On child poverty

Written By: - Date published: 10:27 am, April 29th, 2008 - 25 comments
Categories: families, labour - Tags: ,

The Child Poverty Action Group has released a report [PDF, 400k] showing there were 185,000 children living in poverty in New Zealand in 2004. That’s a big number but it is out of date and already well down from the dark days of the 1990s.

It is estimated that higher employment, higher wages, paid paternal leave, and Working of Families have combined to reduce child poverty by 70% since 2004. On top of that, improved public services, free early childhood education, subsidised doctors’ visits, and cheaper medicine have improved the lives of all children but aren’t caught by the poverty line measure, which only counts income, not the social wage. Moreover, it should be remembered that the poverty line is a moving target; it is 60% of the median household income. Since real incomes are up 15% since National was booted out, even someone living on the poverty line is 15% better off than in 1999.

Notwithstanding all that, more can be done to reduce child poverty. After nine years of centre-left government, the only children still living in poverty are those living in beneficiary households, who can’t get Working for Families. Something can be done for these families. One option would be to restore benefit levels to what they were before Ruth Richardson slashed them in the 1991 ‘Mother of All Budgets’. Another option would be to increase the child tax credit portion of Working for Families, which goes to beneficiary as well as working families. Both these measures would have the added benefit of putting more money into the pockets of people who are hardest hit by the slowing economy, which would create demand and stimulate their local economies.

That child poverty has been reduced 70% is of great credit to Labour but there shouldn’t be any child poverty in a nation as wealthy as New Zealand. It’s good to see the Minister agrees. The only way to get there is with better assistance to families in need. Tax cuts alone won’t cut it.

25 comments on “On child poverty”

  1. Steve Pierson 1

    Ever wondered why the 1991 Budget is known as the ‘Mother of All Budgets’?

    It was the first budget delivered by a woman but the real reason was that the Budget took place just after the second Gulf War. At the start of the war, Saddam had promised America and it’s allies the ‘Mother of all Battles’ if they tried to liberate Kuwait. In Arabic, calling something the mother or father of something is used to say it’s great or huge – the city Abu Dhabi means ‘father of gazelles’, lots of gazelles there it seems.

    And so ‘mother of all budgets’, a budget that delivered something big and terrible, benefit cuts that plunged the economy into recession and tens of thousands of kiwis into poverty.

  2. spanner 2

    Grey power have just asked Helen Clark what is alternative for food consumption, as they wrap themselves in blankets to keep warm.Wineter power cuts loom for them.

    Didn’t Helen Clark say that poverty in NZ was just “extrapolated from an anecdote”?

  3. Didn’t John Key say the answer to the “underclass” was muesli bars and more sports clubs? Oh and tax cuts for the rich? Ahhh… “trickle down” … those were the days…

  4. Dancer 4

    While like most NZers I support the elimination of child poverty we also need to recognise that it’s an area to “measure”. For example the report suggests it is providing a current “where we’re at” on child poverty in New Zealand, 2007. But the info they are working from are all from 2004 and previous years prior to Working for Families and other government policy changes. None of the material I’ve seen around (on poverty/ hardship etc) is actually for 2007.

    And missing out Working for Families is important – a family earning less than $35,000 now effectively pays zero tax.

    I was also surprised to see a call for the removal of KiwiSaver tax credits on the grounds that it benefits middle income earners. However people across income brackets, age groups, and ethnicities are signing up (http://www.beehive.govt.nz/release/kiwisaver+working+new+zealanders).

    And just last month we had the NZ Herald saying “Child poverty is finally on the way down in two of the three rich countries where it increased the most in the 1980s and 90s – Britain and New Zealand.” http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10503896&pnum=0

    So we are making slow progress?

  5. bill brown 5

    you’re on a hiding to nowhere if your definition of poverty is families with incomes below 60% of the median.

    By definition, this is always going to end up with people defined as in poverty.

