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Child hardship rise a “bloody disgrace”

Written By: - Date published: 11:05 am, August 24th, 2012 - 60 comments
Categories: benefits, child welfare, david shearer, employment, equality, jobs, poverty, unemployment - Tags:

David Shearer is right. The rise in inequality under National, shown by the latest Household Incomes report from MSD, is a bloody disgrace.

It’s the effect on kids that’s got him going. Shearer says:

And what’s even worse, the number of children living in hardship has increased from 15 per cent in 2007 to 21 per cent last year.

This figure uses an index of material hardship, different from standard poverty measures. The report’s summary says:

Hardship rates for children rose from 15% in the 2007 HES to 21% in HES 2011 using the ELSI measure. In part, this reflects the falling incomes of those in deciles 3-6, some of whom may already have been in a precarious financial position – the loss of income has been enough to tip them into hardship even though their incomes are still above the poverty threshold we use.

So more children in  families with “precarious” employment are feeling the pinch.

Good on Shearer for his robust and instinctive response. Now we look forward to seeing it reflected in the outcomes from the policy work that is going on behind the scenes.

One feature of this will be careful work on how to assist children in beneficiary families. Ruth Richardson’s “Mother of All Budgets” lives on, as  the report notes:

Poverty rates for children in beneficiary families are consistently around 65-75%, much higher than for children in families with at least one adult in full-time employment (9% in 2011).

  • Since the benefit cuts in 1991, 65-75% of children in beneficiary families have been identified as ‘poor’ in each HES. The figure was close to 70% for 2004 to 2009, and 65% in 2011.

  • For beneficiary families with children, AHC incomes from main benefits, the Family Tax Credit and the Accommodation Supplement are almost always below the AHC 60% fixed line threshold.

  • Why is the reported poverty rate for beneficiary children not therefore 100%? There are typically 20 to 30% of beneficiary children living in households in which over the 12 months before the HES interview there is market income as well, either from their parent(s) or from other employed adults. This extra income is enough to take total household income ‘over the line’.

  • In June 2011 there were 234,000 children in beneficiary families (22% of all dependent children). Around 25% of children live in households in which there is no adult in full-time employment.

It’s way over time for that to change.

 

60 comments on “Child hardship rise a “bloody disgrace” ”

  1. fatty 1

    Its sad that it was at 15% in 2007…that’s after 8 years of Labour and an economic boom.
    We all know that child poverty would increase sharply under National, they stimulate and encourage poverty, and they are proud of it.
    But Labour have no excuse for the stats in 2007, it shows what a failure that Labour Government was. Can we realistically expect this Labour team to do any better, or are we supposed to be happy with 15% child poverty?

    • r0b 1.1

      Poverty (and inequality) were falling (albeit too slowly) under the last Labour government, largely due to WFF. Now they are on the rise again.

      • fatty 1.1.1

        True, they did decrease under Labour, but if they did win in 2008, do you think they would have continued to decrease through till 2011? National seem to be far more effective at increasing inequality, than Labour are at decreasing it.
        My worry is that if Labour get back in they will do little more than slow inequality/poverty down, or maybe reduce it slightly for 2-3 terms, and then National are back in.

        • Lanthanide 1.1.1.1

          “National seem to be far more effective at increasing inequality, than Labour are at decreasing it.”

          That’s because it’s always way easier to destroy something than it is to build it up properly. This should be obvious: out of 100 ways to do something, there might be 99 that don’t work and 1 that does, much easier to pick any of the 99 by random luck than the 1, before you even factor in a deliberate motive.

          • fatty 1.1.1.1.1

            I don’t really understand your point…Can’t Labour just destroy what National create?
            Labour should be able to ‘destroy’ the wealthy’s ability to accumulate, just as National ‘destroy’ the poor’s ability to get out of poverty.

            • Colonial Viper 1.1.1.1.1.1

              To do that you would have to fundamentally restructure the economy, as Roger Douglas and Rith Richardson did.

              Today, Labour is only willing to tinker around the edges.

              WFF for instance was of help to working families but Labour was not willing to extend assistance to families who were not working.

              And as the economy has declined and more workers lose their jobs, the new unemployed fall outside of WFF become subject to Labour’s previous reluctance to truly help the underclass.

              Weak.

