Editorial: Child poverty figure needs more clarity to target relief

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The Children's Commissioner has done well to raise independent funds for an annual report on child poverty, less well in publicising its first year's findings. Headlines that "265,000 Kiwi kids live in poverty" - one in four children in this country - are not new and the impact is diminishing with repetition. Anybody who thinks about that figure wonders whether it can be right. One in four is such a high proportion of the population that the plight of these children would surely be overwhelming health, welfare and education systems.

In fact, that figure is an income statistic. This year, 25 per cent of children in households surveyed by Statistics NZ for the Ministry of Social Development were in families living on less than 60 per cent of the median income after tax, adjusted for family size and composition. Some of those children are going without material necessities but by no means all.

A better measure of child poverty, also used for the commissioner's report, is a ministry survey of household possessions and economising behaviour. It asks whether the household can keep its main rooms warm, provide a meal with meat at least every second day, pay for water and electricity on time, provide good beds, replace worn out clothes, visit the doctor, replace broken appliances, afford clothes for important or special occasions, and so on.

A household that says it cannot afford any six of 16 such expenses is considered to be in hardship. Last year 17 per cent of children in surveyed households were in that predicament. That produces a national estimate of 180,000 children, not one in four but more than one in six.

However the households in hardship are not always those on a low income. The report notes that "living above the income poverty line is insufficient to protect some families from material hardship. Conversely, not all with an income below the poverty line experience material hardship." In fact, it says, only 35-45 per cent of poor households are poor on both measures.

Those in material hardship with incomes about the 60 per cent median are likely to see their circumstances improve, the report says. It is those in hardship with incomes below the poverty line who need help. If they comprise 35-45 per cent of "one in four" children then we are talking about perhaps one in 10 - a troubling figure and one likely to be more readily accepted by the public.

It represents around 100,000 children suffering real hardship in low-income households. The country has the resources to help them from its existing budget for income support. The previous Government's system of income supplements still provides needless tax credits to large families on fairly high incomes.

That money should be diverted to children in genuine need.

But first we need to find out who they are, where they are and why their circumstances are worse than families below the 60 per cent median who are not lacking the essentials. We also need to know whether their hardship is temporary, or persistent and likely to be permanent without help.

The Children's Commissioner, Dr Russell Wills, has made poverty and its associated illness the prime concern of his five-year term. He started last year with an expert study that urged the Government to publish an annual audit of child poverty and set targets to reduce it.

The Government declined and Dr Wills has gone ahead with a grant from the J.R. McKenzie trust. His 2013 NZ Child Poverty Monitor is of real value in trying to define poverty and give the public a figure that conveys the hardship. One in 10 is bad enough. One in four does not bear thinking.