Industrial Poverty Alleviation of National Bureau of Statistics

　　【Overview】  With the reform, opening, fast economic and social development, with the Chinese government and the whole society, China’s poverty reduction career has made achievements. From 1978 to 2009, the rural impoverished population across China was reduced from 250 million to 35.97 million and the poverty incidence was reduced from 30.7% to 3.8%. As an important part of the anti-poverty strategy, rural poverty monitoring has been stressed by National Bureau of Statistics all along. From mid-1980s, the central government and governments at all levels have conducted large-scale well-organized and planned poverty alleviation oriented by development; the rural poverty monitoring system was built, developed, provided timely and accurate data support to reflect China’s anti-poverty progress, distribution, features and trend of impoverished people, as well as to evaluate poverty alleviation effect, and provided objective and true reference for the decisioning of scientific and reasonable poverty alleviation plans, policies and measures.

　　In the 21st century, rural poverty problems have become regional ones instead of general ones, relative poverty replaced absolute poverty as the main problem, long-term poverty became temporary poverty, the reasons for poverty became unstable birth control of impoverished people, weakness and other individual factors instead of insufficient regional economic development, remote location, poor natural conditions, insufficient human resources and other structural factors, poverty due to diseases and return to poverty due to disasters have become the main parts of poverty in China in the new era, the life features of impoverished people became high weakness instead of insufficient foods and clothes, the structure and diversified features of impoverished people become more and more obvious. In the new era, the new features of rural poverty in China have resulted in the complicated poverty alleviation and heavy tasks, and raise high requirements on the present rural poverty monitoring. To achieve China’s goal to terminate absolute poverty by 2010, LGOP is developing the new poverty alleviation plan for the new decade. It is a practical and urgent problem how to improve rural poverty monitoring so as to serve China’s anti-poverty campaign.

　　【Review of rural poverty monitoring】  Rural poverty monitoring refers to the dynamic behavior process of testing, measuring, analysis and evaluation of rural poverty objects’ situation and changes with funds, technologies, related equipments and scientific methods, in a strict and normative organization & operation mode by National Bureau of Statistics. The basic tasks of rural poverty monitoring include rural poverty standards testing, description of basic rural poverty situation, monitoring and evaluation of pro-poor policies and project effect. Based on poverty alleviation strategies in different periods, rural poverty monitoring has experienced the following stages:

1. Large-scale poverty alleviation and development stage (1986-1993). In mid 1980s, the rural household contract responsibility system liberated productivity, the Chinese government formally took over the historical responsibility to help impoverished people to shake off poverty, LGOP was set up, and corresponding provincial, prefecture and county government departments were set up. To grasp the poverty situation at that time, especially poverty scale and distribution, National Bureau of Statistics used rural family sampling data to calculate rural poverty standards for the first time, calculated poverty incidence by income and cereal output, which marked the starting of rural poverty monitoring.

2. Poverty alleviation breakthrough stage (1994-2000). In 1994, the central government constituted “The State Seven-Year Priority Poverty Alleviation Program”, centralized human resources, materials and funds to solve the subsistence of 80 million rural impoverished people in the 7 remaining years in the 20th century. To achieve the goals of “The State Seven-Year Priority Poverty Alleviation Program”, the central government designated 592 key counties for national poverty alleviation and development as the main poverty alleviation breakthrough objects. From that year, National Bureau of Statistics cooperated with LGOP to improve poverty monitoring, put poverty monitoring as a part of poverty alleviation project into World Bank’s loan projects in China, introduced objective poverty standard calculation methods, built the independent external poverty monitoring system to reflect the poverty reduction situation of farmers and effect of poverty alleviation projects in poverty reduction project areas. The creative job accumulated rich experience for building national poverty monitoring system. In 1987, with support from State Development Planning Commission, LGOP, Ministry of Finance, State Ethic Affairs Commission, Ministry of Agriculture, Agricultural Bank of China, other ministries and commission, National Bureau of Statistics launched the special poverty monitoring investigation covering 592 key counties for national poverty alleviation and development and built a systematic poverty statistics index system, which marked the formal building of the national rural poverty monitoring system.