              • Te Reo Putake

                The only weak thing appears to be your memory, CV! Labour campaigned on extending WFF to beneficiaries only 9 months ago. Remember now?

              • Carol

                As I understood it at the time (from my then location in the UK) during the 80s to the first decade of the 21st century, it was very hard for a (nominally) left-wing party to go against the neoliberal narrative and get elected.

                The neoliberals were very successful in dominating all the relevant areas of power and control internationally, from the finance sector, through the media, education etc. This was evident in the UK. Consequently all the Labour/Labor parties shuffled rightwards. I recall when Clark first became PM, she was touting the “closing the gaps” policy (gaps between Maori and Pakeha), but then backed off from it as the media relentlessly characterised it in a negative way.

                I think once Rogernomics took a hold in NZ, opening up the country to foreign flows of capital and finance, it was very hard to turn away from it. It may have been possible, but not easy.

                But now it’s a different world since the GFC and the discrediting of the finance sector and the neoliberal voodoo economics. Now is the time to work on highlighting the failure of the so-called “neoliberal” way, and to build a different narrative.

                Any Labour Party still treading the timid BAU approach (of steady-as-she-goes and endless compromises with the neoliberal scam) is not worthy of the Labour name in the current context.

                • Bill

                  Any Labour Party still treading the timid BAU approach (of steady-as-she-goes and endless compromises with the neoliberal scam) is not worthy of the Labour name in the current context.

                  Indeed.

    • Dr Terry 1.2

      Over many months we have been assured by both major parties of “quality work going on behind the scenes”. In other words, if it is happening, it remains invisible to most of us. The “production” is well rehearsed by now, let’s get to the action, on the visible stage!

      Dare I risk alienating readers by turning to good, old fashioned Scripture? There is lots of prophecy concerning the poor (and poverty):

      Psalm 41:1 Happy are those who consider the poor . . . you do not give them up to the will of their enemies.”
      Psalm 41:10 In arrogance the wicked persecute the poor (interpret “beneficiaries”) – let them be caught in the schemes they have devised.
      James 2:6 But you have dishonored the poor. Is it not the rich who oppress you?

      Compare Shearer: “It’s a bloody disgrace”. In fact it is wickedness by government, bred by sheer evil negligence, or deliberate policy. When will something be done, urgently and visibly, about New Zealand’s shame (near worst among OECD countries)?

  2. vto 2

    We are getting poorer for two reasons…

    1. We are discouraged from owning anything (Have to compete with foreigners to buy our own land. John Key sells the assets that we do have.).

    2. Existing policy settings encourage wealth into the hands of fewer people.

    Both of these things are evidenced in the ample evidence.

  3. bad12 3

    Take a point Dave, although after the events of the past week or so make your ‘concern’ now sound just a wee bit dishonest,

    Here’s poverty New Zealand style, and you have to bear in mind that throughout these long years of building the ‘Poverty Economy’ there HAS NEVER been enough employment in the economy to employ all those able to work,

    *Mouldoon added income tax to benefits,

    *Lange Government leaves benefits being taxed as income,

    *Richardson/Shiply directly cut benefits by $20 per week plus rack rent State House tenants,

    *Clark Government restores State House rentals to 25% of household income but leaves $20 cut to beneficiaries income in place,

    *Clark Government institutes Working for Families scheme and deliberately doesn’t allow beneficiaries to participate,

    *Slippery National Government raises GST and while ‘compensating’ beneficiaries for the initial rise in the tax takes no account of the fact that ANY price rise after that point in time will add further tax onto the fixed income of those reliant upon benefits,

    There’s how a ‘poverty economy’ is built, most of those reliant now upon benefits will probably not have even been born when such poverty was legislated for by the New Zealand Parliament,

    Much of this poverty has become entrenched by Labour Government’s refusal to undo the measures instituted by National which has with deliberation increased the level of New Zealand poverty,

    Considering the above measures made by previous Governments the average child dependent upon a benefit is somewhere in the region, including inflation, of being $120 worse off per week and that isn’t a small amount of money…

