The rich get richer while child poverty just increases

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The Tax Package 2024 includes tax bracket increases, Family boost, $25 per week In Work Tax Credit (IWTC) , and $10 for the Independent Tax Credit per week.

The figures in Treasury’s graph can be used to show the total tax package is $2.9 billion per annum or around $30 per household on average.  

 

The top 2 quintiles (40% of households) gain $1.6 billion or 55% of the total.  But they also benefit by $750m a year from the landlords’ tax reduction. When that is Included, they get 64%, by far the lion’s share of the total.  What is so shocking is that the lowest quintile gets just 5.4% of the total.   About 130,000 households get nothing at all and 8000 are slightly worse-off. 

No one seems to have worked out how the many spending cuts will be distributed, but increased transport costs, prescription charges, lower quality school lunches will hurt the poor most. We know that rents are rising along with rates and insurance. Cut-backs to budget advisory services and foodbank funding increase the misery along with changes to price indexation for benefits and an inadequately adjusted minimum wage. 

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Remember, the worst-off families get no tax relief in this budget and miss out on the IWTC because they are on benefits The IWTC payment (which assist with the costs of raising children) is now nearly $100 per week for 1-3 children with an extra $15 a week per additional child.  In this recession, as low-income families lose work, as they will, they also lose $100 per week (more for larger families) FOR THEIR CHILDREN.

We can infer from the Child Poverty Report that the coalition government is abandoning any pretence to reduce child poverty.   They think forcing mothers into paid work is the way to address their poverty, ignoring and devaluing the demanding work of parenting.  

The ideology of the government clearly is to view all benefits, and even a part benefit as bad and paid work always better and more valued than unpaid work.

Some few sole mothers will get the Minimum Family Tax Credit (MFTC) to top up their earnings but only if they get completely off a benefit.  That is, the state rewards getting off a benefit, with another costly tax credit that somehow is deemed morally superior to a part benefit

But the MTFC is just a state funded replacement of their part benefit and is the worst designed benefit imaginable (reduces dollar for dollar for any extra dollar earned!) But hey– being off benefit even if in ill-paid, dangerous unsuitable and low skilled work must be the key to a better life. Looking after your own children is clearly viewed as inferior and unworthy work.

Working for Families (WFF) is supposed to reduce child poverty, but the poorest children are denied a poverty reducing payment in order to provide a ‘work incentive’. National have a history of promoting the work conditional aspects of WFF as they have done in the latest budget. The price is that families denied the IWTC fall into deeper poverty. 

Despite their names, neither the IWTC, nor the weird MFTC are effective work incentives. The IWTC rewards being entirely off a benefit, not the extra hour of work, while the MFTC has huge work disincentives with its 100% abatement for extra earnings.  

Until we get a proper review of WFF that puts poor children at the centre not paid work, child poverty will continue to get worse.



50 COMMENTS

  1. Luxon claims to be Christian. A central value in Christianity is The Family Shown by Mary, Joseph and the infant Jesus. Subjects of many Renaissance paintings and the traditional crib at Christmas. The cruel meanness shown to poorer families who cannot find work shows the vile hypocrisy of both National and Labour whose real religion is the greed of Neoliberalism.

    • On the topic of Christianity, the “poorer families” you invoke are, all too frequently, that very un-Christian phenomenon the unmarried mother with multiple children to multiple men who are nowhere to be found.

      We could slash a great deal of the social issues we have at a stroke if people got married to have kids and then stayed married. But, unfortunately, it has become fashionable to advocate for, above all else, people’s “freedom” to be as reckless as they like and short-term in their thinking, no matter how much it inevitably blows up in their faces and makes themselves (and worse, their children) miserable, and very often, poor.

      • While I agree with you regarding stable families you seem to have forgotten that another essential of Christianity is the instruction not to judge others & to love & be kind to your enemies. We have a society where people use their taste buds & genitals to make most of their decisions & unfortunately many in the so-called Christian church have the same problem.

    • Mothers being forced into outside paid work, with toddlers farmed out into childcare which is a money-making venture now run increasingly by Asian immigrants, can be seen as an attack upon the traditional family unit, and ergo an attack upon the stability of the social community.

      Worse, parental bonding, especially maternal bonding, can be majorly damaged when tots spend most of their waking hours with paid strangers and outsiders and home becomes a place to be bathed, to sleep, clothes changed, stomachs fed. It’s a dreadful thing to be be doing to helpless infants, and is as bad as the shocking rate at which Kiwis physically batter and kill their children, and like the transgender agenda introduced by the previous government, societally destructive and solidifying power in the hands of the elites. Christianity has nothing to do with it.

