Poverty, crowding and cold damp housing are the key contributors to illness in poverty stricken children, Children's Commissioner and Hawke's Bay pediatrician Dr Russell Wills says. The Hawke's Bay region is trending beside the rest of the country with a "year-on-year" rise in child poverty and related illness, he said.

Dr Wills is issuing the first of what he plans to be an annual update on trends in child poverty and poverty-related illnesses such as breathing difficulties and skin infections.

"What we see is large numbers of poor Maori, Pacific Island families coming in, mostly with pre-school age children. What we see in our in patients is skin and chest infections while our out patients have developmental problems.

"These are not people who do not try to care for their kids. They are good people who love their children very much but don't have the money to support them.

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"Often a family can only heat one room, so the whole family bunk together in the living room."

He said if one family member is sick the risk of spreading the illness is greatly increased, with the youngest the most vulnerable.

Dr Wills' update shows child poverty roughly doubled in the early 1990s and has fallen little since, and that child hospitalisations with poverty-related illnesses rose and fell in parallel with poverty and have risen again since the global recession hit in 2007 to a record high last year.

The biggest increases in the past 12 years have been in asthma and bronchiolitis, which mainly affects babies. Dr Wills said the poorest tenth of infants were 10 times more likely than the richest tenth to be hospitalised with bronchiolitis. "It's not just a matter of income poverty. What matters is children in very poor families in crowded, cold and damp houses. There is an income issue, there is a housing supply issue and there is a housing quality issue."

An expert group appointed by Dr Wills last year made 78 recommendations, starting with targets to reduce child poverty, a plan for how to reduce it, and annual monitoring of five official poverty measures.

"The Government is doing a lot of good stuff, such as social housing and insulation but we don't have a plan for child poverty in this country. In the UK there is a plan and even a child poverty Act. What we need to do is take the money we are spending and put it towards the areas where it is most needed. The families and homes as the far end of poverty in New Zealand."

The Government has picked up some recommendations, such as a housing quality "warrant of fitness" initially for state houses.

But it refused to adopt official poverty measures or targets, so Dr Wills has used J R McKenzie Trust charitable funding and Otago University experts to monitor his own measures. He said the goal was to inform the public about the extent of child poverty and refocus public spending on those most in need.

"A lot of the expert group recommendations were cost-neutral - taking the existing spending and investing it where it makes the most difference," he said. "It means some people would lose entitlements and it would go particularly to children who are younger and poorer. Those are win-lose political choices and no matter who is in power they will occur only if there is a very strong public understanding and support."

The expert group recommended raising the maximum family tax credit for children under 15 from $92.73 a week to the same as the rate for children aged 16 and over, $101.98, and then gradually raising the tax credit further for children under 5.

Dr Wills' advocacy manager Donna Provoost said the money could be found by changing the income thresholds and abatement rates for the in-work tax credit, which currently gives tax credits to working families earning up to $89,500 a year with two children or $124,700 with four children.

Social Development Minister Paula Bennett said the Government measured child poverty based on Ministry of Social Development data.

APN