    • Foreign Waka 3.1

      Building an ever more deprived people is an international phenomena. NZ has, however been an ardent forerunner of backwards sliding policies (lets say 1800’s?) which makes me think that the population of 4 mil people is a perfect “experiment” for wanted policies to be tried. Naturally also in the context of : at what rate can the impoverishment be done without having a major political fall out. Kind of cooking a frog slowly, if you know what I mean.
      Internationally: It has recently been established that in the affluent EU states the change of currency has reduced incomes by as much as 30%. Now, this certainly has had an impact – ref Greece. Britain will not feel as much as they do not have the Euro as currency.
      The poverty rate across the globe has steadily increased over the last two decades – ref OECD site below – that is, for most countries in the world.
      The term poverty is often misused in the context of country to country instead of income vs affordability of basics at the place of living.
      Tax policies and benefit payments, wage levels and living standards are pegged by governments from perceived similar countries but with a different structure and thus abnormalities become the norm. Its kind of a lazy way of designing policies. There is to my understanding very little knowledge by many people here in NZ about the differences in political models, lived history and current affairs and structures of other countries. A failure of how History is being taught? Manipulation becomes so much easier when there is only a small window opened to the world.

      http://www.oecd-ilibrary.org/sites/factbook-2011-en/03/05/02/index.html;jsessionid=5f1ka3o4a63c2.delta?contentType=/ns/Chapter,/ns/StatisticalPublication&itemId=/content/chapter/factbook-2011-32-en&containerItemId=/content/serial/18147364&accessItemIds=&mimeType=text/html

      • blue leopard 3.1.1

        @ Foreign Waka,

        “at what rate can the impoverishment be done without having a major political fall out. Kind of cooking a frog slowly, if you know what I mean.”

        Interesting.

        And perhaps this is the “Bloody Disgrace” Mr Shearer is referring to; that he considers they may have pushed the “gap” too far this time and there may be a backlash?

        • Dr Terry 3.1.1.1

          Look, we have (or should have) known about the wickedness of poverty in this country for a considerable time now. Many reports have been made available (including from the UNO). None of us can legitimately plead ignorance, as Shearer suddenly seems to be doing. How much milder language can be used for this dread situation in a small and “prosperous” country, than “bloody disgrace”? I trust that, finally having facts dawn upon him, Shearer will immediately set something concrete in motion, urgently, to alleviate a desperate situation. It is far past the time!

  4. tracey 4

    Does this mean wealth isnt trickling down from the top? If so, does it mean privatisation is also a myth that has had its day?

    • fatty 4.1

      the trickle down effect is not supposed to happen, it is only supposed to be believed

    • joe90 4.2

      Trickle down visualised.

    • bad12 4.3

      As everyone else such as pensioners and those on low incomes at or near the minimum wage are effected much the same as beneficiaries by the GST rise, IE: everytime there is a price rise in anything there is a rise in the amount of GST paid for which there is little hope of gaining recompense in the form of a rise in the minimum wage then income is in fact ‘Trickling Up’,

      The ‘Trickle Up’ a few cents here and a few cents there in extra GST paid is being facilitated by the Slippery National Government via it’s 2009 tax package, which in effect takes an extra 20 or 30 cents off of the weekly supermarket spend from everybody in the form of GST and redistributes it among it’s core vote the 40% at the top of the income tree via the tax cuts given,

      The rate of extra GST paid is well hidden among price rises in goods bought and most people will not have given this ‘Trickle Up’ facilitated by National a second thought…

      • Draco T Bastard 4.3.1

        A few cents here, a few cents there and pretty soon you’re talking serious money. It just doesn’t seem like it to the individual person losing that money but it is to the person receiving it from the millions losing.

  5. tracey 5

    +1

    I remember when ms richardson said we had to tighten our belts and the good times would come later. Mr english still peddkes this.

    • Dr Terry 5.1

      Sure, we know too well exactly who must “tighten their belts” – the lower rung of society only!
      Why is it that the poorer people in Europe are protesting? They know that they are the ones being screwed, while the wealthy remain scot-free.

  6. BernyD 6

    Based on all those Governments’ responses, it’s an environmental problem for the children.
    Some kind of cummunity based support people are what’s required.

    Those kids need a house to live in and an income of their own.
    If they choose to rent from their parents then fair enough.

    It depends but,those kids are adults already, they know what starvation means.
    Ultimately if we can get it right it’ll benefit their parents and families in the long run.

    Let them educate themselves, but help them understand why.

