The Dominion Post

There’s no such thing as ‘child’ poverty

- Liz Koh

Much has been made of the focus on wellbeing in the latest Government Budget and the $1.1 billion dedicated to ‘‘child poverty’’ measures.

There are many children living in poverty in New Zealand and it is admirable indeed to find ways to increase their living standards, but let’s get one thing straight. The reason children are living in poverty is that their parents, caregivers or wider family are living in poverty.

We don’t have child poverty in New Zealand, we have poverty. The term ‘‘child poverty’’ is a construct of politician­s seeking votes and charitable organisati­ons raising funds. Put the word child in front of any cause – child poverty, child cancer, child abuse and so on, and it creates an instant emotional effect leading to support for a cause – either political or charitable.

We have poverty in New Zealand. We have single parents going without the necessitie­s of life for the sake of their children. We have elderly people suffering quietly in their homes, putting on more clothes instead of their heaters, struggling to pay rent, and isolated from their communitie­s. We have people of working age with mental health issues, unable to find employment or support their families.

Focusing on children living in poverty implies that there is an intergener­ational cycle – that bringing children out of poverty will ensure they stay out of poverty in adulthood. While there is no doubt some degree of correlatio­n between childhood poverty and poverty in adulthood, it is a nonsense that the majority of adults living in poverty do so because they were impoverish­ed in childhood.

Children live in poverty because the people responsibl­e for their welfare and upbringing are living

in poverty. Getting to the root of poverty is a matter of addressing four key factors – incomes, the cost of housing, the cost of food and mental health. Look at any personal budget and the two biggest expenses by far are housing (rent or mortgage payments, rates and house insurance) and food. This applies to any age group.

In previous generation­s, the elderly retired with a mortgage-free home and the pension was enough to cover living costs. Nowadays, there is an alarming increase in the number of retirees who are either still paying off a mortgage or renting and, even with accommodat­ion supplement­s, the pension is just not enough. Solving the housing crisis is vital to stemming poverty. The issue with housing is the cost relative to incomes. The increase in the cost of housing has far exceeded the increase in average wages and benefit payments. Either the cost of housing needs to go down or incomes need to go up to restore standards of living.

Mental health is important for two reasons. Firstly, it impacts on the ability to earn income and secondly, it affects the ability to make sound financial decisions. Mental health issues are a significan­t cause of overspendi­ng, gambling and risk-taking which lead to poor financial outcomes.

Wellbeing requires a certain standard of living but it is much more than being free of poverty.

The OECD has for some years been working on a framework for measuring wellbeing. Within this framework are two key measuremen­t areas – material conditions and quality of life. Measures of income and wealth, jobs and earnings and housing are what determine material conditions, while quality of life is measured by such things as health status, work-life balance, education

Children live in poverty because the people responsibl­e for their welfare and upbringing are living in poverty.

and skills, social connection­s, environmen­tal quality and personal security. In New Zealand, Treasury is working on a framework for measuring wellbeing, based largely on the OECD framework.

It’s all very well to measure wellbeing. It’s another thing to improve it. There is a limit to what central government can achieve simply by allocating more money for health, education, housing and so on.

Other countries are succeeding with what is called a collective impact approach, whereby organisati­ons in the public, private and not-for-profit sectors work collective­ly and systemical­ly towards shared objectives of reducing poverty and increasing wellbeing.

Much of the impetus for change needs to come from the grass-roots level – from local communitie­s. The Tamarack Institute based in Canada is a catalyst in advancing community-led change in North America and collaborat­es with Inspiring Communitie­s in New Zealand, who provide training, support and resources to bring about community-led change.

There is no question that reducing poverty and increasing wellbeing require systemic change. But let’s be clear, we need to change the focus from child poverty to wellbeing for all New Zealanders.

Liz Koh is an authorised financial adviser and author of Your Money Personalit­y: Unlock the Secret to a Rich and Happy Life, Awa Press. The advice given here is general and does not constitute specific advice to any person. A disclosure statement can be obtained free of charge by calling 0800 273 847.

 ?? CHRIS SKELTON/STUFF ?? Queues for food parcels at the Auckland City Mission. For a solution, Liz Koh says New Zealand could look to the collective impact approach used overseas.
CHRIS SKELTON/STUFF Queues for food parcels at the Auckland City Mission. For a solution, Liz Koh says New Zealand could look to the collective impact approach used overseas.
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