More than a million people in the Czech Republic live below the poverty line, with another approximately two million just above it. The number of those who lack the means to support themselves is increasing, and even the middle class is affected.
According to Jiří Vraspír, an analyst for social affairs at Charity ČR and one of the authors of the report, “The situation has worsened over the past year, especially for families with low incomes.”
Current statistical data shows that thirteen percent of households are struggling with income poverty, with one-fifth of those in this type of poverty being individuals with low education and households with children.
The leading cause is the significant price increase over the past two to three years. Between January 2020 and March of this year, prices have risen by an average of thirty-three percent, with certain commodities and services experiencing price increases of over forty percent. This is particularly true for food, clothing, and energy expenses, according to Vraspír.
Compared to the fall of 2021, when households were saving an average of 8,000 koruna per month, the current average monthly savings have dropped to only 5,300 koruna. Additionally, the average monthly expenditure on groceries has increased by 3,600 koruna compared to two years ago, reaching around 11,000 koruna.
Expensive Housing and Low Incomes
Charity ČR has observed an increase in the number of people in need. “Even the middle class is now struggling to pay rent and mortgages. We are seeing more and more households seeking assistance who did not need it before. They cannot find better jobs and have started getting into debt,” warned Iva Kuchyňková, the social activities coordinator at Charity.
Debt often arises from unexpected expenses, especially among individuals with lower incomes. These expenses may include electricity or water bills or additional costs such as purchasing a new washing machine or refrigerator.
Poradna při finanční tísni, a counseling service for financial distress, has also seen an increase in its clientele, which has become more diverse. “The largest group of clients has been in debt for over four years. Their share has risen from about fifty percent to seventy-four percent in the past year,” summarized David Šmejkal, the organization’s director. He confirmed that debts often accumulate due to unexpected expenses, illness, business commitments, or difficulties understanding financial products.
1.27 million people risk losing their homes or are burdened with excessive housing costs. Of this number, 28.8 percent are seniors, and children are affected in over one-fifth of the cases. 154,000 people are facing housing emergencies. They either have no housing, are at immediate risk of eviction, or stay with friends or relatives. Nearly two-fifths of these individuals are children, with 61,000 children in such situations.
According to Kuchyňková, there are two main factors behind poverty in the Czech Republic: a lack of affordable housing, with rents being too expensive, and low incomes.
“Azylové domy, or shelters, are currently facing the problem of not having anywhere else to move the people they are assisting. There is a shortage of available housing,” emphasized Kuchyňková.
This issue affects single mothers and families with children who are struggling financially. “In a shelter, individuals can only stay for one year. As a result, these people are forced to move from one place to another instead of having a permanent home,” she added.
Low-income people become dependent on social benefits if they can apply for them or are even aware of this possibility, which often is not the case.