For informed decision-making on reducing poverty and inequality in the country, and for monitoring
poverty when policies are implemented, reliable and valid methods of measuring and mapping
poverty are essential. This report examines four different ways in which poverty can be measured in
South Africa at present, and presents the findings from each method, mainly using existing Stats SA
data sets.

In particular, this report shows the extent of poverty in specific geographical areas, by means of a
series of poverty maps. These maps are merely an example of what can actually be mapped
electronically. It is possible, using census data, to depict poverty through maps according to different
measurements, for example household expenditure, or the need for infrastructure or better access to
employment opportunities. These maps can be drawn at the level of small areas such as a village or
suburb, enablingbetter targetingof programmes toaddress the complex issues that result in poverty.

The aimof this paper is toshowhowasocial accountingmatrix (SAM)may be used toanalyse South
Africa’s income distribution. Analysis of households is an important feature of a SAM.
Comprehensive and reliable data on households are therefore essential in order to use this analytical
tool. Important data sources for the compilation of a SAM are those derived from South Africa’s
population census, the income and expenditure survey (IES) and the October household surveys
(OHS) conductedby Stats SA.

The 1998 notes that, while South Africa is an upper middle-income Poverty and Inequality Report
country in terms of per capita income, a large number of the country’s citizens live in poverty.While
this is true of many other middle-income countries, South Africa’s income distribution is among the
most unequal in the world. The 1996 World Development Report found that only Brazil had a higher
level of inequality than South Africa as measured by the Gini coefficient (quoted in May, 1998:23).

Statistical measurement of poverty, and ways of monitoringits alleviation, are relatively new fields of
endeavour in South Africa. Prior to the first democratic elections in April 1994, nation-wide
integrated statistics of this nature were not officially collected.