Prime Minister John Key has acknowledged that the "growing underclass" he promised to tackle in 2008 has probably grown further - rather than decreased - during his first term in government.
Mr Key made the concession yesterday when asked about progress with the underclass, saying it depended what measures were used but recessions tended to disproportionately affect low income earners and young people.
He said he had visited a number of budgeting services and food banks "and I think it's fair to say they've seen an increase in people accessing their services. So that situation is there."
He did not believe the government had not acted on its promise to tackle the issue.
"It's a long, slow job and there's a lot more to be done. I don't accept there's nothing that can be done, but it will take a long time to make those changes."
He said he believed welfare reform - planned for National's second term - would help lift people out of poverty. So too would education policies.
Mr Key made the "growing underclass" a major feature of his 2008 campaign, raising the topic in both his 2007 and 2008 State of the Nation speeches and promising it was a priority, including tackling welfare dependency, crime, illiteracy, drugs and parenting skills.
He also visited McGehan Close, in Owairaka, Auckland, as an example of the type of community he wanted to help.
Yesterday, he denied that the Government had not acted, saying it had put in place initiatives across the board - including more flexible training for students, targeting early childhood education at Maori and Pacific communities, and health initiatives for poor regions such as immunisation programmes.
He said the Government had also done the best it could, in difficult times, to insulate people from the recession.