Family Matters No. 35 - August 1993

Aboriginal Australians and poverty

Issues of measurement
Janet Taylor


Income poverty has been the major focus of poverty measurement in Australia. It is widely used among Aboriginal communities, despite the difficulties in using this measurement. The author alerts readers to problems associated with measuring income poverty and argues that definitions used in measuring income amongst white Australians are not always appropriate when measuring income poverty amongst Aborigines. Data accuracy is also a problem. She argues that a much wider focus is needed that incorporates non-material aspects of poverty resulting from racism, oppression and dispossession.

In her report Aboriginal Child Poverty, Choo (1990) writes that for Aboriginal families, 'material poverty, which can be measured through social indicators such as income, employment, housing, health, education and criminality, is secondary to the more deep-seated deprivation that is the consequence of cultural invasion, racism and oppression'.

Aboriginal communities consulted by Choo emphasised the non-material factors of poverty, including the loss of children through their removal, the loss of identity and spiritual and cultural heritage, the loss of contact with the land, and the loss of dignity and self-respect through oppression over the years.

Material poverty includes both income poverty and non- income indicators of poverty such as housing and health. Aboriginal people suffer both absolute material poverty (lack of food, water and shelter) as well as relative poverty (lack of what are considered 'decent standards of material living conditions). Further aspects reported by Aboriginal communities include alcoholism, homelessness, sexually transmitted diseases, incarceration and the effects of these on access to employment and income (Choo 1990).

On all indicators of poverty - material and non-material, absolute and relative - Aboriginal people emerge as the most disadvantaged group in Australia.

Income poverty has been the major focus of poverty measurement in Australia. It is widely used among Aboriginal communities, despite the difficulties in using this measurement.

Demography and location

As a background to considering income poverty among Aboriginal people it is useful to look briefly at demographic characteristics and geographic location.

The 1986 Census (ABS 1991) showed that 227,645 Australians (1.5 per cent of the population) identified themselves as being of Aboriginal (202,104) or Torres Strait Islander (21,541) origin. About a quarter lived in each of Queensland and New South Wales, with Western Australia and the Northern Territory also having large Aboriginal populations. In the Northern Territory, Aboriginal people comprised 22 per cent of the population, but in the other states they ranged from 2.7 per cent (Western Australia) to 0.3 per cent (Victoria).

Overall, 33 per cent of Aboriginal people lived in rural areas in contrast to 15 per cent of the total population. Over half were under 20 years of age compared with less than a third of all Australians, and there were proportionally fewer Aboriginal people of prime working age (20 to 54 years).

Choo (1990) categorises Aboriginal communities according to lifestyle and location - homelands or outstations (on traditional lands), town camps or fringe camps (including on reserves), and towns or other urban areas. The living situation and needs of these communities vary markedly, with town campers and fringe dwellers being the most deprived.

Income poverty

According to Choo (1990), 'on average, Aboriginal people earn half the income of other Australians'. The 1986 Census shows the median and the mean Aboriginal individual income as 65 per cent of the total population's income (Altman 1991). The overall low income of Aboriginal people is widely acknowledged, but precise measurement of income poverty raises is difficult in general (Carter 1991) and particularly so for Aboriginal people.

The national Poverty Inquiry in the early 1970s made the first attempt to calculate rates of income poverty for Aboriginal people in relation to a poverty line. The Poverty Inquiry in 1973 and 1974 defined 22.3 per cent to 58.3 per cent of Aboriginal people in selected cities as having a weekly income below the Henderson Poverty Line. In contrast, 12.5 per cent of the total population was defined as having an income below the poverty line.

More recently, Ross and Whiteford (1992) estimated poverty rates for Aboriginal families, bringing together data from the 1986 Census (using the census unit record tape sample) and the 1986 Income Distribution Survey. They attempt to overcome the shortcomings of the Census, which provides limited income data which cannot be used to estimate poverty lines, and the shortcomings of the Income Distribution Survey, which as a sample survey does not provide sufficient information to allow generalisations to the Aboriginal population as a whole.

