Child Poverty: A Special Report

A top-level group is calling for sweeping changes to help our most disadvantaged kids. Catherine Masters and Simon Collins examine what child poverty means in New Zealand today and whether the latest attempt at reform will make a difference

In Auckland, poverty does not always jump out at you. Often it's hidden behind the curtains; in a faded lodge in Mangere where a young couple with a smiling 2-year-old girl wearing a big red bow in her hair live in the former psychiatric units with a crowd of other families and children. The rent for their single room is $205 a week and the young mum is relieved and grateful for somewhere to live.

This lodge is cleaned every day and has strict rules - no alcohol, for one.


Although the young woman wants her family out, she says at least she's not in a slum, like the woman from India she met recently in Women's Refuge who was being sent back to one.

She's convinced this isn't poverty, though the fridge in her room is near empty and she won't toilet train her daughter until Housing New Zealand comes through with a house because here you have to share the toilets.

Her little girl gets the necessities, she says: "Nappies, wipes, chips, biscuits."

But this is New Zealand, not India, and this is poverty, say social service workers. Though this young woman is trying to be upbeat, she is here because it's all she can afford.

Over in Clendon we meet another young mother, this one in her mid-30s with six children.

She seems flat and though friendly and very polite, a little detached.

There is a psychology attached to barely scraping by, week after week, and sometimes not scraping by, says Nicole Robertson, the clinical adviser for Mangere-based agency Strive, which tries to address the social, economic, educational and cultural needs of clients.

You have to be able to cut parts of yourself off to be able to cope, Robertson says.

The woman lives in a small three-bedroom house with neat lawns and an orange tree in a street of other small homes.

She is a beneficiary and the rent for this privately owned house is $425 a week.

Like many, her story is complicated. Domestic violence and separation led her here. Her older children live with their father and the younger ones with her.

She has a 12-week-old-baby and a two-year-old girl at home today but her seven-year-old boy is nowhere to be seen.

She's not worried. It's the school holidays and he's out in the neighbourhood somewhere with his little friends who came to fetch him earlier.

Strive has many clients out this way. In a Housing New Zealand property in Mangere lives another woman in her mid-30s. She is a grandmother already, with seven children of her own.

She was doing okay and had a job and had also put herself through study, only to have illness and separation from her partner plunge her and her children below the poverty line.

Not all her children live with her either but two school-age girls do.

Sometimes, she says, they run out of food and don't eat for two days. The girls, a teenager and a pre-teen, sleep their way through the hunger.

There are various reasons for running out of food. The children who live with their father exist on a lot of baked beans and rice. When they come to her they eat what they can find and the food runs out.

Poverty is tiring and grinding, and sometimes she simply doesn't have the energy to go to Winz for yet another food grant where she must face another grilling about where her money has gone: "I just feel shame."

If her two daughters don't have enough for lunch she keeps them home from school, she says.

At school they have already been badly bullied as the "poor family", even though the bullies sometimes come from similar situations.

This woman is articulate and educated. Education is the only way out, she says.

To explain why she ended up in this situation she looks to growing up in Mangere where crime and drugs are a constant and there is a liquor store on nearly every street. Her own mother died young and her family split apart. She had her own issues around not feeling she belonged anywhere and then later on there was domestic violence.

The mother in Clendon can barely afford the rent and the family survives on food parcels but she is not deemed high priority by Housing New Zealand because she and her children already have a roof over their heads.

Tea tonight is probably noodles; whatever is left of the latest food parcel.

Can she see a way out? "Yeah, Lotto," she says lightly, then quietly "no, not really, because wherever there's a path there's always an obstacle to get over."

What poverty means

As the social workers say, child poverty in New Zealand is not the same as in India, but it is real.

A Statistics NZ survey in 2008, before the recession, found that 44 per cent of parents in the poorest tenth of families could not afford waterproof coats for their children.

Two-thirds (65 per cent) of that poorest tenth said they had cut back on fresh fruit and vegetables to keep down costs. Almost half (47 per cent) lived in damp or mouldy houses.

The recession has made things worse.

Among the poorest two-fifths of families, the numbers cutting back on fresh fruit and vegetables almost doubled from 7 per cent in 2007 to 13 per cent last year; families staying in bed longer to save on heating costs jumped from 3 per cent to 10 per cent.

Even schools that resisted food programmes for children coming to school hungry are changing their minds. Alan Lyth, principal of Bairds Mainfreight School in Otara, said last year that it was "good for the parents to know there is an expectation that at least feeding their kids is their responsibility".

This year he says things have got worse because more parents have lost jobs.

"We are having more and more kids who are saying we are not getting enough to eat. So while I still feel that it's a parental responsibility, it's coming to the point where I'm starting to think - I haven't totally changed my mind, but I'm sitting on the fence."

Why it matters

Children's Commissioner Dr Russell Wills, who works part-time as a paediatrician in Hastings, says he has made child poverty a priority in his official job because "the vast majority" of the acute chronic illness he sees in his child patients is "poverty-driven".

"What we see is children with late presentations of unusually severe infectious diseases such as chest infections, skin infections, tuberculosis, rheumatic fever and meningitis - conditions that for our British registrars are shocking because they thought they only existed in third-world countries."

A 2006 Social Development Ministry study of child abuse found that "child death from maltreatment occurs predominantly in the context of poverty, psychological stress and limited support".

