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Child Poverty in New Zealand: Why It Matters and How It Can Be Reduced

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Title: Child Poverty in New Zealand: Why It Matters and How It Can Be Reduced
Language: English
Authors: Boston, Jonathan
Source: Educational Philosophy and Theory. 2014 46(9):962-988.
Availability: Routledge. Available from: Taylor & Francis, Ltd. 325 Chestnut Street Suite 800, Philadelphia, PA 19106. Tel: 800-354-1420; Fax: 215-625-2940; Web site: http://www.tandf.co.uk/journals
Peer Reviewed: Y
Page Count: 27
Publication Date: 2014
Document Type: Journal Articles
Reports - Evaluative
Descriptors: Foreign Countries, Poverty, Children, Public Policy, Disadvantaged Environment, Child Development, Social Problems, Strategic Planning, Policy Analysis, Social Values
Geographic Terms: New Zealand
DOI: 10.1080/00131857.2014.931002
ISSN: 0013-1857
Abstract: A combination of policy changes and wider socio-economic trends led to a dramatic increase in child poverty in New Zealand during the late 1980s and early 1990s. Higher rates of child poverty have now become embedded in the system and show little sign of resolving themselves. For a country which once took pride in being comparatively egalitarian and, more particularly, a great place to bring up children, the tolerance of much greater child poverty is surprising. It is also concerning. Child poverty imposes many costs. This is especially the case, according to the available evidence, when poverty occurs during early childhood and when it is severe and/or persistent. These costs afflict not only the children directly exposed to poverty (e.g. in the form of lower educational achievement, reduced lifetime earnings and poorer health outcomes), but also the whole society. This article briefly explores the available evidence concerning the nature, magnitude, causes and consequences of child poverty in New Zealand and considers why substantial rates of child poverty have been tolerated for an extended period. Drawing on the lessons of anti-poverty approaches in other OECD countries, it then outlines a strategy for securing substantial and durable reductions in child poverty rates in New Zealand. Finally, it considers the prospects of such a strategy being implemented and suggests ways of enhancing the focus of the political system on child-related social issues.
Abstractor: As Provided
Number of References: 40
Entry Date: 2014
Accession Number: EJ1037588
Database: ERIC
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  Value: <anid>AN0097806341;54l01aug.14;2019Feb15.06:07;v2.2.500</anid> <title id="AN0097806341-1">Child Poverty in New Zealand: Why it matters and how it can be reduced. </title> <p>A combination of policy changes and wider socio-economic trends led to a dramatic increase in child poverty in New Zealand during the late 1980s and early 1990s. Higher rates of child poverty have now become embedded in the system and show little sign of resolving themselves. For a country which once took pride in being comparatively egalitarian and, more particularly, a great place to bring up children, the tolerance of much greater child poverty is surprising. It is also concerning. Child poverty imposes many costs. This is especially the case, according to the available evidence, when poverty occurs during early childhood and when it is severe and/or persistent. These costs afflict not only the children directly exposed to poverty (e.g. in the form of lower educational achievement, reduced lifetime earnings and poorer health outcomes), but also the whole society. This article briefly explores the available evidence concerning the nature, magnitude, causes and consequences of child poverty in New Zealand and considers why substantial rates of child poverty have been tolerated for an extended period. Drawing on the lessons of anti-poverty approaches in other OECD countries, it then outlines a strategy for securing substantial and durable reductions in child poverty rates in New Zealand. Finally, it considers the prospects of such a strategy being implemented and suggests ways of enhancing the focus of the political system on child-related social issues.</p> <p>Keywords: poverty measurement; material deprivation; child poverty; social values; anti-poverty strategies; policy evaluation</p> <hd id="AN0097806341-2">Introduction</hd> <p>Child poverty rates in New Zealand rose almost threefold during a short period in the late 1980s and early 1990s and have remained at a much higher level for more than two decades.[<reflink idref="bib1" id="ref1">1</reflink>] In 1986, for instance, using a poverty threshold based on 60% of median disposable household income (after housing costs), the child poverty rate was 11%, while using a 50% threshold the rate was 7%. Eight year later, in 1994, the child poverty rate was close to 30% based on a 60% threshold (after housing costs), while using a 50% threshold the rate was around 20% (see Figure 1). For children in 'workless' households, the poverty rate (on a constant value basis) increased from 20% in the late 1980s to almost 80% several years later. By almost any standards, these are extraordinary and disturbing statistics.</p> <p>Graph: Figure 1 Child poverty rates in New Zealand from 1982 to 2012 (based on 50% and 60% of median disposable household income, after housing costs)</p> <p>Despite various policy initiatives since the second half of the 1990s to reduce child poverty, including a substantial social assistance package during 2005–7 (known as Working for Families), significant rates of child poverty have become embedded in the system and have shown little sign of resolving themselves. Equally disturbing, the rates of <emph>child</emph> poverty, whether measured by income or on a deprivation basis, have consistently exceeded those for most other age groups (see Figures 2 and 4).[<reflink idref="bib2" id="ref2">2</reflink>] Such a legacy is disheartening and shameful. It is also surprising for a country that once took pride in being comparatively egalitarian and, above all, a great place for raising children. For some children today, New Zealand is far from a great place. Their reality consists of living in cold, damp, overcrowded homes; moving home frequently; experiencing hunger; suffering Third World diseases like rheumatic fever; and missing out on many things which the majority of children take for granted. To compound matters, childhood poverty, especially when severe and persistent, often leaves a long shadow in the form of lower educational achievement, frequent unemployment, reduced lifetime earnings and poorer health outcomes. But it is not only the children of the poor who bare scars; our whole society suffers. The broader social and economic costs include higher unemployment and thus additional public expenditure on welfare benefits, worse health outcomes and thus higher costs for health care, lower productivity growth and higher rates of criminal offending.[<reflink idref="bib3" id="ref3">3</reflink>] Substantial rates of child poverty, in other words, increase the burden on the state and reduce a nation's prosperity. For economic reasons alone a society should favour low rates of child poverty. When other values and considerations are included, such as enhancing distributive justice, equality of opportunity and child well-being, the goal of alleviating childhood poverty becomes even more compelling.</p> <p>Graph: Figure 2 Poverty rates in New Zealand from 1982 to 2012 by age (moving-line poverty measure, 60% of median disposable household income, after housing costs)</p> <p>This article has four main purposes. First, it summarizes briefly the available evidence concerning the nature, magnitude, causes and consequences of child poverty in New Zealand. Second, it explores why substantial rates of child poverty have been tolerated for an extended period. Third, drawing on the lessons of anti-poverty approaches in other OECD countries, it outlines a strategy for securing substantial and durable reductions in child poverty rates in New Zealand. Finally, it considers the prospects of such a strategy being implemented and suggests ways of enhancing the focus of the political system on child-related social issues. To start with, however, the issue of poverty measurement deserves attention.</p> <hd id="AN0097806341-3">Measuring Child Poverty</hd> <p>Put simply, poverty means not having enough of those things which most people regard as essential (Perry, [<reflink idref="bib25" id="ref4">25</reflink>], p. 97). It differs from inequality which is about having more or less of something (e.g. income or wealth) than someone else. There are two primary ways of measuring poverty (including child poverty): the first involves using specific measures of disposable household income, while the second involves measuring levels of material deprivation (or hardship) (see Innocenti Research Centre, [<reflink idref="bib12" id="ref5">12</reflink>]; Perry, [<reflink idref="bib25" id="ref6">25</reflink>]; Stephens, [<reflink idref="bib33" id="ref7">33</reflink>]). In both cases, various criteria are employed to determine appropriate thresholds or benchmarks: those living in households with incomes or material deprivation rates below the relevant thresholds are deemed to be living in poverty. Both approaches capture different aspects of poverty and both have an important role to play in any measurement regime—whether for poverty in general or child poverty in particular.</p> <p>To be more specific, income poverty is typically measured on the basis of whether disposable household income, suitably adjusted for household size and composition, is below a specified proportion of the median income (i.e. the mid-point in the income distribution, not the average). Disposable income, in this context, refers to income from all sources (i.e. including wages, benefits and tax credits) minus direct taxes. Across the developed world, the most commonly used poverty thresholds are 50% and 60% of median disposable household incomes (before adjustments are made for housing costs). Such poverty rates are thus a <emph>relative</emph> (or moving-line) measure and will vary depending on the median income, the income threshold adopted, whether or not housing costs are taken into account (and, if so, how), and the nature of the equivalence scale adopted. They will also reflect the shape or distribution of household incomes in a particular society, especially at the bottom end, and this in turn will be strongly influenced by policy settings (e.g. with respect to taxation and benefit levels). Note, too, that fixed-line (or constant-value) poverty measures can be generated by determining a particular reference year and then making annual adjustments for inflation. Fixed-line measures provide a mechanism for tracking changes in the poverty level in real terms compared to the relevant reference year. This enables poverty rates to be compared over time on a constant-value basis (see, for instance, Figure 3).</p> <p>Graph: Figure 3 Poverty rates for children in workless and working households (fixed-line/constant value poverty measure, 60% median income, after housing costs)</p> <p>While the relationship between income inequality (on various measures) and poverty is complex (see Carter, Imlach Gunasekara, & Blakely, [<reflink idref="bib3" id="ref8">3</reflink>]), broadly speaking, countries with high rates of income inequality (e.g. the US), tend to have relatively high rates of poverty, including child poverty. Conversely, countries with below average levels of income inequality, like those in Scandinavia, tend to have lower poverty rates.