Pandemic of poverty

Results from a recent nationwide survey show that more than half of Nepali households are at risk of falling back into poverty because of loss of jobs and income during 2020 due to the pandemic. And it is the children who are affected the most.

This newspaper has been tracking the outcomes of these surveys that were conducted in May, July, August and October. It is a sobering reminder that while the national leadership is engrossed in a fight to the finish in Kathmandu, the state has left Nepalis (especially the most vulnerable) to fend for themselves in dealing with the health and economic impact of the Covid-19 crisis.

The surveys were conducted by Sharecast Initiative for Unicef and the last one in October involved a representative sample of 6,558 households with children all over the country.

The most striking finding was that 42% of households in Nepal have no earnings at all, and a further 19% have a combined monthly family income of less than Rs10,000. This means the official figure for Nepal’s population living below the poverty line will need to be drastically revised.

The National Planning Commission’s 2014 survey of the Multidimensional Poverty Index showed that the incidence of poverty had fallen from nearly 60% in 2006 to 28.6% in 2014 – largely because household incomes rose due to remittances. With the Covid crisis, Nepal’s poverty rate may have climbed back to the level 15 years ago at the end of the conflict.

The Unicef survey shows that the incidence of household poverty during the Covid-19 crisis is spread unevenly through Nepal. For instance, the majority of those who remain in the ‘no earning’ category this year are from rural parts of Sudurpaschim and Lumbini Provinces. A quarter of them tend to be female-led households and 10% were Dalit families. 

The survey shows a clear correlation between the pandemic-induced loss of income across Nepal. For example, the survey in May had shown that there were zero households with no earnings, or those making less than Rs10,000 a month. Strikingly, this figure went up to 49% in July, and even climbed to a high of 64% in August (See graphs).

By October it had fallen to 42%+19% with income below Rs10,000 a month, and it is likely even lower for December. However, 45% of households were still reporting loss of income, and even those with jobs were earning less.

The data shows that except for Karnali, all six other provinces reported a decrease in job loss from May to October, 2020. Province 2 showed a consistently high level of those who had lost livelihoods, and there was little improvement from August to October.  Bagmati and Lumbini Provinces had the lowest percentage of respondents reporting job losses since August.

The coping mechanism for most of those slipping into poverty was to borrow, dig into savings, cut household expenditure, migrate, or rely on remittances. Disaggregated data showed that 61% of Dalit families were forced to borrow to survive, while only 48% of non-Dalit families had to borrow money to run the household, revealing that caste differences can also mean a class gap.

Increased indebtedness will lead many households to fall deeper into poverty. Female-led households tend to borrow less, depend more on savings and remittances, the findings show.

Nepal’s children bore the brunt of falling household incomes by being deprived of adequate food, health care and education. In August, 34% of parents cited ‘food’ among the top three needs of their children, and by October this had dropped to 30%, while children’s education rose from 35% to 45%.

One in five families still say they have to struggle to feed their children. This proportion has remained the same since August, and hunger was more prevalent in Provinces 1, 2 and Lumbini. Inflation, and loss of income were cited as causes.

To a certain extent, educational needs of children appeared to be met in October with 81% of households saying that their children were involved in some form of studying – most of them at home. Less than 15% were attending physical classes, 22% were online. However, in Sudurpaschim and Province 2, a quarter of families said their children were not attending school at all.

Survey results tend to be dry and impersonal. But behind each of these numbing numbers are untold stories of families and children abandoned by an uncaring state. Is it too much to hope that in 2021, Nepal’s rulers will take steps to reverse this neglect?