Bangladesh has significantly reduced poverty since 1990, with its poverty headcount ratio declining from 56.7% in 1991 to 31.5% in 2010. It is notable that from 2005 to 2010 there was a significant decline in the incidence of extreme poverty (the population under the lower poverty line), which decreased by 7.4 percentage points, from 25% percent in 2005 to 17.6% in 2010.
The incidence of extreme poverty declined in both urban (47%) and rural (26%) areas, and distribution of consumption has improved as the poverty gap measure has reduced by 28%. Real per capita consumption expenditure has increased significantly, with a higher rate of increase in rural areas than urban in some cases .
At the threshold of the SDGs, Bangladesh’s extreme poverty is now 12.9%. This is a challenge because extreme poverty is not homogenous and cannot be addressed solely using macroeconomic tools. The extreme poor are often ‘invisible’ to development interventions, and unique in their needs. In addition to macroeconomic development in Bangladesh, a special approach is needed to identify and serve those at the bottom of the pyramid.
The lowest earning and most vulnerable section of extreme poor who live on less than $1.90/day, are the ultra-poor. The ultra-poor generally suffer from interrelated, chronic deprivations, including hunger and malnutrition, poor health, limited education and marginalization or exclusion. Women and girls in particular face distinct challenges. The ultra-poor often face discrimination, marginalization or exclusion, and typically lack the skills, tools and resources to cope with economic setbacks, natural disasters or illnesses.
The World Bank estimates that approximately 700 million people live below the extreme poverty line of US$1.90 a day, with 78% concentrated in South Asia and Sub-Saharan Africa. In Bangladesh, there is an estimated 20 million persons living below the lower poverty line – in extreme poverty. The presence of extreme poverty, especially those in a chronic situation such as the ultra poor, presents us with the greatest challenge with respect to achieving SDG 1.
State-led social protection systems seek to address some of the issues faced by the extreme poor but are often too resource-constrained and geographically concentrated to effectively target and deliver appropriate programs to ostracized groups of the ultra-poor. Moreover, because programs often do not target the root causes of extreme poverty, they result in continued dependence on state assistance and further depletion of limited resources.
Bangladesh has a long history of formal Social Safety Net Programs that have shaped the current Social Security system. The allocation for Social Security Programs (SSP) increased from 1.3 percent of GDP in FY1998 to 2.3 percent in FY2016. Since FY2011, it has stabilized over 2 percent of GDP and accounts for 13 percent of total government spending
Some 23 ministries of the Bangladesh government are administering a total 145 social safety net programmes
While the coverage of SSPs has increased over time, some 64 percent of the poor households still did not have access to any Social Security programmes.
The eradication of extreme poverty requires a solution that is effective in targeting the most vulnerable and remote populations, with a scalable, cost-effective intervention that addresses the multidimensional root causes of poverty, targeting areas where extreme poverty remains pervasive. The solution should achieve long-term poverty eradication by uplifting the ultra poor into sustainable livelihoods and resilience, so that their likelihood of sliding back into extreme poverty is addressed.
The Graduation Approach is one such solution that has successfully tackled extreme poverty at scale in Bangladesh and is currently being adapted to a variety of contexts around the globe by governments, NGOs and MFIs. BRAC has been implementing the Graduation approach in Bangladesh through its Targeting the Ultra Poor programme since 2002, and 1.77 million families have been assisted. However, an estimated 20 million persons (4.5 million families) remain to be assisted in order to achieve SDG 1 by 2030.
Eradicate extreme poverty