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Need for higher disability allowances

19 November 2018

New research shows the need for higher disability allowances to combat child poverty

A new article in the Policy Quarterly journal shows that if the Government is serious about tackling child poverty, it needs to increase the payment rate for disability allowances.

The article compared disability allowance payment rates in the United Kingdom and New Zealand for whānau with disabled children. The median payment rate in the UK was almost three times higher. There are also disability-specific tax credits for whānau with disabled children in the UK. As a result, in the UK, whānau with disabled children do not face an increased risk of living in poverty.

The opposite is true in New Zealand where whanau with disabled children are significantly more likely to be in poverty compared to whānau with non-disabled children. Sam Murray the article’s author, and the National Policy Coordinator for CCS Disability Action, explains.

“In New Zealand, disability allowances are simply too low to effectively reduce the number of disabled children living in poverty. In 2013, the median disability allowance payment rate for disabled children was just $45.62 NZD a week. By comparison, it was $134.36 NZD a week for disabled children in the UK. Even adjusting for purchasing power parity, the UK allowances are far higher.”

The article also found that disabled New Zealand students who receive support through the Ongoing Resourcing Scheme (ORS) are becoming more concentrated in lower decile schools. This trend was the same across mainstream and special schools. Students who receive ORS support now make up 1.7% of all students in decile 1–5 schools, compared to 0.7% of all students in decile 6–10 schools. Sam Murray said that this indicates that poverty may be getting worse for disabled children and young people.

David Matthews, Chief Executive of CCS Disability Action, said there was a clear need for the Government to respond.

“Not every barrier disabled children and their whānau face can be solved by money, but poverty and income inequality clearly can be. The UK data shows that sufficient disability allowances and disability-specific tax credits can eliminate the increased risk of poverty for disabled children and their whānau. It is simply not acceptable for whānau with disabled children to face a higher risk of poverty. The Government needs to increase the payment rate for the disability allowances.”

You can read the article here:
https://www.victoria.ac.nz/__data/assets/pdf_file/0003/1713621/Murray.pdf

ENDS

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