How much money to cut poverty in half?

Elena Grishina: This amount strongly depends on how the crisis has increased the income deficit of the poor population (this is the amount you have to pay the poor to raise them to subsistence level). According to Rosstat, in 2019, the deficit of income was 721,6 billion. Play a role in the speed of economic recovery, the pace of wage growth. Much depends on the chosen support tools – whether it’s targeted benefit for the poor or mass payments, which were given to children up to 16 years. In any case, at the first stage on the additional social support of the population is likely to need at least 300 billion rubles a year.

What is the poverty from the point of view of the economist?

Elena Grishina: Is a condition when a person has no opportunity to provide themselves with a minimal level of consumption. This minimum level can be very different, each country determines its own level. In Russia it is equal to the subsistence minimum in 2019, it was 10 890 rubles per month in Russia as a whole. The world Bank uses different borders of poverty, to define it recalculates prices according to purchasing power parity in 2011 prices. There is extreme poverty or poverty in which a person in day spends no more than 1.9 per dollar, that is about 90 rubles per day, or 2.8 thousand rubles a month, if counted according to the method of the world Bank. Such poverty is characteristic, for example, for some African countries. Another poverty line – daily expenses in the range of 5.5 dollar (slightly more than 260 rubles). There is a monthly total of 8 thousand rubles. The proportion of people in Russia who live less than 8 thousand roubles a month, according to the world Bank, more than 2% (and, for example, in France and Germany, there are almost no people). In Western Europe use a combined indicator to measure poverty. On the one hand, the poor are people whose income is not more than 60% of the median income of residents of their country. On the other hand, as the poor are also considered people who can’t buy, for example, a washing machine, a TV, even a car to go to relax on vacation – all of these nine points.

What happens if we use this median to Russia?

Elena Grishina: last year, according to Rosstat, the median income in Russia was 26 365 rubles. This number differs from the average income, it is calculated differently. Then the bracket 60% of the median was 15.8 thousand. The money lived for 25.1% of Russians.

is There a pattern of changes in poverty levels and GDP?

Elena Grishina: a Clear correlation there. But if GDP grows, poverty tends to decrease. So it was in 2000-�� years. In the beginning of the century the figure was 29%, then on the background of economic growth by 2007, dipped to 13.3% . In the first quarter of this year was poor by 12.6% compared with 14.3% in the same period of 2019. Before the pandemic, people’s income continued to grow slowly, the minimum wage remained almost at the same level, so the situation improved.

The poverty threat for poor people in the economy and the economy as a whole?

Elena Grishina: the Poor man spends less, respectively, reduced aggregate demand. In addition, he is worse fed, can’t pay for treatment, buy medicine, to spend money on additional vocational education. This may decrease its productivity. In addition, children from poor families have a higher risk of failure in life. Speech can go as about getting into the criminal environment and the reduction of career prospects compared to children from more affluent families or health problems due to poor nutrition. This results in long-term negative consequences for the economy. This in and of themselves the children is one of the factors in the emergence of poverty: the birth of a baby family needs increase and income – no. Families need the help from the state, especially when conducting demographic policy aimed at increasing the birth rate.

Russian poor receive enough help from the state?

Elena Grishina: There is a very subtle point. I think if our cost of living has doubled, many would be much happier to live. Because this figure depends on benefits, allowances, bonuses… But would be significantly increased burden on the budget. Therefore, the state strikes a balance, helping people to the best of their abilities. Now was very timely payments for child benefits. Works long-term program of social contract that allows people with state assistance to resolve difficulties, which they can’t stand up. It is good to be infrastructure development, creation of new jobs to people, for example, having mastered cocontract new profession, could find a job with a decent salary, close to home. In addition, you may want to enter for the needy a minimum income. If the income of the family or individual does not fall short of the prescribed amount, the difference could be compensated for by the state. This scheme is much cheaper than the absolute basic income, but she works specifically in helping those who really need help.

is it Possible to completely eliminate poverty as a phenomenon?

Elena Grishina: Hardly. There are different situations, is marginal. Quite a significant portion of the distressed afraid to ask for help. “We don’t goeat in social protection, and then suddenly guardianship take away our children,” they argue. Some find it difficult to collect the documents, someone has a grey or black earnings.

the President set the goal to reduce poverty by half by 2030. Is it real?

Elena Grishina: If all goes well and no new coronavirus misfortune will not happen, I think, everything is achievable. However, there is a danger of the arithmetic of victory: because poverty is a relative concept, if we hold the growth of the subsistence minimum, the indicators will change for the better, and the problem will remain. The only way to overcome poverty, increase incomes, especially labor. The economy will develop, there will be new well-paying jobs, expand employment opportunities and the poor will be less. And targeted social support for the needy to help those who can’t get out on their own.

Michael Pushkin, chief specialist of the employment Bureau of the International organization of labour in Moscow:

Russia has been implementing an extensive and multi-faceted national anti-crisis program, which allows to mitigate the negative effects of the pandemic on the quality of life of citizens.

Over the past year, according to the report, prepared by the Analytical centre under the government of the Russian Federation for submission to the UN, managed to bring out of poverty is about 500 thousand people, as well as to achieve the main indicators goal: to eliminate extreme poverty. This has helped the measures taken to raise income levels of the population, including the indexation of pensions, increase the minimum wage, unemployment benefits, allowances for families with children, the loss of a breadwinner, measures to support entrepreneurship and the creation of more favourable conditions for the self-employed. We should also speak about the phenomenon of working poverty. He mostly takes place in developing countries. According to the ILO, in 2018, 13% of employees were classified as poor with an income of less than 3.1 dollars and 8% are extremely poor with an income of less than 1.9 USD per day. In the last two decades great progress has been made in reducing poverty worldwide (in 2000, the extreme poor accounted for 26% of all workers in the world), but pandemic is making significant adjustments, leveling achievements and the resulting deterioration in the situation of the most vulnerable groups, including poor and working poor. It is expected to growing inequality, the decline in revenues on the back of negative economic growth. Factors contributing to the poverty of the workers – low wages, lack of or low level of social protection and protection against occupational diseases, unworthy working conditions, the inability to obtain professional skills or re��to bucatica, the weakness of mechanisms that protect against the crisis. Among the measures to overcome poverty among workers, the promotion of decent work principles with all its attributes and parameters. Special attention to young people and informally employed, these groups are generally more likely to be among the working poor.