Sharp departure in child poverty approach

Released today, the government's new Child and Youth Strategy might, at first glance, look like a rehash of Jacinda Ardern's child poverty reduction plan. However, it contains some major differences. 

For one, it will track the number of children in benefit-dependent households. This recognises the obvious pitfall of  simply increasing benefit payments to parents, which only draws more onto benefits and makes it harder for them to get off. Hence, under Ardern's plan, we saw a 26% increase in children reliant on benefits between 2017 and 2023. 

Unlike Ardern, who refused to acknowledge the poorer outcomes for children in unemployed households, Minister Louise Upston does. This includes higher rates of abuse, higher likelihood of interaction with Oranga Tamariki and greater likelihood of becoming benefit-dependent when they reach adulthood. There is ample data and evidence to show that is the case.

Supporting this new direction, the specific poverty reduction target has shifted to 'material hardship', reflecting that it isn't necessarily how much money poor households with children receive but what they do with it. The material hardship measurement quantifies what a child is forgoing, for example "not being able to afford two pairs of shoes." 

(The government's coalition-partner ACT might take note here that the document states, "Children in benefit-receiving households are 3.5 times more likely to be in material hardship than children in working households." That lends strong support for ACT's policy of expanding payment cards - already in use for very young parents - whereby the benefit is not paid fully in cash but loaded onto a card for use in supermarkets and other selected retailers. It also supports money management to ensure rent and utility bills get paid on time. Interventionist maybe, but this is taxpayer's money and, most importantly, it is provided so children are properly cared for.)

Another clue to how National's approach differs sharply from previous Labour policy is their stated current strategy of "increasing the In-work Tax Credit". This grows the gap between income from working and income from being on a benefit, a critical necessity in a properly functioning economy. During Jacinda Ardern's time, benefits were officially linked to wage growth, a radical departure from all previous Labour administrations which had linked benefits to the cost of living or CPI. National has now reversed this incredibly damaging policy.

As well as monitoring material hardship, other 'Child Poverty Related Indicators' the government has chosen to measure and target are "housing affordability, student attendance, educational achievement and potentially avoidable hospitalisations." This indicates a far more holistic view of poverty than Labour ever reached. For Labour (and the Greens) child poverty is always about a lack of money. Yet we all know that there are income-poor children in this country who do very well because their parents prioritise them.

Upston concludes her release about this new strategy with, "To achieve lasting reductions in child poverty rates we must break the long-term cycles of disadvantage and intergenerational benefit dependency."

Therein lies the crucial difference. Jacinda Ardern would never, ever have spoken those words. 

Needless attack on government directive by public health academics

In September 2024 the government issued a directive to government agencies not to prioritise services on the basis of race. Shortly after, a group of public health academics from Auckland and Otago Universities wrote a paper which was published in the NZ Medical Journal strongly opposing the directive.

They began by objecting to the term "race" because it is "discredited terminology" which "suggests that the foundations of white superiority are still alive and well in New Zealand today."

They argue that Maori ethnicity is an "evidence-based marker of need" and is "superior to many other markers of need." The example is given of the bowel cancer screening programme failure to recognise that "over half of Maori cancers occurred before the screening threshold of 60 years." The inference is, in this instance, being Maori is a "superior" marker of need.

It isn't. It is an additional and relevant marker. The government directive deals with this possibility as follows:

8.1 when considering proposals for services targeted to specific population groups, agencies should engage responsible Ministers early about choices or options being considered and:

8.1.1 provide a strong analytical case for targeted investment (based on empirical evidence about why such interventions are necessary, i.e. the disparity in outcomes between the target and the general population and why general services are not sufficient to address this), and an assessment of any opportunity costs in terms of the service needs of all New Zealanders

Yet the group persists with an overarching dismissal of the directive saying:

"This directive, and the political discourse surrounding it, is an affront to scientific and public health knowledge, and requires explicit rejection from health professionals and the scientific community."

