The Ministry of Health and the Lakes District Health Board have acknowledged her criticism and said work was being done to prevent discrimination.
But Minister for Children Tracey Martin has hit back, saying "trying to demonise" Oranga Tamariki and the people who worked for it wasn't the way to make things better. She said it would be nice if Oranga Tamariki wasn't needed but it wasn't realistic to shut it down.
Raukawa-Tait said district health boards across the country were aware that systems, policies and procedures in place had not served Māori well.
She said many had reviewed their practices but changing the culture of organisations was not easy.
"Discrimination, bias and prejudice are common practice ... Lakes District Health Board is no different but I believe in recent years it has made a genuine attempt to change."
She said the organisation should be doing more.
An internal review into the attempted Hawke's Bay uplift identified a litany of errors, prompting a public apology from Oranga Tamariki and immediate policy changes.
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The attempted removal was documented by Newsroom, showing officials repeatedly trying to get the mother to give up the child, while whānau and the mother's midwives were kept outside the room.
The agency said it would make changes to its approach, while the Minister for Children said she would not be asking for the agency's boss to resign.
And as several other iwi-led investigations are under way, Oranga Tamariki said it would change its policies and connect with whānau better.
However, Raukawa-Tait said the practice of removing children from whanau should be shut down.
She said she would prefer there were no state departments anywhere near tamariki Māori and that the shut down of Oranga Tamariki "would be a damn good start".
"The state has never done a good job at caring for the children, so put that $1 billion that was allocated to [Oranga Tamariki] this year in the Budget, put that into the families and into the organisations who don't have the money to do the breadth of the work that they should be doing."
A core ministry advising the minister would be fine, but the delivery of the services and the support for the families should not be delivered by a government agency, she says.
She said Māori could look after themselves if given the support to do so.
Raukawa-Tait said she had little regard for people who suggested Māori had not been able to help themselves already.
"What have those people ever done to assist Māori to be able to take their place in this country as full contributing citizens?
"What we have to understand is that in New Zealand we've had piss-poor policy over many years that has relegated Māori to the sideline."
Minister Tracey Martin said Oranga Tamariki was needed as long there were high rates of family violence and abuse coupled with addiction, mental health and other issues.
"What we need is for Oranga Tamariki to work well, for all children, Māori and non-Māori and that's what I'm committed to.
She said Oranga Tamariki was created to drive a system change from Child Youth and Family Service.
"So yes, the Government has invested more than $1 billion into Oranga Tamariki from July 1, because this is an area of longstanding need and we think children are worth it. But as well as being for looking after those children already in care better a lot of that money is specifically for Māori, iwi and NGO providers like Family Start."
She said the investment would see about 900 new roles by the end of year four and iwi, Māori organisations and NGOs were expected to provide about half of these.
She said about 30 per cent of the budget for Oranga Tamariki went to Māori, iwi and NGOs who worked with children and families and Oranga Tamariki was trying to make those relationships stronger.
She said Oranga Tamariki was the only government department that had a legal requirement to improve outcomes for Māori.
"I absolutely get that Māori children are over-represented in our care and protection system and we need to do better.
"But trying to demonise the agency and all the people who work for it that have the job of looking out for children isn't the way to make things better."
Oranga Tamariki deputy chief executive Governance and Engagement Blair McKenzie told the Rotorua Daily Post that the funding and structure of the organisation was a political decision, therefore it was unable to enter into debate about the subject.
"However, we have an absolute obligation under the law to keep children and young people safe and will continue to do so," McKenzie said.
"Protecting and caring for the country's most vulnerable children, both Māori and non-Māori, is our mandate, but we know that young people do best when with family.
"That's why we're committed to improving support for families who are at risk of having their children and young people taken into care. Working with the community, namely Māori, iwi and NGO providers, is the best way to do this."
McKenzie said about 30 per cent of the total budget wet to Māori, iwi and NGOs who worked with children and families.
"We want to improve our work in this area, and so far we've signed four strategic partnerships with Ngāi Tahu, Ngāpuhi, Waikato-Tainui, and Ngāi Tūhoe.
"We are also now subject to new legislation requiring us to provide measurable improvements in outcomes for Māori – the only government department to be held to account in this way."
Lakes District Health Board chairman Deryck Shaw said nobody would dispute there was discrimination in all organisations and Lakes was no exception.
"The DHB accepts that efforts to address Māori Health equity have not had the successes that the DHB would have liked and this is the board's main priority.
"We have embarked on a programme to co-design and partner with iwi and communities in the design of health services. We have also sought to increase the voice of Māori at the governance table and have recently changed the Midland Regional governance structure to have equal representation from the DHB chairs and the iwi governance board chairs. "
Shaw said an organisation's cultural value base was the responsibility of all staff and not just a team of Māori staff.
In response to criticism about all district health boards, Ministry of Health deputy director-general Māori Health John Whaanga said current inequities in Māori health was "unacceptable".
"The very fact the Māori health directorate has been reformed indicates how seriously we are about achieving equities in the health sector, and we are in constant communication with our partners in the sector to achieve the ultimate aim of improving access and achieving those equities in health."
Whaanga said, however, there was "considerable way to go".
Health Minister David Clark said Māori too frequently were suffering worse health outcomes than non-Māori, and this Government was taking a number of steps to address this.
"I know we need to make significant changes in how we deliver and design services if we're to make real differences and achieve fair outcomes for Māori and Pacific peoples in Aotearoa. This is exactly why I've made clear my expectations to DHB chairs that achieving equity underpins all of my priorities as Health Minister."
He said they need to have an explicit focus on achieving equity for Māori across their life course and to meet their Treaty obligations as specified under in the New Zealand Public Health and Disability Act 2000.
"I've made it clear to DHB chairs that they must report how they are meeting these obligations as part of their Annual Plan reporting."
- Additional reporting by Caroline Fleming