Te Pōharatanga Tamariki Child Poverty Report 2023
This is the fifth report on child poverty released with the Budget. It shows the progress we have made in reducing child poverty against the child poverty reduction targets set in 2018.
Budget child poverty reporting requirements
The Child Poverty Reduction Act 2018 amended the Public Finance Act 1989, introducing section 15EA, which requires the supporting information for the main Appropriation Bill (the Budget) to include a report on child poverty. The report must:
- discuss any progress made, in the most recent completed financial year, in reducing child poverty consistent with the targets under the Child Poverty Reduction Act 2018
- indicate whether and, if so, to what extent, measures in or related to that Bill will affect child poverty.
The most recently completed financial year is 2021/22, which is the fourth year of reporting on the targets under the Child Poverty Reduction Act 2018. This report addresses paragraph (a) by providing a high-level view of recent trends up to and including 2021/22, before discussing the expected impact of Budget 2023 to address paragraph (b).
It comes at a time when we are facing considerable challenges after Cyclone Gabrielle and other recent extreme weather events, inflation pressures, and a volatile and uncertain global environment.
In these challenging economic times, the Government remains committed to reducing child poverty and improving child wellbeing, and making Aotearoa New Zealand the best place in the world to be a child or young person.
Child poverty is measured against nine child poverty measures set out in the Child Poverty Reduction Act 2018. The latest figures released by Stats NZ for 2021/22 show that eight out of nine child poverty measures have seen statistically significant reductions since the baseline year of 2018. This is testament to the comprehensive package of investments we have put in place over several years to support families and whānau.
These investments include the benefits of the enduring changes we have implemented to reduce child poverty and increase incomes, such as our $5.5 billion Families Package[7], successive main benefit increases, indexing main benefit payments so they increase at the same rate as the average wage annually, increases to the minimum wage, increases to the Working for Families Family Tax Credit, and implementing and expanding the Ka Ora, Ka Ako Healthy School Lunches Programme across the country.
In addition, the extensive package of income and other supports put in place since the start of the COVID-19 pandemic, as well as a very effective public health response, have helped avoid the big increases in child poverty rates that might have been expected. The package has included temporary supports such as the COVID-19 Wage Subsidy Scheme, the ongoing COVID-19 Income Relief Payment, the 12-month residential rental freeze and temporarily doubling the Winter Energy Payment.
Looking ahead, a key Government priority is supporting New Zealanders with the cost of living, particularly low-income households and those affected by Cyclone Gabrielle and recent flooding. The package of support announced to take effect from 1 April this year is now helping approximately 1.4 million people with the cost of living. The package includes an additional lift in main benefits in line with inflation, making more families eligible for Childcare Assistance, and earlier measures that include the extension of half-price fares on public transport, and fuel tax cuts to the end of June this year. For Community Services Card holders, public transport is permanently half price.
Notes
- [7] The Families Package was introduced in 2018 as part of the Government’s focus on reducing child poverty and ensuring children get the best start in life. The package included changes to several income support payments and introduced two new payments, Best Start and the Winter Energy Payment.