Living conditions in 2008 17% of EU27 population at risk of poverty Higher risk of poverty among children and elderly

STAT/10/10

18 January 2010

Living conditions in 2008
17% of EU27 population at risk of poverty

Higher risk of poverty among children and elderly

In 2008, 17% of the population in the EU27 were at risk of poverty. This means that their income after social transfers was below the poverty threshold 1. Since 2005, the at-risk-of-poverty rate in the EU27 has been nearly stable, varying between 16% and 17%.

The highest at-risk-of-poverty rates in 2008 were found in Latvia (26%), Romania (23%), Bulgaria (21%), Greece, Spain and Lithuania (all 20%), and the lowest in the Czech Republic (9%), the Netherlands and Slovakia (both 11%), Denmark, Hungary, Austria, Slovenia and Sweden (all 12%).

It should be noted that the at-risk-of-poverty rate is a relative measure of poverty, and that the poverty threshold varies greatly between Member States.

This News Release, based on data from the EU-SILC survey 2 , is issued by Eurostat, the statistical office of the European Union in connection with the opening conference of the European Year for Combating Poverty and Social Exclusion 3, organised by the European Commission and the Spanish Presidency of the EU, and which takes place in Madrid on 21 January 2010.

One child in five in the EU27 at risk of poverty

In 20 of the 27 Member States, child at-risk-of-poverty rates were higher than for the total population. In 2008, the at-risk-of-poverty rate for those aged up to 17 years was 20% in the EU27. The highest rates were recorded in Romania (33%), Bulgaria (26%), Italy and Latvia (both 25%), and the lowest in Denmark (9%), Slovenia and Finland (both 12%).

Elderly people also face a higher risk of poverty than the total population. In 2008, the at-risk-of-poverty rate for those aged 65 years and over was 19% in the EU27. The highest rates were observed in Latvia (51%), Cyprus (49%), Estonia (39%) and Bulgaria (34%), and the lowest in Hungary (4%), Luxembourg (5%) and the Czech Republic (7%).

Being employed significantly reduces the risk of poverty. In 2008, the at-risk-of-poverty rate for those in employment was 8% on average in the EU27, ranging from 4% in the Czech Republic to 17% in Romania.

Highest rate of material deprivation in Bulgaria, Romania, Hungary and Latvia

In order to draw a broader picture of social exclusion in the EU, the at-risk-of-poverty rate, which is a relative measure, can be complemented by the material deprivation rate, which describes social exclusion in more absolute terms. The material deprivation rate is defined as the enforced lack of at least three of nine items 4. In 2008, 17% of the EU27 population was materially deprived according to this definition. The highest levels were registered in Bulgaria (51%), Romania (50%), Hungary (37%) and Latvia (35%), and the lowest in Luxembourg (4%), the Netherlands and Sweden (both 5%).

Looking at some of the individual items defining material deprivation, it appears that in 2008, 37% of the EU27 population could not afford a one week annual holiday away from home, 10% could not afford to keep their home adequately warm, 9% could not afford a meal with meat, chicken or fish every second day and 9% could not afford a personal car.

Poverty threshold (PPS * ) and at-risk-of-poverty rate (%), 2008

* The annual national at-risk-of poverty threshold is set at 60% of the national median income per equivalent adult. In order to allow comparisons between countries the threshold is expressed in this table in Purchasing Power Standards (PPS), which is an artificial reference currency unit that eliminates price level differences between countries.

p Provisional

- not applicable

Material deprivation , 2008

e Estimate

: Data not available

• The annual national at-risk-of poverty threshold is set at 60% of the national median income per equivalent adult. The median income separates the total population into two equal parts. The income per equivalent adult is calculated by dividing the total household income by its size determined after applying the following weights: 1.0 to the first adult, 0.5 to other household members aged 14 or over and 0.3 to each household member aged less than 14 years old. The total household disposable income is the total net monetary income received by the household and its members, namely all income from work, private income from investment and property, plus all social transfers received directly including old-age pensions, net of any taxes and social contributions paid. However, indirect social transfers, loan interest payments, transfers paid to other households, receipts in kind and imputed rent for owner-occupied accommodation are not taken into account.

The income reference period is 2007 for all countries except the United Kingdom for which the income reference period is 2008 and Ireland for which the survey is continuous and income is collected for the last twelve months.

• The EU-SILC survey is the EU reference source for comparative statistics on income distribution and social exclusion . More information can be found on the Eurostat website:

http://epp.eurostat.ec.europa.eu/pls/portal/url/page/PGP_DS_LIVING_CONDITIONS/PGE_DS_LIVING_CONDITIONS

The reference population is all private households and their current members residing in the territory of the Member States at the time of data collection. Persons living in collective households and in institutions are generally excluded from the target population as well as small and remote parts of the national territory amounting to no more than 2% of the national population.

• For more information on the European Year for Combating Poverty and Social Exclusion visit:

http://ec.europa.eu/social/main.jsp?langId=en&catId=637

• The nine items included in this indicator are: ability to face unexpected expenses; ability to pay for one week annual holiday away from home; existence of arrears (mortgage or rent payments, utility bills, or hire purchase instalments or other loan payments); capacity to have a meal with meat, chicken, fish or vegetarian equivalent every second day; capacity to keep home adequately warm; possession of a washing machine; possession of a colour TV; possession of a telephone; and possession of a personal car.

Eurostat news releases on the Internet: http://ec.europa.eu/eurostat