Monday 20 May 2019

When you have to choose between groceries and your rent, that’s poverty


The 2018 European Statistics on Income and Living Conditions Survey which was quoted in the media this week states that one out of every three families in Malta cannot afford a one week holiday.

This, of course, is not the real litmus test of whether people are struggling, because I think we can all agree that a holiday is not a necessity but a luxury.  While going away and taking a break from one’s routine is always a treat, it is not crucial to one’s survival. The real indicators of material deprivation can be seen in other parts of the report where it is stated that 15.6% said an unexpected expense would financially cripple them. By “unexpected expense” the report cites the sum of €675.  This figure struck me because it is a relatively small amount, which points to a situation where people are obviously living from pay cheque to pay cheque, and are therefore unable to save or put something aside for emergencies.  This means that something like an appliance which needs to be replaced or a car breaking down would seriously impact this family’s finances.  (Here I am not referring to those who do not have the ability to save simply because they squander everything they earn, which is a completely different scenario).  

The study continued with more grim reading: over 40 thousand people (8.1%) have fallen into arrears with their rent or mortgage payments, loans and utility bills while 7.6% could not afford to keep their house warm.  Shelter and heat are perhaps two of the most vital components of our existence, followed by food.  As we emerge from a particularly bitter winter by Maltese standards, I cannot wrap my head around what it must be like to live in fear of becoming homeless, or to not be able to turn on a heater because it is too expensive and would drain your budget.  Shivering in misery while worrying about paying the rent or your loan sounds like something out of Charles Dickens not “thriving” Malta 2019. 

The way these studies are conducted, a household is considered to be materially deprived if it is unable to afford three out of nine items: these include going on holiday, making rent, paying for unexpected expenses, eating meat or chicken every other day, keeping a house warm or owning a car, washing machine, colour TV or telephone, going out for a meal or socializing and attending a concert.  

If a household cannot afford four or more of these items it is considered severely deprived. According to the survey, the latter has dropped slightly by 0.3% but still amounts to over 14 thousand people, which is poor consolation indeed in a country where the economy is purportedly booming.   Having to choose whether to pay one’s bills or buy nutritious food is also a reality and explains why pastizzi shops selling stodgy, pastry items which fill you up, are sprouting up everywhere.  Food prices in general have become more expensive, which is something which really hits home when you travel and realise how much more we are paying for groceries. 

The Government’s reaction to these statistics is that “the increase in the number of people who fell into arrears on rent and loan payments was a result of changes in the rental market caused by economic growth and the increase in foreign workers.”  I fail to understand this kind of reasoning, because what are we supposed to say? “Oh ok, the only real poverty we have is among foreign workers, not the Maltese, so that’s alright then”?

For a start, if we have seen an upward trend in poverty among foreign nationals because of the combined factors of over-inflated rents and meagre wages, that does not reflect well on us at all. We have simply created several ghettos of economic migrants who have moved here to find work, whose living situations are dire, crammed into apartments at extortionate prices simply to feed the machine of the construction industry and related sectors which require more and more workers.  The downward spiral effect can be felt all around us as neighborhoods become run-down because tenants set up residence only fleetingly, not bothering to lay down any roots since they know they will not be staying long. The transitory nature of foreign workers who have no affinity or connection with this country, let alone the community where they are temporarily residing can also lead to loneliness which manifests itself into other social problems. They may have found jobs which they could not find in their own countries, but I doubt whether they feel welcome or consider Malta their ‘home’, especially as anti-foreigner resentment continues to increase.

Secondly, the ripple effect of poverty among the Maltese is already being felt. If for one reason or other you have been forced to rent, you can easily find yourselves among that 8.1%.  And if you lose your job, or you receive a huge electricity bill or any other unexpected expense, you could be just one month’s missed rent away from being thrown out on your ear.   

That it has become more costly to live here can also be evidenced by the many who had re-located here but are now leaving, including those working with the much-vaunted iGaming industry where salaries are on the upper side of the scale.  Who wants to spend 3/4 of their entire salary on accommodation? Meanwhile, young Maltese couples who automatically took it for granted that they would one day buy their own home and raise a family just like their parents managed to do, take one look at their take home pay and at the cost of a flat (you can forget buying a house) and realise this is no longer a feasible dream.  Many are postponing having children or ruling that idea out altogether. 

Will there come a time when everyone simply rents?  This looks like the way we are headed, and the longer the Government takes to regulate the rental market the more unstable will people’s finances be, as they will never know from one month to the next whether they will get a knock on the door telling them their rent has gone up. And unless you have a safety net, that could spell disaster for you and your family.

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