Rural People Live Beyond Their Means: Survey

People living in rural areas spend beyond their means every month, according to the preliminary report on the Household Income and Expenditure Survey (HIES) 2016 unveiled by the Bangladesh Bureau of Statistics yesterday.The HIES, which is one of the core report of BBS published every five years, also showed that the overall monthly expenditure of a family increased more than its income between 2010 and 2016.During the period, the monthly income of a household grew 39 percent while expenditure rose 40 percent.

 

In rural areas, a family spent Tk 14,156 per month in 2016 against the income of Tk 13,353, according to the latest HIES, which was presented by its Project Director Dipankar Roy.The HIES 2016 was carried on 46,076 households, which is almost four times the sample taken in HIES 2010.BBS in HIES 2016 found that the monthly expenditure of a rural family shot up 47 percent in 2016 from Tk 9,612 in 2010.

On the other hand, the income of a rural household rose 38 percent in six years to Tk 13,353 per month in 2016.The slump in remittance might be the reason behind the discrepancy between income and expenditure, said Zahid Hussain, lead economist of the World Bank’s Dhaka office.It appears that people, whose living standards improved owing to remittance in the past, could not cut back on their expenses once the inflows started drying up in 2016-17.And a section of them may have spent from savings or resorted to borrowing after failing to cut expenditures, he added.

The monthly expenditure of households in both urban and rural areas was higher than their monthly consumption between 2010 and 2016.  Roy said it could be because of expenses like weddings, accidents and other requirements.BBS said it estimates consumption excluding lumpy expenditures like durable goods purchase, tax, insurance, expenses of pilgrimage such as hajj, marriage and so on. But expenditure includes all those expenses.

Between 2010 and 2016, the income of urban families rose 37 percent to Tk 22,565 per month and expenditure 27 percent.The HIES 2016 also came out with quarterly estimate of poverty for the first time along with the annual poverty data and overall living standards of Bangladesh’s 16 crore people.It shows that the overall poverty declined to 24.3 percent in 2016 from 31.5 percent in 2010, while the percentage of people under extreme poverty fell to 12.9 percent in 2016 from 17.6 percent in 2010 at the national level.

At the programme, Planning Minister AHM Mustafa Kamal said Bangladesh’s extreme poverty rate is below the world average.The international extreme poverty rate was 13.8 percent in 2016, he said.“However, we do not have room for complacency. We have to take strides in a planned manner,” he said, adding that the government is aiming to eliminate extreme poverty from the country by 2030.

Rajashree Paralkar, acting World Bank country director for Bangladesh, lauded the country’s progress in poverty reduction.Around 80 lakh people came out of poverty since 2010, she said.The HIES 2016 also found that the ratio of population suffering from poverty fell both in rural and urban areas during the period.Yet, the proportion of ultra-poor in 31 districts of the 64 districts is higher than the national average of 12.9 percent.

The overall incidence of poverty in 36 districts is 24.3 percent, which is higher than the national average of poor people.Kurigram has the highest number of poor people at 70.8 percent while Narayanganj has the lowest number at 2.6 percent.The latest HIES found that poverty has declined in all divisions except Rangpur.The relatively new northwest division, which is also known for seasonal hunger named as Monga, registered an increase in poverty to 47.2 percent in 2016 from 42.3 percent in 2010. The level of extreme poverty also grew in the region during the period.

After Rangpur, Mymensingh is the home of the second highest percentage of poor people, followed by Rajshahi, Khulna, Barisal, Chittagong, Sylhet and Dhaka.Some 32.8 percent of the population of Mymensigh, the newly declared division, suffers from poverty. Only three divisions — Dhaka, Sylhet and Chittagong — recorded poverty rate lower than the national average.Roy said Rangpur was under Rajshahi division during the 2010 HIES.“That’s why there was not enough sample of Rangpur division at that time,” he added.

Historically, Rangpur lags behind others in terms of poverty reduction, said KAS Murshid, director general of the Bangladesh Institute of Development Studies.“We have to pay more attention to development of the region,” he added.

 

Source:

The Daily Star. October 18, 2017. Dhaka, Bangladesh.