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Estimating a poverty line: An application to free basic municipal services in South Africa

Haroon Bhorat, Morne Oosthuizen and Carlene Van Der Westhuizen (haroon.bhorat@uct.ac.za)
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Carlene Van Der Westhuizen: Development Policy Research Unit

Working Papers from University of Cape Town, Development Policy Research Unit

Abstract: One of the key interventions aimed at improving the welfare of South African households has been local government’s provision of a package of free basic services (FBS) to poor households. It is, however, not completely clear how different municipalities identify households which are eligible for FBS. Evidence suggests that many municipalities currently provide services to all households with a monthly income of less than R1500 per month. This “FBS poverty line” is, however, low in comparison with a number of unofficial poverty lines utilised by policymakers and researchers in South Africa. This paper considers the impact of increasing the value of the FBS line, both in terms of the additional share and number of households eligible for support as well as the additional financial cost. We find that urban municipalities will face the steepest increases in their FBS budgets with any potential increase in the FBS poverty line.

Keywords: free basic services; poverty line; municipal services; South Africa (search for similar items in EconPapers)
JEL-codes: A1 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2011-10
New Economics Papers: this item is included in nep-afr and nep-ure
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Published in Working Paper Series by the Development Policy Research Unit, October 2011, pages 1-17

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http://hdl.handle.net/11427/7289 First version, 2011 (application/pdf)

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Journal Article: Estimating a poverty line: An application to free basic municipal services in South Africa (2012) Downloads
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