Inequality ‘bad for the country’


Child poverty has been made “hugely worse” by New Zealand’s growing inequality, a Dunedin academic says.

Associate Professor Nicola Atwool, of the University of Otago Department of Sociology, Gender and Social Work, says there is an urgent need to counter the growing gap between rich and poor.

Figures released by Oxfam earlier this year showed the richest 1% of New Zealanders owned one-fifth of the nation’s wealth.

At the other end of the scale, the bottom 40% of households hold only 3% of the wealth.

“Inequality is very bad for the country – it not only breeds resentment and reduces social cohesion, it also has an economic cost and leads to poorer health outcomes,” Assoc Prof Atwool said.

It is estimated that between 25% and 29% of New Zealand children live in households in poverty.

Of these, 14% of children suffer “material hardship” – the lack of four or more basic items in their lives, and 8% are in severe poverty.

While the National Government saw paid work as the solution to the problem, the facts showed that 40% of children in households below the poverty line had a working parent, Assoc Prof Atwool said.

“Also, people coming off benefits tend to go into low-paying jobs, or have multiple part-time jobs and job insecurity,” she said.

For those on benefits, New Zealand’s “incredibly complex” welfare system often took a punitive approach, which led to “terrible cycles of difficulty” for families.

“Our children pay the price for that.”

Poverty in childhood had a “real impact” on education, which was the one pathway out of poverty for many people, Assoc Prof Atwool said.

“Children in poor households tend to disengage from education, and they are often steeped in the sense of helplessness that pervades some families,” she said.

“They can end up feeling there is nothing to aspire to.”

For children living in poor families, access to housing can also be insecure, which compounds the difficulties.

“We need to remember that poverty is a risk factor [for poor life outcomes].”

Resilience research showed that protection from poverty as a risk factor included family support, engagement in the community, and support at school.

“Children in poverty need to have access to the things that we take for granted, and that can be a simple as going to the beach, taking bush walks and playing sport.”

In recent years there had been encouraging examples of schools making themselves into community hubs, bringing in services to make access easier for families and hosting fun events to break down the barriers.

“Hubs bring people together in positive ways, and this is something we can look at further as communities.”

Assoc Prof Atwool believes that government is in a position to “do something positive about poverty and inequality.”

This included rethinking New Zealand’s tax system and thresholds in order to create a more event distribution of wealth.