They estimated that in 1986 43.2 per cent of all Aboriginal families with children had incomes below the poverty line, compared with 15.0 per cent of non-Aboriginal families in 1986. They also estimated that half of all Aboriginal children live in families with incomes below the poverty line, compared with 18 per cent of non-Aboriginal children.

Problems in measurement

In discussing the limitations of their method, Ross and Whiteford (1992) comment: 'Perhaps the most important issue that arises in relation to the question of estimating poverty among the Aboriginal community, and comparing poverty rates with those in the non-Aboriginal community, is the question of whether the basic methodology is relevant to the population being studied.'

Several particular issues are raised. First is the inappropriate use of the nuclear family as the income unit in which income is assumed to be shared.A suggested method for meeting this difficulty is to compare the total income of the Aboriginal population with the total income required to be above the poverty line, rather than attempt to define numbers in poverty. This is an extension of the 'poverty gap' approach (Ross and Whiteford 1992).

Second is the diversity of Aboriginal circumstances. Third, the non-material poverty (in terms of dispossession) and absolute material deprivation suffered by Aboriginal people suggest a different order of poverty from that experienced by the rest of the population (Ross and Whiteford 1992; Choo 1990).

Other issues relating to income poverty measurement among Aboriginal people include the use of appropriate those of definitions and data accuracy.

Definitional issues


Gray and Tesfaghiorghis (1991) discuss the problems of defining Aboriginality. The Australian Government's working definition includes Aboriginal or Torres Strait Islander descent, self-identification as Aboriginal or Torres Strait Islander, and acceptance as Aboriginal or Torres Strait Islander by the community with which the person is associated. The first two of these, but not the third, have been implied by the Census questions asked since 1971, although these questions have not been identical at each census. Gray and Tesfaghiorghis (1991) emphasise that the concept of a separable 'Aboriginal' component of the Australian population is based on a number of problematic assumptions and that what appears to be a firm definition is not. For example, they point out that the 'Aboriginal' families identified by the 1986 Census can be divided into three almost equal categories - those where both household head and spouse are Aboriginal, those where one of the couple is Aboriginal, and those with a single Aboriginal parent.

Income unit - family or household

Definitional issues here relate to the central place of extended rather than nuclear families in Aboriginal communities and strong cultural obligations to share resources (Choo 1990; Ross and Whiteford 1992).


The issue of what constitutes income becomes a question in considering the economic situation of Aboriginal people living in homelands or outstations. Income from Social Security benefits or other sources (for example, royalties) may be supplemented by non-material income from hunting, gathering and the production of artefacts. Choo (1990) quotes Fisk as giving an imputed value to this 'income'. On the other hand, cost of goods in remote areas can be very high.

Labour force participation

As with 'income', the question here is an appropriate definition of employment or labour force participation for Aboriginal people involved in subsistence production (Smith 1991).

A further aspect relating to Aboriginal employment and income is the role of Community Development Employment Projects (CDEP) which have replaced unemployment benefits in some Aboriginal communities. Gray and Tesfaghiorghis (1991) suggest that zero unemployment rates in some communities are perhaps misleading because of these 'make- work- schemes. Smith (1991) notes that CDEP payments can be made for traditional activities. Altman (1991) also discusses the issue of whether CDEP is an employment program or income support.

In outlining the nature of the labour market for different Aboriginal communities, Altman (1991) notes three different situations: the outstations where there is no labour market, the Aboriginal townships or mixed townships with very small labour markets, and major urban centres with mainstream labour markets. This again highlights the issue of locational diversity raised by Choo (1991).