The hyperbole only increases culminating with a threatening reprimand: 

"The Government’s directive is not just an attack on Māori, but an attack on science and good medical practice. Anyone who supports this directive, either actively or complicitly through their silence, is supporting the undermining of our collective scientific knowledge and commitment to evidence-based medical practice."

This implies that any health professional who quietly supports the directive will be perceived and painted as some sort of traitor. Heavy stuff.

But then, in an astonishing, concluding, admission which undermines their own credibility the authors write:

"Our concern is that this circular will be interpreted as shorthand for “no more ethnicity-based anything” when this is not what the directive actually says, and certainly not what is needed."

Indeed. The directive, issued by the Department of the Prime Minister and Cabinet, is quite clear and considered.

Not so the lead author, Belinda Loring,  who told Radio New Zealand, in justifying her stance:

"The good outcomes and high level of high quality service that Pākehā receive isn't the same for other ethnic groups. So it's that inequity that continually needs to be adjusted."

This comes as something of a surprise from one who values "regard for evidence" so highly. The escalating inability to access primary healthcare due to the diminishing availability of GPs; the consequent long waits at ED and after hours clinics; the long wait times for elective surgery; the shortage of ambulances etc are all well-documented and affect all New Zealanders, especially those who live in rural areas.

With that statement the author has only contributed to the "political discourse" she rails so angrily against.

Is social investment the new panacea?

There are individuals born in NZ who will, over their lifetimes, cost the taxpayer hundreds of thousands of dollars in welfare, child protection, justice, corrections and mental health services. They will physically and emotionally hurt others, possibly take a life or lives, and in that respect inflict even greater indirect costs on society. 

Social investment suggests allocating some of that down-the-line cost to up-front intervention and prevention. By necessity it would have to focus on the child, the beginning. Later is often too late.

There have been past tentative efforts in this direction. For instance the predictive risk modelling work done at Auckland University. This identified the common circumstances around the birth of a child who'd go on to be the subject of abuse. For example:

“Of all children having a finding of maltreatment by age 5, 83% are seen on a benefit before age 2, translating into a very high “capture” rate.”

Early reliance on welfare was significant. But there was a host of other predictive indicators, for example having a parent who had served a custodial sentence, or a parent undergoing addictive substance treatment. 

Ultimately, though, then Minister for Children Anne Tolley rejected application of the model. The professor behind the work is now assisting north American states in child protection practice.

But the exploratory work proved that it isn't difficult to identify where the future trouble begins.

The absence of data and knowledge isn't a barrier to informed intervention.

The problem lies with issues of privacy (or avoidance of stigmatisation), and race. 

The last National government introduced a law to enable a baby to be uplifted from a mother whose earlier children had been removed due to substantiated abuse. That didn't play out well when Maori advocates actively blocked the process.

Similarly with Section 7AA, whereby cultural considerations must be paramount when placing a child into care, some Maori will attempt to thwart non-Maori intervention.

While he was Police Commissioner, Andrew Coster oversaw a regime of Treaty training and courses aimed at unlearning unconscious bias. His woke credentials were earned. Next year he will take charge of the new Social Investment Agency where the budget provided for practical intervention will be available to iwi providers. It will be no surprise if he is highly sympathetic to the 'by Maori, for Maori' sloganeering. (We could all be confidently sympathetic if violence against children was diminishing but it is not.)

So where will that leave the current tension between the Minister for Children and Oranga Tamariki bureaucrats? Might we see a Minister for child protection and CEO for social investment with competing philosophies? As if there isn't already enough conflict between the public service and coalition politicians.

But there is another aspect of social investment which suggests to me the government still isn't taking the concept seriously.

Literally billions are spent on incentivising the type of lifestyles that create future criminals. A third of Maori babies are dependent on a welfare benefit by the end of their birth year. They don't grow up in working households. Sole parents are now expected to spend a future 17 years on welfare; if they enter the system as a teenage parent, 24 years. Too often their own parents were subjected to woeful upbringings devoid of examples of how to raise a child well. This malaise isn't just a Maori problem, but a child in need of intervention is more likely to be Maori.

Those billions make a mockery of 'social investment' at $12 million annually.