</p> <p>Importantly, rates of income poverty can be sensitive to relatively small movements (up or down) in the generosity of social assistance (including benefit rates and tax credits). This is because such changes can shift large numbers of families above or below particular poverty thresholds. Specific policy settings, therefore, can impact significantly on rates of income poverty. Equally, however, we should be wary of assuming that marginal changes in family income fundamentally alter the economic circumstances of the individuals in question. A family with an income just above a designated poverty threshold is still poor, even if it no longer meets a particular definition of poverty. Bear in mind, too, that income-based poverty measures make no allowance for the other resources which people may have access to (including savings, intra-family transfers, etc.) and whether they own property or a business.</p> <p>For such reasons, it is helpful to supplement income-based poverty measures with those based on measures of material deprivation (or hardship). The latter approach to poverty measurement attempts to capture the actual day-to-day living conditions or standards of a household. It does this by assessing whether households lack various consumption items because they cannot afford them. The items selected are generally those which are deemed by the majority of the population (on the basis of surveys and/or focus groups) to be necessary or essential for one reason or another. Examples of such items include a raincoat, sturdy shoes, warm clothes and a separate bed. Some deprivation measures include items that are particularly important for children, such as having all the school uniform items required by the school, being able to go on school trips, being able to go to the doctor when required and being able to invite friends to a birthday party.</p> <p>Deprivation rates tend to reflect a country's real per capita incomes—that is to say, they are higher in countries with lower living standards than those which are relatively wealthy. Thus, for example, deprivation rates (across all age groups) are much higher in Eastern European countries like Hungary and Poland than in the richer countries of Western Europe (see Table 1). But variations in real per capita incomes are only one of the reasons why deprivation rates differ. For instance, some countries with roughly comparable living standards as measured by GPD per capita (e.g. Germany and Sweden) have different childhood deprivation rates, and some countries with significant childhood deprivation rates (e.g. New Zealand and Britain) have very low rates of deprivation amongst those aged 65 years or more (e.g. 3–5%). Interestingly, although rates of childhood deprivation (and income poverty) across the OECD are typically higher than those for the elderly (and the population as a whole), there are notable exceptions. Such findings suggest that there are a range of factors which affect rates of income poverty and material deprivation. Policy settings are crucial in this respect.</p> <p>Table 1 Deprivation rates* in 13 countries comparing children with older people and the total population in 2007 (Europe) and 2008 (New Zealand)</p> <p> <ephtml> <table><thead><tr valign="top"><td><bold>Country</bold></td><td><bold>Children 0-17</bold></td><td><bold>Aged 65+</bold></td><td><bold>Total population</bold></td></tr></thead><tbody><tr valign="top"><td>Netherlands</td><td>6</td><td>3</td><td>6</td></tr><tr valign="top"><td>Norway</td><td>6</td><td>1</td><td>5</td></tr><tr valign="top"><td>Sweden</td><td>7</td><td>3</td><td>6</td></tr><tr valign="top"><td>Spain</td><td>9</td><td>11</td><td>11</td></tr><tr valign="top"><td>Germany</td><td>13</td><td>7</td><td>13</td></tr><tr valign="top"><td>Slovenia</td><td>13</td><td>18</td><td>14</td></tr><tr valign="top"><td>Ireland</td><td>14</td><td>4</td><td>11</td></tr><tr valign="top"><td>United Kingdom</td><td>15</td><td>5</td><td>10</td></tr><tr valign="top"><td>New Zealand</td><td>18</td><td>3</td><td>13</td></tr><tr valign="top"><td>Italy</td><td>18</td><td>14</td><td>14</td></tr><tr valign="top"><td>Czech Republic</td><td>20</td><td>17</td><td>20</td></tr><tr valign="top"><td>Hungary</td><td>42</td><td>35</td><td>38</td></tr><tr valign="top"><td>Poland</td><td>39</td><td>41</td><td>44</td></tr></tbody></table> </ephtml> </p> <p>1 The deprivation rates in this table are based on the proportion of households who lack at least three items from a list of nine because they cannot afford them. All nine items are regarded as essential by the majority of the population.</p> <p>2 Source: Perry, [<reflink idref="bib23" id="ref9">23</reflink>], pp. 30-33.</p> <hd id="AN0097806341-4">Child Poverty in New Zealand</hd> <aug> <p>By OECD standards, New Zealand's rate of child poverty is by no means the worst (see Table 2). Moreover, in relation to some income-based poverty measures the situation in 2013 is slightly less serious than during the 1990s and early 2000s (see Figure 1). Nevertheless, using various approaches to poverty measurement, whether based on relative income thresholds or rates of material deprivation, child poverty in New Zealand remains a critical social problem. For instance, on one measure of income poverty (i.e. those living in households with equivalized disposable incomes below 60% of the median, after housing costs), the child poverty rate in recent years has been around 25% (or 27% based on recently revised data—see Perry, [<reflink idref="bib26" id="ref10">26</reflink>]). This is twice the rate experienced during the 1980s, which averaged about 13% (see Figures 1 and 2). Using a more demanding poverty measure (based on 50% of the median household disposable income, after housing costs), whereas the average child poverty rate during the 1980s was about 8%, in recent years it has been about 16–17% (or nearly 20% based on recently revised data). Depending, then, on which measure of income-based poverty is used the number of children in poverty in 2012 was somewhere between 205,000 and 285,000 (i.e. based on recently revised data). (As explained in footnote 2, Figures 1, 2 and 3 do not incorporate the revised poverty data for 2010–12.)</p> </aug> <p>Table 2 Child poverty rates at different relative poverty lines (before housing costs)</p> <p> <ephtml> <table><thead><tr valign="top"><td><bold>Country</bold></td><td><bold>Poverty line at 50%</bold></td><td><bold>Poverty line at 40%</bold></td><td><bold>Poverty line at 60%</bold></td></tr></thead><tbody><tr valign="top"><td>Iceland</td><td char=".">4.7</td><td char=".">1.9</td><td char=".">10.1</td></tr><tr valign="top"><td>Finland</td><td char=".">5.3</td><td char=".">1.5</td><td char=".">11.9</td></tr><tr valign="top"><td>Cyprus</td><td char=".">6.1</td><td char=".">1.8</td><td char=".">12.1</td></tr><tr valign="top"><td>Netherlands</td><td char=".">6.1</td><td char=".">2.9</td><td char=".">15.4</td></tr><tr valign="top"><td>Norway</td><td char=".">6.1</td><td char=".">3.1</td><td char=".">11.3</td></tr><tr valign="top"><td>Slovenia</td><td char=".">6.3</td><td char=".">2.9</td><td char=".">11.1</td></tr><tr valign="top"><td>Denmark</td><td char=".">6.5</td><td char=".">3.6</td><td char=".">11.4</td></tr><tr valign="top"><td>Sweden</td><td char=".">7.3</td><td char=".">3.7</td><td char=".">12.7</td></tr><tr valign="top"><td>Austria</td><td char=".">7.3</td><td char=".">3.2</td><td char=".">13.6</td></tr><tr valign="top"><td>Czech Republic</td><td char=".">7.4</td><td char=".">3.8</td><td char=".">13.0</td></tr><tr valign="top"><td>Switzerland</td><td char=".">8.1</td><td char=".">3.2</td><td char=".">17.9</td></tr><tr valign="top"><td>Ireland</td><td char=".">8.4</td><td char=".">3.5</td><td char=".">18.9</td></tr><tr valign="top"><td>Germany</td><td char=".">8.5</td><td char=".">4.6</td><td char=".">14.9</td></tr><tr valign="top"><td>France</td><td char=".">8.8</td><td char=".">3.7</td><td char=".">16.8</td></tr><tr valign="top"><td>Malta</td><td char=".">8.9</td><td char=".">2.9</td><td char=".">20.3</td></tr><tr valign="top"><td>Belgium</td><td char=".">10.2</td><td char=".">4.1</td><td char=".">16.6</td></tr><tr valign="top"><td>Hungary</td><td char=".">10.3</td><td char=".">3.0</td><td char=".">20.6</td></tr><tr valign="top"><td>Australia</td><td char=".">10.9</td><td char=".">4.3</td><td char=".">17.6</td></tr><tr valign="top"><td>Slovakia</td><td char=".">11.2</td><td char=".">6.6</td><td char=".">17.0</td></tr><tr valign="top"><td>New Zealand</td><td char=".">11.7</td><td /><td char=".">19.4</td></tr><tr valign="top"><td>Estonia</td><td char=".">11.9</td><td char=".">6.1</td><td char=".">20.6</td></tr><tr valign="top"><td>United Kingdom</td><td char=".">12.1</td><td char=".">5.6</td><td char=".">20.8</td></tr><tr valign="top"><td>Luxembourg</td><td char=".">12.3</td><td char=".">4.2</td><td char=".">22.4</td></tr><tr valign="top"><td>Canada</td><td char=".">13.3</td><td char=".">7.3</td><td char=".">21.9</td></tr><tr valign="top"><td>Poland</td><td char=".">14.5</td><td char=".">7.5</td><td char=".">22.9</td></tr><tr valign="top"><td>Portugal</td><td char=".">14.7</td><td char=".">9.6</td><td char=".">22.7</td></tr><tr valign="top"><td>Japan</td><td char=".">14.9</td><td char=".">9.6</td><td char=".">20.5</td></tr><tr valign="top"><td>Lithuania</td><td char=".">15.4</td><td char=".">8.8</td><td char=".">24.3</td></tr><tr valign="top"><td>Italy</td><td char=".">15.9</td><td char=".">9.7</td><td char=".">24.2</td></tr><tr valign="top"><td>Greece</td><td char=".">16.0</td><td char=".">8.1</td><td char=".">23.5</td></tr><tr valign="top"><td>Spain</td><td char=".">17.1</td><td char=".">11.5</td><td char=".">23.6</td></tr><tr valign="top"><td>Bulgaria</td><td char=".">17.8</td><td char=".">12.2</td><td char=".">24.4</td></tr><tr valign="top"><td>Latvia</td><td char=".">18.8</td><td char=".">12.8</td><td char=".">25.0</td></tr><tr valign="top"><td>USA</td><td char=".">23.1</td><td char=".">16.6</td><td char=".">31.1</td></tr><tr valign="top"><td>Romania</td><td char=".">25.5</td><td char=".">17.8</td><td char=".">32.3</td></tr></tbody></table> </ephtml> </p> <ulist> <item>3 Note: The rates cited in this table are generally for 2009, but the New Zealand rates are for 2011.</item> <item>4 Source: Innocenti Research Centre ([<reflink idref="bib12" id="ref11">12</reflink>], p.12).</item> </ulist> <p>As highlighted in Table 2, New Zealand's rates of child poverty are lower if calculated without taking housing costs into account. Indeed, one of the distinctive features of New Zealand is the large gap that emerged during the early-to-mid 1990s between child poverty rates based on a before housing costs measure and those based on an after housing costs measure. These differences reflect major changes in housing policies in the early 1990s (e.g. the abolition of income-related rents for state housing tenants), as well as various trends in New Zealand's housing market (including very rapid house price inflation). In broad terms, housing has become less affordable over recent decades (especially in Auckland). Hence, whereas only 11% of families spent more than 30% of their income on housing costs in 1988, the figure in 2012 was more than double, at 26% (Perry, [<reflink idref="bib25" id="ref12">25</reflink>], p. 65). Most of these families are poor. Addressing the problem of low housing affordability (as well as poor quality rental accommodation) will be essential if child poverty rates are to be reduced on a durable basis.