Budget not enough to fix child poverty

Max Rashbrooke Hana Seddon Alan Johnson 300x191 - Budget not enough to fix child poverty

While the Government made some good changes in last week’s Budget, it’s just not enough to make a real difference to child poverty in New Zealand, Tauranga social agencies heard this week.

The Western Bay of Plenty branch of the Child Poverty Action Group, supported by SociaLink, hosted about 35 members of social agencies to hear the national organisation’s analysis of the 2022 Budget.

Shining The Light on Child Poverty’s three speakers – Alan Johnson, National Deputy Convenor for CPAG, Hana Seddon, Director of Community Ministries for the Salvation Army and economic inequality commentator Max Rashbrooke – outlined the pros and cons of last week’s Budget.

Max Rashbrooke 202x300 - Budget not enough to fix child poverty

Max Rashbrooke, senior associate at the Institute for Governance and Policy Studies, said the Government had a mixed record so far. New Zealand had an economy where there had been very little real income increase for the poorest and middle income earners in 40 years. 

“The rewards still go to those who are doing well.”

He said the distribution of wealth was even worse than income distribution, with 40,000 New Zealanders owning 25 percent of the country’s wealth, the top 10 percent owning about 70 percent and the poorest – two million adults – two percent of the country’s wealth.

Child poverty rates had fallen since Labour came to power, but there had been an increase in extreme poverty. Nothing had been done about taxation when nearly half of the richest New Zealanders pay less tax than someone on the minimum wage. 

“Poverty is about being excluded from things other New Zealanders enjoy.”

Alan Johnson 228x300 - Budget not enough to fix child poverty

Alan Johnson said the recession following Covid was not nearly as severe as expected.

“We bounced back so well it showed what we can achieve if the Government opens the purse strings. We need a radical shakeup of Working for Families.” 

He said 45 percent of the total spend on benefits and income support would go to Superannuation, which was not mentioned at all in the Budget.  

The public probably think the main spend was on benefits for single parents and the unemployed, but the lion’s share was for superannuation, he said.  The Budget was pumping money into ‘bandaids’ rather than addressing the causes of poverty. 

The amount spent on transitional housing would balloon to $466 million in 2023, when the country was short of 10,000 houses. 

“Rather than spending money on motels, we need to spend the money on building houses.”

Hana Seddon 212x300 - Budget not enough to fix child poverty

Hana Seddon said she had grown up in poverty, so knew first-hand the pressure and stress this caused, and she did not want her grandchildren growing up the same way. 

“People are doing the best they can do. People don’t want to talk about policy or the law when they are dealing with the day-to-day realities of being poor. When people are given opportunities and have hope I have seen whole families, generations change. 

“We can’t keep doing the same stuff. We need to ask people ‘what makes a difference for you?’. The reset after Covid hasn’t reset for some people.”