3. Poverty alleviation and development stage in the new era (2001-2006). In 2001, LGOP released China Rural Poverty Alleviation & Development Outline and proposed that China should solve the subsistence of the small quantity of impoverished people in 2001-2010, further improve the basic production and living conditions in impoverished areas, solidify subsistence results, improve the life quality and comprehensive quality of impoverished people, reinforce the infrastructure construction in impoverished countryside, improve ecological environment, change the out-of-date economy, society and culture in impoverished areas gradually and create conditions for moderate prosperity. to achieve the poverty alleviation goals segmented in the plan, improvement of poverty monitoring contents became the core content to perfect poverty monitoring system, i.e., turn from the economic poverty measuring by farmers’ income and expenditure to multi-dimension poverty measuring of community environment, farmer’s production and living conditions, labor, education, health and other aspects. In this period, the rural poverty monitoring system was gradually perfected.

4. The new poverty alleviation stage driven by “Development and aid” (2008-2009). In 2007, the State Council decided to form the rural basic living allowance system across China to guarantee and support all without stress or omission. In 2009, LGOP launched the pilot effective link of poverty alleviation and the basic living allowance, which marked that China’s poverty alleviation entered the new stage driven by “Development and aid”. Poverty monitoring does not cover the basic living allowance monitoring, so the poverty monitoring is faced with opportunities and challenges under Grand Patten of Poverty Alleviation.

　　【Poverty monitoring data sources】  1. Nationwide rural family sampling investigation. It is used to decide the rural poverty standards in specific period of time, to calculate the rural impoverished population across China and in each province and to describe the features of poor people. The investigation targets are about 7,000 selected villages and 68,000 rural families in 857 national investigation counties in 31 provinces (municipalities, autonomous regions) across China.

2. National poverty monitoring special investigation. Mainly monitor and evaluate the poverty situation and poverty alleviation effect of 592 key counties for national poverty alleviation and development. The investigation targets are over 5,000 selected villages and 53,000 rural families in 592 key counties for national poverty alleviation and development in 21 provinces (municipalities, autonomous regions) across China, and 1/3 of the sample families are those for national rural family sampling investigation.

3. Monitoring and investigation on World Bank’s poverty alleviation loan projects in China. From 1995, National Bureau of Statistics successively undertook the independent external monitoring and evaluation of World Bank’s poverty alleviation loan projects in China 4 times, including Southwest Phase 1 (covering 35 counties in Yunnan, Guizhou and Guangxi), Qinba Project (covering 26 counties in Sichuan, Shaanxi and Ningxia), West Project (covering 27 counties in Inner Mongolia and Gansu) and Rural Impoverished Community Development Project (covering 18 counties in Guangxi, Sichuan and Yunnan). The cycle of each project is usually 5 years. Some villages and families in project counties are investigated by sampling to reflect the changes to the farmers’ life and poverty relief grade, and to evaluate the project effect. In the poverty monitoring and investigation on World Bank’s loan projects in China, methods to perfect poverty monitoring index system and probe poverty alleviation effect were tried and probed.

4. County, town and village statistics across China. Mainly collect the development background information of counties, towns and villages, including sampling investigation results and administrative reports. In addition, county-level poverty alleviation information of 592 key counties for national poverty alleviation and development was collected.

　　【Poverty monitoring system index】  1. Farmer’s economic situation. Collect farmer’s income, expenditures, production, sales, purchase, borrowing and other information through daily account, calculate farmers’ pure income per capita and farmers’ life consumption, etc, which are used directly to measure farmers’ economic situation index.

2. Farmer’s living facilities and demographic characteristics. Collect farmers’ characteristics, family structure, housings, possession of household durable consumer goods and drinking water sources, etc, through one interview at year end. In addition, investigate the demographic characteristics of family members, employment, migrant employment, children’s schooling, women’s health and other indexes.

3. Basic situation of investigated villages. Location, infrastructure, resources, population, technology application and other main social economy indices of investigated villages.

4. Basic situation of counties, towns and villages. The statistics of counties, towns and villages mainly covers the following information: situation of affiliated administrative units, population and employment, comprehensive economy, agriculture, trade, industry, investment, education, culture, health, social security and environment protection, etc. County-level poverty alleviation statistics mainly covers county-level poverty alleviation fund source, fund investment direction and farmers’ participation in poverty alleviation projects.

　　【Verification of rural poverty standards】  Judged technologically, poverty standards usually refer to income or expenditures for a specific living standard, and is an objective standard to define impoverished population size and compare changes to impoverished people at different stages. According to nationwide rural resident investigation data by family, National Bureau of Statistics calculated rural poverty standards in different periods in 1985, 1990, 1994 and 1998, while the standards for other years were updated with rural consumer price index. In 1994 and 1998, the poverty standards were measured with an international method, i.e., “Martin Method”, like the following:

1. Calculate food poverty line. 2100 Calorie per day is a person’s lowest nutrient requirement. According to the consumption mode of farmers with the lowest income (30% of the total), build the food consumption list covering 15 areas and 27 types foods. Calculate the food poverty line with the food consumption list and the prices of various foods.

2. Calculate non-food poverty line. Find the “low” non-food poverty line and “high” non-food poverty line with calculation methods. “Low” non-food poverty line refers to willingness to get expenses on basic clothes, heating and other needs by losing the minimum foods. ”High” non-food poverty line refers to other expense as important as needs for foods, such as expenses on traffic, sanitation and communication, etc.

3. Calculate poverty line. Food poverty line + “low” non-food poverty line = low poverty line, food poverty line + “high” non-food poverty line = high poverty line. In the 20th century, China has large impoverished areas, limited poverty alleviation resources and the link of years for calculating poverty standards, so the central government adopted low poverty line (please refer to the appendix for poverty standards and impoverished population sizes in previous years) to measure rural poverty. It should be seen that, at the low poverty line, farmers’ expenses on foods accounted for 85% of the total expenses, the low poverty line is only the basic subsistence line, and high poverty line is the stable off-poverty line recognized in the world.

　　After 2000, for poverty alleviation and development, and to approval the international poverty line, whiling using the rural poverty standards, the central government used low income standards to measure poverty. Low income standard is also a poverty standard (the food poverty line in 1998 was used, if Engel coefficient is 60% in poverty, the low income standard was 880 Yuan, and the standards of other years were updated with rural resident consumption price index). According to the average purchase price in 1993, World Bank’s international poverty standard of 1 USD/day is 885 Yuan, which was very near from the low income standard at that time. From 2008, according to the decision made at the 3rd Plenary Session of the 17th Central Committee of the Communist Party of China, “improve poverty alleviation standard gradually, put all rural population of low income into the pro-poor policy scope”; when poverty standards and poverty alleviation standards are not separated, low income standards are become the rural poverty standards, and the rural poverty standard in 2009 was 1196 Yuan.

　　【Problems in the usage of poverty standards】  1. Too low rural poverty standards. The World Bank is the most important organization of research on poverty problems, and it gave such comments on China’s official poverty standards in its recent research: “China’s official poverty standards cannot be compared with international standards. In comparison with the average income in China and people’s expectation, China’s official poverty standards seem to be rather low. Furthermore, some new research indicates that even according to the objective standards that poverty line should reach (the lowest survival needs and temporary basic survival needs), China’s official poverty standards may be too low”. In recent years, experts and scholars engaged in poverty research in China have written articles to claim to improve rural poverty standards. The poverty standards of 1196 Yuan in 2009 were equal to about 77% of international poverty standards (1.25 USD/day); the standards were only higher than those of Tanzania, India and Benin, and were the fourth lowest in the world. Recently, India re-calculated rural poverty standards, the standards covered clothes, foods and other necessary expenses, as well as basic expenses on education and health, and India’s new rural poverty line was about $ 1.21 a day according to the international comparative project purchasing power. The low poverty standards result in underestimation of impoverished population size, may result in farmers’ loss of capability, social and economic rights and are more likely to become important evidence for international organizations and social scholars to doubt China’s anti-poverty fruits.

