At the end of last year, Lithuanian President Gitanas Nausėda met with the elderly residents of Klaipėda and assured them that poverty in Lithuania has decreased significantly in recent years due to growing wages and pensions. Is this true?
Experts are less optimistic than the president in assessing poverty in Lithuania. According to Aistė Adomavičienė, head of the National Network of Organisations for Poverty Reduction, one in five people in Lithuania are at risk of poverty, and this statistic has not changed for 20 years.
As it turns out, there are two indicators that measure poverty in Lithuania, and they paint different pictures. The first one, mentioned by the president, is the absolute poverty line. This is the amount of income set each year by the Social Security and Labour Ministry needed to meet a person’s basic needs.
In 2023, the absolute poverty line was 354 euros per month for a single person and 743 euros for a family of two adults and two children. Less than 4 percent of the Lithuanian population lived below the absolute poverty line last year, and this figure has fallen in recent years.
However, experts say this is not the best way to measure poverty. The absolute poverty line has increased by only 7 euros since 2021 despite record-high inflation of 20 percent at the end of 2022. So, despite poverty, measured in this way, is falling, the absolute poverty line is set too low, according to experts.
“If we look at absolute poverty, yes, it is decreasing. But that threshold of 354 euros is also very low, and you would not say that people who earn 360 euros are not poor. People who receive that amount are not starving, but that doesn’t mean they can meet their needs,” Adomavičienė explained.
Experts suggest comparing people’s income instead. A person earning less than 60 percent of the median income of the rest of the population is said to live in poverty. This is how the EU calculates the poverty level.
“I wouldn’t say that the situation is very good,” said Adomavičienė when asked to assess the president’s statements about poverty reduction.
She stressed that the percentage of those earning less than 60 percent of the median income of the rest of the population has not changed since the Lithuania’s accession to the EU and is fluctuating around 20 percent.
She also noted that Lithuania’s income inequality is one of the largest in the EU, only lagging behind Bulgaria. Income inequality, which had been falling for a long time, has recently increased again, according to the expert.
“Such data is not good, and it should be borne in mind that income inequality creates a sense of injustice and frustration with the state,” Adomavičienė said.
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