Given that one measure of income poverty is a poverty line which measures disposable income after housing costs have been met (Oxley, Prosser and King 1991), the definition of housing costs can become an issue. Again, housing situations of different Aboriginal communities need to be taken into account. While some families may have relatively low housing costs, the housing may be very inadequate. Choo (1991) refers to the Aboriginal people as the most severely deprived group in the Australian population in relation to housing.

Data Accuracy

Two problems with ABS data sources on income raised by Ross and Whiteford (1992) have already been noted, namely that the Income Distribution Survey as a sample survey does not allow for generalisations to the Aboriginal population as a whole, while the Census with its wide coverage does not provide sufficient income data to allow calculation of poverty lines.

Gray and Tesfaghiorghis (1991) report that ABS is considering a special survey of the Aboriginal population covering social, economic and health aspects which could address some of these shortcomings.Other problems with the Census data which they discuss are the use of different questions to identify Aboriginal people in different census years, wide discrepancies in numbers in different years, and processing errors.

For the 1986 Census (ABS 1991), 13 per cent of Aboriginal people did not state their income and consequently family income could not be calculated for 18 per cent of Aboriginal families and households. Overall, Aboriginal Census data showed a comparatively high level of partial responses. Factors contributing to this include the lack of relevance of some questions to Aboriginal people in remote areas following traditional life styles, particular sensitivity of some topics in Aboriginal society, and language difficulties (ABS 1991).


A major issue in considering poverty in Aboriginal communities stems from the recognition of the extent and nature of poverty (both non-material and material) suffered by Aboriginal families. Given the depth of Aboriginal poverty, is making a comparative study of income poverty with the mainstream society relevant, or is it misleading? Aboriginal agencies also ask whether an income poverty focus is likely to lead to an inappropriate 'welfare' type response.

If a comparative study of income poverty is to be made, the relevance of definitions and accuracy of available data become important issues. For example, in calculating the Henderson Poverty Line there are particular problems for the Aboriginal population which include the definition of 'Aboriginal', of 'income', of 'family' and of 'labour force participation'. Ross and Whiteford (1992) suggest that the 'poverty gap' may be a more useful approach to measuring Aboriginal income poverty than the individual head count they themselves attempted.

The challenge remains to describe Aboriginal poverty in a way that neither trivialises nor hides it, which is in accord with the Aboriginal experience, which highlights inequalities between Aboriginal and non-Aboriginal Australians, and which leads to action to alleviate the devastating situation of so many Aboriginal people.


  • Altman, J.C. (1991), Appropriate Income Support for Aboriginal Australians: Options for the 1990s, Discussion Paper No.12, Centre for Aboriginal Economic Policy Research, Canberra.
  • Australian Bureau of Statistics (ABS) (1991), Census 86 - Australia's Aboriginal and Torres Strait Islander People, Catalogue No. 2503.0, ABS, Canberra.
  • Carter, J. (1991), ed. Measuring Child Poverty, Child Poverty Policy Review 6, Brotherhood of St Laurence, Melbourne.
  • Choo, C. (1990), Aboriginal Child Poverty, Child Poverty Policy Review 2, Brotherhood of St Laurence, Melbourne.
  • Gray, A. and Tesfaghiorghis, H. (1991), Social Indicators of the Aboriginal Population of Australia, Discussion Paper No.18, Centre for Aboriginal Economic Policy Research, Canberra.
  • Oxley, C., Prosser, B. and King, A. (1991), 'Poverty lines: measurement issues' in Carter, J. (ed), Measuring Child Poverty, Child Poverty Policy Review 6, Brotherhood of St Laurence, Melbourne.
  • Ross, R. and Whiteford, P. (1992), 'Poverty in 1986: Aboriginal families with children', in Australian Journal of Social Issues, Vol.27, No.2, May pp.92-111.
  • Smith, D.E. (1991), Aboriginal Unemployment Statistics: Policy Implications of the Divergence Between Official and Case Study Data, Discussion Paper No.13, Centre for Aboriginal Economic Policy Research, Canberra.