Possible causes of poverty within a group of land reform beneficiaries in the midlands of KwaZulu-Natal: Analysis and policy recommendations

This study investigates possible causes of poverty afflicting a community of land reform beneficiaries in the Midlands of KwaZulu-Natal. The 38 beneficiary households had previously been clustered into four groups displaying different symptoms of poverty. Linear Discriminant Analysis was used first to distinguish households that were relatively income and asset "rich" from those that were relatively income and asset "poor", and second to distinguish households that were relatively income poor but "asset rich" from those relatively asset poor but "income rich". In the first analysis it was found that "rich" households could be distinguished from "poor" households using just two indicator variables; gender of the household head and family size. Larger, female-headed households have lower income and wealth per adult equivalent. In the second analysis, it was found that the "asset rich" had more human capital whereas the "income rich" owned vehicles and had fewer dependants per worker. Policy recommendations therefore point to education and vocational training - especially for women, better access to transport, jobs and banking facilities (to mobilise savings) in the long run, and improved and better targeting of social welfare grants for the chronically poor in the short run. These interventions are also expected to increase the demand for family planning and contraception, which in turn helps to reduce family sizes and the premature loss of breadwinners.Agricultural and Food Policy, Food Security and Poverty,

Symptoms of poverty within a group of land reform beneficiaries in the Midlands of KwaZulu-Natal: Analysis and policy recommendations

This study identifies different dimensions of poverty affecting the current and future well-being of households within a community of land reform beneficiaries in the Midlands of KwaZulu-Natal. A census survey of the beneficiary households was conducted in May 2002 to gather data on poverty indicators. Principal Component Analysis was used to construct an index of the standard of housing, which was then combined with variables measuring other symptoms of poverty (income, wealth and health) in a Cluster Analysis of the households. The analysis revealed five clusters representing four distinct groups of poverty; households relatively income and asset rich, households relatively income rich but asset poor, households relatively asset rich but income poor and households with the lowest incomes and assets. While income is an important indicator of current poverty, household wealth (measured in terms of saleable assets) indicates ability to cope with adverse shocks – a key issue as life expectancy is declining and old-age pensioners account for a large share of household income in the survey group. It is concluded that child welfare grants could be increased as pension earnings become less effective in combating the symptoms of poverty in this area. In addition, land reform grants may address poverty more effectively when used to purchase equity in joint ventures with commercial farmers than when used to purchase land that many of the beneficiaries cannot use or transact.Food Security and Poverty,

Symptoms of poverty within a group of land reform beneficiaries in the Midlands of KwaZulu-Natal: Analysis and policy recommendations

This study identifies different dimensions of poverty affecting the current and future well-being of households within a community of land reform beneficiaries in the Midlands of KwaZulu-Natal. A census survey of the beneficiary households was conducted in May 2002 to gather data on poverty indicators. Principal Component Analysis was used to construct an index of the standard of housing, which was then combined with variables measuring other symptoms of poverty (income, wealth and health) in a Cluster Analysis of the households. The analysis revealed five clusters representing four distinct groups of poverty; households relatively income and asset rich, households relatively income rich but asset poor, households relatively asset rich but income poor and households with the lowest incomes and assets. While income is an important indicator of current poverty, household wealth (measured in terms of saleable assets) indicates ability to cope with adverse shocks a key issue as life expectancy is declining and old-age pensioners account for a large share of household income in the survey group. It is concluded that child welfare grants could be increased as pension earnings become less effective in combating the symptoms of poverty in this area. In addition, land reform grants may address poverty more effectively when used to purchase equity in joint ventures with commercial farmers than when used to purchase land that many of the beneficiaries cannot use or transact

Possible causes of poverty within a group of land reform beneficiaries in the midlands of KwaZulu-Natal: Analysis and policy recommendations

This study investigates possible causes of poverty afflicting a community of land reform beneficiaries in the Midlands of KwaZulu-Natal. The 38 beneficiary households had previously been clustered into four groups displaying different symptoms of poverty. Linear Discriminant Analysis was used first to distinguish households that were relatively income and asset "rich" from those that were relatively income and asset "poor", and second to distinguish households that were relatively income poor but "asset rich" from those relatively asset poor but "income rich". In the first analysis it was found that "rich" households could be distinguished from "poor" households using just two indicator variables; gender of the household head and family size. Larger, female-headed households have lower income and wealth per adult equivalent. In the second analysis, it was found that the "asset rich" had more human capital whereas the "income rich" owned vehicles and had fewer dependants per worker. Policy recommendations therefore point to education and vocational training - especially for women, better access to transport, jobs and banking facilities (to mobilise savings) in the long run, and improved and better targeting of social welfare grants for the chronically poor in the short run. These interventions are also expected to increase the demand for family planning and contraception, which in turn helps to reduce family sizes and the premature loss of breadwinners