8 October, 2012
After reading this article from the NZ Herald
you may wish to make a submission to the Expert
Advisory Group on Solutions to Child Poverty, established by the Children's
Commissioner, has been assessing the best available international and domestic
evidence on how to reduce child poverty and mitigate its effects.
The
writer of this article, Jonathan Boston is the co-chair of this group, together
with Dr Tracey McIntosh, of the University of Auckland. In late August they
issued a discussion document outlining their initial proposals. They have also
prepared 20 Working Papers on a multiplicity of policy issues. These are
available on the website of the Children's Commissioner.
This group
would greatly welcome your feedback on our ideas and proposals. In particular,
they would like to hear your views on what you think can make the most
difference.
They
have stated that they will take outsider views into account as they prepare their
final report.
Why
some widely held beliefs on the causes and solutions are wrong and why it
matters to put things right.
Photo / Getty Images
There are well-established,
internationally recognised methods for measuring poverty.
Myth 1
There
is little or no child poverty in New Zealand.
The evidence suggests otherwise. There
are well-established, internationally recognised methods for measuring poverty.
These can be used to track trends in poverty rates over time and between
countries.
One commonly used poverty measure is
the proportion of the population living in households with less than 60 per
cent of the median disposable household income, after housing costs. This is a
relative poverty measure. On this measure, 25 per cent of children were in such
households in 2011. This represents about 270,000 children. Such figures
compare unfavourably with those in Australia and many European countries. The
situation was even worse a decade ago when close to 30 per cent of children
lived in poverty. Yet in 1986 the figure was only 11 per cent.
Using a more demanding income
threshold, around 170,000 children or 16 per cent are living in households
receiving less than 50 per cent of the median disposable household income,
after housing costs. This compares with about 10 per cent in Australia.
Poverty rates can also be assessed in
constant value or real terms over extended periods of time. On this basis, the
children in the poorest 15 per cent of New Zealand households are no better off
today than 30 years ago. This is despite a substantial lift in average real per
capita incomes since the early 1980s. This highlights that economic growth
alone in not enough to overcome child poverty.
Another way of measuring poverty is to
consider how many households cannot afford certain items which the majority of
people believe are essential. This includes keeping one's home adequately warm,
possessing a phone and a washing machine, and paying important bills on time.
This measure of poverty focuses on hardship or deprivation rather than income.
As the accompanying table shows, child
deprivation rates in New Zealand in 2008 were around 18 per cent. This compares
with rates of 6-7 per cent in the best performing OECD countries.
Worse, many children experience
persistent deprivation. The international evidence suggests that such children
are at particular risk of bad outcomes later in life. This includes poor
educational attainment, higher unemployment, poor health and a higher incidence
of crime.
Myth
2
Children
are poor and deprived mainly because their parents are bad, mad, foolish or
indifferent. In other words, children are going to school hungry, have worn-out
cloths and shoes, and live in cold houses because of poor, incompetent
parenting. Every family has enough income, it is claimed. The problem is simply
that some people don't know how to live within their means.
No doubt many parents struggle to cope
with life, make unwise decisions or get trapped with high debt. Some suffer
poor mental health or have drug, alcohol and gambling problems. These issues
are real and need addressing.
But there is little hard evidence that
poor people, as a group, are much worse than rich people in their capacity to
manage their finances. The primary problem is that some parents simply don't
have enough income to provide adequately for their children. And this includes
many people who are in part-time and full-time work.
To those who say that children are
deprived because their parents are incompetent or don't care, consider the
following: whereas about 18 per cent of New Zealand children live in hardship,
only 3 per cent of those aged 65 years and older suffer the same fate. Why are
so few older people materially deprived?
The answer, very simply, is that
governments have implemented policies to minimise deprivation among the
elderly. By contrast, New Zealand society has chosen to tolerate significant
child deprivation. We could choose otherwise.
Myth
3
We
cannot reduce child poverty simply by increasing the incomes of poor families.
Throwing more money at the problem, it is argued, doesn't work. For instance,
it is claimed that the additional funding for low-income families provided via
the Working for Families package, introduced seven years ago, has not reduced
poverty.
Such claims are flawed. There is good
international evidence that increasing the incomes of poor families, especially
those with young children, improves educational, health and employment
outcomes. Likewise, the Working for Families package has lifted tens of
thousands of children out of poverty and significantly improved the financial
circumstances of many other families. Broadly comparable policies in other
countries have had similarly positive impacts.
But Working for Families is only part
of the answer. More needs to be done, especially for the children of
beneficiaries.
But what policy mix is best is by no
means straightforward. There are various ways of increasing the incomes of poor
families and not all of these are equally cost-effective or fiscally prudent.
Moreover, while more money certainly helps, appropriate in-kind assistance is
also important. This includes policies to address poor housing conditions,
improve access to health care, educational and other services, and enhance
employment opportunities.
How, then, can we improve the
circumstances of the most deprived children in this country? How can we ensure
that New Zealand is a great place to live for all our children? Over the past
seven months, the Expert Advisory Group on Solutions to Child Poverty,
established by the Children's Commissioner, has been assessing the best
available international and domestic evidence on how to reduce child poverty
and mitigate its effects.
I am the co-chair of this group,
together with Dr Tracey McIntosh, of the University of Auckland. In late August
we issued a discussion document outlining our initial proposals. We have also
prepared 20 Working Papers on a multiplicity of policy issues. These are
available on the website of the Children's Commissioner.
In sum, child poverty in New Zealand is
unacceptably and unnecessarily high. It can be reduced, and it ought to be.
Doing so would constitute a great investment in all our futures. But it will
require public support, sensible policies, sustained effort and political will.
Jonathan
Boston is professor of public policy at Victoria University and co-chair of the
Expert Advisory Group on Solutions to Child Poverty.
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