      The current government turning its egomaniacal back on cancer patients provides a stark statement about how they regard the fools who pay them. Chri

  2. When they define work as productive & set the tax rates accordingly I might have some time for them. In my view, landlords with their parasitic income stream from exploiting people unable to purchase an overpriced property would be highly taxed & the many lower-income jobs that keep the system going (carers, supermarket workers, etc) would have a tax-free income threshold.

    • Except landlords don’t pay that tax, it’s on charged to tenants.

      And tax free supermarket workers just cost billion dollar companies less in wages.

      Simplistic knee jerk reactions tend to do the most damage.

  3. Children in poverty is unquestionably Labour Government legacy more particularly Jacinda Ardern legacy who took it upon herself to fix it.

  4. it would be more useful to recognise all these three and four letter acronyms are just tinkering around the edges, and, along with other redistributions such as the accommodation supplement, are a distraction designed to deflect from the real issue which is the elite are trying to grab all the world’s wealth in hard assets before the whole stinking system that is neoliberalism implodes upon itself.
    Don’t swim in the weed with a hard on.
    Focus on the actual issues that are causing ever increasing inequality, or else the divide and conquer brigade win.
    These neoliberal tinkerings are not the real issue.

    • Ben. They may seem small issues to you but a proper reform of WFF so that all low income children are treated the same and an adjustment of the absurdly low threshold and high rate of abatement would be a great thing for many many struggling families. Their children can’t wait fir capitalism’s overthrow

      • I highly recommend reading The Big Kahuna: Turning Tax and Welfare on It’s Head in New Zealand-
        Only TOP had a solution for the high marginal tax rates faced by low income families and beneficiaries.
        The Greens policy of Income Guarantee only entrenches this further.
        Labour- well history shows they had no idea or didn’t care about child poverty.

  5. ” The rich get richer while child poverty just increases” while good people fail to act.
    John Stuart Mill was quoted as writing/saying…
    At best, the essence of the quote can be traced back to the utilitarian philosopher John Stuart Mill, who delivered an 1867 inaugural address at the University of St. Andrews and stated: “Let not any one pacify his conscience by the delusion that he can do no harm if he takes no part, and forms no opinion. Bad men need nothing more to compass their ends, than that good men should look on and do nothing. He is not a good man who, without a protest, allows wrong to be committed in his name, and with the means which he helps to supply, because he will not trouble himself to use his mind on the subject.”
    https://www.openculture.com/2016/03/edmund-burkeon-in-action.html
    The deeply chilling thing for me @ Susan St John is that those who do us harm do so knowingly.
    [The] fuckers ‘know’ they’re causing misery and harm and they love it.

  6. This has been said by you before – We can infer from the Child Poverty Report that the coalition government is abandoning any pretence to reduce child poverty. They think forcing mothers into paid work is the way to address their poverty, ignoring and devaluing the demanding work of parenting.

    And it shows a determination not to notice the words, the meaning, the conditions – because people don’t want to know the facts and face them. How to make them care without mass, concerted violence forcing it? The psychology behind this wilful ignorance has been studied; we need to bring psychology to play and find the chinks that will allow feeling to creep in behind the Wealthy and Orthodox Iron Curtain (WOIC said as ‘woke’).

    • Bob the first troll doesn’t want to know the facts because they alway poverty him to be the troll he is.
      A true Christian PM would not create emoyment slavery and make poverty numbers explode as Luxon has. Alongside seperatism, poverty will be his legacy. But typically, Luxon is weak as unlike Ardern he won’t take on a ministry.

      • NSC your spelling and grammar reflect yet again your level of education.
        I’m convinced English is not your first language.

        • Bob the troll, your grammar is the worst on this site, you must be a foreigner at standard two level.
          If you saw your reflection, it would be a piece of shit. Now toddle off and have a nice day, you incompetent prick.

  7. ” The top 2 quintiles (40% of households) gain $1.6 billion or 55% of the total. But they also benefit by $750m a year from the landlords’ tax reduction. When that is Included, they get 64%, by far the lion’s share of the total. What is so shocking is that the lowest quintile gets just 5.4% of the total. About 130,000 households get nothing at all and 8000 are slightly worse-off. ”

    Thank you Susan for the work you have done here with revealing the cold hard truth behind the butchery of that Willis and her colleagues have committed here and the MSM have neglected to inform the neglected constituency of how they have been once again been ” played ” in favour of the vested class.