</p> <p>Based on the official measure used by the European Union, the childhood material deprivation rate in New Zealand was around 18% in 2008 (i.e. prior to the full impact of the global financial crisis). This was significantly higher than in many Western European countries at roughly the same time and six times the rate of material deprivation amongst those aged 65 years and older (see Table 1). Using the Economic Living Standards Index (ELSI), the rate of material deprivation for children increased as a result of the global financial crisis from around 15% in 2007 to around 21% in 2011 before falling back to about 17% in 2012 (see Figure 4).</p> <p>Graph: Figure 4 Material deprivation for children and other age groups, 2007 to 2012, Economic Living Standards Index (ELSI)</p> <p>Table 3 highlights the large variations in childhood deprivation rates across different kinds of households in New Zealand in 2008 (see also Figure 4). Notice that a significant proportion of children in households in the lowest 10% of living standards were missing out on various essential items whereas almost no children in households enjoying the top 45% of living standards lacked any of these items. Particularly concerning is the fact that around 60% of the children in the lowest decile households lacked at least three of the 12 children's items whereas there were no children in households in the top 45% of living standards missing out on three or more items. This graphically illustrates the profound differences in the living standards of New Zealand families and the substantial deprivation experienced by children in disadvantaged households. Significantly, too, the hardship rate for families with three or more children is almost double that for families with only one or two children (see Perry, [<reflink idref="bib25" id="ref13">25</reflink>], p. 182), and 48% of poor children in New Zealand are in families with three or more children. In part, this reflects the design of the Family Tax Credit (FTC), In-Work Tax Credit (IWTC) and the Accommodation Supplement, all of which deliver proportionately greater assistance to smaller families (see below).</p> <p>Table 3 Children's deprivations of necessities, and other restrictions or stress points in their day-to-day lives, by their family's Economic Living Standards Index (ELSI) score, 2008</p> <p> <ephtml> <table><thead><tr valign="top"><td /><td><bold>Significant deprivation</bold></td><td><bold>In-between</bold></td><td><bold>Little or no deprivation</bold></td></tr></thead><tbody><tr valign="top"><td><bold>Living standard level (1=low, 7=high)</bold></td><td char=".">1</td><td char="."> 2</td><td char=".">3</td><td char=".">4</td><td char=".">5-7</td></tr><tr valign="top"><td><bold>Distribution of children across the 7 ELSI levels (%)</bold></td><td char=".">10</td><td char=".">10</td><td char=".">14</td><td char=".">22</td><td char=".">45</td></tr><tr valign="top"><td><bold>Enforced lacks of children's items (%) – do not have because of the cost</bold></td></tr><tr valign="top"><td> warm winter clothes</td><td char=".">23</td><td char=".">6</td><td char=".">3</td><td char=".">-</td><td char=".">-</td></tr><tr valign="top"><td> two pairs of good/sturdy shoes</td><td char=".">42</td><td char=".">11</td><td char=".">9</td><td char=".">3</td><td char=".">-</td></tr><tr valign="top"><td> waterproof coat</td><td char=".">44</td><td char=".">16</td><td char=".">9</td><td char=".">4</td><td char=".">-</td></tr><tr valign="top"><td> all school uniform items required by the school</td><td char=".">33</td><td char=".">9</td><td char=".">6</td><td char=".">1</td><td char=".">-</td></tr><tr valign="top"><td> separate bed</td><td char=".">27</td><td char=".">8</td><td char=".">5</td><td char=".">2</td><td char=".">-</td></tr><tr valign="top"><td> separate bedrooms for children of opposite sex (aged 10+)</td><td char=".">31</td><td char=".">17</td><td char=".">12</td><td char=".">4</td><td char=".">1</td></tr><tr valign="top"><td> friends to birthday party</td><td char=".">40</td><td char=".">13</td><td char=".">5</td><td char=".">1</td><td char=".">-</td></tr><tr valign="top"><td><bold>Economising 'a lot' on children's items to keep down costs to enable other basic things to be paid for (%)</bold></td></tr><tr valign="top"><td> continued with worn-out shoes/clothes for the children</td><td char=".">39</td><td char=".">21</td><td char=".">8</td><td char=".">3</td><td char=".">-</td></tr><tr valign="top"><td> postponed child's visit to doctor</td><td char=".">13</td><td char=".">5</td><td char=".">4</td><td char=".">-</td><td char=".">-</td></tr><tr valign="top"><td> unable to pay for school trip</td><td char=".">18</td><td char=".">6</td><td char=".">5</td><td char=".">-</td><td char=".">-</td></tr><tr valign="top"><td> went without music, dance, kapa haka, art, swimming, etc</td><td char=".">38</td><td char=".">23</td><td char=".">13</td><td char=".">4</td><td char=".">1</td></tr><tr valign="top"><td> involvement in sport had to be limited</td><td char=".">34</td><td char=".">21</td><td char=".">11</td><td char=".">3</td><td char=".">-</td></tr><tr valign="top"><td><bold>Multiple lacks of children's items</bold></td></tr><tr valign="top"><td> 3+ of the 12 children's items above</td><td char=".">60</td><td char=".">24</td><td char=".">13</td><td char=".">1</td><td char=".">-</td></tr><tr valign="top"><td><bold>Enforced lacks reported by respondent in child's family (%)</bold></td></tr><tr valign="top"><td> could not keep main rooms warm because of cost</td><td char=".">41</td><td char=".">20</td><td char=".">11</td><td char=".">4</td><td char=".">-</td></tr><tr valign="top"><td> cut back or did without fresh fruit and vegetables ('a lot')</td><td char=".">65</td><td char=".">34</td><td char=".">15</td><td char=".">10</td><td char=".">-</td></tr><tr valign="top"><td> postponed own visit to doctor ('a lot') </td><td char=".">56</td><td char=".">48</td><td char=".">22</td><td char=".">9</td><td char=".">-</td></tr><tr valign="top"><td> delayed repair or replacement of appliances ('a lot')</td><td char=".">73</td><td char=".">45</td><td char=".">25</td><td char=".">14</td><td char=".">1</td></tr><tr valign="top"><td> no home computer/internet access</td><td char=".">33</td><td char=".">18</td><td char=".">10</td><td char=".">5</td><td char=".">-</td></tr><tr valign="top"><td><bold>Housing and local community conditions (%)</bold></td></tr><tr valign="top"><td> difficult to keep house warm in winter (major problem)</td><td char=".">61</td><td char=".">39</td><td char=".">33</td><td char=".">19</td><td char=".">4</td></tr><tr valign="top"><td> dampness or mould (major problem)</td><td char=".">47</td><td char=".">40</td><td char=".">26</td><td char=".">14</td><td char=".">2</td></tr><tr valign="top"><td> crime or vandalism in the area (major problem)</td><td char=".">30</td><td char=".">16</td><td char=".">12</td><td char=".">7</td><td char=".">4</td></tr><tr valign="top"><td><bold>Financial strain (%) – for the first 4 items below, the selected response was 'more than once in the last 12 months'</bold></td></tr><tr valign="top"><td> received help (food, clothes, money) from food bank or similar </td><td char=".">38</td><td char=".">23</td><td char=".">9</td><td char=".">4</td><td char=".">-</td></tr><tr valign="top"><td> borrowed from family/friends for everyday living costs</td><td char=".">62</td><td char=".">47</td><td char=".">33</td><td char=".">12</td><td char=".">2</td></tr><tr valign="top"><td> late payment of car registration/insurance </td><td char=".">57</td><td char=".">35</td><td char=".">26</td><td char=".">8</td><td char=".">1</td></tr><tr valign="top"><td> late payment of electricity, water, etc </td><td char=".">59</td><td char=".">36</td><td char=".">25</td><td char=".">15</td><td char=".">1</td></tr><tr valign="top"><td> unable to cope with unexpected $500 expense (i.e. cannot pay within a month without borrowing)</td><td char=".">81</td><td char=".">57</td><td char=".">40</td><td char=".">18</td><td char=".">2</td></tr><tr valign="top"><td><bold>Children's serious health problems reported by respondent (%)</bold></td></tr><tr valign="top"><td> serious health problems for any child in the last year</td><td char=".">50</td><td char=".">30</td><td char=".">31</td><td char=".">30</td><td char=".">21</td></tr><tr valign="top"><td><bold>Overall dissatisfaction with living standards reported by respondent (%)</bold></td></tr><tr valign="top"><td> dissatisfied or very dissatisfied with material standard of living</td><td char=".">60</td><td char=".">30</td><td char=".">20</td><td char=".">8</td><td char=".">-</td></tr><tr valign="top"><td><bold>Summary multiple deprivation scores (based on 12 children's items plus 8 general household items)</bold></td></tr><tr valign="top"><td> 5+ of 20</td><td char=".">81</td><td char=".">38</td><td char=".">12</td><td char=".">2</td><td char=".">-</td></tr><tr valign="top"><td> 8+ of 20</td><td char=".">47</td><td char=".">11</td><td char=".">3</td><td char=".">-</td><td char=".">-</td></tr></tbody></table> </ephtml> </p> <p>5 Source: Adapted from Perry, [<reflink idref="bib24" id="ref14">24</reflink>], p. 14.</p> <p>Disturbingly, poverty rates for Māori and Pasifika children are around double those for Pākehā/European children. Similarly, the evidence suggests that Māori and Pasifika children are almost twice as likely to be living in severe poverty and face a higher risk of remaining in poverty for extended periods of time (Imlach Gunasekara & Carter, [<reflink idref="bib11" id="ref15">11</reflink>]). The available data with respect to material hardship paints an even bleaker picture. Using an adjusted ELSI measure averaged over 2010–2012, the hardship rate for <emph>all</emph> Māori and Pasifika (at 28%) was almost three times the European rate, which was 10% (Perry, [<reflink idref="bib25" id="ref16">25</reflink>], p. 182). It is likely that the hardship rate for Māori and Pasifika <emph>children</emph> is even worse. Child poverty in New Zealand is also concentrated spatially (e.g. South Auckland, Porirua, East Christchurch and South Dunedin), and is higher amongst families with significant physical disabilities and/or mental health issues.