Johannesburg — ALTHOUGH poverty levels were at their lowest for at least 10 years due to the effects of social grants, four out of 10 South Africans still lived in poverty last year , the South African Institute of Race Relations (SAIRR) said yesterday.

It said the number of South Africans living in relative poverty decreased from 22,2-million in 2004 to 19,6-million last year -- 40,7% of the population.

"This was the lowest number of people living in poverty since 1998. In that year, about 19,5-million people had been living in relative poverty."

The number of people living in relative poverty peaked in 2004 at 22,2- million, the SAIRR said.

People are defined as living in relative poverty if they live in households that earn less than the poverty income.

The SAIRR said a household of one would be living in poverty if the monthly income was less than R871, while a household of eight would have to have an income of less than R3314.

It said about 18,7-million black South Africans, or 49% of the population, lived in poverty last year, and black South Africans made up 95% of all those living in poverty.

The SAIRR said 711631 or 16,7% of c oloured people, 172227 whites (3,6%) and 75907 Indians (6,4%) lived in poverty last year.

Researcher Kerwin Lebone said the decline in poverty could be attributed to the effects of social grants and a drop "until recently" in unemployment. He said such high levels of poverty were unlikely to drop significantly in the short term.

"The effects of the global financial crisis will affect the government's ability to continue to provide a wide social welfare net," he said.

The recent unemployment statistics showed that the number of people without work was also on the increase.

In another statement, the SAIRR said the majority of white South Africans earned seven times more than their black counterparts last year . It said the average per capita income in SA last year was R32559, with whites earning on average R135707, blacks R19496, Indians R56173 and Coloureds R27569.

Black South Africans' average income rose 180% over the past decade, while that of whites increased 162%. "It is clear that the income gap between South Africans is closing," researcher Marius Roodt said. "It is questionable whether this gap is closing fast enough. Such large wealth disparities between population groups do not bode well for the future stability of SA."

On the effect of poverty and unemployment, the SAIRR said between 1996 and 2007 more whites moved out of their homes into "informal dwellings" because they had lost their jobs, income or homes.

The institute estimated that 5863 white people were living in the open-space shacks.