  7. blue leopard 7

    Dear Mr Shearer,

    Would you please explain to me what the “Bloody Disgrace” is that you are referring to?

    Is it that our politicians are doing nothing but advancing the wealth gap?

    …And being so corrupt as to be avoiding addressing the issue at all costs, including applying untruths and distraction techniques?

    Or is it that our most vulnerable are ruining things for the rest by being such creators of this situation?

    And being so corrupt as to be indulging in activities such as painting their roofs when they should be out working in jobs that are not there and they couldn’t sustain even if they were because they have a health complaint. A health complaint, of a nature which allows them to be able to paint their roof (and thus save costs that would arise if they left their roof unpainted or got another to do it), yet would not allow them to paint roofs as a job?

    Is the “Bloody Disgrace” referring to all disinformation flowing around this country and the western world that leads people to either consider not voting is the best course of action or voting for political views that are going to lead to more of the same, in which your party seems intent on redistributing in order to get parliamentary jobs next election?

    What is the “Bloody Disgrace” that you are referring to?
    And are you going to do anything other than spread the type of views and policies that continue the problem?

    • Colonial Viper 7.1

      What is the “Bloody Disgrace” that you are referring to?

      Those bloody sickness benes who are out fixing their own roof instead off going out to work one of the many jobs available out there.

      • blue leopard 7.1.1

        Dear Mr Shearer,

        Yes, I thought that might be the case-although I’m a little unclear; why the disgust?

        Considering one of the inevitable consequences of [an unfettered form of] capitalism is one where wealth collects in fewer and fewer hands, I thought that this might be a good time to push for a national day of celebration for the people getting poorer and poorer?

        Shouldn’t these people, along with those getting wealthier and wealthier be seen as a sign that our great system of unfettered capitalism is alive and well and being allowed a full and free expression?

        Any capitalist politician worth his/her salt would surely see that these stats of a widening gap are a moment of achievement? So how about it, huh? And what’s with the disgust?

        • Foreign Waka 7.1.1.1

          We need to accept that Mr Shearer’s view on poverty is relative. He has worked for a very long time with the poorest of the poorest. The NZ level of poverty does not qualify for this term under such perimeter. Whilst it is admirable if people like Mr Shearer spent their time helping others in desperate need, I hope this kind of circumstance is not becoming a self fulfilling prophecy due to another “hands off” approach in order to shine in ones best skills.

          • blue leopard 7.1.1.1.1

            @ Foreign Waka
            Creating a situation where one’s best skills can shine…
            …oh dear….now there’s a thought…that sounds all too plausible (LOL..?)

  8. bad12 8

    Dear Dave,

    As usual i am a little short again this week, any chance of an extra Mango-skin or two quietly swept off of the table in my direction,

    Yours,

    A sickness Bene.

  9. Tom Gould 9

    Typically, not a bad word from anyone about the Tories. Pathetic.

    • BernyD 9.1

      They can read their uncivilised behaviour between the lines

    • blue leopard 9.2

      @ Tom Gould

      Why speak a bad word for a right-wing party who are achieving the inevitable consequences of their policies?

      It is a success story for them, both through their policies and through their ability to get people to vote for such.

      Congratulations Nact Government for achieving exactly what your ideology necessarily leads to.

      And well done for fooling people into believing it would lead anywhere else but where it is

      Well done 🙂

      • Colonial Viper 9.2.1

        +1 and you will see National paying lipservice to the issue while all their core supporters understand what the (favourable for them) reality of it is. And the media give them yet another pass.

      • Dr Terry 9.2.2

        But NOT well done, Mr Shearer – so late on the scene with lame (not robust) words.

  10. It is a disgrace that those who are genuine cases are thrown into the same basket
    as those who are ripping the system off,i heard last night of a case of a husband
    and wife living quite well off the rort,needles to say high noon is nigh.
    Its these sort of cases that are making it harder for the genuine people who need
    the state support without the fear or retribution from any government minister that
    likes to wield the big stick.
    The focus is on child poverty, the numbers are sobering and are a downright
    disgrace when you add in the parents of those children living in poverty as well.

  11. quartz 11

    I’m sure I’ve seen plenty of those children out painting their parents’ roofs.

  12. Marjorie Dawe 12

    Govt questioned on its Children Result Action Plan (C.R.A.P).