</p> <hd id="AN0097806341-5">The Consequences of Child Poverty</hd> <p>There is a large and robust body of research on the harmful consequences of child poverty in developed countries like New Zealand (see Duncan & Magnuson, [<reflink idref="bib7" id="ref17">7</reflink>]; EAG, [<reflink idref="bib9" id="ref18">9</reflink>], pp. 14–17; Gibb, Fergusson, & Horwood, [<reflink idref="bib10" id="ref19">10</reflink>]; Ladd, [<reflink idref="bib14" id="ref20">14</reflink>]). What this shows, at least in terms of reliable correlations, is that children living in poor families, when compared with those in well-off households, face a much greater likelihood of going to school without breakfast (and/or having no lunch); a higher chance of not seeing a doctor when unwell, but a greater risk of illness, injury and hospitalization; a higher risk of dying during childhood; a greater likelihood of living in an overcrowded, poorly insulated and inadequately heated home; a higher rate of residential mobility; and a greater risk of mental health problems. More specifically, compared with non-poor children, those experiencing poverty in New Zealand:</p> <p></p> <ulist> <item> have a 1.4 times higher risk of dying during their childhood;</item> <p></p> <item> are three times more likely to suffer ill health, 1.5 times more likely to be hospitalized, and twice as likely to be admitted to hospital for acute infectious diseases;</item> <p></p> <item> are much more likely to live in homes with no heating (e.g. because there are no heaters, no money to use heaters or no electricity due to unpaid bills);</item> <p></p> <item> are less likely to participate fully in early childhood education; and</item> <p></p> <item> are less likely to leave school with NCEA level 2 (which is the entry level qualification to skilled employment). (see EAG, [<reflink idref="bib9" id="ref21">9</reflink>], p. 15)</item> </ulist> <p>These are not outcomes that any parent desires for their children. Moreover, child poverty can have a long-reach (see Duncan, Ziol-Guest, & Kalil, [<reflink idref="bib8" id="ref22">8</reflink>]; Duncan & Magnuson, [<reflink idref="bib7" id="ref23">7</reflink>]). It can fundamentally affect a person's whole life-course, contributing to lifelong ill-health, limited employment prospects, insecure housing and semi-permanent poverty.</p> <hd id="AN0097806341-6">The Reasons for Higher Child Poverty Rates in New Zealand in Recent Decades</hd> <p>As noted earlier, child poverty rates in New Zealand are now much higher, at least on certain measures, than three decades ago. Why is this? Two main factors triggered the dramatic rise in child poverty rates in the late 1980s and early 1990s: firstly, a substantial increase in those receiving social assistance (due to much higher unemployment and an increase in the number of solo parents and those receiving sickness and invalids benefits); and secondly, a substantial reduction in the real value of most welfare benefits. For instance, between 1987 and 1992 the number of beneficiaries almost doubled while the real value of most core benefits was cut by 10–30%. Child poverty rates were further exacerbated by other policy changes and wider economic and social trends since the mid-1980s, including:</p> <p></p> <ulist> <item> an increase in relative housing costs, much of which was driven by policy changes;</item> <p></p> <item> a large increase in energy costs (e.g. average electricity tariffs for residential consumers have increased more than 70% in real terms since the early 1990s);</item> <p></p> <item> a growing dispersion of incomes between 'work-rich' and 'work-poor' households;</item> <p></p> <item> changes in family structure, especially an increase in the proportion of sole-parent households prior to the 1990s;</item> <p></p> <item> a modest reduction in the progressivity of the tax system (including a greater reliance on indirect taxes); and</item> <p></p> <item> a reduction in the real value of family assistance programmes—partly due to a failure to index fully many forms of social assistance including tax credits, housing subsidies and primary health care subsidies.</item> </ulist> <p>Figure 3 graphically illustrates the enormous impact of the various policy changes concentrated in the early 1990s on the child poverty rate in households largely dependent on welfare benefits, most notably the unemployment benefit and the domestic purposes benefit (for sole parents). Whereas in the late 1980s only about 20% of children in 'workless' households were in poverty (using a fixed-line or constant value measure based on 60% of median household income after housing costs), by the early 1990s the figure had reached almost 80%, four times higher. Despite the reintroduction of income-related rents in the early 2000s and the Working for Families package during 2005–7, the poverty rate for children in 'workless' households had barely fallen below 60% by 2007. By comparison, the poverty rate for children in working families has not significantly exceeded 20% (on the same measure) over the past three decades, although the rate in the mid-1990s was substantially higher than during the 1980s. If children spent only a brief period in 'workless' households, such statistics would not be so concerning. But the available evidence suggests that 6% of children have spent at least 13 years in benefit supported households by the time they reach 14, while a further 15% have spent at least seven years in such households by the age of 14 (Office of the Deputy Prime Minister, [<reflink idref="bib19" id="ref24">19</reflink>], p. 10). Close to 180,000 children, in other words, spend substantial periods of their children in families on very low-incomes.</p> <p>There are several reasons why child poverty rates in 'workless' households have remained stubbornly high for over two decades. First, while core benefit rates (e.g. for unemployment and sole parents) have been (mostly) inflation adjusted since the large cuts in 1991, they have not been adjusted (unlike National Superannuation) to reflect the significant growth in real wages (see Treasury, [<reflink idref="bib35" id="ref25">35</reflink>], [<reflink idref="bib36" id="ref26">36</reflink>]). For instance, after-tax wages increased by 24% in real terms between 1994 and 2011, while median household incomes grew by 46% in real terms (Perry, [<reflink idref="bib25" id="ref27">25</reflink>], p. 61). Hence, while most of those in employment have enjoyed higher living standards since the early 1990s, core benefit rates in real dollar terms have remained constant.[<reflink idref="bib4" id="ref28">4</reflink>] In relative terms, therefore, those in 'workless' households are slowly becoming worse off when compared to those in 'working' households. Unless or until there is proper review and recalibration of benefit rates to reflect changes in overall societal living standards, the situation for 'workless' households will continue to deteriorate in relative terms. Thus far, no government has been willing to undertake such a review. This is extraordinary, all the more so given the abundant evidence that current levels of social assistance are inadequate for many 'workless' households.</p> <p>Second, the Working for Families package of tax credits (see Perry, [<reflink idref="bib21" id="ref29">21</reflink>]) was deliberately designed to deliver most of the additional assistance to 'working' households (i.e. those where at least one parent is in paid employment for at least 20 hours per week or where a couple is working at least 30 hours a week). This goal was achieved by rendering 'workless' households ineligible for the IWTC (which replaced the former child tax credit in April 2006). The logic behind the IWTC was to enhance labour force participation rates, especially amongst sole parents, by providing additional work-related financial incentives. The IWTC, however, has remained controversial, partly because of its complexity and partly because it discriminates (many think unjustly) between families with different levels of engagement in the labour market (see St John & Dale, [<reflink idref="bib31" id="ref30">31</reflink>]). Recent court decisions have upheld the government's view that such discrimination can be justified under the Bill of Rights Act (see Court of Appeal, 2013). Nevertheless, the current design of the IWTC is far from ideal and needs a serious rethink (see below). Moreover, unless the incomes of 'workless' households with children can be boosted significantly by one means or another, major reductions in child poverty will be extremely difficult to achieve. It is critical that policymakers grasp this fundamental point.</p> <hd id="AN0097806341-7">Explaining the Tolerance of Significant Child Poverty in New Zealand</hd> <p>How might we explain the fact that New Zealand has tolerated significant rates of child poverty for over two decades? Several possible explanations can be quickly eliminated (see Boston, [<reflink idref="bib2" id="ref31">2</reflink>]). First, such tolerance, especially in recent years, has not resulted from inadequate information. Despite the lack of official poverty measures, the policy community has had access to academic research (e.g. Stephens, [<reflink idref="bib32" id="ref32">32</reflink>]; Waldegrave et al., [<reflink idref="bib38" id="ref33">38</reflink>]), as well as comprehensive and reliable analyses of trends in household incomes, including inequality and hardship, published regularly by the Ministry of Social Development (e.g. see Perry, [<reflink idref="bib22" id="ref34">22</reflink>], [<reflink idref="bib23" id="ref35">23</reflink>], [<reflink idref="bib25" id="ref36">25</reflink>]). Additionally, there has been a wealth of robust international and local data on the damaging educational, health, social and economic impacts of childhood poverty. Aside from this, there has been a mass of data available on the extent of the hardship being experienced by many low-income families, including the heavy demand for special needs grants and food parcels from community organizations, significant household overcrowding, and thousands of young children going to school without breakfast and/or any lunch. Hence, decision-makers in New Zealand cannot plead ignorance. Evidence that a serious problem exists has been abundant.</p> <p>Second, we cannot blame the tolerance of significant child poverty on a lack of advocacy. On the contrary, numerous professional bodies (especially in the health care sector), community groups and voluntary organizations have drawn attention to the plight of poor families since the early 1990s. The Child Poverty Action Group, in particular, has championed the cause of poor children with remarkable perseverance, dedication and skill, and received substantial, and generally sympathetic, media coverage (e.g. see Dale, O'Brien, & St John, [<reflink idref="bib6" id="ref37">6</reflink>]; Child Poverty Action Group Incorporated (CPAG)). Hence, there has been no lack of 'voice', what has been lacking is an adequate political response.</p> <p>In my view, there are at least four reasons for the failure of policymakers in New Zealand to address child poverty (see also Rashbrooke, [<reflink idref="bib28" id="ref38">28</reflink>]). First, market-liberalism has dominated much of the policy community since the mid-1980s. To be sure, this philosophical stance has weakened somewhat in recent years, partly as a result of the global financial crisis. Nevertheless, New Zealand policymakers have been strongly influenced by the following propositions: boosting economic growth requires lower public expenditure and a less active state; maintaining adequate work incentives and reducing dependence on the state requires that benefit rates be kept low; the best way of alleviating poverty is to encourage higher rates of employment; and, economic growth should have priority over distributive justice and poverty relief. These assumptions help explain why there has been no proper review of benefit rates in over two decades, despite the dramatic impact of the 1991 benefit cuts on child poverty.</p> <p>Second, market-liberal assumptions have been buttressed by various myths, paternalistic attitudes, anti-statist sentiments and what some call 'tough love'. Examples include the proposition that childrearing is largely, if not exclusively, a parental responsibility; that the state should not interfere in family matters; that people are poor because they waste much of their income on alcohol, tobacco or gambling, or because they are lazy; that the real problem is not a lack of money but poor budgeting; that child poverty would be greatly reduced if some couples had fewer children (or none at all); and that 'throwing more money at the problem' is ineffective, or even counterproductive. In short, the poor are viewed as irresponsible and wasteful, and hence undeserving of greater state support.</p> <p>There can be no denying, of course, that some people fit such stereotypes. The problems they face, whether substance abuse or a gambling addiction, need attention. This requires well targeted, properly resourced policy interventions, as well as effective action by community groups. But any suggestion that child poverty rates almost tripled during the late 1980s and early 1990s because of a simultaneous outbreak of irresponsible living by numerous parents is simply not consistent with the empirical evidence. Likewise, there is no evidence that the dramatic increase in child poverty during these years was because the poor suddenly chose to have lots more children. And even if they did, one presumes that the humane response is not compulsory sterilization (as is sometimes mooted) but rather adequate income support for larger families.</p> <p>Third, and related to this, support for egalitarian values in New Zealand has been in steady decline over the past three decades. As a result, there is now a greater acceptance of income inequality and relative poverty and less support for income redistribution. For instance, whereas in 1992 around 70% of those surveyed endorsed a progressive tax system (with those on high incomes paying a greater proportion of their income in taxes than low-income earners), by 1999 support had fallen to 60%, and by 2009 to just over 50% (International Social Survey Programme, [<reflink idref="bib13" id="ref39">13</reflink>]). Likewise, the proportion of New Zealanders who support government measures to reduce income differences between the rich and poor fell from 50% in 1992 to 40% in 2009 and there was a similar reduction in the proportion of people who thought income disparities were too large. Related to this, less than half the population (43%) agreed in 2009 that the government should provide a decent standard of living for those who are unemployed. In short, increased inequality in New Zealand has gone hand-in-hand with a shift in values; the once implicit and broad support for egalitarianism has been significantly eroded. Similarly, increased inequality, coupled with greater socio-economic residential segregation, has no doubt reduced the extent to which wealthy citizens experience and understand the problems which afflict the poor. For instance, children brought up in well-off households in affluent suburbs have virtually no direct experience of material deprivation or hardship. Their living circumstances are far removed from the substantial deprivation experienced by children brought up in households with the lowest 10–20% of living standards (Perry, [<reflink idref="bib24" id="ref40">24</reflink>], p. 14). Where there are significant social and geographical gaps between the rich and the poor, there is an obvious risk that the rich will cease to empathize with those who are much less fortunate than themselves and compassion will be lacking.</p> <p>Finally, issues of ethnicity, and related demographic trends, may have contributed to the failure of policymakers to take more decisive action to reduce child poverty. Around 50% of poor children in New Zealand are of Māori or Pasifika ethnicities, and child poverty rates amongst such groups are at least twice those of the European population (on most measures). Not surprisingly, therefore, child poverty tends to be associated in the public mind with minority groups—and thus identified as a minority ethnic problem, rather than a broader societal issue. Such perceptions, coupled no doubt with elements of racism and negative attitudes to sole parents, may have contributed to an 'us' and 'them' attitude amongst some European voters and decision-makers. From this perspective, child poverty is viewed as 'their' problem not 'our' problem; poor children are seen as 'their' children, not 'ours'. Consistent with this, a notable refrain from certain members of the public during the consultations I undertook as Co-Chair of the Expert Advisory Group (EAG) on Solutions to Child Poverty in 2012 was the need to 'stop them breeding'.</p> <p>If the policy problem is framed in such ways, many people might well conclude that child poverty is an issue for the Māori or Pasifika communities to address, not one for society as a whole. Likewise, if child poverty is seen as solely the result of bad choices by certain individuals (e.g. poor parents are having too many children), then the case for action by the state to alleviate the problem may appear less strong.</p> <p>To a certain extent, parallels can be drawn with other countries which have deprived ethnic minorities. For instance, in the US child poverty is concentrated especially in the black and Latino communities. Perhaps it is no accident, therefore, that as demographic changes have altered the ethnic composition of the population and as poverty has become more entrenched within certain ethnic minorities there has been a corresponding diminution in support for governmental measures to address child poverty. But caution is needed in making such assessments, not least because New Zealand, unlike the US, has a long history of intermarriage. Multiple ethnicities are thus very common.</p> <hd id="AN0097806341-8">Reducing Child Poverty in New Zealand</hd> <p>Turning to the question of how best to reduce child poverty in New Zealand, several matters deserve emphasis. First, it is vital to learn from the experience of countries (such as those in Scandinavia) with much better track records over extended periods of time, as well as countries like Britain and Ireland which have had success in alleviating child poverty in recent decades, at least prior to the global financial crisis. Second, attention must be given to the distinctive features of child poverty in New Zealand and the particular challenges which these generate. Third, a strategy is required which both reduces child poverty in a sustainable way and mitigates some of the damaging consequences of such poverty. International evidence suggests that priority should be given to alleviating poverty in early childhood. Finally, there are no easy, simple or cheap solutions. While investing in poverty reductions now is likely to generate some long-term gains (as well as short-term co-benefits, such as lower health care costs), it will entail significant upfront fiscal costs. This is likely to require additional public expenditure (rather than a mere reprioritization of existing expenditure); and this, in turn, will entail measures to broaden the tax base and/or increase certain tax rates. Politically, of course, this poses significant challenges.</p> <hd id="AN0097806341-9">Lessons From Other OECD Countries</hd> <p>As a general rule, the countries with low rates of child poverty (such as Denmark, Finland, Iceland, Norway and Sweden) have rates of market-income inequality below the OECD average and/or tax–welfare systems that are relatively effective at redistributing income to those in low-income households (Cass & Whiteford, [<reflink idref="bib4" id="ref41">4</reflink>]; OECD, [<reflink idref="bib17" id="ref42">17</reflink>], [<reflink idref="bib18" id="ref43">18</reflink>]; Whiteford & Adema, [<reflink idref="bib40" id="ref44">40</reflink>]). For instance, child poverty rates in the US are high because market-income disparities are substantial and the tax–welfare system is not very effective in redistributing incomes between households. By contrast, Canada has a broadly similar level of market-income inequality (i.e. before taxes and transfers) to that of the US, but the tax–welfare system is much more effective in redistributing income to poorer households (OECD, [<reflink idref="bib18" id="ref45">18</reflink>], p. 36). Hence, whereas the child poverty rates (i.e. using a threshold of 50% of median household disposable incomes before housing costs) in Canada and the US are roughly the same before taxes and transfers are taken into account, after they are factored into the equation, Canada's child poverty rate falls to almost half that of the US.</p> <p>Such an analysis suggests that there are potentially two strategies available to reduce the proportion of households with disposable incomes below recognized poverty thresholds and thereby alleviate child poverty: the first is to lower market-income inequality for wages below the median; the second is to enhance the redistributive effectiveness of the tax–welfare system.</p> <p>The first option is the more complex and difficult of the two. For one thing, boosting wages at the bottom end of the income distribution will not greatly assist most families unless there are compensatory changes to the tax–welfare system. This is because much of the extra wage income will be lost via higher taxes and reduced family assistance (see Treasury, [<reflink idref="bib37" id="ref46">37</reflink>]). For another, market-income inequality is affected by many different variables and few of these are amenable to the direct control of policymakers. Such variables include: the overall structure of the economy and patterns of employment in different sectors; labour market mobility and participation rates; the structure of employment, including working-time arrangements; the nature of labour market institutions, including union density and bargaining coverage; the framework of labour market regulation, including the minimum wage; benefit replacement rates; unemployment rates; and cultural values. Over recent decades there has been a general tendency across the OECD for market-income inequality to increase (especially at the top end of the distribution), but the reasons for this, as well as possible solutions, remain contested (see OECD, [<reflink idref="bib18" id="ref47">18</reflink>]; Stiglitz, [<reflink idref="bib34" id="ref48">34</reflink>]). Similarly, there is continuing debate about why the rise in inequality has been so uneven between countries.</p> <p>Aside from this, social factors that are not necessarily related to the structure of the economy or the labour market also shape the dispersion of household incomes. One of these is the proportion of sole-parent households. On average, sole-parent households have lower disposable incomes than two-parent households. This reflects the fact that: (<reflink idref="bib1" id="ref49">1</reflink>) such households have only one working-age adult; (<reflink idref="bib2" id="ref50">2</reflink>) both education and employment levels, and thus potential earnings, tend to be lower; and (<reflink idref="bib3" id="ref51">3</reflink>) many sole parents are (largely) dependent on cash transfers and other forms of public assistance. Accordingly, child poverty rates amongst sole-parent households are invariably higher within OECD countries than amongst two-parent households. Likewise, other things being equal, countries with comparatively high rates of sole parenthood have greater child poverty than those with low rates of sole parenthood. Having said this, the picture is complicated by the fact that the employment rates (and earnings) of sole parents vary significantly across the OECD and some countries provide relatively generous assistance to sole-parent families. Hence, for instance, although the rate of sole parenthood in Scandinavia is close to or above the OECD average, child poverty rates are nonetheless low. This is because the Scandinavians have strong incentives for sole parents to find paid employment, while also providing considerable financial support to enable participation in the labour market (e.g. via heavily subsidized childcare and early childhood education). Achieving high parental employment levels is thus a critical mechanism for minimizing child poverty. This applies even in a context where wage dispersion is considerable.</p> <p>The second broad option for reducing child poverty is to enhance the redistributive effectiveness of the tax–welfare system, particularly for low-income families. On the whole, the OECD countries that are most effective in redistributing income combine relatively progressive tax regimes (OECD [<reflink idref="bib16" id="ref52">16</reflink>]) with comprehensive and generous social security/social assistance regimes. With respect to reducing child poverty, key ingredients typically include: (<reflink idref="bib1" id="ref53">1</reflink>) strong parental employment incentives and related supports; (<reflink idref="bib2" id="ref54">2</reflink>) significant family assistance programmes (in the form of tax credits and/or child payments); and (<reflink idref="bib3" id="ref55">3</reflink>) benefit systems that are designed to ensure that household disposable incomes are above (or at least not too far below) recognized poverty thresholds. Interestingly, the countries with the lowest rates of child poverty generally rely heavily (although not exclusively) on universal (i.e. non means-tested) forms of family assistance (e.g. a universal child benefit).</p> <p>Additionally, governments across the OECD provide many 'in-kind' services for children (and their families), such as education (at all levels), health care, housing and care services. Although these are not designed primarily as instruments for redistribution, their effect is typically strongly redistributive.[<reflink idref="bib5" id="ref56">5</reflink>] Hence, while in-kind services do not directly impact on the inequality of <emph>household disposable incomes</emph> (or income poverty rates), they do affect rates of material deprivation (e.g. the affordability and access to health care services) and overall levels of societal inequality. The nature, comprehensiveness and generosity of in-kind services must therefore be taken into account in designing strategies to alleviate child poverty and material deprivation.</p> <p>Over recent decades various OECD countries (e.g. Australia, Britain and Ireland) have made concerted, and relatively successful, efforts to reduce child poverty (Waldfogel, [<reflink idref="bib39" id="ref57">39</reflink>]). These anti-poverty strategies have generally been initiated by centre-left governments but have often received support from parties across the political spectrum. In policy terms, the following mix of elements has been in evidence:</p> <p></p> <ulist> <item> explicit and generally ambitious medium-to-long-term poverty reduction targets or high-level political pledges;</item> <p></p> <item> additional cash transfers to families (both working and non-working), typically involving a mix of universal and targeted elements;</item> <p></p> <item> various measures to enhance the employment of sole parents and improve the flexibility of working hours; and</item> <p></p> <item> additional investments in children via extra subsidies for childcare and early childhood education, longer paid maternity leave, more funding for schools in poorer areas, and improved social support for young mothers (Cass & Whiteford, [<reflink idref="bib4" id="ref58">4</reflink>]; Waldfogel, [<reflink idref="bib39" id="ref59">39</reflink>]).</item> </ulist> <p>In the case of the UK, a particular focus of the former Labour government's anti-poverty strategy was on assisting families with young children (e.g. 0–5 years) so that the youngest children receive benefits at least equal in value (or higher) than older children. This approach, as noted earlier, is consistent with international evidence which highlights the importance of avoiding persistent and/or severe poverty during early childhood.</p> <hd id="AN0097806341-10">Addressing the Distinctive Features of Child Poverty in New Zealand</hd> <p>Turning, then, to the local context: as well as drawing on the lessons from overseas experience, any anti-poverty strategy in New Zealand needs to recognize, firstly, the distinctive features of child poverty in this country, and secondly, the magnitude of the challenge.</p> <p>As previously indicated, important considerations include:</p> <p></p> <ulist> <item> the relatively high cost of housing, coupled with significant quality issues (Bierre, Howden-Chapman, & Early, [<reflink idref="bib1" id="ref60">1</reflink>]);</item> <p></p> <item> the heavy concentration of child poverty within beneficiary households (the product of the large benefit cuts in the early 1990s and the failure for over 20 years to adjust core benefit rates to reflect higher real wages);</item> <p></p> <item> the relatively high rates of sole parenthood, coupled with employment rates for sole parents below the OECD average and child support arrangements that result in many custodial parents receiving no direct financial support from the non-custodial parent;</item> <p></p> <item> the design of particular forms of income support, including the FTC, the IWTC and the Accommodation Supplement, which tend to deliver inadequate assistance, especially to families with young children and/or at least two children; and</item> <p></p> <item> related to (<reflink idref="bib4" id="ref61">4</reflink>) the fact that almost half of poor children are in families with three or more children.[<reflink idref="bib6" id="ref62">6</reflink>]</item> </ulist> <p>The current design of family assistance is particularly problematic. With respect to the FTC, the maximum rate for the first child (if under 16 years) is $92 a week (for the 2013–14 financial year), but only $65 a week for any subsequent child (if aged under 13) or $75 a week (if the child was aged 13 to 15). For the first child aged 16 to 18, the maximum rate is $101 a week, whereas the rate for all subsequent children of this age is $92. The abatement threshold, which was initially inflation adjusted, was frozen at $36,827 in the 2010 Budget for fiscal reasons, and is now being slowly reduced in nominal terms to $35,000,[<reflink idref="bib7" id="ref63">7</reflink>] thereby reducing the level of assistance available to all those with incomes above the threshold. Additionally, the maximum rate of $101 a week has been frozen in nominal terms until the rates for the eldest child under 16 and for subsequent children aged 13 to 15 equal the rates for 16- to 18-year-olds via periodic inflation adjustments. This process is likely to take many years (given the gaps between the rates and the low rate of inflation). The 2010 Budget also included provision for the FTC abatement rate to be increased gradually from 20 cents in the dollar to 25 cents (in steps of 1.25 percentage points at each inflation adjustment). As a result, the real value of the assistance provided to low-to-middle income families via the FTC has been declining slowly for several years. Unless current policy settings are amended, this decline is set to continue for at least a few more years (possibly much longer, depending on the rate of inflation).</p> <p>The IWTC delivers assistance to families who meet certain employment-related criteria. The maximum amount payable is $60 per week for families with up to three children. An additional $15 is payable for the fourth child and each extra child after this. The IWTC abates out once the assistance delivered by the FTC has fully abated. The IWTC has not been inflation-adjusted since 2006. Since then the CPI has increased by at least 15%. Likewise, the maximum rates of assistance available under the Accommodation Supplement have not been increased since 2007. A related issue is that households of more than four persons (e.g. a sole parent with more than three children or a couple with more than two children) are not eligible for any additional housing assistance.</p> <p>Overall, therefore, the real value of income support for most low-to-middle income families has been declining steadily for about six years. Also, the current design of family and housing assistance means that families with young children and/or at least two children receive proportionately less state assistance than those with teenagers and/or one child. These policy settings have little to commend them.</p> <p>If the problem of child poverty is to be addressed, the scale of the problem must be properly understood. To illustrate: suppose it was decided to increase the incomes of families with around 50% of the median disposable household income (before housing costs) to at least 60%. The additional income required would depend on the composition of the family in question (i.e. the number of adults and children), but would entail an increase of around 20% on current incomes. For instance, using 2012 data, a sole parent with one child would need an extra $90 a week (an increase from $450 to $540), while a couple with four children would require an additional $175 a week (an increase from $860 to $1035) (see Perry, [<reflink idref="bib25" id="ref64">25</reflink>], p. 103). Using poverty measures after housing costs are taken into consideration, the amounts in question would be somewhat less, but nonetheless substantial. Bear in mind, that about 16–17% of children are in families whose incomes are <emph>below</emph> the 50% poverty threshold, so even if they received an increase in their weekly income commensurate with the amounts noted above, they would still be in poverty based on a 60% threshold.</p> <p>Securing increases in incomes of the magnitude noted above will involve very significant fiscal costs—regardless of how such assistance is delivered (i.e. the precise mix of changes to benefit rates, family assistance, housing assistance, child support, etc.). Additionally, there are major problems in New Zealand's housing market that will require a substantial public investment over a decade or more to address (e.g. in the form of extra social housing, better quality standards, etc.). Aside from this, significant policy changes are needed in areas such as education and health care, as well as more effective interventions to address major social hazards (e.g. smoking, alcohol abuse and gambling). Cumulatively, these measures will require significant additional funding.</p> <p>Such considerations also highlight the need for a concerted, comprehensive and well-integrated approach. As it stands, the National-led government has adopted various measures which are designed to reduce long-term welfare dependency, support vulnerable children and boost skills and employment, including a series of ambitious targets as part of the 'Better Public Services' initiative. Further, a number of specific measures to assist low-income families were included in the 2013 budget (e.g. relating to insulation, housing subsidies, food-in-schools, microfinance, community hubs, etc.). But while such initiatives have merit and are to be welcomed, their cumulative impact will be modest. Fundamentally, without substantive measures to deliver greater financial assistance to low-income families, a major part of the available policy tool-kit will be missing.</p> <hd id="AN0097806341-11">The Strategy Proposed by the Expert Advisory Group</hd> <p>In late [<reflink idref="bib9" id="ref65">9</reflink>], the EAG on Solutions to Child Poverty completed its Final Report. In my view, this provides a helpful framework for tackling the challenge of child poverty in New Zealand. Let me briefly summarize the main recommendations of the EAG.</p> <p>Of crucial importance, the EAG argued that the government should adopt a strategic approach. That is to say, there should be 'official' poverty measures, specific poverty-reduction targets, a set of child-poverty related indicators (e.g. covering education, health and so forth), and a proper monitoring and reporting framework. The Group went further and made detailed recommendations with respect to what these poverty measures ought to be; it also proposed ambitious, yet realistic, poverty-reduction targets, both for the medium term (i.e. three years) and over the longer term (i.e. 10 years). For instance, the EAG recommended that New Zealand should aim to reduce child poverty rates to the levels experienced in the top performing OCED countries, thereby returning this country to the much lower rates enjoyed three decades ago. The Group also highlighted the importance of setting bold targets for reducing severe and persistent poverty and giving particular attention to poverty in early childhood.</p> <p>To enhance political accountability for policy outcomes, the EAG recommended that the relevant poverty measures and reporting arrangements should be embodied in legislation—through a Child Poverty Act—as has occurred in Britain. But whereas the British legislation contains explicit poverty-reduction targets, the Group proposed that each New Zealand government should set its own targets and then be held to account for achieving them.</p> <p>In terms of specific policy interventions to reduce child poverty, the EAG recommended a two-pronged approach. On the one hand, it emphasized the need to boost the incomes of poor families. On the other hand, it highlighted the need for a range of other interventions, not least to improve the quality of rental accommodation (particularly in the private sector), increase the stock of social housing and enhance access to health and other important social services.</p> <p>With respect to the challenge of lifting the incomes of disadvantaged families, the EAG supported both an employment strategy and a welfare strategy. Under the former approach, the aim is to create more job opportunities (by boosting economic growth) and encourage beneficiaries into paid work through a mix of carrots and sticks. Essentially, this is the path being taken by the current government. But while generally desirable, the evidence strongly suggests that it is not sufficient by itself.</p> <p>Under the latter approach (i.e. a welfare strategy), the aim is to boost real levels of assistance to families via higher tax credits, increased housing subsidies, more extensive primary health care subsidies and greater assistance with childcare costs. Put differently, the goal is to enhance the overall redistributive effectiveness of the tax–welfare system. More specifically, the EAG proposed the following:</p> <p></p> <ulist> <item> increasing the value of the FTC by raising all rates to the level available for older teenagers who are the first child (currently $101 per week);[<reflink idref="bib8" id="ref66">8</reflink>]</item> <p></p> <item> reviewing and redesigning the IWTC;</item> <p></p> <item> reviewing the level and structure of all the main welfare benefits, with a view to increasing the rates in real terms and aligning all rates to movements in real wages (rather than prices);</item> <p></p> <item> reforming the current child support arrangements to ensure that at least some of the financial contributions paid by non-custodial parents are passed on to their children (i.e. when in beneficiary households);</item> <p></p> <item> boosting the level of assistance available via the Accommodation Supplement for larger families; and</item> <p></p> <item> extending the higher primary health care subsidies available for children under the age of six to all children.</item> </ulist> <p>Over the longer-term, the EAG proposed implementing a Child Payment. This would have both a universal and a targeted component. The payment would deliver the greatest level of assistance to families with very young children (e.g. under three years), with the value gradually declining in steps as the child aged. The proposed design of the Child Payment recognizes the critical importance of the early years of a child's life and the fact that when children are very young they generally need full-time parental care. The opportunity costs of young children, in other words, are significantly greater than for teenagers (even though the costs of maintaining a teenager are typically higher).</p> <p>Importantly, the EAG did not favour increasing the minimum wage or introducing a so-called 'living wage' as part of a strategy to alleviate child poverty. In short, the EAG argued that such measures would not generate significantly higher disposable incomes for most low-income families. This is because such families would lose much of their wage increase to extra taxes and reductions in social assistance. Aside from this, the EAG was also concerned about the possible negative impact of higher wages on overall employment levels.</p> <p>With respect to the controversial IWTC, the EAG noted that there are major problems with the way this particular tax credit is currently designed (see EAG, Working Paper No. 10, [<reflink idref="bib9" id="ref67">9</reflink>]; St John, [<reflink idref="bib29" id="ref68">29</reflink>]; St John & Dale, [<reflink idref="bib31" id="ref69">31</reflink>]). Moreover, the EAG's proposed changes to the FTC and the Child Payment, if adopted, would raise additional question marks over the IWTC in its present form (e.g. over the fiscal cost, phase out arrangements, etc.). At the same time, a plausible case can be made, on both equity and efficiency grounds, for including some kind of work incentive payment (or 'in-work' cash transfer) as part of an overall policy package (see Pearson & Immervol, [<reflink idref="bib20" id="ref70">20</reflink>]). From an equity perspective, for instance, employment generally entails additional travel costs; for those with young children it also involves extra child care costs. It is not unreasonable for the state to help subsidize such costs. From an efficiency perspective, the available international evidence suggests, on balance, that work incentives tend to encourage higher levels of engagement with the labour market (although the overall gains appear to be modest). These considerations help explain why the majority of OECD countries have in-work payments. Such policies differ greatly, however, in their design and generosity (e.g. with some being time-limited while others are open-ended, some being limited to workers with dependent children—as in New Zealand—while others are available irrespective of family status, etc.).</p> <p>How best to reform the IWTC is far from clear. There are problems with every conceivable option (including administrative complexity, compliance costs, perverse incentives, arbitrary cut-offs, equity issues, take-up issues, fiscal costs, etc.). Possible reforms could include: changes to the work-hours text; changes to the income thresholds and abatement rate; changes to the amount of assistance per child; and moving to time-limited payments or lump-sum payments. I remain genuinely uncertain about which approach would be best, and the EAG was divided on the subject. But whatever option is adopted, one matter is absolutely clear: there must be a significant increase in the real level of public assistance available to low-income families who have little or no engagement with the labour market.</p> <p>The EAG acknowledged that an ambitious package of policy initiatives designed to reduce child poverty by the magnitude proposed would be costly and thus difficult to achieve, especially in the current fiscally-constrained environment. For instance, a comprehensive package of policy measures embracing initiatives covering income support, child support, housing, health, childcare, education and training could readily cost $2 billion annually (or more). This amounts to about 3% of current government expenditure (which is slightly over NZ$70 billion per annum).</p> <p>Expenditure increases of this magnitude, as previously noted, will require more than a mere reprioritization of existing government expenditure; additional revenue will be needed. How this extra revenue should be generated is bound to be contentious. In my view, there is a strong case for both broadening the tax base (e.g. via a capital gains tax and an inheritance tax) and increasing certain direct and indirect tax rates. For instance, the tax rate on trusts could be increased and aligned with a higher top tax rate on incomes. There could also be steeper taxes on various environmental and other negative externalities. Politically, of course, tax policy changes of this nature pose significant challenges. In my view, such challenges are unavoidable, and must be faced frankly and robustly. This is not the place to debate tax policy, but I would make one quick observation: there is no compelling empirical evidence that OECD countries which have lowered their top tax rates markedly in recent decades (like Britain, New Zealand and the US) have enjoyed higher rates of GDP growth per capita than countries which have adjusted their top tax rates down relatively little (like France, Germany and Switzerland) (Piketty, Saez & Stantcheva, [<reflink idref="bib27" id="ref71">27</reflink>]). Such views may be unfashionable in certain quarters, but we need to be informed by evidence, not dogma.