Most New Zealanders are not aware of the limited amounts that people on a benefit receive, and that is adding to an increased fracturing of our society, one researcher says.
The Helen Clark Foundation has released a new report into social cohesion in New Zealand, comparing it to Australia.
Financial inequality was a significant driver of the problems identified in this country, the report’s author Shamubeel Eaqub said. New Zealanders were half as likely to say they are satisfied with their financial situation as Australians.
“Inequality – that divide between people who are comfortably off versus people who are not, people who go hungry versus those who do not, there’s big divergence,” Eaqub said.
“There’s quite significant variation in almost every dimension. Everything from feeling safe to a sense of participation, financial comfort, sense of worth… it’s all related. It’s quite frightening.
“We know that poverty erodes people’s dignity and connection to community.”
He said other data showed that inequality in New Zealand had worsened, particularly after the 1980s economic reforms.
“There has not been much progress since then. It’s probably more of that entrenched poverty. What we’re seeing particularly among Māori and Pacific Island people, who are more likely to be poor, they feel like hard work is not enough.
“The opportunities are not available to everyone equally. They are also more likely to say they face discrimination. The thing that really shocked me was a quarter of New Zealanders go without meals sometimes or often – it should not happen in a country like New Zealand.”
The research showed younger people and Pasifika communities had the highest levels of financial dissatisfaction.
New Zealanders identified the cost of living and inflation as their most pressing concerns. In total, 32% of New Zealanders were satisfied with their financial situation compared to 60% in Australia.
Eaqub said that could be partly a function of the point of the economic cycle each country was in, but there were structural issues, too.
“Their standard of living is higher, they save more, their income level’s higher. Relative to income their cost of living is slightly lower. There’s a whole bunch of different reasons.”
Eaqub said the dysfunction of New Zealand’s housing market and the relative unaffordability of houses had contributed to the problem.
“If you look at the work we did even on the cost of being single, the biggest variation there was housing, that’s what is eating up people’s incomes.
“It’s not the only thing but in New Zealand everything is relatively speaking expensive and housing and those necessities have become quite expensive so discretionary income is squeezed, particularly for the lower incomes.”
He said the research showed that rich people thought that benefit levels were enough, but poorer people thought they were not.
“What that tells you is there is a perception we’re doing enough. But those who are living in those conditions are telling us it’s very hard to escape the poverty trap… have we got our welfare safety net right? Have we got the ability to climb out of poverty right? The wider social cohesion part is hard to answer.”
He said the fact that the JobSeeker basic benefit is $361 a week for single people over 25 without children, compared to $538 a week for people on NZ Super might surprise some people.
“If you’re old you deserve more money than if you’re young and poor? We have a very inequitable welfare system… I don’t think people realise how little money is given. That’s the stereotype thing.
“Are there ways we can connect with each other and have conversations across diverse groups of people?
“Social cohesion can best be understood as the glue that holds our communities and society at large together,” he said.
“The opposite of social cohesion is polarisation. Without social cohesion, societies become increasingly unstable – from politics to business, to civil society, to day-to-day life in our communities. This is a pattern increasingly seen around the world, and New Zealand is not immune.”
Eaqub said that, as in many of the world’s democratic societies, trust in New Zealand’s leaders and institutions was increasingly fragile.
“We know from research that societies with higher levels of social cohesion are typically healthier, more resilient to external shocks and crises, and experience higher levels of economic well-being.
“Now that we have a benchmark with our research, we have something to measure and improve – and that change starts at the individual and community level.”
Murray Bruges, executive director of The Helen Clark Foundation, said the report set out actions and strategies for improving social inclusion, including awareness raising, countering stereotypes, and opportunities for positive interactions.
“We need to be asking ourselves what actions we can take to be more engaged, more aware, and to counter negative stereotypes – from popping our head over the fence to chat with neighbours, to getting more involved with our community organisations, to staying up to date with the news and engaging in democratic processes at the local and central levels.”
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