The Dim-Post

August 23, 2012

Excerpts from the MSD Household Incomes Report

Filed under: policy — danylmc @ 1:50 pm

Which is here.

16   Poverty rates for children in beneficiary families are consistently around 65-75%, much higher than for children in families with at least one adult in full-time employment (9% in 2011).

  • Since the benefit cuts in 1991, 65-75% of children in beneficiary families have been identified as ‘poor’ in each HES.   The figure was close to 70% for 2004 to 2009, and 65% in 2011.
  • For beneficiary families with children, AHC incomes from main benefits, the Family Tax Credit and the Accommodation Supplement are almost always below the AHC 60% fixed line threshold.
  • Why is the reported poverty rate for beneficiary children not therefore 100%?  There are typically 20 to 30% of beneficiary children living in households in which over the 12 months before the HES interview there is market income as well, either from their parent(s) or from other employed adults.  This extra income is enough to take total household income ‘over the line’.
  • In June 2011 there were 234,000 children in beneficiary families (22% of all dependent children).  Around 25% of children live in households in which there is no adult in full-time employment.

 17   Nevertheless, on average from 2007 to 2011, two in five poor children (40%) were from households where at least one adult was in full-time employment or was self-employed, down from around one in two (50%) before WFF (2004).

  • The WFF package had little impact on poverty rates for children in beneficiary families (around 70% from 2004 to 2009), but halved child poverty rates for those in working families (21% in 2004 to 11% in 2007 and close to the same since then).
  • Because there are many more children in working families than in workless or beneficiary families, the proportion of poor children who come from working families is much higher than the poverty rates themselves at first sight suggest.
  • On average from 2007 to 2011, two in five poor children came from working families where at least one adult was in full-time employment or was self-employed, down from just over one in two before WFF.
  • The New Zealand proportion is not unusual.  In OECD countries (on average), around half of poor children come from working families.

19   Poverty rates for Maori and Pacific children are consistently higher than for European/Pakeha children: on average from 2009 to 2011, just under half of poor children were Maori or Pacific.

  • On average over 2007 to 2011, around one in six European/Pakeha children lived in poor households, one in four Pacific children, and one in three Maori children (double the rate for European/Pakeha children).
  • The higher poverty rate for Maori children is consistent with the relatively high proportion of Maori children living in sole-parent beneficiary families and households (eg around 43% of DPB recipients were Maori in the 2007 to 2011 period).
  • On average from 2009 to 2011, just under half (47%) of poor children were Maori or Pacific: for children overall, around 34% were Maori or Pacific.
  • The sample size is too small to allow more precise poverty rates to be given for the smaller ethnic groupings.
About these ads

21 Comments »

  1. There appears to be a lot of facts and statistics in this post. What the hell do you expect us to do with that?

    Or, at the least, I want a graph. Using at least five different colours. Until then, stop trying to make me think.

    Comment by Andrew Geddis — August 23, 2012 @ 2:19 pm

  2. National is delivering for its base!

    Comment by Sanctuary — August 23, 2012 @ 2:31 pm

  3. Simple solutions to address poverty:

    (a) Statistically lower the threshold
    (b) Class children as depreciable assets with a 5-year operational life

    Fixed!

    Comment by Gregor W — August 23, 2012 @ 2:34 pm

  4. “Class children as depreciable assets with a 5-year operational life”

    Anyway to get a tax rebate on that?

    Comment by Matt Nolan — August 23, 2012 @ 2:54 pm

  5. So what you’re saying is that somewhere between 25% and 35% of beneficiaries don’t even have the proper incentives to get into work?

    Comment by BeShakey — August 23, 2012 @ 3:23 pm

  6. That’s the gist of it.
    The rebate should offset the taxable component of any Family Economic Unit (FEU) revenues, thus increasing cash-flow and eliminating ‘poverty’.

    The FEU can them make a rational choice post depreciation to either ‘sweat’ the Juvenile Production Asset Class (JPAC) for maximum return at a minimum operational expenditure over time (estimated useful life 10-15 years) until obsolescence, or choose to divest of the asset and replace with another JPAC (ideally one with higher production capacity / lower Total Cost of Ownership due to technological change).