    This is up there with “we want all kids to perform above average at school”

  6. Steve Pierson 6

    bill. to be fair, it’s not my defination, it’s the international one. The reason it is a fraction of median income, and not a fixed level is a recognition that poverty is different in different societies, it’s not about how much you have but how much you have relative to other people.

    And you’re right that reaching the rising bar is hard but it’s not mathmatically impossible, like having all kids above average at school would be. You just have to ensure that no family with kids has an income of less than 60% what the median household has.

  7. Craig Ranapia 7

    And you’re right that reaching the rising bar is hard but it’s not mathmatically impossible, like having all kids above average at school would be. You just have to ensure that no family with kids has an income of less than 60% what the median household has.

    Steve: Perhaps I’m showing my innumeracy here (not impossible considering that I’m doing really well if I can reconcile my bank statement the same way twice, two months in a row), but wouldn’t that move the median upwards.

    And I don’t know if it’s either politically or ethically wise to tell people who don’t have children that they somehow deserve to be in poverty, no matter how you define it.

  8. Phil 8

    Is this the report which stated “Child poverty is highly correlated to household income”?

    That’s gold – I bet it took them a lot of hard number crunching to work that one out…

    Seriously though, single point-in-time studies like these are pretty much useless for coming up with strategies to reduce poverty. To use a sporting analogy; they give you the score-card at the end of the match rather than a play-by-play.

    What is essential is having a logitudinal study of significant depth and breadth to begin looking at real dynamics and household mobility – that exists with SoFIE (http://www.stats.govt.nz/products-and-services/info-releases/sofie-info-releases.htm) and I really hope that once researchers get their teeth into that, it will produce some really positive outcomes

  9. And so ‘mother of all budgets’, a budget that delivered something big and terrible, benefit cuts that plunged the economy into recession and tens of thousands of kiwis into poverty.

    Um, no. The MOAB actually benefited NZ hugely and practically saved the economy. No one defends the MOAB by saying it was the best thing to do (save Richardson herself and Douglas, but that is no surprise) or that we should do it again, but let’s be honest it was the necessary thing to do at the time because of the terrible state of the economy.

    Upon winning the 1990 election, Bolger and Richardson quickly became aware of two unrelated financial crises: firstly, that the Bank of New Zealand required an immediate injection of capital to avoid insolvency as a result of the poor performance of a NZ$2.8bn loan portfolio in Australia, and secondly that the outgoing finance minister David Caygill’s projection of a modest fiscal surplus was inaccurate, and that the country instead faced a fiscal deficit of NZ$5.2bn if action were not taken immediately.

    So, the economy was in tatters (thanks to Labour) and the MOAL was designed to cut back and save money so that a recession was avoided. In fact, much of the economic buoyancy in Labour’s term, such as the massive surpluses, has been credited to the policies of Richardson. So really you ought to be thanking her, Pierson.

  10. Scarfie 10

    Perhaps I’m showing my innumeracy here … but wouldn’t that move the median upwards.

    Craig, no it wouldn’t. The median is the value which separates a population of values into two halves, values above and values below.
    http://en.wikipedia.org/wiki/Median

    The following two populations of values:
    “1 2 5 8 9”
    “4 4 5 8 9”
    both have the same median, 5. Now think of those numbers as representing family income, and compare the low ends.

  11. Matthew Pilott 11

    Craig Ranapia, there is a difference in the workings of the mean (average) and median in the example Steve gives.

    Let’s say the median is $60k – this will be the actual dollar value of the middle income. This means that if there are 21 people earning an income in the group being measured, the income of the 10th (when they are ranked in ascending order – imagine it as a list, the median is plucked from the middle) earner will be $60,000.

    If someone goes from, say, $45,000 to $55,000, on our hypothetical list, the median will not have changed. They may have gone from 3rd to 7th, but the median (10th) will not ahve changed. The median only changes when someone crosses the median – goes from below to above and vice versa. With what Steve is talking about, you have a hypothetical situation whereby there would be no family with an income of below $36,000 (or 60% of the median).

