A job is not enough: High rents keep kids in poverty
The latest child poverty figures show that even two-income households aren’t able to avoid poverty, thanks to exorbitant rents.
The 2022 Child Poverty Report shows rental costs are pushing children into poverty, and employment alone is not enough to end material deprivation. In fact, it says that 76% of families in poverty are also in employment.
The Ministry of Social Development’s latest annual report on child poverty shows that about 30% of children living in private rentals are experiencing social hardship as a result of poverty.
‘‘This leaves very little for the other necessities, and it is not surprising that this group has very high material hardship rates,’’ the report’s author, MSD principal adviser Bryan Perry said.
For children living in state housing, 54% are in hardship – but the report notes that income-adjusted rents of social housing are easing the effects of low incomes.
With many two-income households struggling to make ends meet after paying rent, the level of poverty amongst singleparent families is even worse. A child in a single-parent household was more than three times more likely to face material deprivation.
The report stated that 29% of children living in single-parent households faced material hardship. It said the level of child poverty among single-parent households had decreased from 34% five years ago, but it remained far higher than in comparable countries. In Europe, for instance, the rate was 19%.
While the overall picture showed the level of child poverty had decreased in New Zealand, it also raised areas of concern – specifically for Māori, Pasifika and in terms of the cost of housing eating up the wages of even fully employed twoparent families.
The data was collected last year, and it arrived with caveats around the recent concerns about inflation and the cost of living. Government ministers said it showed measures introduced during the pandemic had worked to keep New Zealand on a path towards eradicating child poverty.
Minister for Child Poverty Reduction Jacinda Ardern said increases to benefits, the wage subsidy and low unemployment throughout the pandemic had resulted in more children being lifted out of poverty – when similar economic shocks had increased child poverty in the past.
Professor Mike O’Brien, from the Child Poverty Action Group, said it was encouraging to see the rate of material hardship continuing to decline for children.
He said the report had identified issues in need of greater attention. The high rate of deprivation for those on benefits and low incomes was a concern – showing the need for Working for Families to provide better support for beneficiaries and parents on low incomes.