1. GHANA’S POVERTY PROFILE 2013
Ghana Living Standards Survey,
Rounds 5-6
26 August 2014

2. Outline of presentation
Introduction
Data sources
The standard of living measure
Poverty lines and patterns
Poverty covariates
Summary

3. Introduction
Ghana achieved positive economic growth from 1991 and by 2007 have become a lower-middle income country
Poverty has declined in Ghana over the years
These declines are largely due to growth
To what extent have Ghanaian households and communities benefited from this growth?
Which groups have benefited most?

4. Data sources Ghana Living Standards Survey rounds
Poverty has many dimensions.
The focus is on consumption poverty
Ghana Living Standards Survey rounds
2005/06 – GLSS 5
2012/13 – GLSS 6
Used expenditure data on:
Education & Health
Employment
Household Agriculture
Household food and non-food Expenditure
Non Farm Enterprises
Assets

5. The Standard of Living Measure
Involves calculating the total consumption expenditure for each household using adult equivalent scale.
Based on 2,900 calories per adult equivalent per day (Recommended dietary allowance 10 edition)

6. The Standard of Living Measure
Welfare=Total Household Expenditure
Price Index * Household Size (eqsc)
Total Household Expenditure:
Food expenditure (actual)
Own food consumption
Non food expenditure (actual)
Non food (rent and user value) imputed
Housing expenditure
Price Index:
Regional price differentials

7. The standard of living Measure…
Household size in adult equivalent scale (eqsc)
The adult equivalent scale is calculated based on the composition of the household, using a calorie-based scale of age and gender specific calorie requirements
Equivalent adults recognizes, for example, that the consumption requirements of babies or young children are less than those of adults.

8. Setting Poverty lines Two lines are estimated
Upper poverty line (absolute)
Lower (food) poverty line (extreme)
Upper poverty line estimates the overall poverty rate
Lower poverty line estimates extreme poverty rate

9. Setting Poverty Lines
Over the period people’s tastes and preferences have change.
The need to make adjustments of consumption aggregates to reflect the changes in the consumption pattern
the minimum basket was updated for consumption (inclusion of the user values- mobile phones, ipad, rice cookers, computers, etc.) to reflect wellbeing and living standards in Ghana now.
Using the Engel method – estimated food and non food expenditure .
food – extreme poverty line
Food + non food – absolute poverty line.

10. NEW Poverty Lines (2012/13)
Absolute poverty line (Upper)
- Gh¢1, per year
- Gh¢3.60 per day
Extreme poverty line (Lower)
- Gh¢ per year
- Gh¢2.17 per day

11. 2013 Poverty Rates
Poverty rate: 24.2% Extreme poverty rate:8.4%

12. Poverty Rates in Ghana, 2005 - 2013
Year
Absolute PL=Gh¢1,314.00
Extreme
PL=Gh¢792.05
2012/13
24.2%
8.4%
2005/06
31.9%
16.5%
Poverty declines 7.7 percentage points. This follows
earlier trends (1991 and 2006)
By this rate Ghana has achieved the MDG 1 of halving
the poverty rate from 1990 levels.

13. Poverty level in Ghana (2012/13)
Year
ABSOLUTE
PL=Gh¢1,314.00
EXTREME
PL=Gh¢792.05
2013
6.4 million
2.2 million
2006
7.0 million
3.6 million

14. Poverty Incidence by region: PL= Gh¢1,314
Only Eastern region experienced an increase in poverty .
Even though the Upper East and Upper West regions have seen big poverty decline, they are still among the poorest

15. Contribution to poverty by region
The Northern Region has over the 7-year period contributed to poverty more than any other region
The three northern regions contributes more than a third to national poverty

16. Decomposition of change (%) in poverty headcount, 2005/06 to 2012/13
Change
Share of change due to:
Growth
Redistribution
National
-7.7
-8.8
1.1
Urban
-1.9
-2.4
0.5
Rural
-5.8
3.0
Observed change in mean value of the standard of living (‘growth effect’)
Change in inequality when mean value is unchanged (‘redistribution effect’)
In Ghana Growth has remained the engine of poverty reduction
In the absence of inequality, poverty reduction would have been larger than -7.7%.

17. Inequality has increased slightly...
Gini

18. POVERTY COVARIATES Employment status Ownership of Assets Access to
Potable Water
Sanitation (Toilet facility)
Electricity

19. Poverty Incidence by employment status of household head
HH headed by farmers remain the poorest in Ghana
HH headed by private sector workers have experienced improvement in their poverty levels
Poverty Incidence by employment status of household head

20. Percentage of households owning different durable goods has increased across all Regions
Percentage of households owning fridge by Region
fridge ownership in the Northern regions has almost tripled over the years

21. Percentage of households owning TV by Region
Asset ownership in the Northern regions tripled over the years

22. Percentage of households owning mobile phone by Region

23. Percentage of households having access to potable water by Region
Access to potable water has increased across almost all regions.
Potable water includes pipe, bottle/sachet, protected well/spring, and borehole. It excludes unprotected well and surface water.
Percentage of households having access to potable water by Region

24. Percentage of households using adequate toilet facility by Region
Use of flush & KVIP toilet facility has increased across all regions,
but remains low in the 3 northern regions
Percentage of households using adequate toilet facility by Region

25. Households using electricity
Percent
Household access to electricity has increased
across all regions

26. Summary
Ghana has consistently been experiencing poverty reduction since the 1990s .
Ghana achieved the MDG1 of halving its poverty level in 2013.
24.2% of Ghanaians are poor and therefore cannot afford to spend Gh¢3.60 per day (Gh¢1, per year).
8.4% of Ghanaians are extremely poor. That is putting all their expenditure together, they cannot afford to spend Gh¢2.17 per day on food (Gh¢ per year).

27. Summary cont’d Poverty has decreased in all regions except Eastern.
Greater Accra recorded the lowest poverty rate.
The three northern regions recorded the highest poverty rates even though there were improvements.
Inequality in the distribution of welfare has increased slightly.
Access to services (potable water, toilet facilities and electricity) and ownership of assets have increased across all regions

28. Thank You