Poverty reasons and effects

Page of content
Introduction

Body

1.How is poverty measured

2.What is the reasons for poverty

3.What are the effects of poverty

4.Which measurements are implemented by the south African government

Conclusion

Illustrations

Bernadino heights high school

Economics research task:

Poverty in South Africa

Jamie lee dondas

Grade 11F
Introduction
In this task I will be discussing poverty in South Africa. Poverty means suffering to the poor and not being able to satisfy their basic needs of food, water, clothing and shelter and also not having access to clean water, sanitation healthcare services, education and other social services.
Body
1. How is poverty measured?
Poverty measurements are used to compare poverty across countries over time.
The World Bank poverty line: Economists have set a poverty line based on the cost of a common basket of basic food products. The poverty line is used as a measure to identify households/individuals in need of social grants and free basic services. The World Bank’s poverty line as applied internationally is calculated between $1 and $2 per day per person .In its latest update, the Bank has used national poverty lines for 75 developing countries .There has been a huge improvement in the price levels of data, thanks to the ICP, which collects the data on prices needed to estimate purchasing power parity exchange rates. According to the latest ICP for 2005, the Bank’s main international poverty line was $1.08 a day at 1993 PPP. The new ICP price data for 2005 indicate that the cost-of-living is higher in developing countries than was expected.
The poverty gap: The difference between household income and the poverty line is the amount of money of which the income of a household is below the poverty line. The poverty gap provides a clearer perspective on the depth of poverty.
Economic inequality: Economic inequality is the difference between income and expenditure of the poorest and the richest components of a country or area. The issue of economic inequality involves equity, equality of outcome and opportunity, and life expectancy .Economic inequality varies between societies, historical periods, economic structures and systems (capitalism or socialism), ongoing and past wars. Refer to figure E
The poverty rate: The percentage of the total population in an area or country living in poverty is the poverty rate. Poverty rate by province ➢ The poverty rate in the nine provinces of South Africa differ ,as well as in rural and urban settlements. According to the Bureau for market research , poverty rates in 2005/2006 increased from 24,9% in Gauteng to 64,6% in Limpopo. Refer to figure G Poverty by gender ➢ There is a major difference in the poverty rate according to gender:45% of all female households in South Africa live below the lowest bound of the poverty line, compared to only 25% of male households. Poverty by level of qualifications ➢ Poverty incidence are also high among those with lower education levels. Poverty rate by age ➢ The incidence of poverty generally increased with the age of the age of the head of the household. The reason being for this is partly because of families relying in pension grants. The statistics south Africa poverty line: South Africa has set a criteria to work out a MLS as follows: ➢ Statistics SA proposed a poverty line of R322 per month in 2000 prices. In 2006 about 47% of the population did not have R322 for essential food and other items. ➢ In 2008 ,the MLS of an average household was set as R1957,76 per month. The amount has increased over time to take inflation into account. Refer to figure A.

2.What are the reasons for poverty ?
Poverty is caused by many different factors , some are very basic and some more specific to a certain country. The following are the most common reasons for poverty:
Overpopulation: Overpopulation is the situation of having large numbers of people with too few resources, too little space and not enough food. In many parts of the world overpopulation has led to deterioration of the natural environment. Refer to figure B&J
Inadequate education and employment: The labour market is overcrowded with unskilled workers looking for employment. Because of people being unemployed they don’t have money to satisfy their daily needs and wants.
Illiteracy and lack of education: Lack of proper educating is most common because the government cannot afford to provide good public schools especially in rural areas.
The cycle of poverty: Poor people are most likely to stay poor because they are trapped in a situation of poverty from one generation to the next without having the opportunities to change their lives. This cycle can be broken when some kind of intervention takes place,e.g if parents send their children to school, they have a much greater chance of earning a living and improving themselves. If the cycle is not broken the people will stay poor because of the family circumstances that they experienced as children.refer to figures C and L
Welfare dependency: Social grants may act as forbidding to employed people or people looking for employment. People rely on grants to meet their basic means and therefore a situation of poverty is created. Reliance on grants kills initiatives to improve the self. This means that people remain poor because they don’t want to go work to earn a salary.
Disease and lack of healthcare: Many of the country’s poor people do not have access to health services. People and children die of infectious diseases and diseases caused by parasites, such as cholera, pneumonia ,tuberculosis, malaria, dysentery and measles. When the breadwinner of a household become too sick to work, the family is without an income.Refer to figure K
Bad governance: Bad governance and politics lead to corruption, poor tax collection and poor poverty alleviation programmes. This leads to a lack of financial resources to maintain infrastructure and to provide for adequate welfare, health services and access to basic education.
Warfare and conflict: Economies of countries who are at war or civil unrest will not operate effectively and the chances of losing money is high.