    I found this on Scoop (22 August) and am wondering if the acronym was deliberate and if it was, just what does it mean? Do the Nats mean they are CRAP at resolving the poverty issue, or do they think the kids are CRAP or will they be in the CRAP because their policies are making things worse?

    • blue leopard 12.1

      @ Marjorie Dawe & quartz
      LOL!!

    • Carol 12.2

      It actually is called the Supporting Vulnerable Children Result Action Plan:

      http://www.stuff.co.nz/national/politics/7526176/Govt-launches-plan-for-vulnerable-children

      But Jacinda Ardern shortened it to C.R.A.P. in question time this week:

      http://www.parliament.nz/en-NZ/PB/Business/QOA/3/6/6/50HansQ_20120822_00000009-9-Child-Poverty-Abuse-and-Neglect-Supporting.htm

      Jacinda Ardern: Can he confirm that the targets he reannounced today are all set beyond the 2014 election; if so, how will Ministers be assessed on the newly minted Children Result Action Plan, or C-R-A-P?

      Hon TONY RYALL: Gosh, you certainly needed a university education for that joke, did you not? If the member had read the report, she would have seen that some of those result areas will be achieved well before the election, and although the party opposite may think this is a joke—[Interruption]

      But the name for the action plan surely is a joke in its own right?

      • McFlock 12.2.1

        It’s a joke that 3 ministers and their staff didn’t see coming, no less.
        Although it’s possible that the name was a little subtle sarcasm that a functionary expected to be picked up and changed before the final copy was released.

        • blue leopard 12.2.1.1

          @ McFlock
          …or yet another example of how very little capacity those in government are able to identify unintended consequences (a most important skill for those in government). i.e. didn’t even look as far as seeing what the acronym spelled…

          • McFlock 12.2.1.1.1

            It is possible that public service turnover was so bad that none of the backoffice folk had competent work experience of more than a couple of years, but how many people would have seen it in 3 ministries? A dozen? more? Less? And nobody saw the acronym and brought it to the attention of even one minister?

  13. Bill 13

    Sadly, (and yes, you can call me for being cynical if you want) I’d expect ‘Labour’ to simply wield a slightly lighter stick than National’s with regards the parents of children in poverty and dangle one of those ‘Clarkesque carrots’ – you know the one’s? – just over the horizon and out of reach for now and only ever eventually applicable to parents that ‘Labour’ consider as worthy.

  14. Michael 14

    A useful test of Labour’s good faith (or its opposite) in this area is whether it supports Catherine Delahunty’s Bill to extend the IFTC to non-working families. Although the Bill merely tinkers with the WFF policy (which should be scrapped and replaced with a guaranteed minimum income for families and individuals, respectively, via a progressive tax system, IMHO), it does at least result in more income for poor families. Ergo, it must do something to relieve child poverty. Necessary but not sufficient is my summary. However, I understand Labour will not support the Bill because it fears being labelled “soft” on criminals (aka those unable to obtain, or maintain, paid employment in the current labour market). Perhaps I’ve misunderstood the semantic nuances surrounding Labour’s position on this Bill. Perhaps one of Labour’s cognosecenti might enlighten me?

  15. Dr Terry 15

    Again, poverty (esp. among children) is no new thing in NZ. It is great to see that the deplorable situation is at last being noticed (one hopes!) Several months back I researched this situation and published my findings internationally. All that I have received is a blank wall of silence.

    • fatty 15.1

      can you give a link please…i’d like to read it

    • Foreign Waka 15.2

      Of cause, because children are – sorry about this – expendable. More are being borne every day and more mouths need to be fed with no food in sight – on an international, or shall we say 3rd world country level. Bio Fuel is taking increasingly food out of the bowls of the poorest and this is now even worse with the droughts and floods in South America, Africa and Asia. There is recognition that bio fuel is really putting enormous pressure on the food supply. Prices for commodities such as flour, sugar, corn and wheat over the past few weeks have seen increases by up to 15%. So the food on everybody’s table now becomes even more expensive (Don’t forget the follow on in the feeding for animals too). This needs to be urgently addressed in an international forum as food is more important than some ROI on “food fuel”.
      That you encounter a blank wall of silence does not surprise me as the ball is now in the court of the profiteers. Of cause they stay obscure in silence.

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