News

Fiji’s poverty rate revised downwards

April 25, 2022 4:50 pm

Fiji’s national poverty rate for 2019/20 is now estimated at 24.1 percent, compared to 29.9 percent previously recorded.

The World Bank says the household consumption estimates in the Household Income and Expenditure Survey have been updated to account for revised spending on non-food items such as utilities, communications, domestic services, and education.

It adds this change affects consumption-based poverty estimates and Fiji’s national poverty rate is now revised downwards.

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The discrepancy in the coding was identified by the World Bank’s Poverty & Equity Global Practice Team during a cross-check review exercise to ensure Fiji’s Survey remains in-line with international practices.

The World Bank says it regrets the error was not identified earlier.

The review identified that in the consumption aggregate estimated from the 2019-20 Survey, expenditure on four non-food categories, communications, domestic services and education was only included for households that spend on all sub-categories.

The World Bank says the revised expenditure measures now represent total spending on any of these items, bringing these figures in line with international standards.

The change has resulted in household consumption figures being revised upwards for most Fijian households, with non-food consumption originally representing four percent of total household consumption, now accounting for 11 percent.

The World Bank says Fiji’s national poverty line remains virtually unchanged at $2179.4 in the original, compared to $2179.5 in the revision, due to the relatively uniform distribution of non-food expenditures among the households in the original and revised reference groups used to calculate the poverty line.

Poverty estimates have now been revised downwards in both urban and rural areas, with estimates for all divisions now lowered by 3.4 to 6.2 percentage points.

The revised consumption aggregate means a Gini Index of inequality of 30.7 points, slightly up from 30.1 points.

The urban-rural gap in real per adult equivalent consumption increases from 1.40 to 1.45.

The World Bank adds it should be noted that the 2019-20 poverty estimates are based on consumption per capita and cannot be compared directly to 2013-14 poverty measures which were based on income.