    Further efficiencies within the FEU could be gained by divesting itself of low production, opex heavy plant (i.e. Granny / Mum’s New Boyfriend Asset Classes) and looking at alternatives presented by off shoring.

    Comment by Gregor W — August 23, 2012 @ 3:38 pm

  7. “(b) Class children as depreciable assets with a 5-year operational life”

    Or to bring back a hoary old chestnut, (c) sell them as meat. It’ll be even more effective.

    Comment by deepred — August 23, 2012 @ 4:09 pm

  8. Careful deepred.
    There’s Pete George’s in them thar hills…..

    Comment by Gregor W — August 23, 2012 @ 5:17 pm

  9. the main problem with selling children is the postage to belgium.

    Comment by Che Tibby — August 23, 2012 @ 6:31 pm

  10. There are places closer than Belgium.

    Comment by peterlepaysan — August 23, 2012 @ 8:26 pm

  11. When they say poverty, they mean inequality.

    Comment by Swan — August 23, 2012 @ 9:03 pm

  12. “There are places closer than Belgium”

    But do they pay as well

    “When they say poverty, they mean inequality”

    No they measured the two seperately. A number of the poverty measures were against a “fixed” benchmark level (so absolute not relative). We saw general poverty decline against this (expected), but child poverty doesn’t want to budge as much.

    Comment by Matt Nolan — August 24, 2012 @ 7:05 am

  13. 10.”There are places closer than Belgium.”
    I thought Bert Potter was dead?

    Comment by Clunking Fist — August 24, 2012 @ 1:00 pm

  14. “We see general poverty decline against this (expected), but child poverty doesn’t want to budge as much?”

    Could that fact, I wonder, have anything to do with greed and selfishness on the part of the parents? Partying at weekends (mostly younger parents of course), and spending money on things that are unnecessary.

    Comment by Dan — August 24, 2012 @ 1:35 pm

  15. Work may set you free, but children will make you poor?

    It IS quite selfish of parents to not have children, if that’s what you mean, Dan.

    Comment by Clunking Fist — August 24, 2012 @ 2:09 pm

  16. “Could that fact, I wonder, have anything to do with greed and selfishness on the part of the parents? Partying at weekends (mostly younger parents of course), and spending money on things that are unnecessary.”

    The figures are for households so probably not.

    Comment by Matt Nolan — August 24, 2012 @ 2:34 pm

  17. “No they measured the two seperately. A number of the poverty measures were against a “fixed” benchmark level (so absolute not relative). ”

    My reading of the summary is that a relative poverty measure has been used. It is relative to the median income. Therefore it is a measure of inequality, not (absolute) poverty.

    Comment by Swan — August 25, 2012 @ 7:30 am

  18. ^^ You are right they have used a fixed line measure, but that was simply set based on an inequality measure with a reference year of 2007.

    Comment by Swan — August 25, 2012 @ 7:42 am

  19. @14

    I think that idea of beneficiaries partying up and not buying their kids food is a bit unfair, and largely mythical. But from my reading of those stats, it looks like the number of households in poverty overall has dropped, while the number of children in poverty has increased. That either indicates a problem with your measures, or a different kind of irresponsibility (which is a much more troublesome issue to address).

    Comment by Milla — August 26, 2012 @ 7:56 pm

  20. I am fully aware what its like to be on a benefit been there done that. Also been on low income for years too. It is possible to manage but some people just dont want to.

    Comment by Gail Lucas — September 12, 2012 @ 9:58 pm

  21. It is only fair to say that poverty on a global scale is on the rise. We as a nation are broading the divisions between socio-economic status. There needs to be a balance. Current legislation and policy changes have ehanced poverty, and can only be combated through social cohesian. Oppressing marginalised groups is the way to a destructive country. The government needs to work with the people in the position and listen, Paula Bennet needs to stand down from her position her sudden movements in policy changes to benefits has caused nothing but further social exclusion. This comes to my surprise as she is a former DPB recipient, I wonder how she would feel if she was struck with the same deal when she was receiving the DPB?? Paula has forgotten, I guess when your in power you least forget where it all started.

    Comment by T.M — September 28, 2012 @ 10:26 am


RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

The Rubric Theme. Blog at WordPress.com.

Follow

Get every new post delivered to your Inbox.

Join 413 other followers

%d bloggers like this: