Herald on Salvation Army report

The Herald editorial:

The Salvation Army’s annual stocktake on New Zealand’s social health has earned high credibility. It owes this to its recognition of progress as well as problems.

Its latest “state of the nation” report notes continuing improvement in many of the country’s most persistent concerns. Child poverty, for example. It finds children in material hardship, as measured by an absence of some essentials, has dropped from 21 per cent at the peak of the 2008-09 recession to 14 per cent last year, the level it was before the recession. That trend is not evident in the more standard statistical measure of poverty – living on less than 60 per cent of the median household income – but that is because earned incomes have risen.

Average weekly earnings rose 3 per cent last year while the cost of living rose only 0.1 per cent. Half of the increase in earnings came from pay rises, the rest from working more hours. At the same time, unemployment dropped for a second year in succession, though the proportion of the population employed did not rise as much as it did in 2013 and 2014, the peak of the Christchurch rebuild.

The population grew again by 2 per cent, slightly greater than the growth in employment which suggests the numbers retiring exceed the increase in new workers and immigration.

Perhaps most heartening, the report says increases in the statutory minimum wage have helped lift the incomes of the lowest paid faster than the highest paid employment, in finance. The gap may be wide but, contrary to careless rhetoric, it is apparently not necessarily getting wider.

Beneficiaries and their children do not benefit from increases in the minimum wage. Their incomes are indexed to price inflation rather than wages. That ought to change. But at least basic benefit rates will be raised by $25 from April 1.

The Salvation Army estimates 16.4 per cent of children are in families dependent on benefits, the lowest proportion since the late 1980s. That figure is close to the 14 per cent found lacking some of life’s essentials, suggesting the true extent of child poverty is around 14 per cent, not the 25 per cent often quoted by academic researchers.

Perhaps the best news of all, the Salvation Army’s findings are in pre-school education, which is now reaching beyond children in better-off areas thanks to efforts to reach the poorest deciles. Last year, 92.5 per cent of pre-school children received early education. It is a remarkable figure even if the quality of the education is uneven.

So good progress on child poverty, weekly earnings, unemployment, benefit levels, minimum wage and reducing welfare dependency plus pre-school education.

Not everything is improving. House prices moved further out of reach of first home-seekers in the year to last September. While the rate of capital gain slowed in the year to December, reflecting new taxes and lending restrictions on rental property, rents are rising more sharply as a result.

A compassionate country will never succumb to complacency while any of its citizens are in poverty or distress, but it does no harm to acknowledge the success of concerted effort.

Definitely still more to be done.