Palestine National Authority

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Palestine National Authority Palestinian Central
Bureau of Statistics
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POVERTY ASSESMENT IN PALESTINE
UNSD/ DESA FOURTH REGIONAL WORKSHOP ON POVERTY
Amman 25-28/11/2004
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Efforts on Poverty Analysis

• Poverty Dimensions in the West Bank and Gaza
  Strip (Shaban and Botmeh, 1995)
• This study determined the poverty lines in the
  Palestinian Territory in harmony with
  socioeconomic situation. The study based mainly
  on the basic needs.
• National Poverty Report.
• It is considered as the 1st National document
  that defines a national poverty line based on
  scientific methodology and national data.
  (National Commission of Poverty)
• The Palestinian Participatory Assessment Project
  (PPA 2001).
• The main object of this project was to understand
  the multidimensional nature of poverty and
  inclusion of the perspective and priorities of
  the poor in poverty analysis and to increase
  local capacity to analyze and monitor poverty and
  policy impacts. 1st stage was completed and the
  2nd stage on going.
• (National Commission of Poverty, represented by
  Ministry of planning)

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Efforts on Poverty Analysis

• Deep Palestinian Poverty in the Midst of the
  Economic Crisis, December 2004. (World Bank and
  the PCBS)
• This reports attempted to clarify the debate, by
  providing estimate of the current poverty and
  discussing some of the reasons why estimate vary
  
• also addresses the factors of cause of poverty,
  the impact of emergency assistance efforts on
  poor, and potential impact of an economic
  recovery on longer-term poverty rates.
• The report focuses on the situation of the
  poorest of the poor (those who fall into
  subsistence poverty).
• Monitoring System

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Official Statistics of Poverty

• Introduction
• To have a comprehensive system that investigate,
  analyze, alleviate, and monitor poverty among
  Palestinians, three stages were distinguished
• In the 1st stage there was a need to arrive to a
  conclusion about the magnitude of the problem
  (starting from indirect indicators, such as
  employ. Living standards, educational status,
  health status, etc..
• In the 2nd stage there was a need to identify a
  national poverty linefor measuring, monitoring
  the changes that affect poverty.
• In parallel, there was a need to create a process
  to enhance poor people to be involved in the
  analysis of poverty and formulation of reduce it
  through policy.
• In the 3rd stage (as parallel stage) there was a
  need to create a type of monitoring system of
  reporting

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Official Poverty Definition
Data Sources

• Household Expenditure and Consumption Survey
  (PECS) which was conducted by PCBS during the
  years 1996-1998, 2001, 2004.
• The instruments were designed following the
  UN/ILO recommendations.
• A self-weighted sample consisting of the 12
  sub-samples, one for each month.
• A survey period of 12 months to account for the
  seasonal differences.
• A recording period of one month.
• Data capture by record keeping with the help of
  the interviewer support if needed.
• The survey provides details data on expenditure
  and consumption.
• National Poverty Survey, (PNS 2003) which was
  carried by PCBS during December 2003, to have a
  quick accurate picture of expenditure and
  consumption poverty since the start of Intifada
  in September (the Palestinian-Israeli conflict).
  It is a nationally representative poverty survey,
  with a sample of 3,100 households.

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Official Poverty Definition

• The definition combines absolute and relative
  features and is based on a budget of basic needs
  for a reference household
• A six-member household consisting of 6 persons
  (2 adults and 4 children is adopted as a
  reference household in the case of other sample
  households, the poverty line has been amended).
• Household was used as a unit of analysis(based
  on a assumption that households constitute an
  income pooling and\ or consumption-sharing unit).
• Consumption is used instead of income (based on
  assumption that expenditure\ consumption reflects
  needs more than income).
• Two poverty lines have been developed according
  to actual spending patterns of Palestinian
  families.
• Deep (absolute) poverty line reflects a budget
  of food, clothing, and housing
• Relative poverty line adds other necessities
  including health care, education, transpiration,
  personal care, and housekeeping supplies.

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Official Poverty Definition

• The two poverty lines have been adjusted to
  reflect the different consumption needs of
  families based on there composition (household
  size and number of children).
• Three main poverty indexes are used
• The head count index (P0) which gives the
  percentage of population in poverty or deep
  poverty,
• The poverty gap index (P1) which gives the
  percentage by which the average income of the
  poor is below the poverty line, and
• Poverty severity index (P2) which gives the mean
  of the squared consumption deficits.
• A two-parameter equivalence adult scale is used
  to reflect the differences in the household size
  and\ or composition
• E (A P.C)F
• E ( of adults 0.46 of children)0.89

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Official Poverty Definition

• The poverty line was calculated at the National
  level , but poverty indices were disaggregated to
  cover regional and some essential socio-economic
  indicators, such as locality type household
  size, socio-economic indicators of the head of
  the household etc..
• The methodology of compiling poverty line
  provides the possibility of updating it over time
  using CPI.
• Households are used as a unit of presentation,
  but poverty information can be presented on
  individuals (considering all household members
  as poor or not according to the household
  situation of poverty).
• The geographic differences for cost of living are
  not adjusted, even prices (cost of living) vary
  over different regions of the Palestinian
  Territory.
• The official poverty line and figures used
  available data from the Palestinian Expenditure
  and Consumption surveys.

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Official Poverty Definition
Questions raised on the methodology used in
poverty in Palestine

• Use of consumption vs. Income while consumption
  is considered as a better measure of well-being
  than disposal income for poverty assessment, but
  its use for this issue may not necessarily
  translate into more reliable poverty statistics,
  especially, if we want to to highlight the
  variation in living standards due to variation of
  income, remittances, loans, and social aid.
• Data Source Reliability Issues as mentioned
  poverty statistics in Palestine depends on
  household expenditure and consumption surveys
  the frame of the 1st three rounds were derived
  from a Comprehensive Sample Frame, while the last
  two rounds were derived from the 1997 census
  data, in addition census frame (problems of
  sample frame) in addition there is a decrease in
  the sample size between these rounds (4500 in
  year 1996, 3500 in 1997, 1998, and 2004, and
  planed to be 2400 in 2005) also, there is a need
  to be careful when testing sampling errors those
  due to sample size.
• Frequency of monitoring in Palestine, poverty
  figures depend on the available data from PECS
  to have a regularly poverty statistics, there is
  a need to conduct an annual PECS survey,
  otherwise we will be only able to update poverty
  line using CPI.

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Official Poverty Definition
Main Findings

• Mostly, all studies found that a variety of
  factors are strongly related with poverty
• Poor tend to have larger families, more children,
  and relatively low level of education.
• Poverty is strongly related to unemployment and
  short-term employment.
• There is a need to use economic modules in
  studying poverty, since cross-tabs some times
  give misleading conclusions.