Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Poverty is falling and income inequality is not rising

Media Release

1st September 2014

ACT Leader Dr. Jamie Whyte

The Left is wrong: poverty is falling and income inequality is not rising

“A Roy Morgan poll shows that the issue people are most concerned about is income inequality. This just goes to show how the persistent repetition of a lie bewilders the public. Income inequality is not in fact rising. And the child poverty rate has been declining for nearly 20 years, falling from 35% in 1994 to 16% in 2007 and recently returning to pre-global financial crisis levels in 2012” said Dr Whyte.

“Those who advocate socialism have exploited the public’s concern about a rising number of people being trapped into a cycle of dependency. The Left’s repeated claims that New Zealand is getting more unequal are simply false and divert attention from policies that would help people out of dependency.

“Prior to the recent recession, there were 15 years of steady growth in median household incomes driven, in part, by the steady increase in the number of two-parent households where both parents are in paid employment (3% pa).

Figure 1: Real household income trends before housing costs (BHC) and after housing costs (AHC), 1982 to 2013 ($2013)


Source: Bryan Perry, Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2013. Ministry of Social Development (July 2014).

“The net income gains from the mid-1990s to 2013 were similar for all income groups, so income inequality in 2013 was also similar to the mid-1990s” said Dr Whyte.

Figure 2: Real household incomes (BHC), changes for top of income deciles, 1994 to 2013


Source: (Perry 2014).

“The Gini coefficient – the most common measure of inequality – shows no evidence of a rise in income inequality since the mid-1990s. The trend-line is almost flat.

Figure 3: Gini coefficient New Zealand 1980-2015


Source: (Perry 2014).

“The Top 1% of income earners in New Zealand earn such a modest share of total earnings that the Occupy movement is left with nothing to protest about. The incomes of NZ’s top 1% of earners make up 8-9% of total incomes, as they have since the mid-1990s. It was only in the USA were the share of the top 1% continued to rise strongly, from 13% to 19%. New Zealand’s top 1% is performing so poorly that even the Swedish top 1% is set to overtake it”, said Dr Whyte

Figure 4: Top 1% income shares, USA, New Zealand and Sweden, 1970-2012


Source: The World Top Income Database at http://topincomes.g-mond.parisschoolofeconomics.eu/#Database

“Reducing inequality would not help to reduce poverty. The causes of poverty are complex but failure to get an education is one. Our one-size-fits-all education system has failed children from deprived homes for many years. Charter schools have successfully lifted educational achievement for children in poverty in many countries. Yet the political left is against this ladder,” said Dr Whyte.

“Who doubts that if New Zealand had its own Bill Gates, the country would be both more unequal and more prosperous? We need policies that encourage hard work, enterprise and success. ACT is the only party advocating such policies.

“The last time there was a significant increase in income inequality was in the early 1990s and this spike in inequality was immediately followed by a 15 year long economic boom” said Dr Whyte.


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Also, Loan Interest: Productivity Commission On Tertiary Education

Key recommendations include better quality control; making it easier for students to transfer between courses; abolishing University Entrance; enabling tertiary institutions to own and control their assets; making it easier for new providers to enter the system; and facilitating more and faster innovation by tertiary education providers... More>>

ALSO:

Higher Payments: Wellington Regional Council Becomes A Living Wage Employer

Councillor Sue Kedgley said she was delighted that the Wellington Regional Council unanimously adopted her motion to become a Living Wage employer, making it the first regional council in New Zealand to do so. More>>

ALSO:

Scoop Images:
Dame Patsy Reddy Sworn In As Governor-General

This morning Dame Patsy Reddy was sworn in as the New Zealand Realm’s 21st Governor-General. The ceremony began with a pōwhiri to welcome Dame Patsy and her husband Sir David Gascoigne to Parliament. More>>

ALSO:

Ruataniwha: DOC, Hawke's Bay Council Developer Take Supreme Court Appeal

The Department of Conservation and Hawke's Bay Regional Investment Company (HBRIC) are appealing to the Supreme Court over a conservation land swap which the Court of Appeal halted. More>>

ALSO:

With NZ's Marama Davidson: Women’s Flotilla Leaves Sicily – Heading For Gaza

Women representing 13 countries spanning five continents began their journey yesterday on Zaytouna-Oliva to the shores of Gaza, which has been under blockade since 2007. On board are a Nobel Peace Laureate, three parliamentarians, a decorated US diplomat, journalists, an Olympic athlete, and a physician. A list of the women with their background can be found here. More>>

Gordon Campbell: On The Key Style Of Crisis Management

At Monday’s post Cabinet press conference Key was in his finest wide- eyed “Problem? What problem?” mode. No, there wasn’t really a problem that top MPI officials had been at odds with each other over the meaning of the fisheries policy and how that policy should be pursued... More>>

ALSO:

Mt Roskill: Greens Will Not Stand In Likely Post-Goff By-Election

“The Green Party’s priority is changing the Government in 2017, and as part of that we’ve decided that we won’t stand a candidate in the probable Mt Roskill by-election... This decision shows the Memorandum of Understanding between Labour and the Green Party is working." More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news