3.What are the effects of poverty?
Poverty has psychological effects, economic effects and social effects.
Physical and psychological effects: People living in poor housing without access to clean water, sanitation, or basic health facilities are more likely to become sick. Malnutrition and not being able to afford good medical services increases the mortality rate. Poor people lack self -confidence. People who are poor are often treated unfairly and discriminated against. This leads to a loss of self –respect and dignity.
Economic effects: Poverty affects the economy because the taxes paid should be used for those living in poverty. In South Africa , a large amount is budgeted for welfare including social grants, leaving less money to provide for other development needs such as effective education, skills and training, and developing and maintaining the infrastructure of the country.
Social effects: Poverty leads to a low standard of living and quality of life .In poor communities, the crime rate, incidences of unrest civil and domestic violence will increase.
Environmental effects: The state of poverty and population has a negative impact on natural resources. Overcrowding on inner cities causes decay, such as the blocking of drains and the leaking of pipes.

4.Which measurements are implemented by the South Africa government to alleviate poverty?
-The factors that cause poverty has to be removed to improve the situation. The government can intervene by addressing the following poverty intervention programmes:
-Poverty relief programmes: gives a short-term assistance to poor people in emergencies.
-Poverty alleviation programmes: the aim is to reduce the impact of poverty in a more permanent way.
-Programmes in South Africa include the following:
-Social grants, such as child support, foster care, disability grants and pensions.
-Social wages:access to basic services whereby the income of households is increased through access to subsided social services.
-Employment generating programmes and income support,to create jobs and income support including the following: ➢ Community-based public works programme ➢ Expanded public works programme ➢ National youth services ➢ Learnerships ➢ Land reform and food security programmes
-Entrepreneurship development programmes whereby people are encouraged to start their own businesses.
Conclusion
As it was mentioned above there are a lot causes for poverty which has a negative effect on a country’s economy. So it is important that members of society work together to provide opportunities for all members to reach their full potential. If we all work together we can reduce the number of people living in poverty.

ILLUSTRATIONS

Figure A

| |Headcount rate % |Poverty gap % |
|Total |14,46 |4,38 |
|By province | | |
|Western cape |6,09 |1,76 |
|Eastern cape |20,64 |5,97 |
|Northern cape |19,14 |5,84 |
|Free state |10,41 |2,78 |
|Kwazulu natal |21,47 |6,99 |
|North west province |15,27 |4,97 |
|Gauteng |4,23 |1,14 |
|Mpumalanga |19,26 |5,99 |
|Limpopo |23,75 |7,05 |
|By rural or urban settlements | | |
| Urban |7,25 |2,00 |
|Rural |27,91 |8,83 |
| | | |

household poverty by province and settlement using $2 a-day-line(R1057,92 per average household in 2008 prices)

Figure B
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Figure c

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Cycle of poverty

Figure D
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Poverty trends: alternative measures developing countries 1990-2006

Figure E
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Inequality

Figure F
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Figure G
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Poverty rate by province

Figure I
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Figure J

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Overpopulation

Figure K

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Diseases and lack of healthcare
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Figure L
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Bibliography
Internet: 13th February 2012 the presidency(online) available url www.polity.org.za 21 october 1996 anc census 2011 website by unwembi(online)available www.google.co.za 28February 2012

Newspaper:tygerburger kraaifontein 15/02/2012

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Bibliography: Internet: 13th February 2012 the presidency(online) available url www.polity.org.za 21 october 1996 anc census 2011 website by unwembi(online)available www.google.co.za 28February 2012 Newspaper:tygerburger kraaifontein 15/02/2012 ----------------------- Qwertyuiopasdfghjklzxcvbnmqwertyufghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjkl Ertyuiop[pic]asdfghjklzxcvbnmqwe lzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnm