The number of Kiwi children in relative poverty has jumped over 300,000 for the first time since 2010 – but it’s because of record inequality, despite falling absolute hardship.
The Ministry of Social Development’s annual household incomes report shows that the numbers below a European standard measure of absolute hardship, based on measures such as not having a warm home or two pairs of shoes, fell from 165,000 in 2013 to 145,000 (8 per cent of all children) last year, the lowest number since 2007.
Children in benefit-dependent families also dwindled from a recent peak of 235,000 (22 per cent) in 2011, and 202,000 (19 per cent) in 2013, to just 180,000 (17 per cent) last year – the lowest proportion of children living on benefits since the late 1980s.
But inequality worsened because average incomes for working families increased much faster at high and middle-income levels than for lower-paid workers.
The net result was that the number of children living in households earning below 60 per cent of the median income after housing costs jumped from a five-year low of 260,000 in 2013 to 305,000 last year, the highest since a peak of 315,000 at the worst point of the global financial crisis in 2010.
In percentage terms, 29 per cent of Kiwi children are now in relative poverty, up from 24 per cent in 2013 and only a fraction below the 2010 peak of 30 per cent.
Unicef national advocacy manager Deborah Morris-Travers said the increase showed that the Government’s reliance on economic growth as the way out of poverty “does nothing for those on benefits and on very low fixed incomes”.