    I don’t think that it is mentioned, implicit or otherwise, that people without children deserve to be in poverrty, I’m afraid it appears to me you made that up, or are looking for a fight somehow!

  12. Ben R 12

    The majority of the children cited come from families receiving WINZ benefits. Isn’t there an obligation on those receiving WINZ benefits, or Housing New Zealand accomodation/allowances to use contraception?

    It’s an abuse of the welfare system & the social contract that underlies it to have large families while receiving benefits.

    Increasing payments may work in the short term, but will ultimately lead to the system collapsing under its own weight.

    With better family planning child poverty would reduce.

  13. bill brown 13

    It is implicit that if people with children’s incomes are bolstered so that they do not fall below the 60% threshold a proportion of people without children will be moved into the poverty bracket as the median will drift up.

  14. Steve Pierson 14

    bill brown, learn the difference between a median and a mean.

    Ben R, weirdest comment of the day

  15. Matthew Pilott 15

    Yes bill (if that comment is directed to what I said) but no one is saying that we should ignore poverty for families without children. This post is about child poverty though, which is why people are looking at and discussing…child poverty. And no one came remotely close to saying, as Craig implied, that people without children deserve to be in poverty.

  16. Ben R 16

    Steve,

    Could you explain what you don’t understand about my post?

    My point is that we have a form of social contract where we pay benefits to those in need. As with any contact/agreement there is some obligation on both parties. Surely those getting money from the state, should be using contraception to avoid increasing the amount the state needs to pay them?

    My other point is that while CPAG make some fair points, they seem to overlook family planning. When that is the clearest way to reduce child poverty. Women in third world countries often live in poverty because they can’t use contraception, but that’s not the case in NZ.

  17. Hillary 17

    Ben R, should we compulsorily sterilise beneificiaries, since they are breeding like rabbits at the taxpayers expense?

    If it was true that people are choosing DPB as a lifestyle, which I doubt, what would that say about other opportunities available to them?

    Labour have done alot to address child poverty, and its great to hear Dyson saying that child poverty can be eliminated. It must be.

    Which is why Labour has to win the election. I am seriously fearful about what would happen to children of working and not working families under National.

  18. Ben R 18

    Hillary,

    No, I don’t think the state should have that kind of coercive power – it would be pretty hard to say we lived in a liberal democracy if that happened.

    I just don’t see why family planning isn’t at least talked about as a way to reduce child poverty. It shouldn’t be viewed as a negative or taboo subject. As I mentioned above, reducing family size is one of the easiest ways historically for people, particularly women, to avoid poverty. I think CPAG overlooks this for ideological reasons, when it could actually help those in need.

  19. When the razor was taken to the benefit system by Jenny Shipley et al it wasn’t just the $ in the bank each fortnight, it was the added assistance that disappeared, which had previously enabled beneficiaries especially women on the DPB to manage their debt load as well as provide food, shelter and emotional support for their families. Things such as a maximum (repayable) $1000 loans for essential home repairs disappeared. The amount of casual part time work you could do before your benefit was shaved of the difference was reduced. Things became extremely rigid, kids started missing out on sports and other previously attainable social activities. I watched several friends struggle to explain that to their children. I am also again fearful for the children of beneficiaries under a National government.

  20. Mmmmm, beneficiary-bashing, it is delicious.

    Because of course the fact that “Working for Families” gives NO benefit to those families on benefits, and has in fact resulted in a net loss for some families, means nothing. It’s because the damn proles can’t keep it in their pants.

  21. Matthew Pilott 21

    How’s WfF caued a loss for some people, QoT?

    I often hear people complain that WfF doesn’t help people on benefits – perhaps a fair comment, although I’d say benefits not directly given in cash would be better – free quality training/education, basically things hat will help people get in to some form of work if they are able.

