Unlike poverty, which concentrates on the situation of those at the bottom of society, inequality shows how resources are distributed across the whole society. This gives a picture of the difference between average income, and what poor and rich people earn, and highlights how well different Member States redistribute or share the income they produce.
Data on inequality is vital when considering poverty, as the overall distribution of resources in a country affects the extent and depth of poverty. This is important as the monetary poverty levels in the EU are calculated in relation to median income.
Looking at inequalities is particularly crucial at a time when in many countries the financial efforts necessary to get out of the budget crisis are not necessarily asked of the rich.
Generally, countries with high levels of inequality are also likely to have high levels of poverty and those with lower levels of inequality are likely to have lower levels of poverty. This shows that the problem of poverty is fundamentally linked to the issue of how resources are distributed and redistributed in a country.