Child poverty keep keeps falling, confounding the commentators
The latest child poverty statistics were released yesterday, showing reductions on the three main measures, even (for 2 out of 3) between July 2020 and June 2021, i.e. through much of the pandemic, thus confounding the claims of many commentators.
(A brief technical note: the first measure shows how many children are living in households with less than half the typical income (are poor households keeping pace with average ones?); the second shows how many children are living in households with less than half the income the typical household had in 2017 (are households getting richer compared to the past?); and the third one shows how many children are in households going without basic items like heating and clothing (are households able to afford the necessities?).)
Some may wonder how this can be, when foodbank use and other indicators of severe poverty are soaring. Well, foodbank use, though an indictment on our society, affects only some people in poverty, while many others have benefited from higher benefits and wages, wage subsidies, accommodation supplement increases, and so on.
Also, calculating poverty rates across hundreds of thousands of people, without access to Statistics New Zealand data and Treasury modelling, is next to impossible – and frankly I think some of the people who try to do it themselves should be more cautious about the claims they make.
It’s not all good news for the government, of course. Much progress was achieved with the Families Package several years ago, but that progress has slowed up since, or even come to a standstill on some measures. Major negatives include the fact that child poverty rates for Māori are high and not consistently falling, and the same is true for people with disabilities.
Moreover, only one out of the government’s three main targets for 2021 has been unequivocally met, with another possibly met. The target that was most clearly missed – to sharply reduce the proportion of children living in households with less than half the typical income – is, to my mind, extremely important, because it measures the extent to which poorer households are keeping pace with, or falling adrift from, the standard of living considered normal in their society.
To deal with that issue requires lifting low incomes more rapidly than middle ones. Basically, it looks like the government is going to need an equivalent of the Families Package – which cost more than $1 billion a year – again this term, and next (if it wins in 2023), if it is going to meet its targets. And there is no sign so far that it plans such a move. The hardest parts of meeting the child poverty targets, in other words, lie ahead.