Left Further Behind - Child Poverty Action Group

is one of the poorest regions in New Zealand: 49% of children were identified as being born in the
bottom two most-deprived deciles (Rudd, 2010). A research project in 2010 found that the number of
rheumatic fever cases in Northland is increasing, and one in 100 children had heart damage caused
by previous undiagnosed rheumatic fever, which starts with an untreated sore throat (Department of
Labour, 2011b). The New Zealand Medical Association Journal says rheumatic fever and the heart
disease it causes reflect “gross and intolerable health inequalities” (J. McGregor, 2011, p. 19). All
these indicators point to the likelihood of significant economic and social hardship and poverty for
these children’s adult lives.
Another reason to be concerned about child poverty is that generational cycles of high income are
common in the rich countries, but so are cycles of low income: in the US almost 50% of children
born to low-income parents become low-income adults. The rate is also high in the UK at 40%,
and in Canada at about 30%. Even in the Nordic countries, where overall child poverty rates are
low, a disproportionate fraction of low-income children become low-income adults (Corak, 2006). As
societies, we need to protect children from poverty, both for their own well-being and development
as children and with a view to longer-term economic and social outcomes; refusing to make this
investment and commitment is a recipe for economic and social failure, a failure which is both
predictable and preventable (Gluckman & Hayne, 2011).
The discussion in this report demonstrates that child poverty is not inevitable but is the avoidable
consequence of badly designed or inadequately considered policy. Figure 2.3 above shows that,
while a higher proportion of the populations in the US and Australia experience poverty, a greater
percentage of children in New Zealand than in Australia experience poverty. Overall, New Zealand’s
policies have resulted in very few of our elderly experiencing poverty, and we have succeeded in this
more so than the US, the UK, Australia or even Norway. If we can achieve this outcome for our aged
population, we can develop, implement and resource better policies to achieve it for our children.
In the year ended June 2011, with GDP of around $200 billion, nearly $9 billion was spent on New
Zealand Superannuation (NZS), a universal pension provided to approximately 500,000 eligible
superannuitants, while only $1.7 billion was spent on the Domestic Purposes Benefit which is used
to support most of the 235,000 children and their parent/carer living in beneficiary households (see
Table 2.3). There seems to be little intergenerational equity in the government’s treatment: support
for superannuitants has been very effective in preventing poverty among older New Zealanders
which is a good thing, but equivalent levels of support have not been provided for children.
Children, poverty and social security
While, as indicated above, child poverty is not limited to sole parent beneficiary families, such families
are significantly over-represented among those living below the poverty line. Table 2.5 shows the
numbers and age distribution of children currently living in households receiving a benefit; most
of these are children living in sole parent households in receipt of the Domestic Purposes Benefit
(DPB).
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