2. Unclear definitions of various standards related to poverty alleviation. In 2010, rural poverty alleviation entered Grand Patten of Poverty Alleviation, but in practice, the public are still unclear about the definitions of some standards related to poverty alleviation, for example, poverty standards, poverty alleviation standards and minimum living standards cannot be understood or distinguished correctly, which bring barriers to poverty measuring and the understanding of poverty situation. When poverty standards are used to calculate impoverished population size, poverty standards is an economic or statistical concept, and is decided by farmer’s income and expenditure. To assure the link of impoverished population and poverty scale in different years, the international convention is to use the standard for several or more than 10 years without changes once the standard is confirmed; when poverty standard is used as the reference for poverty alleviation resource allocation, poverty standard refers is only poverty alleviation standard in fact, is a policy concept, is decided by investments, and may grow along with the increase of the state’s financial strength. However, in practice, people usually mix poverty standard and poverty alleviation standard. The 17th National People’s Congress proposed to “improve poverty alleviation standards gradually” and differentiated poverty standard and poverty alleviation standard formally for the first, but the 2 standards have not been separated in practice.

　　In the poverty alleviation framework with effective link of 2 systems, the minimum living standard and poverty alleviation standard are also mixed. For example, such opinions as “rural minimum living standard is higher than poverty alleviation standard” or “the population enjoying the basic living allowance is larger than impoverished population” are the presentation of incorrect understanding of the two standards. The national rural minimum living standard is simple the average of local rural basic living allowance, and China has no exact national rural minimum living standard. Rural basic living allowance was tried in developed areas first, and the minimum living standards in the areas were usually higher or equal to rural poverty alleviation standards, so the average of local basic living allowance were higher than national rural poverty standard. In addition, poverty standard corresponds to the population below the poverty line with self-development ability, the basic living allowance population corresponds to the population without self-development ability who receive the basic subsistence allowance or the population under poor living conditions that have to live on the basic subsistence allowance. Rural basic living allowance and rural poverty alleviation have different functions and standards, but can be linked effectively. Only when the 2 standards are understood, the government can guarantee and aid all without stress or omission.

3. One poverty standard cannot feed all parties’ needs. Now, China has only one rural poverty standard, which results in: 1. The objects of poverty alleviation and basic living allowance cannot be distinguished; 2. instructions cannot be given to anti-poverty work in developed areas and underdeveloped areas at the same time; 3. the standard cannot be used as reference for central and local poverty alleviation work at the same time; 4. Anti-poverty goals cannot be verified clearly in different stages.

4. There is no corresponding urban poverty standard. There is only rural poverty standard, but there is no corresponding urban poverty standard. When rural areas are changed, urbanization is accelerated and many rural migrant workers enter cities, the rural impoverished population will be changed a lot, and it is hard to grasp the county’s overall poverty situation, which goes against faster overall urban-rural development and termination of poverty.

　　【Contradictions between supply of and needs for small area poverty information】 In 2008, many pro-poor policies and measures targeted at counties, towns, villages and even farmers, decisioning departments at all levels needed detailed and reliable poverty information at county level or below badly. In addition, to improve the poverty alleviation efficiency, Ministry of Finance, National Development and Reform Commission and other departments pays much attention to the poverty situation of 18 impoverished areas in 22 provinces (municipalities, autonomous regions), such as Wuling Mountain Area and Jiuwan Mountains. However, China lacks the poverty information by country or small area composed of several counties; the existing national rural poverty monitoring system, based on sampling investigation, can only provide national and provincial poverty monitoring information limited by number of samples and investigation fees. The system provides effective reference for the development of macro policies, but cannot help decisioning departments to confirm the objects of policies or measures.

