In 2022, the risk of poverty in the Netherlands reached its lowest level since 1977, with 637,000 people living below the threshold, i.e. 3.8% of the Dutch population. This decrease is largely due to government subsidies to mitigate the effects of inflation, without which the risk would have risen for the first time in ten years.
Last year in the Netherlands, 637,000 people were living below the at-risk-of-poverty threshold, representing 3.8% of the population. This figure represents the lowest level of at-risk-of-poverty recorded since 1977, according to the Statistics Netherlands (CBS) study published on November 8.
In 2021, this rate was significantly higher, reaching 5.4% of the population. The study reveals that the government has made a major contribution to reducing the risk of poverty.
This has been demonstrated by a number of measures, such as a one-off “energy allowance” of 1,300 euros (1,400 dollars) for low-income earners to compensate for exceptionally high energy bills, and the reduction of 380 euros on the energy bill of all Dutch people due to inflation. At the same time, the Netherlands recorded its lowest gas consumption in 50 years in 2022.
Without these subsidies, almost a million people would have been at risk of poverty, raising the total poverty rate to 5.9% of the population. This would have marked the first increase in the poverty rate in 10 years.
Different from the poverty line or an indicator of wealth or standard of living, the at-risk-of-poverty rate compares low incomes to other residents in a country. Based on household income, which does not include savings, people are at risk of poverty when they belong to a household whose income is below 60% of the national median disposable income after social transfer.
The at-risk-of-poverty threshold varies from household to household, ranging from 1,200 euros net of taxes (1,280 dollars) per month for a single person to 2,300 euros net (2,455 dollars) per month for couples with two children.
Most at-risk-of-poverty households live in the Netherlands’ major cities, namely Amsterdam, Rotterdam, The Hague, and Utrecht. Over 24% of these households live in these cities.
CBS also points out that the number of children at risk of poverty was relatively low compared to previous years. Last year, 165,000 children lived in households that were at risk of poverty, 27,000 fewer than the previous year.
However, poverty among children with a migrant background remains a major issue. Among children not born in the Netherlands, almost one in five lives below the low-limit income. The situation is even more worrying for Syrian children, where one child in two lives in a family whose income is insufficient to meet their needs.
For 2023, the energy allowance was renewed, but lowered to 800 euros, and students living away from home could receive a grant of 400 euros. The Dutch government had budgeted a cost of 1.4 billion euros (1.5 billion dollars) for 2023, of which 500 million euros (534 million dollars) had already been used to finance the 2022 subsidies.