    Lastly, WfF provides a damn good incentive for someone on a benefit to get a job – and not a negative incentive (don’t work and you’ll be punished) but a positive one (get a job, and you’ll get that much more money). Gotta love that.

  22. ‘Working for Families’ would have the word ‘working’ in it because people are working. That would exclude people who don’t work, I suspect. Stop me if I’m being too obnoxious…but they would certainly have to rename it to pay it to people on welfare.

    It has also been called a tax cut, which also wouldn’t make much sense for people who don’t work and don’t pay tax.

    But the point I really wanted to make is that welfare causes poverty. After all, being welfare is not exactly the road to riches. Welfare payments are small to discourage the general population from giving up and going on welfare. Therefore if you are on welfare you are going to be poor.

    If someone can work out how to pay handsome welfare payments without having everyone quit, then please let us know, because this is the one question which can resisted solution by the most brilliant minds in economics for the past 60 years.

    It is an important question too, because there are people out there who are very badly treated by our welfare system. For example, I have been sickened by the plight of adults with learning problems, or physical disabilities, who never got anywhere in school. We should be spending a lot more on these people.

    Anyway, to reduce poverty you need to increase wealth. To do that you must reduce welfare roles.

  23. NP 23

    I had always understood that beneficiaries pay tax, yet do not receive ‘Working for Families’ assistance; hence the problem of the country’s poorest children becoming poorer over time, even if the remaining are in a better position than 1999.

  24. Draco TB 24

    Anyway, to reduce poverty you need to increase wealth. To do that you must reduce welfare roles.

    False dichotomy FTW?

    We need to help those to the opportunities available to them not just pay out welfare and expect them to suddenly become successful. They won’t simply because they don’t know how as they’ve never been taught. Throw in some confidence issues brought on by childhood abuse, probably a consequence of poverty itself, and you have some very real and very complex issues to deal with.

  25. lauren 25

    would national REALLY help the poor…whata joke! NO…VOTE LABOUR 2008, considering i come from a predominantly middle class family.

