Following an in-depth, year-long study by a team of experts, Caritas has launched a strong appeal for the minimum wage to be raised to €180 weekly from the current €158.
The study, which focused on three low-income household categories, established a minimum budget for a decent living based on a basket of essential items. Its findings are that the minimum essential budget required for a household of two adults and two children to have a decent life amounts to €10,634 per year; a single parent household with two children needs a minimum yearly budget of €8,581; and an elderly couple – 65 years and over – would need €6,328.
These fresh Caritas findings confirm the presence of a phenomenon which, if not tackled properly and in good time, might lead to circumstances that would hardly mirror the healthy social conscience we all speak of and want to see in our country. Caritas is a Church organisation with a lot of work experience among the fragile sectors of the community. Its study carries a lot of weight. It is not, however, the only indication that the situation of vulnerable families is far from rosy.
National Statistics Office figures on income and living conditions for survey year 2010, published last January, revealed a monetary “at-risk-of-poverty” rate of 15.5 per cent and an “at-risk-of-poverty or social exclusion” rate of 20.6 per cent. In other words, 63,474 people fell below the 2010 at-risk-of-poverty threshold of €6,260. Persons living in households with dependent children, especially single parents, tended to be at a higher risk of poverty, as were persons aged under 18 or those aged 65 and over.
Moses Azzopardi, president of the National Association of Pensioners, has argued that the risk of poverty is on the increase. He noted that the median income (which is less than the average income) was lower in 2010 (€6,275) than it was in 2009 (€6,392), so if the calculation of the risk of poverty were to be made on the basis of the 2009 amount, the rate would have gone up to 16.3 per cent.
Caritas leader Mgr Victor Grech argues that money should not be seen as an obstacle to improving the situation of the poorest. Just as the government found a lot of money to invest in various capital projects, with goodwill the financial means to help the most vulnerable could be found as well.
His argument is fully understandable but the problem is multi-faceted as it is made up of various factors that involve not only the people caught in the poverty trap but also the well-being of the economy. Raising the minimum wage does not necessarily help those who, for various reasons, are unable to properly make use of the money they receive, both in minimum wage and benefits. This is an age-old argument but it still holds. One way of helping these people is through specific advice, help and care.
It is also wrong, however, to make sweeping generalisations. Not all those who are on a minimum wage are simply unable, through bad habits or lack of sufficient education, to handle their money well.
The other argument is of course over the impact that a rise in the minimum wage could have economically in the country. How many people are on the minimum wage today? Are their employers in a position to pay them the rise suggested by Caritas? What would be the effect on their operations if they were to do so?