    It is an insult considering the coverage and hype in evidence before the budget was delivered to parliament by the MSM.

    Its all gone suspiciously quiet now the facts and realities are out there regarding the bribery and deceit carried out by this gang of elected deplorable individuals…I am trying to be polite and choose my words carefully.

    I do think that the term ” child poverty ” is a distraction when the correct term should be ” family or adult ” poverty that is a direct attack on New Zealanders human and economic rights including children who just aren’t born into a life of wealth and privilege but are subject to the harsh realities of a system that punishes them before they have even started living life.

    • Thanks Mosa. i agree that it is family poverty not just child poverty that matters. But the truth is their poverty rates are the highest of any demographic and the consequences for society of not ensuring the health and wellbeing of children is immense. One of the best ways ensure children are well cared for it is to support the mothers and stop putting barriers in the way of their good re-partnering. We are so punitive.

  8. High housing costs are the biggest source of poverty, and also forces both parents to work full-time.

    The biggest causes of high housing costs are artificial restrictions on land supply through the planning and consenting process (restrictions on building both up and out), and housing’s very favourable tax treatment, essentially tax-free capital gains. This increases the investment into housing over other investments and increases prices.

    So where is the NZ Left on fixing those two causes of poverty??
    Until the Left answers that question, it is simply doing spinning its wheels ‘fighting poverty’.

    • I think the biggest problem with housing in NZ/AO is the greedy neoliberal state encouraging people to spend time in NZ, study in NZ, work for low wages in NZ, for a cost imposed by the government and with unreasonable rules that tend to impoverish the poorer incomers, and tend to advantage those who have money and assets elsewhere already. They all need housing and the demand goes up faster than reasonable supply.

      Landlords get a cut from the seething mass looking for a home, some of the wealthy incomers spend time in hotels , some of the not wealthy live in otherwise empty houses bought by overseas people using them as a way to park their excess funds, avoid tax or just to turn bank numbers into something solid. Some of the houses are kept from general use so they can be holiday homes and that airb/n/b thing. Meanwhile the people who should have a settled place to live their lives are living in the motels. Mad, yes but follow the money for the answer to any questions.

      Housing grows in value because of the demand being kept up. It is a truly vicious circle thought up by people that can only be viewed as basically callous even vicious themselves. The land speculators building the chicken perches (foul designs) are just today’s version of the scalpers who came in as colonisers. Some of my relatives back in the day tried that, and Fitzgerald confiscated most of their purchase. But it seemed a good idea for the men who wanted to get in first at the low end of the market.

      • Until the Right answers that question Greywarbler it is simply doing spinning its wheels ‘fighting poverty’.

        • You realize poverty & unemployment are “good” for National as people can be “encouraged” in to jobs they wouldn’t normally take, for wages they wouldn’t normally accept. Poor people also don’t vote for National, so as long as they aren’t committing crimes, aren’t a priority for National. If you wanted someone to do something about poverty, that was Ardern and her Government of kindness with a majority & a mandate to do just that, so what happened?

    • Yes, ada that is why the dicks in power gave landlords more money so the rents would reduce, they said the rents would not increase as much, fucken liars. The left built more houses than national and the right wingers every did, this lot just sell them and make bullshit excuses up to justify their actions and the dumb dumbs believe.

      • So the only houses are the state’s houses?

        Most people don’t want a state house and have the government as their landlord.

