Letter to the Hutt News:
Dear Editor
According to Gordon Campbell a recent OECD report showed New
Zealand's
"...economic policies have caused a significant rise
in income inequality" (Hutt News, December 16).
Income inequality grew during the late 1980s and early 1990s then
levelled off during the 2000s.
Over that period the structure of families, and gender participation
in the work force changed significantly. Single parent families
headed by females with no or low educational qualifications and/or
work experience increased significantly through to the turn of the
century before levelling off over the past few years. Many depend on
welfare and consequently form a large share of poor families.
At the same time, partnered woman increasingly either remained
working or returned to work earlier after childbirth.
In a nutshell, there are now more households with one work-less
parent, and more households with two working parents. The difference
between the the incomes of the two households is pronounced.
What the OECD report Campbell refers to said was that,
"...active
labour market policies, childcare supports and in-work benefits" are
needed if increased economic growth is desired. This recognises that
children coming out of disadvantaged homes eg unemployed households,
need a working parent and better engagement with education from an
early age.
The welfare reforms instituted by the National government (and
Labour prior with the creation of the In Work Tax Credit) have gone
some way to fulfilling this goal but need to go much further.
Reducing welfare dependence would contribute enormously to reducing
inequality.
Lindsay Mitchell
Figure J.5 Inequality
in New Zealand and the OECD trend: the Gini coefficient
Source:
http://www.msd.govt.nz/documents/about-msd-and-our-work/publications-resources/monitoring/household-income-report/2014/main-report.doc