Poverty Rising Again in Greece with Three Million at Risk

Poverty is on the rise in Greece with a total of 29.5 percent of the total population—around 3,092,300 people—at risk of poverty or social exclusion, according to an independent report published on Monday.

According to “Poverty Watch Greece 2022” of the Hellenic Antipoverty Network, which uses Hellenic Statistical Authority data, 19.6 percent of the Greek population is at risk of income poverty. Another 14.8 percent experiences material deprivation of basic goods, and a further 13.6 percent of eighteen to sixty-four-year-olds live in low-employment households.

The Network also concluded that almost one in four children live in a household at risk of poverty, and one in three are at risk of poverty or social exclusion.

“These figures show that child poverty in Greece is severe, recurrent,” the report noted, “and worsening, and that we are in a much worse position than the European average, where 1 in 5 children live in poverty.”

Relative poverty rates started to increase dramatically after 2010 (27.7 percent), starting to drop in 2015 (from 35.7 percent) and reaching 28.9 percent in 2020.

“It is striking that in the whole of the past twelve years, about a third of the total population survived in conditions of poverty or exclusion according to official data,” the report says.

“This suggests that poverty has been a persistent problem for a large part of the population and that it only started to decline in the years 2017-2019,” it was added.

In 2020, with the large drop in incomes due to the pandemic, relative poverty began to rise again.

The geographical distribution of the population at risk of poverty recorded at the lowest percentage was in Attica (12.9 percent), Crete (14.9 percent) and South Aegean (17.5 percent).

The highest risk of poverty was in Eastern Macedonia and Thrace (29.0 percent), Western Greece (28.5 percent), Central Macedonia (25.5 percent), Western Macedonia (21.5 percent) and Central Greece with the Peloponnese (24.2 percent).

Poverty in Greece rises due to energy bills

The report also found that one in two households are struggling to pay for their energy needs as seven out of ten have less than 1,500 euros of monthly family income.

To manage this, 64 percent of those surveyed said that they have had to cut down on other household needs and 36 percent on some of their more basic ones.

Four in ten households heat only one part of their residence and turn the heat off even if the temperature is low (they faced temperatures lower than 18C in their residences last winter).

In terms of energy bills, one in three households delay the paying of bills. Citing an analysis of the International Monetary Fund (IMF), the report notes that the loss of real income of Greek households due to the energy crisis will be over ten percent in 2022.

Among other issues, the report notes that Greece has one of the highest VAT rates amongst OECD countries and ranks first with Finland in the Eurozone.

High indirect taxes lead in addition to tax evasion to a reduction in disposable income: e.g. while the weaker strata have lower direct taxes due to lower income, they ultimately “lose out” due to high indirect taxes on goods and services.

The report said that in Greece, revenues from indirect taxes account for about 56.4 percent of tax revenues while direct taxes account for about 35.4 percent. Consequently, there is no fair distribution of the tax burden, and the lower income groups are again the most heavily burdened, it said.