ANALYSIS: New Zealand’s monetary response to the Covid-19 pandemic may create increasing inequality, leaving the wealthy better off and those who were already struggling even further behind.
We can be justifiably proud of our Government’s approach to the Covid 19 virus crisis. It has acted quickly recognising the WHO recommendations. The country “lock-down’ will do much to stop the spread of the virus and the Government support for people and businesses is to be commended. This will hopefully put us in a better position to face the future and recover from the damage that the virus is doing and will certainly continue to do. Further, most are following Government instructions and people are working together in their communities to make the best of their situations, by forming neighborhood support groups.
However some cracks are opening and even though the Government is responding with changes to the support packages, many would describe the crisis as a three way issue.
First is the virus and the damage it is doing to people. Then there is no doubt that there will be long term damage to the economy. But thirdly, many people concerned about social justice are now describing the crisis as an inequality crisis and the Government must recognise this.
Those most impacted are those on basic incomes or benefits. Many cannot store food and must visit supermarkets every few days. At present they find that shelves are empty of many basic needs, owing to an excess of panic-buying by selfish hoarders. Many cannot afford to top up their cellphones, do not have IT devices for their children to access educational programs, have no internet access and do not have strong neighbourhood support groups.
Many of those with mental health problems feel powerless, especially if they live alone. There are still many uncertainties about what will happen as well as the anxieties of subsisting on a very low benefit or income. And the stress levels for many young people are very high.
And what about the homeless? Those sleeping rough, couch-surfing and living in overcrowded accommodation will further struggle to self-isolate and survive.
Covid-19 is impacting unequally on those most vulnerable. Those at the lower end are suffering whereas those who are well-off have the resources to cope much better. So it is an inequality crisis and the Government must do something about it. In the GFC the poor suffered most and took much longer than the wealthy to get over the impact.
The Government must among other things:
• Significantly increase benefits. The recommendations of the Welfare Expert Advisory Group would be a great start.
• Increase the incomes of the low paid by increasing the Working For Families Tax credits, making them available to all and not just those in the workforce. Actual government grants to all these people.
• Ensure that there are enough well stocked food outlets so that all can get food when they need and ensure that panic buying does not result in empty shelves
• Ensuring that the homeless are well looked after. This will significantly slow the spread of the virus, and benefit us all.
• Encourage the establishment of neighbourhood support groups.
With this further support from Government we can get through this together and significantly reduce inequality of outcomes for Covid 19.
Dr. Prudence Stone for the Equality Network. 0272898987
The Equality Network is grouping of 36 New Zealand organizations all of whom promote social justice. It operates under the principle that more equal societies are better for all. For more information visit our website: www.equalitynetwork.org.nz
The Ipsos New Zealand Issues Monitor reported in December 2019 that Poverty / inequality is the second highest ranking issue in Aotearoa with 29% considering it as a top issue. It has been in the top 5 issues since measurement began. Housing is the top issue. Read more here .
But there has been little improvement in lowering economic inequality. Max Rashbrooke comments that the report on Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2018, by Bryan Perry for the Ministry of Social Development’s key annual report makes for depressing if not surprising reading.
Economic inequality remains at the very high level the country was left with in the late 1990s following 15 years of market-based reforms. Poverty rates for the general population and children remain high. Relative poverty rates virtually all increased 2008-17. In contrast, material deprivation decreased. Nonetheless, the overall story is the continuing absence of substantial action against economic inequality and poverty, both of which damage individuals and the social fabric alike. For more details refer here .
“We need to fundamentally reframe our systems settings to address the drivers causing and underpinning inequality; structural change in systems especially financial.“
The Equality Network Hui was held in Wellington on 27 June 2019. The hui covered important topics such as child poverty; a living wage; taxation; public health; mental health; education; welfare, housing and the environment
Action Station’s report on The People’s Mental Health Review, based on 500 personal stories of mental health experiences reveals a mental health system in crisis, with long wait times, a lack of suitable treatment options and an under-resourced and stressed workforce. They call for urgent funding increases for mental health services, an independent inquiry into mental health in New Zealand, and restoration of the Mental Health Commission.
Refer https://www.peoplesmentalheathreport.com for more details