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Monday, August 16

Inequality, child poverty plateau under National

The latest Household Incomes in New Zealand report shows the gap between rich and poor has plateaued since John Key’s Government came into office, the Green Party said today.

“Everyone has an interest in narrowing the gap between rich and poor, because inequality hurts everyone,” said Green Party co-leader Metiria Turei.

“New Zealand has one of the biggest gaps between rich and poor in the developed world. Between 2004 and 2007 the gap was narrowing, but it has plateaued under National. In fact, on one measure – the GINI co-efficient – it has widened.

“The evidence is clear that narrowing the gap is better for everyone, in all income brackets. People in more equal societies live longer, are healthier, achieve better educationally, and suffer less crime no matter how much they earn.

“Just last week we saw evidence of this in the University of Otago study exploring the links between life expectancy, inequality, ethnicity, and smoking.
“Yet progress has stalled under John Key’s Government and we all stand to lose.”

The Household Incomes in New Zealand report was released today on the Ministry of Social Development website, although there was no Government press release announcing its release.

The 2009 update covers a wide range of income-based measures of hardship and inequality in New Zealand and is the first report covering the period since John Key’s Government came into office.

The report also shows no improvement in rates of child poverty since 2007, noting that the effect of income rises have largely been cancelled out by rising housing costs in many lower income households with dependent children.
Mrs Turei said she expected the gap between rich and poor to widen further as more of the policies of John Key’s Government take effect.

“This report doesn’t take this year’s Budget into account. It was noted at the time that tax cuts for the rich and an increase in GST are likely to widen the gap. We can expect to see evidence of this in future studies as the full impact of these policies kicks in,” she said.

“We shouldn’t wait for this to happen. We need urgent action to start closing the gap now.

“Back in May the Greens released an eight-point plan to reduce inequality called ‘Mind the Gap’. I invite John Key to read it in light of today’s report and adopt some of the measures it suggests like a progressive pricing system for electricity, building 6000 new state houses, and introducing a comprehensive capital gains tax.

“New Zealanders like to think ourselves as an egalitarian society where everyone gets a fair go. We have this ideal because we know that a fair society is better for everyone. If we want to live up to this idea then it’s decision time for John Key’s Government,” Mrs Turei said.

Mrs Turei will address a public meeting in Lower Hutt on the subject of inequality on Wednesday 18 August and in Waitakere on Thursday, 26 August.