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Poverty Eradication Scheme? the Micro-Public Fund (Zakat) is the Leading Solution...
Oxford Dictionary defines ‘Poverty’ as being poor, great lack of
money or resources, scarcity or inferiority. Others define it as disadvantaged, low income, poor or less developed. These conventional definitions do not seem to differ or vary from that defined by al- Ghazali who gave meaning to poverty as a state of not being able to satisfy one’s needs which are basic in nature.
Poverty to day, is no longer viewed only as a mere economic issue,
but also is a complex social and political concern that is yet to be
successfully solved universally. The concept of poverty is viewed in the context of society as a whole where it persisted in every community around the world but the extent or degree in which it affected human race varies from one society to another.
Even though it is prevailing throughout the world, poverty has always
been ignored and is closely associated with disbelieve (kufr). As said by
Prophet Muhammad SAW:
“Poverty might lead a person to disbelief”, further clarifies the intensity of this situation. Thus, the Holy Quran cannot emphasis more on the poor and needy as commanded by Allah (swt) in
Surah An-Nisaa: 8:
واذا حضر القسمة أولوا القربى واليتامى والمساكين فارزقوهم منه
وقولوا لهم قولا معروفا
“But if at the time of the division, other relatives, or orphans, or
poor are present, feed them out of the (property), And speak to them words of kindness and justice”.
A report states: "Poverty is a multidimensional phenomenon, encompassing inability to satisfy basic needs, lack of control over resources, lack of education and skills, poor health, malnutrition, lack of shelter, poor access to water and sanitation, vulnerability to shocks, violence and crime, lack of political freedom and voice.
The numbers show little progress in reducing income poverty over the
last decade--impressive gains were made in East Asia before the crisis hit, but have been partly reversed, and little if any progress took place elsewhere and a large majority of poor people said they were worse off now, have fewer economic opportunities, and live with greater insecurity than in the past."
CLASSIFICATION OF POOR AND INSUFFICEINCY OF
INCOME
Poverty in Islam is concerned with insufficiency of income and the
inability in fulfilling basic human needs. One is considered poor if he does not possess sufficient necessities to fulfill his basic needs.
Therefore, poverty can be interrelated to two basic classifications
of poor, which are faqir who are the needy, and miskin who are the poor, as identified and understood in Islam. Faqir is defined as someone who can only satisfy less than half of his basic necessities while miskin is a
poor man who can satisfy half or more of his basic necessities, but is still
below the minimum requirement of basic necessities required.
Prophet SAW said (about those defined as miskin): “He who does
not get enough to satisfy himself, and he is not considered so, so that charity may be given to him, and he does not beg anything from
people”.
There are no distinct techniques to measure poverty, as it is always associated with some level of income required to provide for the basic human needs. This human needs refer to the right of food, clothes and shelter as pronounced by the Prophet SAW that are to be identified and met in order to sustain a minimum standard of living.The poverty line or income level, which serves as an indicator to identify whether a person is poor, is useful where a person is considered poor if his income is below poverty line income.
FACTORS CAUSING POVERTY FROM ISLAMIC
PERSPECTIVE THE NATURE OF MAN
Man is the essential element in any society thus; any problem related
to the society must have something to do with individual because it is his actions on the ethical aspects that affect others as a whole.
One of the many reasons poverty persists in any one community is
because of the widespread existence of income inequality and unjust wealth distribution. It is due to man’s narrow-mindedness and selfishness as well as ignorance for a collective life has made man a slave to things, which are material in essence.
In fact, poverty is caused by man’s deviation form divine teachings
in which he practices unlawful things and the man-made problems such as injustice, laziness, selfishness, dictatorship, fraud, cheating, monopoly practices, speculative hoarding and oppression that with each passing day, making the poor getting poorer and the rich getting richer.
ان الله يأمر بالعدل والإحسان وايتاىء ذى القربى وينهى عن
الفحشاء والمنكر والبغى يعظكم لعلكم تذكرون
“God commands justice, the doing of good, and liberation to kith
and kin, and He forbids all shameful deeds, and injustice and rebellion: He instructs you, that ye may receive admonition”. (16:90).
Mismanagement and misallocation of funds happening today as a
result of so much power in the hands of the elite, who maintain the status quo at national levels is the rationale for the existence of an income gap between the poor and the non-poor.
There are also corruptions and bribery, or the misuse of public power
and resource for private benefit and profit by officials such as politicians and policy makers in which they enrich themselves through the misuse of power entrusted to them. Negative attitude, easy access to money as well as deficiency in democratic government initiates corruption and provides an ideal condition for corruption to prevail.
Accumulation of wealth by the rich people will therefore hurt the common people as they are left out and the public interest is further disturbed. Islam promotes just distribution and ethics in everything we do. Those practicing corruption should be penalized for their inefficiency and those
who are efficient should be reward for their creditability.
FUNCTION OF GOVERNMENT AND MARKET
FAILURE
The government is established as a protector for the public interest.
It means that, government will only see to it if there exist to be a market failure in the economic activity. However, there seem to be an interruption in the economic balance when the government is no longer protecting the public and is applying free trade thus causing massive competition to develop.
Government especially in the third world countries tends to borrow
from international donor organization such as the IMF, which in turn requires the debtor country to export their production instead of for local circulation.
This will have a severe impact when the prices go up, food subsidies are
eliminated, basic services cost such as electricity increased and health and educational funds vanish.
In addition to the said government’s failure, inadequate access to
employment, lack of physical assets such as land and capital to be owned by the poor, lack of means of supporting rural development in poor region, inadequate access to markets where the poor can make trade, low endowment of human capital and the destruction of natural resources leading to environmental deprivation as well as reduced productivity are merely some of the causes of poverty in light of the function of the government.
Consequently, poor governance and market failure are two aspects,
which should be properly addressed to attain justice in the economic activities, which will help in poverty eradication.
POVERTY ERADICATION IN ISLAM
As Muslims, we are to approach poverty like any other problems faced
by our society, in accordance with the Islamic teachings and way of life. It is the concern for the poor, which leads us to address their needs through many approaches, instruments and government policies.
Elements of Poverty Alleviation It is identified earlier that poverty is a result of diverse factors and therefore has different dimensions in which it would be implemented. These elements are the individual and society’s role in eradicating poverty as well as the government’s role.
Individual and Society’s Role.
As vicegerent of Allah on this Earth, we to live a moderate lifestyle
in such a way that we fulfill our material and spiritual needs simultaneously. Islam recognizes differences in individual human potentials because each is endowed with different types and levels of abilities.
Therefore, man is to earn his living according to his capacity and
ability as that said by Allah (swt) in the Holy Qur'an (Al-
Jumu’a: 10).
It is therefore, the public duty of individuals and society to focus
on integrating the Islamic principles, moral and ethical aspect in our daily life, as well as the response from the society about poverty, regardless of involvement of the Government. In other words, the strategy to combat poverty is through harmonious equilibrium in development and Islamic ethical values. There should also be fundamental changes at both the management and policy level, and change in individual character to be more inspired, efficient and selfless individuals in any society.
The Prophet also mentioned the importance of earning an honest living
in his many hadith. One of them is reported by Al- Miqdam, who quoted the Prophet saying:
“Nobody has ever eaten a better meal than that which one has
earned by working with one’s own hands”.
ISLAMIC STATE’S ROLE
The Islamic Economy approach and Significance.
Creed and Islamic Economy:
The basic creed that promotes Islamic economic behaviour evolves from
the Islamic concept of God, Allah, with attributes ascribed to Him –
Al-Malik (the absolute Owner of All), Al-Rahim (who gives
blessings and prosperity, particularly to whom use these gifts as he has
permitted), Al-Muhaymin (watches over and protects all things), Al-Wahhab (donates all things to His creatures, even to non-believers), Al-Fattah (opens the solutions to all problems and eliminates obstacles), Al-Razzaq (the Provider of all things that are beneficial to His creatures) and so on.
The Divine attributes do not only have metaphysical significance; a
firm belief in them acts as a powerful source of inspiration and guidance in economic pursuits and planning.These attributes have been described through the Quranic verses and Hadith to construct a mind and guides individual behaviour in a direction, which truly reflects firm belief in Allah’s Unity, Tawhid.
Without this firm belief the Islamic economic system and the whole life, falls prey to inconsistency and discord. How do beliefs in this attribute influence economic attitude? A firm belief in the divine attribute of the Provider eliminates insatiable lust for amassing wealth through unlawful means and cools down impatience. It dissuades from unhealthy competition and egotism. It relieves tension and anxiety and unhealthy reaction in the event of poor for one’s effort. A firm belief in the divine assurance:‘Whosoever fears Allah, Allah will appoint a way out for him and will provide for him from (a quarter) whence he has no expectation’ (65:2,
It is not only discourages one from becoming avaricious and resorting
to unlawful earning but also plays an important role in guiding policy-makers and planner to cast off the capricious fears of loss due to abolition of unlawful institutions and undesirable policies and programmed. A firm belief in his attribute, Al-Razzaq, as expressed in the verse:
‘Slay not your children, fearing a fall to poverty, We shall provide for them and for you. Lo! The slaying of them is a great sin’ (17:31), would inspire the policy-makers to be restrained, barring exceptional cases, in launching on economic grounds a country-wide campaign for birth-control, which often provides a refuge for the morally corrupt. Similarly, belief in the Divine Wisdom of unequal distribution of wealth (4:32) shuns class antagonism and persuades the well-to-do to share their fortune to the poor, thus reducing the distance between the haves and haves-nots.