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    by Gearóid Ó Loingsigh On August 29th a video in which veteran FARC (Revolutionary Armed Forces of Colombia) commander Iván Márquez announced that they had taken up arms again was released. There was no delay in the reaction to it, from longtime Liberal Party figure and former president Uribe, for ...
    RedlineBy Admin
    1 week ago
  • Air New Zealand identifies this enormous plot of unused land as possible second airport site
    Air New Zealand couldn’t believe its luck that this seemingly ideal piece of real estate had so far gone entirely unnoticed. Air New Zealand’s search for a site to build a second Auckland Airport may have made a breakthrough this afternoon, after employees scanning Google satellite imagery spotted a huge, ...
    The CivilianBy admin
    1 week ago
  • Redline on the Labour Party
    No-one on the anti-capitalist left in this country today puts forward a case that Labour is on the side of the working class.  There are certainly people who call themselves ‘socialist’ who do, but they are essentially liberals with vested interests in Labourism – often for career reasons. Nevertheless, there ...
    RedlineBy Admin
    1 week ago
  • New Fisk
    No Right TurnBy Idiot/Savant
    1 week ago
  • Labour’s failure
    When National was in government and fucking over the poor for the benefit of the rich, foodbanks were a growth industry. And now Labour is in charge, nothing has changed: A huge demand for emergency food parcels means the Auckland City Mission is struggling to prepare for the impending arrival ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Ardern attempts to vaccinate Clarke Gayford live on television to prove that it’s safe
    Gayford, pictured here on The Project, before things got wildly out of control. A bold public relations move by the Government to encourage parents to vaccinate their children has gone horribly wrong. Prime Minister Jacinda Ardern appeared on tonight’s episode of Three’s The Project, where the plan was for her ...
    The CivilianBy admin
    1 week ago
  • Has Mr. Whippy gone too far by parking on our front lawns?
    Mr. Whippy’s business model has driven it down a dark road of intimidation. Residents in major centres around the country are becoming disgruntled by the increasingly aggressive actions of purported ice cream company Mr. Whippy, who have taken to parking on people’s front lawns and doorsteps in a desperate attempt ...
    The CivilianBy admin
    1 week ago
  • Cleaning up the water
    Today the government released its Action Plan for Healthy Waterways, aimed at cleaning up our lakes and rivers. Its actually quite good. There will be protection for wetlands, better standards for swimming spots, a requirement for continuous improvement, and better standards for wastewater and stormwater. But most importantly, there's a ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Fronting up
    Today I appeared before the Environment Committee to give an oral submission on the Zero Carbon Bill. Over 1,500 people have asked to appear in person, so they've divided into subcommittees and are off touring the country, giving people a five minute slot each. The other submitters were a mixed ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Politics of science – making a silk purse out of a sow’s ear
    Anti-fluoride activists have some wealthy backers – they are erecting billboards misrepresenting the Canadian study on many New Zealand cities – and local authorities are ordering their removal because of their scaremongering. Many New Zealanders ...
    1 week ago
  • Democracy – I Don’t Think So
    So, those who “know best” have again done their worst. While constantly claiming to be the guardians of democracy and the constitution, and respecters of the 2016 referendum result, diehard Remainers (who have never brought themselves to believe that their advice could have been rejected) have striven might and main ...
    Bryan GouldBy Bryan Gould
    1 week ago
  • Government says it will now build just one really nice home
    Following publication of this article, the Ministry has requested it to be noted that this supplied image is not necessarily representative of what the final house will look like, and it “probably won’t be that nice.” As part of today’s long-anticipated reset of the Government’s flagship KiwiBuild policy, Housing Minister ...
    The CivilianBy admin
    2 weeks ago
  • Imperialism and your cup of coffee
    Over the next week or two we will be running three synopses of parts of the opening chapter of John Smith’s Imperialism in the 21st Century (New York, Monthly Review Press, 2016).  The synopsis and commentary below is written by Phil Duncan. Marx began Capital not with a sweeping historical ...
    RedlineBy Admin
    2 weeks ago
  • Still juking the stats
    The State Services Commission and Ombudsman have released another batch of OIA statistics, covering the last six months. Request volumes are up, and the core public service is generally handling them within the legal timeframe, though this may be because they've learned to extend rather than just ignore things. And ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Hard News: Time for a New Deal: 25 years on
    In 1994, I was editing an ambitious street mag called Planet, from a fabled office at at 309 Karangahape Road. The thirteenth issue of the magazine was published in the winter of that year and its cover embodied a particularly ambitious goal: the end of cannabis prohibition.I wanted to do ...
    2 weeks ago
  • Not impressed
    KiwiBuild was one of the Ardern government's core policies. The government would end the housing crisis and make housing affordable again by building 100,000 new homes. Of course, it didn't work out like that: targets weren't met, the houses they did build were in the wrong place, and the whole ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Solar beats coal
