The Post: Labour’s patchy poverty record eases pressure on National

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Not met. Not met. Not met. The rollcall of verdicts on the last Labour government’s progress against its child poverty targets, released by Statistics New Zealand on Thursday, was unsparing. The party didn’t meet a single one of the goals it had set for its first – and, as it turns out, only – two terms in government.

Labour had, of course, a hard road to travel. Although some measures of hardship fell under John Key, his National government had spent much of its time claiming it couldn’t even measure poverty, let alone tackle it.

But determined campaigning by NGOs, amplified by hard-hitting reportage, had sparked public concern by filling TV screens with images of children growing up in mould-ridden houses where the heating was switched off to save money – homes where fridges were empty and hope in short supply.

In the 2017 election, Bill English and Jacinda Ardern vied to outbid each other on tackling hardship. And when she won power, one of her first moves was to pass the landmark Child Poverty Reduction Act.

Confronting a situation where, depending on the measure, somewhere between 150,000 and 250,000 children lived in hardship, Labour set itself the goal of cutting those rates by one-third by 2024 – and by as much as two-thirds by 2028.

So, what went wrong? Initially, not much. The party addressed the issue with seriousness, rigour and compassion.

In its first term, the Families Package put $1bn extra a year into the pockets of poor and middling households, via higher benefits and Working for Families tax credits. Poverty dropped sharply, and the number of households unable to regularly afford food fell from 20% to 13%.

Even in the pandemic, Labour achieved the remarkable feat of keeping poverty levels flat or falling, partly through continued benefit increases and wage subsidies. The problem was everything after.

To maintain progress on its chosen path, Labour would have needed another $1bn-a-year Families Package. But none was forthcoming, largely because there was no capital gains tax – or reprioritised spending – to free up the required funds. Compounding the problem, the cost-of-living crisis drove Labour to focus increasingly on the “squeezed middle”. It took its eye off the ball.

The ultimate verdict, as delivered on Thursday, was that Labour cut child poverty by just 30,000-50,000 on two of its key measures (and not at all on the remaining one). It missed its 2023-24 targets by about as much again: a job half done, in short. As many as 150,000-200,000 children remain in hardship.

There were wider failings, too. Labour’s goals were couched in impenetrable policy-speak: I defy any layperson to tell me what “50% of equivalised median household disposable income” means. Even Cabinet members couldn’t have explained targets that, unsurprisingly, had next-to-no public support.

Labour’s agenda also relied too heavily on benefit and tax-credit increases. These are important policies, but should the state’s coffers really have to do so much heavy lifting? If work paid better, employers would rightly shoulder more of that burden.

Alongside benefits and wages, a third big lever for tackling child poverty is housing, and here Labour’s record was once again mixed. State house-building, revived after lying dormant under National, added over 14,000 homes, while ramped-up infrastructure investments and zoning reform began clearing the way for increased affordable housing. More, though, was needed.

So where to from here? The pressure is, for the moment, pretty well lifted from National, which can use Labour’s mixed record as a get-out-of-jail-free card. And until middle-class families feel their living standards have recovered, they may have little compassion to spare for others.

Our best hope is that, if the economy can recover, so too will our reservoirs of sympathy. Pressure can still be applied to National to meet its own unambitious targets for 2027, which involve either maintaining the current rates or lowering them by just a few percentage points.

A new drive to halve child hardship – to lift out of poverty roughly 75,000-100,000 of the remaining 150,000-200,000 children – could be pencilled in for, say, 2035. Those targets would, though, need to be couched in one readily comprehensible measure, not to mention a wider national mission and sense of purpose that would excite public support.

We need, above all, a rethink of our social and economic systems, one based on acknowledging our responsibilities to each other – to poor children, in particular, who are blameless in their situation – and recognising that growth is best built from the bottom up. The only way to fix our productivity problems is to ensure that each of us is capable of paddling our collective canoe as fast as it can go. And that, in turn, will require us to make the collective investments – in health, in education, in housing, and in incomes – that will equip every child to play their part in that mission.