping people work their way out of poverty. For example, solar technology has become more affordable and accessible, providing clean and reliable energy sources for low-income households.
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Measuring poverty
The Census Bureau in the United States, for instance, uses the Official Poverty Measure (OPM) and, more recently, the Supplemental Poverty Measure (SPM). The OPM compares pre-tax cash income to a national poverty threshold adjusted for family composition. The SPM was introduced in 2010 to better reflect 21st-century social and economic realities.
Another approach to measuring poverty is through relative measures, which are developed by referencing actual expenses or incomes of the population. These thresholds are based on the set of goods that people need for survival in a given year and are adjusted over time as the prices of these goods change.
On a global scale, the World Bank plays a crucial role in measuring poverty to monitor progress toward ending extreme poverty. They use global poverty lines derived from the median national poverty lines of countries in different income groups. These global poverty lines are periodically updated to reflect changes in the cost of living and improvements in household consumption measurements. Purchasing Power Parities (PPPs) are used to account for relative price differences across countries, allowing for comparisons in poverty levels.
Additionally, the World Bank utilises household surveys, such as the Survey of Well-being via Instant Frequent Tracking (SWIFT), to collect data on consumption, income, and specific project results. They also explore real-time monitoring approaches that leverage machine learning methods and diverse data sources, including satellite imagery and mobile phone data, to enhance the frequency and accuracy of poverty estimates.
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Frequently asked questions
There are at least 3.3 million people living in poverty in Australia. This figure represents 13.4% of the population.
761,000 children are living in poverty in Australia, which equates to 16.6% of all children.
Australia does not have an official method for measuring poverty. Researchers use a range of "poverty lines" to estimate the number of people in stressed financial circumstances. One of the most famous measurements is the Henderson poverty line, which states that the poverty line for a single person is $616.62 per week, including housing.