  9. This just in on RNZ by some bankster sycophant named Susan Edmunds, Money correspondent. ( eye-roll…)
    “Townhouses, new builds: What’s hurting Auckland’s housing market?”
    https://www.rnz.co.nz/news/business/518768/townhouses-new-builds-what-s-hurting-auckland-s-housing-market
    Ah..? Well perhaps it’s the now foreign owned banksters grifting house prices and they’re literally banking on us to be so desperately compliant we just suck it up then spit it out.
    The Press.
    NZ banks ‘some of the most profitable in the world’
    Honestly, in my view Susan Edmunds is as full of shit as one would expect of someone playing Lap Poodle to four foreign owned banksters making more in profits than any other banks in the world second only to Canada from us.
    https://www.thepress.co.nz/business/350094635/nz-banks-some-most-profitable-world?utm_source=pocket_saves
    So, how can a taxes paid for reporter on a tax paid for news media deliberately avoid THE FACTS?
    Did someone ask ” But what can we dooooo…. ( Sniffle…) Well, strike would be one course of action. Get together and simply stop working and paying your mortgages then target your MP’s. They’re the shiny six figures who float about in your parliament buildings selling you out to the four foreign owned banks.
    Now, bankster lobbyists. Heard of ? AO/NZ house prices are a swindle. The banks, foreign owned, the real e-snake industry and our politicians and our media are all in on it in that sickly sort of way where they pretend they’re being noble and honourable but it reality, they’re fucking crooks doing crooked shit with your money and your lives. Housing isn’t supposed to be a fucking ‘industry’, it’s a place to live with your partner, your kids and your pets for fucks sake. NOT living in fear of the foreign owned bankster mafia on a fertile beautiful stunning country larger than the UK by 29 K sq km but with only 5.2 million people and the only thing wrong with that picture is us because we’ve been conditioned to having scum bags steal from us by the likes of RNZ’s Susan Edmunds, [Money correspondent.]

    • Women wanting to rise in the world have to bow to money. That’s female advancement; money controls, not husbands and overwhelming fertility. Money can’t buy you love so goes the song – but money can buy most things, so keep it up you woke females and Susan Edmonds and maybe you too can roll in millions or billions.

  10. I cry for my own children, but also for all of our tamariki. This is an all out military industrial attack upon all of us, and we must not be silenced.

    • Yes I feel it as a subtle military attack. Winston once connected himself with Asia – Taiwan I think. What if the Chinese turned out to be better than westerners; certain countries seem to be readying themselves for a match?

      Perhaps learning some Mandarin as well as Maori and seeing what Sun Tzu the general, wrote, and Confucius the philosopher, advised and we might get some ideas of how to combat this onslaught and save ourselves. But then the trouble is the onslaught is new technology formed by man, but directed to taking mankind over in the main. And China has embraced this.

      Where do humans go to live together in a satisfactory communal way, unmolested?
      Playing Toto Make Believe which asks questions that stuck in my mind. Do you like? https://www.youtube.com/watch?v=Mn0MKyesiVI

  11. I wonder if the Min(imum) of Social Development studied and learned from this book –
    New rights New Zealand : myths, moralities and markets 2006.

    NEW RIGHTS NEW ZEALAND: MYTHS, MORALITIES AND …
    Ministry of Social Development
    https://www.msd.govt.nz › 27-pages202-206 PDF
    by D JANIEWSKI · 2006 · Cited by 28 — Janiewski and Morris are professors of, respectively, history and religious studies. This book presents the findings of a…

    New rights New Zealand : myths, moralities and markets
    Victoria University of Wellington
    https://tewaharoa.victoria.ac.nz › discovery › fulldisplay
    Online version: Janiewski, Dolores E., 1948- New rights New Zealand. Auckland, N.Z. : Auckland University Press, 2005. Also published in another …

    The Min’s listing has irregular appearance of PDF on my computer, but it is still readable. We should remember too as pointed out, that there have been efforts and funds set up to provide thought and wise comment on matters political and economic that concern us. such as the Marsden Fund. Which apparently have mostly been ignored. by the PTB – if there wasn’t money in them.
    Ho hum, buzz; the bees may collect honey but is it affected by current viruses? (Bit of play with words – we know the Covid virus, but what about the one resulting in Converts of the Covert who are drawn to the Convent on the hill – or CCC?)

    new riGhts new ZeaLanD: myths, mOraLities anD marKetsBy DOLOres JaniewsKi and PauL mOrris aucKLanD uniVersity Press, 2005
    Christine CheyneSenior LecturerSchool of Sociology, Social Policy and Social WorkMassey University
    New Rights New Zealand is an intriguing addition to the literature on the economic and social reforms of the late 1980s and 1990s. Janiewski and Morris are professors of, respectively, history and religious studies. This book presents the findings of a research project entitled “Marketing morality: The campaign to remoralise NZ, 1984–1999” for which they received a Royal Society of New Zealand Marsden Fund grant.

    Not all readers of this journal will be aware that the aim of the Marsden Fund is to support research that incorporates originality, insight and research excellence. A further goal of the Marsden Fund is to foster the development of research skills and, to this end, projects are encouraged to support postgraduate research. Janiewski and Morris’ research incorporated work done by a Master’s student that is the basis of Chapter 10…

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