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No more poor in Russia, experts claim

November 16, 2012, 11:44 UTC+3

Is the defeat of poverty imaginary and the statistical stuff or not?

1 pages in this article

“Poverty has been overcome in Russia!” – proclaimed experts from the Centre for Strategic Research (CSR), writes the Komsomolskaya Pravda daily. This has been done by filling the social budget items with the oil money, parry the experts interviewed by the publication. As a result, maybe there is no destitution in the country, but poverty remains, and it will be much more difficult to cope with it.

According to international rules, a person is poor if he lives on less than 1.25 dollars per day (according to a different method – on 2 dollars). It is clear that the dollar in the United States and the dollar in India – are quite different sums because of different prices, and a certain notional dollar – by purchasing power parity is taken into account.

So, it turns out that in Russia there are no people at all who would be living on 1.25 dollars per day. If in 2001, according to the World Bank, the figure was 0.89 percent, in 2007 – 0.02 percent, then in 2008 they disappeared altogether, and even the crisis did not lead to the restoration of poverty, the newspaper notes.

If the bar is raised higher – to 2 dollars per day, Russia also does not have this kind of poor people. In 2009, they accounted for 0.05 percent, and in the Ukraine, for example – for 0.17 percent.

How poverty has been defeated? As it happened during the 2000s, when oil started to grow, there is a suspicion that it’s the thing. The CSR concludes that it is so. Petrodollars made it possible to raise pensions, social benefits, public sector wages.

“We must recognise that the state was distributing the natural resource funds in a balanced way,” head of the Economic Expert Group Yevsei Gurvich said.

But that’s the destitute, and what about the poor? – the newspaper asks. And who are the poor generally? In the United States – if a person has less than 13 dollars per day (less than 12,000 roubles per month in Russia) he is regarded as poor. In Russia – if a person has income below the living wage, 6,307 roubles per month on average in the country (the regions set their minimums, because life in Moscow is more expensive than in the provinces). In general, there are about 13 percent of people in Russia living below this line.

But there is one striking thing. Russia’s poor are not so poor, the CSR noted.

In fact, in addition to the minimum subsistence level, the state calculates which minimum non-monetary benefits a family must have. They are – a refrigerator, a TV set, a washing machine. If a person does not have these things and he lives on less than 6,307 roubles a month, he is poor. The CSR has found out there are many people in the country earning less than a living wage, but all of them have not only the above appliances, but also computers, mobile phones and even cars. Certainly, most likely it would be a worn Lada car, bought at a time when a person earned well, but there it is.

The paradox is in the fact that according to both Russian, and international calculation principles, a car and a computer are the distinguishing features of not the poor, but the so-called middle class.

The CSR believes that in Russia 30 percent of people belong to the middle class. How they calculated it? It turned out that after all the middle-class people have things, which the poor almost never have – a flat-screen TV, a car of foreign make and a no frost refrigerator.

It turns out that some got into the middle class not quite fair means. Loans helped them. If last year the share of loans in the country’s population spending accounted for 15 percent of goods, then this year is stands at 22 percent. It is thanks to loans that Russia by the number of cell phones per capita is ahead of France and even the United States.

Boththe defeat of poverty and the growth of the middle class in the country – all these achievements are imaginary, and in general – it’s the statistical stuff, Yevsei Gurvich said. Firstly, the social policy has been based on just giving more and more oil money to the poorest. However, nobody bothered to think of effectiveness of spending, therefore much was lost in vain. Secondly, if a country has a poor healthcare and education system, such country cannot be considered wealthy. That’s the trouble of the country. What kind of a middle class it is – there’s a foreign car in the family, but it’s impossible to send the child to a decent school?

Yelena Frolova of the Federal State Statistics Service (Rosstat) also not quite agrees with the view that poverty has been defeated in Russia.

“About 6 percent of the poor people still live in extremely dire straits,” she said.








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