Who are “the poor” in Malaysia?

We most easily think of “the people” as ourselves, our “class” of people. We forget that “the people” includes politicians, civil servants, police, soldiers, bankers, businessmen, garbage collectors, drivers, investors, farmers, etc., all with their dreams and goals.

Who’s poor?

All of us fear being poor. That’s why we worry about increases in the price of electricity, fuel, assessments and hikes in tolls. We recognize there will always be rich and poor. We hope the poor won’t suffer too much. We hope they will grasp opportunities and lift themselves up. We “do charity” now and then, and shed tears of joy whenever we hear of someone doing good for the poor.

Yet, the question “who are the poor?” is not easy to answer. One economist famously said “Poverty, like beauty, lies in the eyes of the beholder.”

When, in our conversations, we try to define poverty, the first thought that arises is lack of income or resources.

Eventually we end up with a list of poverty indicators which are not much different from what we find in academic discussions of poverty: “vulnerability to risks, powerlessness, lack of personal freedom, social exclusion, etc.”

Such conversations often end with someone asking whether there is an official definition of poverty. And, as soon as we hear it, we critique it.

Yet those who work for government, e.g. in the Social Welfare Department, in the Housing Department and in the Economic Planning Unit (EPU), have to work with definitions.

They need clear definitions in order to make decisions.

The statistically poor.

So, according to officialdom, who are the poor?

I’ll start with official data from the statistics department, published by the EPU.

Poverty Line Income (PLI).

Malaysia began measuring the incidence of poverty in 1970. In 1977, we introduced the PLI approach: any household which earns equal to or less than the PLI – and the PLI varies according to where the household is located – is classified as poor.

Household.

The PLI is based on “household” income.

In 2005, when the current definition was finalized, the “reference household” was made up of 1 male and 1 female aged 18-29, 2 boys aged 3 and 9 and a girl aged 5.

For the reference household, statisticians and dieticians estimated the expenditure for a healthy and balanced diet. This is called “Food PLI.”

To this was added “Non-food PLI,” comprised of the expenditure for clothing, housing, durables, transport and ‘others.’ The Non-food PLI is based upon many inputs, including Household Expenditure Surveys, mathematical models, tests, checks and reviews.