Definitions

needs-based

Basic needs

The basic needs approach is one of the major approaches to the measurement of absolute poverty. It attempts to define the absolute minimum resources necessary for long-term physical well-being, usually in terms of consumption goods. The poverty line is then defined as the amount of income required to satisfy those needs.

A traditional list of immediate "basic needs" is food (including water), shelter, and clothing. Many modern lists emphasize the minimum level of consumption of 'basic needs' of not just food, water, and shelter, but also sanitation, education, and healthcare. Different agencies use different lists.

Related approaches, taking their cue from the work of Amartya Sen, focus on 'capabilities' rather than consumption.

In the development discourse, the basic needs model focuses on the measurement of what is believed to be an eradicable level of poverty. Development programs following the basic needs approach do not invest in economically productive activities that will help a society carry its own weight in the future, rather it focuses on allowing the society to consume just enough to rise above the poverty line and meet its basic needs. These programs focus more on subsistence than fairness. Nevertheless, in terms of "measurement", the basic needs or absolute approach is important. The 1995 world summit on social development in Copenhagen had, as one of its principal declarations that all nations of the world should develop measures of both absolute and relative poverty and should gear national policies to "eradicate absolute poverty by a target date specified by each country in its national context."

Basic needs approach in different countries

Canada

Professor Chris Sarlo, an economist at Nipissing University in North Bay, Canada and a senior fellow of the Fraser Institute, uses Statistics Canada's socio-economic databases, particularly the Survey of Household Spending to determine the cost of a list of household necessities. The list includes food, shelter, clothing, health care, personal care, essential furnishings, transportation and communication, laundry, home insurance, and miscellaneous; it assumes that education is provided freely to all residents of Canada. This is calculated for various communities across Canada and adjusted for family size. With this information, he determines the proportion of Canadian households that have insufficient income to afford those necessities. Since the early 1970s, the poverty rate has declined from about 12% of Canadian households to about 5%.

The Philippines

The Municipality of Rosario, Batangas, Philippines implemented its Aksyon ng Bayan Rosario 2001 And Beyond Human and Ecological Security Plan using this concept as a core strategy through the Minimum Basic Needs Approach to Improved Quality of Life - Community-Based Information System (MBN-CBIS) prescribed by the Philippine Government. This approach helped the municipal government identify priority families and communities for intervention, as well as rationalize the allocation of its social development funds.

United States of America

In the United States, the equivalent measures are called self-sufficiency standards or living income standards. Unlike the federal poverty level (FPL), which is calculated from a single, national variable (cost of food), these models assume that different households have different needs, based on factors such as the number and age of children in the household, and the cost of housing in the particular area (usually a county) that they live in. In keeping with the principles of basic needs, these measurements do not include any extra money for entertainment, savings, debt payment, or unusual or avoidable expenses, such as vehicle repairs. It assumes that adults will be working and pay taxes; it also includes costs of all government, charitable, and family subsidies, such as free medical care through Medicaid, free food from the USDA food stamps program or a food bank, or free childcare from a grandparent. All of these costs are ignored by the official FPL measurement, but included in a self-sufficiency standard.

Minimum expenses vary by region. For housing, child care, food, transportation, health care, and other necessary expenses, plus net taxes, a family in middle-class Warren County in northwestern Pennsylvania of one adult and two children (one preschooler, one school-aged) needed a minimum income of $30,269 to pay its own way in 2006. Child care is the largest expense in this budget, followed by housing, taxes, and food. The same family, living in the wealthy Seattle region of Washington would need to earn $48,269 to be self-sufficient. These figures contrast sharply with the FPL for that year, which was just $16,600 for any three-person household.

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