Finance Minister Grant Robertson says he can't see how the Government's response to the current lockdown will make inequality worse, but poverty activists say he's done nothing to stop it from happening.
Child Poverty Action Group (CPAG) says there was a 50 percent increase in hardship grants from the Ministry of Social Development in just one week after restrictions were suddenly introduced in mid-August, with the discovery of a community case of the Delta COVID-19 variant.
But spokesperson Janet McAllister says the Government hasn't shown the same willingness to help out the poorest this time around, unlike last year.
"In March last year, the Government quickly announced lockdown-related income entitlement increases, and doubled the Winter Energy Payment. They have not done so this year," she said on Friday.
"This year's more inadequate response is a slap in the face to those doing it tough - our research shows last year was a hard year for families, and they went into this lockdown with fewer resources than they had before the pandemic hit."
While businesses and employees affected by the loss of income can apply for - and receive - wage subsidy assistance in just days, benefit increases announced in this year's Budget won't kick in until 2022.
"The nature of a situation like this, where it is a crisis situation, is that it is important to get the food and the support out quickly," Robertson said in Parliament on Thursday. "That's why we use the agencies and the approaches that we do. Longer term, we continue to look for ways that we can support our low-income New Zealanders."
He said delays in assistance - such as increasing benefits - take longer because "there is a very, very large number of people involved, and when we are changing supports, that, in turn, triggers other changes to other assistance that they might be getting as well".
"It's complex but it has been one of the issues that, over my time as a minister, I have sought answers on because I do believe that when Governments make policy changes, we should be able to implement them as soon as possible."
He said the Government will "continue to monitor the impact of this outbreak on our low-income households and we will respond accordingly".
McAllister said it was "deeply concerning" Robertson seems to think enough is being done in the meantime.
"Families needed increased income entitlements from the moment lockdown hit."
In an interview with financial news site interest.co.nz, Robertson said he wasn't "seeing anything that indicates we’re likely to see a further exacerbation of [inequality] in light of the policy changes", talking about both the Government's response and that of the Reserve Bank. The latter was widely expected to hike interest rates before the lockdown came, raising fears the property market will continue to spiral out of control.
"I have no desire to crash the housing market… What I do have a desire for is more sustainable house prices," he said.
Fasst-rising house prices have been linked in academic research to growing inequality. They've grown faster in the past 18 months than at any other time in recent history.
CPAG said the Government should bring forward the benefit increases pencilled in for 2022.
"It won’t be enough but it will be something," said McAllister. "Families need more today. Families in mounting distress can’t live on promises of ‘next year’. Children are hurting now, and the longer their need is left, the worse the consequences will be for everyone."