    As the climate crisis escalates, it is now obvious that we need to radically decarbonise our economy. The good news is that its looking easy and profitable for the energy sector. Wind is already cheaper than fossil fuels, and now solar is too:The levellised cost of solar PV has fallen ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • A Step Too Far.
    A Crown Asset? For reasons relating to its own political convenience, the Crown pretends to believe that “No one owns the water.” To say otherwise would re-vivify the promises contained in the Treaty of Waitangi – most particularly those pertaining to the power of the chiefs and their proprietary rights ...
    2 weeks ago
  • Where Money Comes From
    Most people would say, no doubt, that they have a pretty good idea of what money is. They live with the reality of money every day. It is what is needed to buy the necessities of life and to maintain a decent standard of living. You get money, they would ...
    Bryan GouldBy Bryan Gould
    2 weeks ago
  • Banned by the Green Party leadership: Jill Abigail on women’s rights and trans rights
    The article below was an opinion piece that appeared in the Spring 2019 issue of Te Awa (the NZ Green Party’s newsletter) and on the Greens website.  In keeping with their policy of hostility to women defending women’s right to female-only spaces, Green bureaucrats have since removed the opinion piece.  ...
    RedlineBy Admin
    2 weeks ago
  • The fallacy of the proximity argument.
    Longer term readers may remember my complaining that, as a political scientist, it is burdensome to have non-political scientists wanting to engage me about politics. No layperson would think to approach an astrophysicist and lecture him/her on the finer details of quarks and black holes, but everybody with an opinion ...
    KiwipoliticoBy Pablo
    2 weeks ago
  • Where We Stood: Chris Trotter Replies To Stevan Eldred-Grigg.
    Joining The Fight: Stevan Eldred-Grigg's argument for New Zealand staying out of the Second World War fails not only on the hard-headed grounds of preserving the country’s strategic and economic interests; and not just on the soft-hearted grounds of duty and loyalty to the nation that had given New Zealand ...
    2 weeks ago
  • Universities back the climate strike
    On September 27, School Strike 4 Climate will be striking for a future to pressure the government for meaningful climate action. This time, they've asked adults to join them. And now, Lincoln University and Victoria University of Wellington have signed on:Victoria University of Wellington has joined Lincoln University in endorsing ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Another constitutional outrage
    Another day, another constitutional outrage in the UK. This time, the government is saying that if parliament passes a law to stop Brexit before being prorogued, they may just ignore it:A senior cabinet minister has suggested Boris Johnson could defy legislation to prevent a no-deal Brexit if it is forced ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Ending dairy in Canterbury
    Environment Canterbury has finally proposed nitrogen limits to stop dairy farmers from poisoning Christchurch's water supply. And naturally, farmers are whining about it:A proposed move by Environment Canterbury (ECan) to protect Christchurch's drinking water by setting tough – some would say, draconian – nitrate reductions in the decades ahead and ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Is National the party of climate arson?
    The Zero Carbon Bill is currently before select committee. While its targets are weak, its a generally sensible bill that promises to establish a long-term framework to guide emissions reductions. But National hasn't made up its mind on whether it will support it - and according to Andrea Vance in ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Experts warn Harold the Giraffe “well past” typical giraffe life expectancy, may not have long
    Dum-de-doo. Children across New Zealand have known him for generations as the lovable giraffe who tells them to exercise, hydrate and not to shove lit cigarettes up their nostrils. But a world renowned giraffe expert says we shouldn’t be getting attached to Life Education’s Harold the Giraffe, as he is ...
    The CivilianBy admin
    2 weeks ago
  • August ’19 – NZ blogs sitemeter ranking
    Image credit: 22 BLOGGERS WITH ADVICE FOR RESEARCHERS AND EVALUATORS, ILLUSTRATED I notice a few regulars no longer allow public access to the site counters. This may happen accidentally when the blog format is altered. If your ...
    2 weeks ago
  • Bye, bye to the collusion lie
    Sums it up, really. ...
    2 weeks ago
  • Opinion: Treat your car by buying extra petrol to snack on while you aren’t driving
    By Mike Hosking. Yesterday morning, I waltzed into work, and as I walked past the drones aggressively typing out news on the computers I’ve repeatedly asked to be moved further away from, I caught a glimpse of the words “climate change”, and noticed that suspiciously they weren’t in condescending quotation ...
    The CivilianBy admin
    2 weeks ago
  • US imperialism, Huawei, racism and imperial anxiety
    by Tony Norfield US political opinion against China has two solid bases. The first is the longstanding racist and protectionist sentiment in the white working class; the second is a more recent anxiety about China’s economic prowess in America’s ruling elite. This article notes some historical aspects of anti-Chinese racism ...
    RedlineBy Admin
    2 weeks ago

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