Poorest Japanese Families Getting Poorer

J. Sean Curtin (Professor, Japanese Red Cross University)

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Over the past thirty years, there has been a massive redrawing of the poverty map in the United States. Formerly, the elderly constituted the bulk of the most visibly poor section of the population, but this has now firmly shifted to female-headed families. During the past decade, a very similar trend has begun to emerge in Japan. At the beginning of August 2002, a government survey revealed that lone-mother families (comprising divorced, separated, widowed or unmarried mothers) were on average the most economically disadvantaged in Japan. August also saw the introduction of reductions in allowances paid to such families, which will almost certainly exacerbate their level of poverty.

According to the Citizen's Basic Living Survey (Kokumin seikatsu kiso chosa) released on 9 August 2002, the income of the average household for 2000 was about 6.17 million yen. This represented a decline of 1.5% from the previous year and was the fourth straight year in a row that a reduction has been recorded. The comprehensive survey was conducted during June and July 2001 by the Ministry of Health, Labor and Welfare with 247,000 households being surveyed, making it the most accurate guide on the state of the Japanese households.*

For families with children under the age of 18, the average annual household income was about 7.26 million yen. 59.3％ of these families said they felt their economic situation was difficult. Amongst households with children, the group that experienced the most severe hardship were lone-mother families (divorced, separated, widowed or unmarried mothers). The average annual income of these families was just 2.52 million yen. This figure was lower than the average annual income of an elderly household, which stood at about 3.19 million yen.

The annual income of mother-headed households was almost a third less than the income of the average two-parent household, putting most lone-mother families well below the poverty line. Poverty is usually measured at household level and calculated on the basis of whether an individual lives in a household with a (size-adjusted) disposable income that is less than half the median for the average household in the nation. Individuals living in such a household are normally classified as poor. Not surprisingly, according to the same survey, 81.6％ of Japanese lone-mothers said they were experiencing real hardship.

According to data from the Luxembourg Income Study (LIS), in most industrialized nations many lone-mothers experience poverty. In the mid-nineties, the highest rates were recorded in the United States (59.6%), followed by Canada (43.5%), Germany (43.3%), Britain (40.3%) and Australia (38.3%). Sweden with its comprehensive welfare policies had the lowest rate of lone-mother poverty at a mere 3%. Japan does not contribute data to the LIS, so no direct comparison can be made.**

The number of mother-headed families in Japan increased throughout the 1990s. The 1993 National Survey on Lone Mothers Household and Others (Zenkoku Boshikateitou chosa) counted 789,900 and in 1998 the same survey recorded 954,900. This was an increase of 165,000, which corresponds to a 20.9% rise in just five years. As the current divorce rate is on an upward trajectory, this figure is almost certain to increase.***

In response to increasing poverty amongst lone-mother families, the government has decided to restrict eligibility to dependent-child allowance (Jidoufuyouteate), which is a special child-care benefit for mother-headed families. By changing the criteria for receiving the allowance, lone-mothers will now have to be earning far less in order to qualify for the maximum monthly benefit. Full dependent-child allowance is currently paid at a monthly rate of ¥42,370 for a single child, ¥47,370 for two children, and ¥50,370 for three children. From 1 August 2002, a mother's annual income will have to be less than 1.3 million yen to qualify for the maximum amount. Previously, the figure was just over 2 million yen and a flat rate scheme covered incomes up to 3.65 million yen. Now, for every 10,000 yen earned over the 1.3 yen limit, 170 yen will be deducted from the allowance. A tax deduction for widows has also been eliminated. For families experiencing extreme financial hardship, social assistance (Seikatsu hogo) will still be available.

Several earlier reforms already reduced the amount a single-parent could earn before losing entitlement to the allowance. Each time a reduction has been implemented, an increase in poverty among mother-headed family has been recorded.

The government says that the new austerity measures are necessary due to the ever increasing number of divorces involving children, which are putting a strain on welfare budgets. Lowering benefits is seen as a way of discouraging divorce. Critics say that the new dependent-child allowance measures will do nothing to dissuade people from divorcing. The only thing they are certain to achieve is create more financial hardship for an already disadvantaged social group.

Legal experts point out that more money would be available to lone-mother families if the government introduced a law which effectively forced fathers to pay maintenance for their former wives and children. Unlike almost every other industrially advanced nation, Japan has no such statute. Government policy stipulates that divorced fathers have an obligation to contribute to the cost of raising their children, but includes no measures for making them do so. Currently, the government has no plans to introduce a law to force delinquent fathers to pay.

The austerity plans were originally to be implemented in April 2003, but in June 2002 the Koizumi Cabinet decided that the cuts needed to be urgently implemented. While the government is still dithering over the bad loans crisis in the banking sector, it has taken decisive action to ensure that the poorest children in Japan will become poorer.

References

* Citizen's Basic Living Survey (Kokumin seikatsu kiso chosa) [Japanese]

** Luxembourg Income Study (LIS) [English]

*** National Survey on Lone Mothers Household and Others (Zenkoku Boshikateitou chosa) [Japanese]