As a conclusion, firm belief in divine attributes not only has a
far-reaching influence on the general attitude of the individual, it also
touches economic enterprises, policy-making and planning. Without such firm belief practicing the Islamic injunctions poses formidable difficulties and leads one to impracticable compromises, which result in dualism and hypocrisy.
The Government’s Role towards Poverty Alleviation Poverty, Employment and Growth The economic resources of this world belong to Allah who gave them to mankind to benefit from them. So, the duty of man is to properly utilize them for the welfare of society. This world entail:
1. the full and efficient employment of all human and natural resources;
2. the alleviation of poverty and fulfillment of basic needs, and
3. the optimum rate of economic growth.
The objective of the alleviation of poverty, the full employment of resources and optimum rate of growth can only be achieved by the active participation of government. The Islamic government should not leave the allocation of resources only to the blind market forces because; being an impersonal entity, the market may not take care of the total welfare, especially of the poor, of the society. Government should play a positive role in the economy through pragmatic planning and by providing necessary physical and social infrastructure.The government must invest in this sector since private entrepreneurs may not find enough incentive to invest because of the heavy investment requirement and small monetary return realized over a long period time.
In this case, government investment should be channeled into the
improvement of highways, dams, bridges, the construction of irrigation networks, airports, telecommunication services and the provision of other facilities, which would bring about external economies to the different sectors of the economy.
So, Islamic government has a great responsibility to eradicate
poverty, fulfill basic needs and improve the living standard of the people. If it fails to do so, the Prophet’s (s.a.w) warning should remind them:
“Whom Allah has made administrator over the affairs of Muslims
but remain indifferent to their needs and poverty, Allah will also be
indifferent to his needs and poverty.”
Establishment of Equitable Distribution of Income and
Wealth The establishment of an equitable distribution system calls for certain governmental functions, such as:
i. the role of state is to emphasis on training and rendering assistance for gainful employment to the public. A variety of technical training programs may be launched to assist the unskilled labor force of the less developed countries;
ii. the government should enforce a just remuneration system so as to
fairly distribute the generated income among the factors of production;
iii. the arrangement of a social security system based on zakat and
other charitable revenues.
They would serve as insurance to the unemployed, handicapped, divorcees and other needy members of society.As basic necessities are provided, the national wealth circulates among the members of the community. This is why Islam makes it obligatory for the government to guarantee the provision of basic needs to all.
If the existing fund is not sufficient, government has the right to pull resources from the rich in addition to the obligatory dues to guarantee basic needs to each and every one in the society. Ibn Hazm calls for the extra levies on the rich to fulfill the basic needs of the destitute of a society. He says:
“
The rich of every locality are obliged to manage the basic needs of the destitute living in it. If the wealth, stored in Baitul-Mal, is not adequate to meets the wants of the indigents, the head of the state may compel the rich to contribute by imposing extra levies on them.”
Government should play a great role through monetary and fiscal
policies in reducing the disparity between the haves and have-nots. These policies should be geared towards the benefit of the poor.
It is also one of the responsibilities of an Islamic government to
differentiate between the deserving and undeserving of the national help. In this case, government should invest in the social overhead capital such as education, healthy and other infrastructural development so that the poor may benefit more than the rich.
Islam strongly encourages the rich to spend for people in the lower
income group over and above compulsory payments so that wealth trickle-down among the various classes of society. In this context, the principle is that the more one has, the more responsible towards providing the poor one is.
Allah (saw) says:
يسألونك ماذا ينفقون قل
العفو...
“And they ask you how much they are to spend; say: what is beyond your needs.”
There are compulsory measures of distribution which also heavily
contribute to the reduction of inequality among the people.
The institutions of
Zakat, tithe, sadaqatul fitr, inheritance, bequest etc. come under this category. In these cases, one has to dispose one’s wealth to one’s fellow-beings whereby have-nots become better off. Mutual gifts, endowments and other optional charities, on which Islam places a heavy emphasis, also reduce the disparity between the haves and the have-nots of society.
Taxation in an Islamic Economy
The classical Islamic scholars also gave justifications for taxation as a major of sources of government revenue in an Islamic state. This has been supported by Imam Malik:
“If there were no funds in the treasury or the need of the army
increased above the capacity of the treasury, the state has the right to levy taxes on the rich up to the level that satisfies the need immediately and until the revenues of the treasury appear.”
Islamic government should make sure that the imposition of taxes does
not the kill work incentives of the tax payers. It must carry out some research to find out which particular rates and types of taxation are the most suitable to maximize government revenue in the economy. There should not be any injustice involved with taxation policy in an Islamic state.
Although an Islamic state has the right to impose taxes on the poor it
should try to minimize their tax burden in general. The bulk of tax revenue should come from the rich of the society because, they are economically more capable to contribute towards revenue collection than the poor.
This is why suggestion has been made that the Islamic state should
minimize indirect taxes, which are normally borne by the poor and concentrate on the direct taxes, which are usually collected from the
rich.
