[Full report EAGChildPovertyProgress29Oct13.pdf]

Child Poverty in New Zealand: Building on the progress to date

29 October 2013

EXECUTIVE SUMMARY

Child poverty is preventing many New Zealand children from living healthy, productive lives. As many as 25 percent – up to about 265,000 New Zealand children – currently live in poverty. These children deserve the opportunity to live healthy lives, learn in school and take part in normal childhood activities. Investing to support these children to achieve their potential will pay dividends for all New Zealanders through future economic and social gains.

In December 2012 we released Solutions to Child Poverty in New Zealand: Evidence for Action. We recognised that child poverty is complex and has many elements so, to be effective, any anti-poverty strategy must incorporate a range of responses. It will also take sustained effort over many years. Reducing child poverty is an investment that will return real benefits for individual children and for society, by saving on the need to address the harmful consequences in the health, education, social services and justice sectors.

The purpose of this paper is to reflect on the progress since the release of our Report, and identify key areas where further effort is required. The progress we have seen in a short period of time is pleasing and we should celebrate these achievements. We also cannot lose sight of the task still ahead. What we are seeing, from the progress within the Government and the range of activities in local communities, is that an organic strategy is emerging. Now is the time to help shape this work and provide a framework so that efforts are mutually reinforcing, gaps are identified and addressed, and the collective impact is greater than the sum of the individual initiatives.

We need a cohesive and comprehensive anti-poverty strategy to avoid spending valuable time and resources that mitigate some of the impacts of poverty, but do nothing to address the underlying issues causing the harm.

There is strong evidence that the merits of taking an investment approach to supporting better outcomes for young children will pay great dividends for society. This investment approach could provide the framework to shape and direct the aspects of our collective activities.

With this in mind, the EAG believe the most pressing areas for further action are:

Strategy for investing in children

• New Zealand has never had a national strategy to combat child poverty, and the Government has a key role in driving change and improving accountability for addressing child poverty.

• A strategy for investing in children would include establishing specific poverty reduction targets and a monitoring and reporting framework. In the interests of credibility and durability, these arrangements should be embedded in legislation.

• Setting up a Better Public Service target on child poverty could go some way to achieve this focus.

Steps to address income poverty

• Insufficient income to pay bills and purchase essentials forces many families to make hard choices – we want families to have enough money to meet their children’s needs. The Government currently supports families through Working for Families for just this reason, but this is not working optimally.

• If we applied the investment approach to the Family Tax Credit (FTC), we could target more support where it matters most and where child poverty is higher – for younger children and larger families.

• Currently, FTC payments vary by the age of the child, so that the highest payment is for older children (i.e. current maximum weekly rate for 16-17 year olds is $102 but only $64 for a child under 12 years). We recommend eliminating the different rates and having one single per-child rate (preferably based on the rate for 16 years or older). This would provide more money for younger children and reduce child poverty rates for those who benefit most.

Continued momentum on housing and health • A promising start has been made to address our housing crisis. However we need much more – failure to improve the quantity, quality and affordability of housing for our poorest families will lock us in a cycle of spending to address remedial health and social issues. We recommend moving ahead on the development and implementation of the housing warrant of fitness, and investing in more social housing.

• Child health outcomes for our poorest children are shocking. While health care interventions cannot solve the root causes of child poverty, they can mitigate some of its worse effects. Investing in maternity and child health services, with universal free access to healthcare services and medications for children 24 hours a day, and further targeting for those identified at higher need, will result in immediate improvements the children most in need, and also reduce the likelihood of intergenerational transfer of poverty.

[Full report EAGChildPovertyProgress29Oct13.pdf]

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