Need seen for strategies to help address poverty

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All political parties are taking poverty more seriously, but a strategic approach to raising the incomes of the poorest people by indexing them to the country’s median wage is urgently needed, Dunedin Child Poverty Action Group co-ordinator Dr Emily Keddell says.

One-off proposals, which might be seen as bribes, would not reduce poverty year on year, she said.

The group wants to get rid of the discrimination resulting from the in-work tax credit by abolishing it and adding $72.50 to the family tax credit for the first child payment.

The in-work tax credit, which is not available to beneficiaries who work less than 20 hours a week, had not been shown to have been effective as a “carrot” to encourage people to undertake more work.

Rather, it had almost a “zero effect”, Dr Keddell said.

The current system also did not recognise the precarious nature of many workers’ jobs.

About a third of workers had unstable hours over which they had no control and it was easy for them to lose the in-work tax credit because of that, she said.

There was also a need to raise the income level at which Working for Families tax credits began abating. This should be indexed to the median wage.

Action on incomes was urgent because the number of children in poverty, measured at between 25% and 29% of children, was not reducing.

“It’s not going away,” she said.

It was also important that the next Government established an agreed national measure for poverty, which had not been achieved to date.

Dr Keddell would like to see this set at 60% of the median wage after housing costs.

Other measures could also be used, such as material hardship, measuring the number of things people went without.

Without any official measure, there was no way of honouring the country’s international commitment to reducing poverty.

Housing costs were a big issue, Dr Keddell said.

Releasing land so property speculators could build on it was not a solution. There had to be “serious state investment”.

Houses considered “affordable” at $600,000 were out of the reach of families who needed them and who might be in rental accommodation which was not up to standard.

In Dunedin, the quality of housing rather than the cost had been an issue, but improvements were being made through initiatives such as Cosy Homes, which improved insulation.