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High rental costs put many at risk of poverty
The annual Christmas charity concert in aid of cash-strapped families with young children in the Faroes took place yesterday.
As in previous years, families with tight finances could apply for a share of the donations received.
According to organiser Barnabati, a new trend is emerging from this year’s applications: many applicants have an income placing them above the at-risk-of-poverty line, yet their housing rental costs are eating away most of their disposable income.
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The at-risk-of-poverty rate counts the share of the population with the lowest relative spending potential.
These statistics are based on the equivalent income, also known as ‘equivalised disposable income’, which is an equivalised household income figure adjusted for different household compositions.
The at-risk-of-poverty rate indicates the proportion of people with an equivalent income below 60 percent of the national median equivalent income.
“Most of this year’s applicants live in rental properties, and for many of them – even those whose income is above the at-risk-of-poverty line – their rental costs make up a significant portion of their monthly budget,” says Barnabati chairman Djóni Eidesgaard.
>> SEE ALSO National median disposable income is DKK 184,000
“We’re seeing that many of these families have almost nothing left once the rent is paid, and some cannot even afford to pay their rent.”
The average number of children receiving Christmas assistance over the past few years has been about 550. About 20 percent of this year’s applicants were first-time applicants.
“A vast majority of our applicants have applied for more than three years, which would indicate that these families are living in more or less permanent poverty.”
Eidesgaard points to the distinction between being at risk of poverty and living in poverty.
“There are many definitions, but some say that if you have been below or near the at-risk-of-poverty line for more than three years, you can be considered to be living in poverty.”
Read the Faroese version of this article here.
More Faroese News in English.