Long-term studies of children born in Christchurch and Dunedin in the 1970s have found that children who grew up in low-income families were far more likely than others to leave school without qualifications, become teenage parents, commit crimes, become addicted to drugs or alcohol, suffer worse physical health as adults, and go on welfare.

Researcher John Pearce has calculated the resulting lost productivity and higher state spending costs New Zealand about $8 billion a year, or 4.5 per cent of our economic output.


At first glance, poverty can often be seen as a poor family's own fault. Former Act MP Rodney Hide wrote in the Herald on Sunday two weeks ago that children's "lack of breakfast is not caused by a lack of money, it's caused by a lack of care".

A sole parent with three children paying the median $365 rent for a three-bedroom house in Otara would get $689.44 a week from the domestic purposes benefit, family tax credits and accommodation supplement. Even after paying the rent, that's $324.44 a week, arguably enough to live on.

Hide says welfare has let parents disregard living within their means.

"Human beings have been around for two million years," he says. "People went through wars and depressions and always gave their kids breakfast. Now we are in a society that is rich beyond previous generations' dreams, beyond their wildest imaginings, and we have people who, almost through no fault of their own, don't have the wherewithal, the spirit, to actually look after their own children."

Budgeting agencies confirm even the poorest families can feed their children once they get their debts under control and learn to budget.

"If you are up to your eyeballs in debt, which 90 per cent of the people we see are, it's extremely difficult," says Mangere budgeter Darryl Evans.

"Can you turn it around? Absolutely!"

The deeper question is what has undermined parents' abilities to manage. As the Maori Party put it this year for a ministerial committee on poverty: "It is not just about addressing material poverty, it is also addressing the poverty of hope."

Even the most self-confident person can quickly lose confidence and self-worth if they lose work and/or their relationship.

Welfare has been around in more or less its current form since 1938, yet child poverty did not take off until the late 1980s and early 90s when trade barriers were lifted and state enterprises sold off.

Unemployment skyrocketed, benefit rates were cut, state houses moved to market rents, and children in families earning under 60 per cent of the median income, after housing costs, trebled from 10 per cent of all children in 1986 to 29 per cent eight years later. Last year the figure was still 25 per cent.

The initial driver was a loss of jobs. In 1986 only 29 per cent of children in poverty lived in households with no fulltime worker; now 65 per cent live in such households.

But another driver has been disintegrating marriages, because 80 per cent of the children in workless families live with only one parent. Sole parents have increased from 10 per cent of all families with children in 1976, soon after the domestic purposes benefit (DPB) was introduced, to 29 per cent today.

In contrast, Wills notes that the elderly have been relatively protected. Their numbers in poverty have risen only from 4 per cent in 1986 to 10 per cent, fewer than in any other age group.

"The rate of child poverty is a choice," he says. "We can therefore choose for it to be different."

What can be done?

Wills has tapped top academics and movers and shakers such as Business NZ chief Phil O'Reilly and Strive head Sharon Wilson-Davis, who was also on the Rebstock committee which largely wrote the Government's welfare reform agenda.

He asked them to report on solutions to child poverty by December, tying in with the ministerial committee on poverty and a Government white paper on vulnerable children being published next Thursday.

The group's initial "options paper", on which submissions close next Friday, proposes targets to cut child poverty, a food in schools programme, changes to welfare and housing subsidies, a "warrant of fitness" for rental housing, and passing on child support from absent parents to custodial parents instead of siphoning it off to pay for sole-parent benefits.

On the first key poverty driver, jobs, it suggests a carrot-and-stick mix.

"Carrots" include more flexible childcare subsidies and giving parents priority for job subsidies.

The "stick" is to turn the DPB into a "young child-carer benefit", make sole-parents look for part-time work one year after giving birth, and stop the benefit completely when their youngest child turns 6, "when there would be an expectation of full-time work".

Family tax credits would be raised for young children in the short term. In the long term, the group proposes a universal child payment higher than existing tax credits for the first year after giving birth, then stepping down gradually and becoming a targeted top-up like the current tax credits from age 6.

On the second key driver, disintegrating marriages, Wills says the reforms would reduce the current incentive for young parents to separate so that one can get the DPB.

The universal payment would lift couples' incomes in the first year, and beyond that the proposed DPB-replacement would be much harder to get.

He believes that passing on child support, usually from absent dads to custodial mums, will also encourage dads to take ongoing responsibility for their children.

The outcome

The Government's initial response to the group's ideas was dismissive. Key described a universal child payment as "dopey".

But as reported in the Weekend Herald today, Finance Minister Bill English, who chairs the ministerial committee on poverty, says he is "quite open" to a food in schools programme and has not ruled out a rental housing "warrant of fitness".

His committee is looking at ways of using family tax credits and housing subsidies to tackle poverty more effectively, and at ways to make housing more affordable. Labour is also reviewing its policies in both areas.

Wills will not get all he wants from either party. But in the short term his initiative has increased the chances that both parties will give more weight to the interests of children in their approach to both issues.

In the long term, he has planted ideas in the public mind. O'Reilly, the group's business voice, says many of the ideas will have to wait until there is money to pay for them.

"I'm a keen fan of the idea of water on a rock," he says.

"If this report is another couple of drops of water on that rock, that's fine."