</p> <p>As expected, the most controversial of the EAG's recommendations were those proposing a greater reliance on universal forms of social assistance, especially during the early years of a child's life (see St John, [<reflink idref="bib30" id="ref72">30</reflink>]). This is not the place for a detailed defense of the approach enunciated by the EAG. But various matters deserve stressing. First, the policy debate in New Zealand needs to move beyond a simplistic either/or approach to universality and targeting. The policy terrain is much more complicated than this and many policy options (and sub-options) are available. These include what the 2010 Marmot Review (which focused on how to reduce health inequalities in England) termed 'proportionate universalism' and what Theda Skocpol has referred to as 'targeting within universalism' (Mkandawire, [<reflink idref="bib15" id="ref73">15</reflink>], p. 17). Second, and related to this, the debate needs to be informed by careful, sober, rigorous analysis and the avoidance of knee-jerk reactions or ideological-driven rigidity. Third, it is vital to consider the coherence of the <emph>overall</emph> policy package, not merely the integrity and logic of the individual components. And fourth, while the aggregate fiscal costs of the various options are a critically important consideration, they should not have overriding priority. Other criteria also need appropriate weighting, including feasibility, simplicity, compliance costs, political durability and the effectiveness of the interventions in meeting their multiple objectives.</p> <hd id="AN0097806341-12">The Prospects for Reducing Child Poverty in New Zealand</hd> <p>It is one thing to enunciate a strategy for reducing child poverty in New Zealand, it is quite another to implement it. There are two related challenges here: first, meeting the upfront fiscal costs of such a strategy; and second, generating and sustaining the required political support over long periods of time. Fundamentally, without adequate multi-party agreement, it will be hard to reduce child poverty on a durable basis. Currently, such agreement is lacking. How might it be secured?</p> <p>Above all, there needs to be genuine shift in the 'political wind' or 'climate of opinion', including a greater societal commitment to particular values, especially amongst better-off New Zealanders (e.g. a strong emphasis on social justice and social solidarity, a preference for low levels of poverty, support for childbearing and gender equity, a recognition that the state has a legitimate role in encouraging family well-being and protecting the best interests of children, and so forth). Achieving this will require strong, committed civil society advocacy and adroit political leadership.</p> <p>It will also need prudent use of all three Aristotelian forms of persuasion: logos (the use of logic), ethos (appeals to authority and ethical considerations) and pathos (appeals to the emotions). In practical terms, effective persuasion will entail continuing efforts by researchers and community groups to highlight the empirical evidence regarding the long-term economic and social costs of child poverty; to underscore the harmful impacts of poverty on individual children; to emphasize the shame of tolerating significant childhood deprivation in the midst of plenty; to counter the manifold myths and misunderstandings noted earlier; and to reframe the policy problem so that child poverty is not perceived solely or primarily as a Māori and/or Pasifika concern—but rather as an issue about the rights, opportunities and well-being of all children, regardless of their ethnic background. Equally, a focus on <emph>child</emph> poverty, rather than <emph>family</emph> poverty, is likely to be more conducive to capturing the public imagination. Emphasizing the expected long-term national <emph>economic</emph> benefits of lower rates of child poverty might also help. The message needs to be clear: child poverty benefits no one; less poverty means better outcomes and a more secure future for everyone, not just the poor. Likewise, the focus should not be on the costs of poverty relief (although these are undeniable), but on the wisdom of investing in our <emph>collective</emph> future.</p> <p>Will such an approach change the political wind sufficiently? Unfortunately, the international evidence suggests that building the necessary political consensus for a vigorous drive to alleviate child poverty is easier in societies which are relatively homogeneous (especially on the crucial dimensions of ethnicity and religion) and have comparatively high rates of social mobility. By contrast, societies characterized by deep and entrenched social divisions (e.g. the US) are less likely to secure or sustain any agreement on anti-poverty strategies. As New Zealand becomes increasingly diverse culturally and ethnically, and as socio-economic inequalities become more firmly embedded, there is a risk that the impulse for compassion and social solidarity will further diminish. This would be regrettable, but it cannot be ruled out.</p> <hd id="AN0097806341-13">Conclusion</hd> <p>To sum up, there is robust evidence that New Zealand has significant levels of child poverty and material deprivation. There is equally good evidence that such poverty is harmful, all the more so when experienced in early childhood; it is also socially and economically damaging. Fortunately, there are policy levers available to reduce child poverty and mitigate some of its worst effects. Unfortunately, the political will to make the most of such levers has thus far been lacking. The challenge, therefore, must be to change the political wind—ideally in a durable manner. This will not be an easy or straightforward task. Nevertheless, for the sake of the many children who deserve a better start in life, it is critically important. Investing in the future of our children, and especially our most disadvantaged and vulnerable children, is surely the best possible investment any society can make. To quote an old Indian proverb:</p> <p> <emph>To plan for a year</emph>—<emph>sow a rice paddy field</emph></p> <p> <emph>To plan for a decade</emph>—<emph>plant trees</emph></p> <p> <emph>To plan for a future</emph>—<emph>nurture children</emph></p> <ref id="AN0097806341-14"> <title> Notes </title> <blist> <bibl id="bib1" idref="ref1" type="bt">1</bibl> <bibtext> This article is based on a paper prepared for the 'Children in Crisis Conference', organized by the Wilf Malcolm Institute of Educational Research, Waikato University, and held at the Kingsgate Hotel, Hamilton, 7–9 October 2013. I would like to thank Jane Carpenter, Simon Chapple, Susan St John and Tom Stuart for their helpful comments on earlier versions of this article.</bibtext> </blist> <blist> <bibl id="bib2" idref="ref2" type="bt">2</bibl> <bibtext> Since this article was completed in November 2013, Statistics New Zealand and the Treasury found an error in the datasets used for calculating trends in household income and poverty. The revised data show that child poverty in New Zealand was higher during 2010–12 than previously estimated (i.e. as measured on an income basis, but not on a deprivation basis) (see Perry, [26]). Figures 1, 2 and 3 have not been adjusted to reflect these revisions, partly because all the relevant data are not yet available.</bibtext> </blist> <blist> <bibl id="bib3" idref="ref3" type="bt">3</bibl> <bibtext> For further details, see the various Working Papers and Reports produced by the Expert Advisory Group on Solutions to Child Poverty: <ulink href="http://www.occ.org.nz/publications/child%5fpoverty,">http://www.occ.org.nz/publications/child%5fpoverty,</ulink> especially Working Paper No 8, 'The Case for an Investment Approach to Reducing Child Poverty'.</bibtext> </blist> <blist> <bibl id="bib4" idref="ref28" type="bt">4</bibl> <bibtext> Note that beneficiaries with children were eligible for the increased assistance delivered via the FTCs during 2005–7, but not the IWTC. However, core benefit rates were reduced, thus leaving beneficiary households only marginally better off in net terms.</bibtext> </blist> <blist> <bibl id="bib5" idref="ref56" type="bt">5</bibl> <bibtext> There are a few exceptions to this generalization, the most obvious being large, universal subsidies for post-compulsory education (which are regressive).</bibtext> </blist> <blist> <bibl id="bib6" idref="ref37" type="bt">6</bibl> <bibtext> Note that around 37% of children are in families with three or more children, so the greater risk of such families being poor is not large.</bibtext> </blist> <blist> <bibl id="bib7" idref="ref17" type="bt">7</bibl> <bibtext> The threshold is being reduced at the rate of $450 each time the rates of the FTC are increased by inflation. These adjustments occur whenever the cumulative increase in the (adjusted) CPI reaches 5% from the previous adjustment.</bibtext> </blist> <blist> <bibl id="bib8" idref="ref22" type="bt">8</bibl> <bibtext> Given the recent changes to the FTC (as discussed earlier in the article), any reform package would need to consider (and adjust) the abatement threshold, the abatement rate and the indexation regime, as well as the rate structure and levels of assistance.</bibtext> </blist> </ref> <ref id="AN0097806341-15"> <title> References </title> <blist> <bibtext> Bierre, S., Howden-Chapman, P., & Early, L. (Eds.). (2013). Homes people can afford: How to improve housing in New Zealand. Wellington: Steele Roberts Aotearoa.</bibtext> </blist> <blist> <bibtext> Boston, J. (2013). The challenge of securing durable reductions in child poverty in New Zealand. Policy Quarterly, 9, 3–11.</bibtext> </blist> <blist> <bibtext> Carter, K., Imlach Gunasekara, F., & Blakely, T. (2013). 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  Data: Child Poverty in New Zealand: Why It Matters and How It Can Be Reduced
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  Data: <searchLink fieldCode="SO" term="%22Educational+Philosophy+and+Theory%22"><i>Educational Philosophy and Theory</i></searchLink>. 2014 46(9):962-988.
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  Data: Routledge. Available from: Taylor & Francis, Ltd. 325 Chestnut Street Suite 800, Philadelphia, PA 19106. Tel: 800-354-1420; Fax: 215-625-2940; Web site: http://www.tandf.co.uk/journals
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  Data: 10.1080/00131857.2014.931002
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  Data: 0013-1857
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  Data: A combination of policy changes and wider socio-economic trends led to a dramatic increase in child poverty in New Zealand during the late 1980s and early 1990s. Higher rates of child poverty have now become embedded in the system and show little sign of resolving themselves. For a country which once took pride in being comparatively egalitarian and, more particularly, a great place to bring up children, the tolerance of much greater child poverty is surprising. It is also concerning. Child poverty imposes many costs. This is especially the case, according to the available evidence, when poverty occurs during early childhood and when it is severe and/or persistent. These costs afflict not only the children directly exposed to poverty (e.g. in the form of lower educational achievement, reduced lifetime earnings and poorer health outcomes), but also the whole society. This article briefly explores the available evidence concerning the nature, magnitude, causes and consequences of child poverty in New Zealand and considers why substantial rates of child poverty have been tolerated for an extended period. Drawing on the lessons of anti-poverty approaches in other OECD countries, it then outlines a strategy for securing substantial and durable reductions in child poverty rates in New Zealand. Finally, it considers the prospects of such a strategy being implemented and suggests ways of enhancing the focus of the political system on child-related social issues.
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