Stats SA Adjusts Poverty Line
In South Africa, we have some many people living below the “poverty line” that we have created 3 poverty lines. The Food Poverty Line, The Lower-Bound Poverty Line and the Upper-Bound Poverty Line. These figures have recently been moved upwards to cater for the increase in food over recent months.
We know that recently unemployment shot up again to around 29% (it was hovering around 25% for a long time). This means many people are having to share resources within households to get by. Stats SA says that one person’s salary is currently being used to care for an average of 3.5 peoples needs. You may wonder what the poverty line is and where it sits today?
‘Stats SA says that one person’s salary is currently being used to care for an average of 3.5 peoples needs’
Food Poverty Line
If you want to eat somewhat nutritious food but can cover no other expenses whatsoever then you would fall into this category of extreme poverty. Stats SA sets this figure at R561/person per month.
The Lower & Upper Poverty Line
These two groups cover more than just enough food to stay alive and are able to cover some other basic human needs. These slightly more realistic poverty lines are set at R810/person and R1227/per person per month.
Stats SA say that the median income in the country sits at R3300 a month. If this is used on average to look after the needs of 3.5 people then that means each person has R930 to take care of all their needs not just food. This shockingly puts the ‘average’ South African below the poverty line. Many households who live in metropolitan areas like Manguang, eThekweni and Buffalo City face even greater hardships since almost 40% of residents there earn even less, living on incomes of less than R2500/month.
‘This shockingly puts the ‘average’ South African below the poverty line’
It is no wonder then that so many consumers turn to credit to pay for essentials like food and are not equipped to deal with any sort of emergency. No wonder saving is not a realistic goal for most South Africans. Unfortunately, in a culture where it is reported that 1 house out of every 10 across the country has someone lending money illegally to their neighbours, consumers, even distressed consumers, have access to credit that they realistically can probably never repay.
It is hoped that new but rather controversial legislation for debt review done by the NCR (called debt intervention) will assist those consumers who are living with debt and exist on or below the poverty line. The lawmakers have been generous, extending the current qualifying income level to R7500/month as long as consumers have less than R50 000 debt.
Average Household Spend
Stats SA & Researchers who spoke to almost 21 000 different households report that many lower income, single child, households are trying to cover monthly household expenses that amount to around R7 600 a month (as of July 2019).