The number of children living in material hardship has reached a 10-year high, with 14.3% of children, nearly 170,000 children, living in material hardship.
Figures released by Stats NZ this morning show the number of children living in material hardship hasn’t been this high since 2015, and marks the third consecutive annual rise in child material hardship.
“Today’s figures are worrying but not surprising,” says Child Poverty Action Group Executive Officer Lyn Amos.
“Child poverty rises when incomes at the bottom fall behind the cost of living. We know what works: lift incomes, index supports to wages, and properly fund services. New Zealand has reduced child poverty before and can do so again.”
Analysis:
14.3% of children, around 169,300, are living in material hardship, which from this year is measured using the MH18 index rather than the DEP17 index.
This year’s material hardship rate is the highest number Stats NZ has on record since 2015, and has seen a significant increase since 2022, when the rate was 10.6%, or around 121,800.
It remains higher than the baseline year of June 2018, when the rate was 13.3%, or around 150,900.
The BHC50 figure, which measures the number of children growing up in households that earn less than half of a normal family income, is around 12.6%, or 148,700 chuldren.
This has remained roughly similar for the last three years, but is lower than the baseline year of 2017/18, when the rate was 16.5%, or around 183,400 children.
The AHC50 (fixed) figure, which measures the number of children growing up in households that don’t have enough money left to live on once rent is paid (compared to what counted as a basic living standard in 2017/18), is 17.8%, around 210,600 children. This is down from the baseline year of 22.8%, around 253,800 children.
The organisation’s research and programme officer, Dr Yu Shi, says inflation’s silent cuts to incomes are making families’ experience of material hardship tougher.
“Indexing income support to general inflation rather than wage growth means families are being punished by the costs of housing, utilities and food, which are all rising faster than average inflation,” says Dr Shi.
Even if the Government isn’t actively cutting income support, rising rents have meant the real value of accommodation supplements are falling, and with thresholds for Best Start and
Family Tax Credits remaining largely frozen since 2018 [CR1] , inflation is effectively performing cuts to families’ incomes.
“The Government’s Budget Policy Statement leaves practically no fiscal headroom for the wealth transfers needed to reduce child poverty this year. As a result, its statutory child poverty targets are mathematically impossible to achieve under these settings.”
The Child Poverty Reduction Act 2018 introduced a target to reduce material hardship rates among children to 6% by 2028.
Despite reaching a recorded low of 10.6% in 2022, today’s announcement by Stats NZ, showing material hardship rates to the year ended June 2025 are at 14.3%, all but confirms the Government will not reach this target.
It also set targets to lower the percentage of children growing up in families that earn less than half of a normal family income, not counting housing costs (BHC50) to 5%, and reduce the rate of children in families that don’t have enough money left to live on once rent is paid, compared to what counted as a basic living standard in 2017/18 (AHC50) to 10%.
It is worth noting that the scale of poverty continues to rise for two years. The number of children living in a family with little money left after paying rent is over 353,000, comparable with the former peak in 2008, the Global Financial Crisis.
Today’s figures show the weight of poverty is being predominantly carried by tamariki Māori, Pasifika children and children in households with disabilities, whose experience of poverty is consistently higher than the average New Zealand population.
“A quarter of tamariki Māori are living in material hardship. Nearly a third of Pasifika children are, too. Where is the urgent action needed from the Government?”, asks Child Poverty Action Group’s Isaac Gunson.
“How many more generations of tāngata whenua, tagata moana, and tāngata whaikaha must bear the deeply unjust weight of poverty before the Government steps up and gives them a fair shot at life?”
“Young people with disabilities face higher, lifelong costs due to healthcare needs, and are being penalised in their formative years by poverty. There is no decision being made in by children experiencing poverty that prolongs their hardship more than the decisions made for them in Wellington,” Gunson says.
“The solutions are clear because they’ve worked: in the initial years after the Child Poverty Reduction Act came into law, we saw significant reductions in child poverty rates.”
“All we need now is for that action to be sustained, and the same political will to meet the moment and ensure our youngest generations can flourish free from poverty.”