The average single person with no children needs €14,864 in income in order to live a decent life, a new study has determined.
The joint project by the General Workers Union, Moviment Graffitti, Alleanza kontra l-Faqar and Rethink Advisory presented their findings on defining a National Living Income for Malta during a press conference on Friday.
The study defined a national living income as not a threshold below which people would risk extreme poverty but at which and above would allow people the freedom and capability to participate fully in society.
The figures were established by examining the basket of basic needs, a 1000 household survey and an economic study tracking the spending habits of households in order to afford a decent life.
Based on these, the study established that a national living income should stand at around €14,864 for a single person with no children, €20,099 for a single person with one child, €26,018 for a single person with two children, €21,316 for a couple with no children, €25,746 for a couple with one child and €30,734 for a couple with two children.
The final figures for the national living income included the established cost of a decent living as well as the additional expenses for income tax and national insurance contributions.
When testing the basket of needs, the authors looked at seven categories - health, food and drinks, housing, education and transport as well as leisure activities, which included paying for streaming services, gym memberships or going on holiday, and miscellaneous expenses such as requiring a professional service or expenses related to owning a pet.“
The point was not simply to calculate what a household might need to get by with just the bare minimum, but to also include those things which aren’t strictly necessary but which overall allow people to live a better quality of life,” Jake Azzopardi from Rethink Advisory said.
“We also took into consideration that an unforeseen expense would not put undue financial pressure on a household.”
Azzopardi added that the figures did not take into account the considerable costs faced by first-time property buyers, as while these are substantial, they are typically shouldered by a proportionally small band of households, which would ultimately skew the figures, he said.
The figures for the national living income, he continued, were based of the 40th and 50th percentile of what households spend in a year, not only because this represented a median in the figures, but also because the largest amount of households’ expenditure was found within these brackets.
With the national minimum wage currently standing at around €9,600, Azzopardi estimated that most households would need to see a 30 per cent increase to reach these income levels.
GWU Secretary General Josef Bugeja said that the study was important to the union as it considered social justice one of its foundational pillars.
“We cannot talk about economic growth when that growth is not being distributed equally among us all and we have people in full time employment who despite their best efforts are not living a decent life,” he said.
“Furthermore, we did not want to stop at the needs of just those who are employed at the exclusion of more vulnerable sections of society, such as pensioners or people who for whatever reason cannot work.”
“When having discussions about this topic it can often get heated and you can be tempted to only present your opinions on the matter, but with this study we have a scientific document that we can put on the table as fact.”
Bugeja said that the study would be presented to the social partners as well as the Government and as a next step was looking to possibly extend the study to see how a national living income could be best implemented.