Child poverty figures error

Treasury can't give any indication as to the scale of its error.

Treasury has apologised for an error which could see fewer children projected to be lifted out of poverty as a result of the Government’s families packages.

It is not yet clear whether heads will roll over the coding error but officials have confirmed that child poverty reductions were overestimated when the previous National Government delivered its Budget in May last year and the error appears to have carried through to affect the current Government.

It is understood one of Prime Minister Jacinda Ardern’s first big speeches of the year was to include a child poverty focus and the Government was planning to introduce legislation in early February that would require governments to set child poverty reduction targets.

But the Treasury blunder was unlikely to be a quick fix and the exact number of children expected to be lifted out of poverty was not expected to be known until the end of February.

The Government would be setting its child poverty reduction targets later in the year.

The new Government delivered a ‘‘mini-budget’’ in December that largely undid the tax-cuts National announced at the May Budget, and unveiled a new families package that was more targeted toward poorer families.

It was projected to lift 88,000 families out of poverty but now Treasury can’t give any indication as to the scale of its error.

Treasury Secretary Gabriel Makhlouf said a coding error led to flaws in its simulations.

The extent of any change in the projections on child poverty was still being determined.

‘‘Because the error applies equally to comparisons with the previous Government’s Family Incomes Package, the estimated relative impact of the two packages is essentially unchanged,’’ he said.

‘‘The error does not affect the number of people who will be helped by the Government’s Families Package, the amount of extra income they will receive, or the fiscal impact of the package,’’ Makhlouf said.

‘‘This is a deeply regrettable mistake and I apologise for it on behalf of the Treasury.

‘‘The Treasury holds itself to high standards and I’m disappointed to have not met those standards here,’’ he said.

The Families Package would still ‘‘substantially reduce’’ the number of children in low-income households.

An independent review has been ordered and is expected to report back on the error by mid March.