Tough times ahead for children in hardship under next government, CPAG warns

The Child Poverty Action Group is asking the National Party to make good on its commitment to children in poverty, but says the party’s fiscal plan reveals it has no desire or intention to help those living in the greatest poverty in Aotearoa.

Today the National Party revealed its fiscal plan with $2 billion cut from the amount forecast to be spent on benefits over the four-year forecast period.

Just two days earlier on the Newshub leaders’ debate on Wednesday evening, both Labour leader Chris Hipkins and National leader Christopher Luxon promised to stick to the targets outlined in the Child Poverty Reduction Act (2018) and both said they would halve child poverty by 2028.

CPAG convenor Alan Johnson said the leaders’ words were hollow, with neither major party showing any policy that reflects a real commitment to children in poverty.

"For many of us, overcoming child poverty is the right and compassionate thing to do. Right now, our economic system is restricting many families who want to do well for their kids," he said.

"People across our communities - our teachers, healthcare workers, supermarket workers, caregivers, friends, neighbours - are being swept into poverty by systems that make the rich richer and the poor poorer.

"As these constraints are placed on them, many parents continue doing their best - using all their energy and problem-solving skills to help their children."

Labour has virtually turned its back on many of the recommendations of the 2019 Welfare Expert Advisory Group, and appears to have shelved its Working For Families review, Mr Johnson said.

Working for Families is a weekly payment (made up of the family tax credit and the in work tax credit) to the caregiver that is supposed to help meet the needs of children and prevent child poverty in low-to-middle income families.

But 200,000 children of the poorest children miss out on the In Work Tax Credit because their parents are on a benefit or a part benefit. 

"To significantly improve child poverty, the full package needs to be given to those families that currently miss out," Mr Johnson said.

Instead, both Labour and National have said they will increase the In Work Tax Credit to nearly $100 a week from April 2024. They have chosen to continue to ignore the plight of the 200,000 poorest children and increase the discrimination against them.

Moreover, by leaving the very low threshold of $42,700 (from which WFF starts to sharply reduce) unchanged for the next 3 years, they make the work disincentive for the ‘working poor’ even worse.

Labour ignored reporting by Inland Revenue that found our tax system to be unfair, with large holdings of wealth held largely untaxed, by the very top earners.

Instead of adopting a tax on the holders of wealth, they chose to take GST off fresh fruit and vegetables, a policy universally described by economists as expensive and of most benefit to higher income people while ineffective in delivering significant benefits to the families most in need of help..

National, as well as cutting benefits, wants to toughen the sanctions in the already broken welfare system -- a move that is not backed by a shred of evidence that they will be effective in getting those on benefits into suitable paid work.

It will also peg benefit rises to inflation, meaning people in our most vulnerable communities will fall even further behind over time.

"So while we are pleased to see both party leaders publically saying they care about child poverty -- their actions don’t reflect that," Mr Johnson said.

"We can and should expect better. The systems that lock people into poverty do not have to be designed that way. Labour and National have let out children down."

In early 2023 the UN Committee reconsidered New Zealand’s commitment to the UN Convention, and reassessed whether the government was meeting its obligations to children.

The UN Committee specifically welcomed the Child Poverty Reduction Act 2018, the four Wellbeing Budgets, the Child and Youth Wellbeing Strategy 2019 and the Families Package (2018).

It was, however, still concerned about rates of child poverty and housing deprivation.

The UN Committee picked up on a new concern raised by CPAG in its reporting -- that of food insecurity and hunger experienced by children in New Zealand.

The UN said: " The Committee is however seriously concerned that a significant proportion of children live in poverty and experience food insecurity and severe housing deprivation, including homelessness, insecurity of tenure, and overcrowding, resulting in poorer health and education outcomes, disproportionately affecting Māori and Pasifika children."

In March, official child poverty statistics showed little movement in rates since 2018, and CPAG then warned that without any real shift in policy it would be difficult for any government to meet its ten-year targets by 2028.

CPAG says all political parties should be creating policies that ensure children have access to education, housing and food.

CPAG created 11 policy briefs in June outlining how New Zealand could eradicate child poverty.