Wellbeing Budget and Child Poverty Reduction Act lay foundations for change

Child Poverty Action Group (CPAG) welcomes both the Government’s announcement of its first Wellbeing Budget and the passing into law of the Child Poverty Reduction Act this week, saying that both are indicators of the intention for real and sustained change to come.

“A 'Wellbeing' Budget will be a very significant change of direction and is highly ambitious,” says Associate Professor Susan St John, CPAG economics spokesperson.

CPAG believes that making children visible as one of the five priority areas of this Budget shows true commitment to reducing child poverty.

“It is a landmark approach to the Budget; for the first time in a long time we are seeing political acknowledgement that a successful economy is much more than budget surpluses and economic growth,” says St John.

But as Prime Minister Jacinda Ardern herself said, these are just the foundations and “it’s all about what we do."

Achieving any reductions in poverty will be dependent upon significant additional spending. As a nation, Aotearoa spends modestly per capita when compared to other OECD countries.

“It’s time for money to be better spent so that the wellbeing of all people is enhanced,” says St John.

CPAG noted with disappointment last Christmas that the promised Families Package would not come into effect until July this year. When it did finally come in, the increases were not enough to reduce family distress among those who are worst off, which was evidenced by the increased demand on charities. It is now worse than ever.

“The 2019 Budget is a long way off, and any changes targeted at helping low-income families may not be implemented until much later. For many desperate families, the unremitting poverty they face daily is causing irreparable damage to their lives of their children,” says St John.

Charities such as Auckland City Mission are overwhelmed by the unprecedented demand this Christmas. It is baffling as to why immediate relief is not being offered to these families who have been failed by years of eroded benefits, as well as discriminatory and inadequate tax credits.

The Child Poverty Monitor released last week shows that one in five children live in households without access to enough food or healthy food.

“Many of these children live in families supported by a welfare benefit, who aren’t currently able to get the In-Work Tax Credit portion of Working for Families Tax Credits that could make a worthwhile difference to their lives,” says St John.

For many families, an extra $72.50 would be a welcome relief this Christmas and provide the pathway out of poverty and to better lives that they so desperately need.

CPAG says that as a matter of urgency, Government should remove punitive sanctions that reduce family incomes, and wipe all debts incurred through housing grants and other overpayments.

“It is clear that families cannot afford the repayments, which compromise their wellbeing,” says St John.

“And that is simply a result of their incomes being too low. If this Government is committed to improving wellbeing then it will take seriously the impact that debts to the Ministry of Social Development have on families' weekly budgets.”

CPAG urges the Government not to delay until Budget 2019 to announce and implement Wellbeing changes. The worst-off families need some reprieve this Christmas from the substandard welfare and family support policies that have locked them into poverty for years.

Photo by Di Lewis from Pexels