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Budget Standards and the Poverty Line

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  • Peter Saunders

Abstract

This article reports some of the results from a recent study which, among other things, developed and costed low cost budgets for a range of Australian households. A budget standard represents what is needed, in terms of goods, services and activities, to achieve a particular standard of living and what that costs in a particular place and time. A low cost budget standard is one designed to meet basic needs at a frugal level while still allowing social and economic participation consistent with community expectations. The low cost budget standard estimates for households living in Sydney in February 1997 are somewhat higher than the Henderson poverty line, partly a reflection of the high cost of housing in Sydney, but also a consequence of the low cost standard itself being above a poverty standard. In spite of this, the budget standard relativities for different households provide an estimate of the relative needs of Australian households in the 1990s which could replace the current much‐criticised equivalence scale.

Suggested Citation

  • Peter Saunders, 1999. "Budget Standards and the Poverty Line," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 32(1), pages 43-61, March.
    • Handle: RePEc:bla:ausecr:v:32:y:1999:i:1:p:43-61
    DOI: 10.1111/1467-8462.00092
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    Cited by:

    1. Alfred Michael Dockery & Sherry Bawa, 2015. "The Impact of Children on Australian Couples’ Wealth Accumulation," The Economic Record, The Economic Society of Australia, vol. 91(S1), pages 139-150, June.
    2. Madurai Elavarasan, Rajvikram & Pugazhendhi, Rishi & Jamal, Taskin & Dyduch, Joanna & Arif, M.T. & Manoj Kumar, Nallapaneni & Shafiullah, GM & Chopra, Shauhrat S. & Nadarajah, Mithulananthan, 2021. "Envisioning the UN Sustainable Development Goals (SDGs) through the lens of energy sustainability (SDG 7) in the post-COVID-19 world," Applied Energy, Elsevier, vol. 292(C).
    3. Heindl, Peter & Löschel, Andreas, 2015. "Social implications of green growth policies from the perspective of energy sector reform and its impact on households," CAWM Discussion Papers 81, University of Münster, Münster Center for Economic Policy (MEP).
    4. Irene Cussó-Parcerisas & Elena Carrillo Álvarez & Jordi Riera-Romaní, 2018. "What is the Minimum Budget for an Adequate Social Participation in Spain? An Estimate Through the Reference Budgets Approach," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 11(1), pages 263-290, February.
    5. Rodgers, Joan R. & Rodgers, John L., 2006. "Chronic and Transitory Poverty in Australia 2001-2004," Economics Working Papers wp06-28, School of Economics, University of Wollongong, NSW, Australia.
    6. Heindl, Peter & Schuessler, Rudolf, 2015. "Dynamic properties of energy affordability measures," Energy Policy, Elsevier, vol. 86(C), pages 123-132.

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