　　【Quantitative evaluation of poverty alleviation effect and influence】  Evaluation of poverty alleviation effect and influence is very important to improve pro-poor policy system, overcome defects and barriers in poverty alleviation, improve the vigor and effect of pro-poor policies and improve pro-poor policy level. Along with the poverty alleviation, independent external of poverty alleviation draws more and more attention from pro-poor policy development departments and implementation departments at all levels. However, the comments on poverty alleviation effect from statistics departments are mostly qualitative analysis of changes to the society and economy during the execution of pro-poor policies; besides monitoring on World Bank’s loan projects in China, there is little quantitative analysis of poverty alleviation effect or proof analysis. In addition, some experts and scholars engaged in poverty research mainly provides quantitative evaluation of poverty alleviation funds’ influence on income increase and poverty reduction with regression model, and evaluation methods are seldom innovated.

　　【Advice on the improvement of rural poverty monitoring】  Poverty is both an economic problem and a political one in China, but independent external poverty monitoring is a technical problems. The poverty monitoring technology level decides the poverty alleviation service efficiency, so we raise some advice on the improvement of rural poverty monitoring:

1. Try measuring poverty with several poverty standards. National Bureau of Statistics is only responsible for calculation of poverty standards all along, but the poverty standards for poverty measuring and poverty alleviation are decided by policies or approved by the State Council after joint research by execution units, such as LGOP, Ministry of Finance, National Development and Reform Commission and National Bureau of Statistics, etc. For objective, linked and comparable calculation, taking World Bank’s Experience into consideration, we suggest that China can use several poverty standards for poverty measuring to feed needs for historical comparison, regional comparison, urban-rural comparison and link with the basic living allowance and other relief systems at all levels under the Grand Patten of Poverty Alleviation. Details: 1. Calculate the new poverty standard (i.e., high poverty line of Martin Method) to reflect stable anti-poverty effect according to the present consumption mode, use the new poverty standard as the objective reference to reflect national anti-poverty effect in the new poverty alleviation planning, as well as the poverty standard or the minimum living standard of the central government and underdeveloped areas. 2. Calculate the poverty standard for regional comparison and urban-rural comparison and get rid of the influence of regional price level on the living standard represented by poverty standard so that poverty alleviation can be more fair and practical. Here, it should be pointed out that National Bureau of Statistics is now promoting urban-rural resident investigation integration and the poverty standard for urban-rural comparison can be worked out soon after the definitions and approaches of urban and rural income & expenditure indices are unified. In addition, since the urbanization is always accelerated in China, the poverty standard for urban-rural comparison will provide a reference for accurate measuring of impoverished population size across China, overall urban-rural planning, termination of poverty across China, independent objective evaluation of millennium goal completion.

2. Provide small-area poverty information to integrate statistics resources effectively by adopting international advanced statistics technologies. In 2010, three methods were adopted to fill the small-area poverty information gap: 1. Add resident investigation samples to get the results of poverty investigation on counties, towns and even villages (called sampling by town or by village). 2. Report from bottom to top level by level to collect impoverished people or objects to support. 3. Adopt “poverty map” research technology, i.e., build consumption model with common indices for resident investigation and census, as well as resident investigation date, input agricultural census data into the model, and get the statistically reliable poverty incidence and impoverished population size by county and even by village.

　　The first 2 methods have 2 defects: sharp rise of investigation costs and inaccurate data. To provide small-area poverty information with the third method, 3 conditions are required: 1. the latest census data; 2. detailed resident sampling investigation data; 3. Census and sampling investigation need to have the same poverty feature indices as many as possible. In 2009, Red Cross Society of China used the data of the second agricultural census and rural resident investigation data for poverty map research. In addition, the 6th population census will be started soon and small-area poverty information may be available persistently.

3. Improve poverty statistics ability at many aspects to match the advancement of poverty alleviation and development. First, improve the ability to communicate with LGOP, the Ministry of Finance, National Development and Reform Commission and other data users, to learn the pro-poor policy direction and data gap, consequently to improve monitoring contents pertinently and provide quality data service. When funds are provided, under Grand Patten of Poverty Alleviation, it will be the stress in the improvement of monitoring contents how to cover the basic living allowance monitoring and related participatory monitoring. Second, improve the pro-poor policy evaluation level, learn and grasp various policy evaluation methods through international cooperation and develop a set of pro-poor policy evaluation system suitable for China’s situation so as to provide normal evaluation of pro-poor policies.

　　(National Bureau of Statistics)