We seem to be simultaneously stoking a massive fire while standing by with a watering can.

Wellington takes a hammering (though it's not evident from MSD's calculations)

My blog posts often result from a question popping into my head.

In this case, given all the gloom and doom around public servant lay-offs in the capital, I wondered, "How big is the growth in Jobseeker benefit receipt in the Wellington region and how does it compare to other regions?"

To answer this I accessed the latest Jobseeker Support data at MSD. Their chart calculates the percentage of the working-age population (aged 18-64) receiving Jobseeker Support in each region and compares Sept 1,2023 to Aug 30, 2024:

 

(Left click on image to enlarge)

That's interesting, I thought. The year-on-year growth (final column) is highest in Auckland, Central and Waikato. Comparatively, Wellington isn't faring that badly.

But hang on. To get a reliable percentage, a reliable fraction is required. The denominator (middle  column) is the 'Estimated 18-64 resident NZ population'.

Note that the chart purportedly uses June 2023 for both calculations - 'Reported week' and 'Same week last year.'

Yet Wellington and Central have changed population numbers - Wellington's increased while Central's decreased. So the column headings are at least partially incorrect.

The official published numbers are totally unreliable.

To answer my question, I can however set up my own graph showing absolute numbers on Jobseeker Support by region, and the percentage change from base, year-on-year. At 27 percent annual growth, much higher than any other region, Wellington does not look pretty. But neither does Auckland, in terms of absolute growth:

Still, we have been in much tougher times. In June 1993 for instance, 200,000 people were reliant on the equivalent benefit but in a population around 2 million lighter.

That isn’t much consolation to those losing their jobs today but let’s hope that the unavoidable correction to Labour’s six years of over-cooking the economy with borrowed money doesn’t come with too much more pain.

The child poverty conundrum

 The Child Poverty Report 2024 has just been published. It's an overview and selected findings, as opposed to a full report which is due in 2025.

Poverty can be measured in various ways.

Material hardship is measured by asking survey questions about deprivation. Has a child gone without fresh fruit and veges, been subject to postponed doctor visits, experienced a cold and damp house, etc. The DEP-17 scale has 17 items and experience of 6+ is considered material hardship; 9 or more, severe hardship.

The following graph shows that children in beneficiary households experience material hardship at rates that are consistently, "four to five times the rates for children in working households":

(Left click on image to enlarge.)

While the fall in the hardship rate is good news, the percentage of all children living in beneficiary families increased from 15 to 19 percent  between 2017 and 2024 (see Table 6).

So the rate of hardship has fallen but there are more children subject to it.

In my opinion, the growth in benefit-dependent children is primarily the result of increasing benefit payments and incentivising more families to opt for welfare and stay on it for longer.

The following further graph from the report illustrates the steep rise in beneficiary incomes over recent years (but does not include Best Start, Winter Energy Payment or Accommodation Supplement.) A sole parent with two children receives just under $700 weekly. Adding in the exclusions however, pushes that figure up to $1,057 weekly (April 2023). See Page 6,  https://www.msd.govt.nz/documents/about-msd-and-our-work/publications-resources/research/benefit-system/total-incomes-annual-report-2023.pdf

In respect of children in workless households, in 2022 (latest data) New Zealand was second only to Romania when compared to 26 European countries.

By family type the highest material hardship rate occurs in sole parent families at 32 percent (compared to 12 percent overall.)

The report notes, "New Zealand also has a relatively high proportion of sole parent households compared with European countries."

Most children on benefits are in sole parent households (70%).

In conclusion, the report shows that in general child well-being has improved and poverty has fallen.

However, the part of the equation that relates to those children living on benefits is not sustainable policy.

The numbers cannot  be encouraged to keep growing. That will only ramp-up inter-generational dependency and further deplete potential productivity.

The feasible approach is that which Clark and Cullen adopted during the 2000s (but Ardern and Robertson shunned more latterly). 

That was, work is the best way out of poverty. Always has been and always will be.

Simply shoveling ever more money into perpetually unemployed households is just another moribund idea from the Ardern era.