Published on 5th of June, 2024
Unemployment figures are rising, major jobcuts in the public service are underway, and budgeting services are reporting increased numbers of working families showing up for help.
It is easy to see why CMM stakeholders have expressed concern about a new era of austerity economics in New Zealand. Surveyed in early May in the weeks leading up to Government’s Budget 2024 announcements, our clients, staff and supporters reported being worried about signs of more hardship in the community, especially among individuals and whānau that are already experiencing high levels of deprivation.
While a small minority (5%) of respondents noted positive changes in their lives between May 2023 and May 2024, this was not the case for most. Among these changes were that Covid restrictions and infection severity had decreased, an increase in pension rates, and higher wages for some.
Foremost among our stakeholders’ concerns is access to health and medical services, and the impact of cost hikes on basics like food, utilities, and public transport. In Christchurch, children under five travel for free on buses and in March Environment Canterbury assured service users that bus fares here “will mostly stay the same”, but commuters in other centres are being hit harder following the end of public transport subsidies.
“While some increases are in themselves modest, the cumulative effect for people on benefits or on low incomes can be devastating,” says CMM Executive Director Jill Hawkey. “Stats NZ figures show a 4% increase in rents over the past year, or almost $20 a week on average. It’s really concerning that almost one in five New Zealand households now spends over 40% of their income on housing costs as this is the point at which most households will struggle to meet other everyday expenses.”
Figures from FinCap, the non-government organisation that supports free financial mentoring services, highlights the growth in hardship among families over recent years. In early May FinCap’s chief executive Ruth Smithers reported a 28% increase in people accessing financial mentoring services between 2022/23 and 2023/24.
Closer to home, CMM’s own financial mentoring service has seen an increase in referrals over the past year. “My team reports that more people in low paid jobs particularly are feeling the pressure from increasing rents,” says Social Services Manager Eve Lafferty. “This has bumped up our wait list and we’re hearing from other services that wait lists across the sector are growing.”
CMM’s financial mentoring service is one of the budgeting advice services nationally that has been awarded a contract from the Ministry of Social Development for the next three years. Others were not as lucky and several are now facing closure at a time when more families are experiencing hardship from higher costs and job losses. A recent RNZ article reported that one Dunedin provider was seeing professionals, including “teachers, dentists and plumbers, reaching out for support,” while a provider in Upper Hutt described the situation as “like watching a train derail.”
With cost-of-living pressures over the past year resulting in a greater number of households experiencing what is defined as ‘material hardship’, it is unsurprising that more people feel that their income is insufficient to meet everyday needs. The Household Economic Survey defines material hardship as “a household that is unable to afford six or more of 17 items most people would regard as essential.” People who experience material hardship are unable to afford doctor’s visits, fresh fruit and vegetables, and heating, among other items.
In the year ended June 2023, 8.5% of New Zealand’s population was in material hardship, an increase of 1.1% compared with the previous year, while 3.5% of the population was in the higher category of deprivation described as ‘severe material hardship.’ Severe material hardship applies to households that are unable to afford nine or more essential items.
“Our supporters are really concerned about what they’re seeing in their community and what their family and friends are telling them,” says Jill. “It’s shocking that almost half of all survey respondents said that nothing is better off for them or the people they know when they compared their situation to the previous year.”
The CMM programmes that support children, families, older people, and housing are of the greatest importance to stakeholders, according to the survey results. Respondents identified two core programmes among those they felt were most important. Both receive no Government funding and are financed exclusively through grants and donations: The Whānau Support Worker at Aratupu and CMM’s Family Support Fund.
The Family Support Fund is accessed on clients’ behalf by CMM support workers to pay for development opportunities for children, such as learning assessments and extra lessons as well as essentials for families who find themselves not able to cover basic living costs. The Whānau Support Worker based at Aratupu Preschool & Whānau Hub assists families to access entitlements, health services, and basic items such as food and sanitary products when there’s not enough money at home to cover these costs. They also facilitate the parenting programmes and workshops run at Aratupu.
Looking towards Budget 2024, the top five areas CMM stakeholders want Government to prioritise are: affordable and social housing (71%), primary and secondary health (38%), climate change/green transition (33%), education including ECE (19%), and child poverty (14%).
“We work daily across our stakeholders’ priority areas to bring to life CMM’s vision of a just and inclusive society in which all people flourish,” says Jill. “And I’m confident that together with our wonderful supporters, we will continue to make a difference for clients as things around them get tougher over the coming year.”
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For information about becoming a Mission Partner, please contact Fundraising & Communications Manager, Michael Herman, at michaelh@mmsi.org.nz
