Child poverty on the rise? ACOSS CEO Cassandra Goldie's claim is overblown

Updated

The first sitting of the new federal parliament prompted a call for fresh measures to address child poverty.

Australian Council of Social Service chief executive Dr Cassandra Goldie said on ABC Radio National on November 12: "The problem is growing and that's the real concern for us... The number of children is rising in Australia that don't have enough to eat, to put a roof over their head, and to get a good start in life before they get to school."

Dr Goldie said ACOSS data showed almost 600,000 children were living below the poverty line.

In a joint press release that day with the United Nations Children's Fund, UNICEF, the two organisations called on the new parliament to "make tackling growing child poverty a national priority".

The claim: ACOSS CEO Cassandra Goldie says child poverty is rising in Australia.

ACOSS CEO Cassandra Goldie says child poverty is rising in Australia. The verdict: The claim does not stack up. Leading research in the field shows child poverty has stayed stable over the last 10 years, with some bounces along the way.





Defining poverty

There are many ways to describe poverty, but in simple terms there are two very broad definitions.

Absolute poverty is often used in developing countries. The World Bank draws an "extreme" absolute international poverty line of $US1.25 a day. Another way of measuring absolute poverty is an inability to buy a basket of goods.

Relative poverty is used by the Organisation for Economic Co-operation and Development and many developed countries. It is defined as a proportion of the median income. This type of poverty is not only about a person's access to food, shelter and education, but also about the ability to participate in society. For instance, in Australia it may be having enough money to afford a mobile phone and internet access at home. This fact check examines relative child poverty.

Is child poverty rising in Australia?

The joint press release on November 12 quoted Dr Goldie as saying: "The most recent Household, Income and Labour Dynamics in Australia (HILDA) report found that child poverty has increased by 15 per cent since 2001. Half of these children are in sole parent families."

After reading the HILDA report, ABC Fact Check found this is not the case. It says 10.5 per cent of children under the age of 18 were living in poverty in 2010. The corresponding figure in 2001 was 10.8 per cent.

The HILDA report, funded by the federal government through the Department of Social Services, is published by the University of Melbourne's Melbourne Institute, which has been researching poverty in Australia for over 40 years.

The institute's Professor Roger Wilkins has written the HILDA survey for the past 11 years. "My overwhelming impression is that child poverty rates have bounced around, but there has been no real increase or decrease over the time I have been collecting data," he told Fact Check.

"Child poverty for two-parent families has been relatively stable because the Family Tax Benefit has been successful in boosting the income of two-parent families."

Professor Wilkins notes new unpublished data may suggest a slight upturn for the next report.

Where there has been a significant increase in child poverty over the last 10 years is in lone-parent households. Professor Wilkins says "this is due to less generous parent payments for lone parents, and pushing them onto the Newstart allowance".

Employment growth has also decelerated, which particularly affects single parents who are less flexible. For example, it's harder for single parents to move to find new work and their working hours are often restricted.

Other ways of measuring poverty Access to dental care

The Henderson Poverty Line, commonly used by Australian poverty researchers when there was one breadwinner in a family

Social Exclusion, when someone experiences multiple, overlapping problems such as unemployment, poor health and low education

Measures that take into account other financial variables such as wealth and consumption

60 per cent of the median household income

Financial stress, based on people's perceptions of their financial health



When Fact Check queried the way ACOSS had interpreted the HILDA report, a spokeswoman said: "We acknowledge the omission of the word 'lone' in Dr Goldie's statement was unintentionally misleading."

ACOSS has since amended its statement to read: "The most recent Household, Income and Labour Dynamics in Australia (HILDA) report found that child poverty in sole-parent families has increased by 15 per cent since 2001."

The spokeswoman also referred Fact Check to research by the National Centre for Social and Economic Modelling at the University of Canberra. "NATSEM shows child poverty increased to 2012, up from 10.6 per cent of children in 2010 to 11.8 per cent in 2012," she said.

NATSEM, which provides research to commercial, government and not-for-profit clients, published a report in August titled "Poverty, Social Exclusion and Disadvantage in Australia". It is funded by UnitingCare, an agency of the Uniting Church. Like Professor Wilkins, it concludes that child poverty rates have been stable over the past decade.

Its primary data source is a survey of income and housing carried out every two years by the Australian Bureau of Statistics. It looked at poverty trends in those surveys from 2000-01 to 2011-12.

"Child poverty rates (for both those aged less than 15 years and less than 25 years) remain virtually unchanged since 2000-01 when compared with 2011-12," the NATSEM report says.

The rates for children under 15 were 11.6 per cent in 2000-2001 and 11.8 per cent in 2011-12. The ACOSS spokeswoman said the NATSEM research showed "a very substantial increase in child poverty from 2006 to 2012, from 9.1 per cent to 11.8 per cent... and a modest increase from 2001".

A co-author of the report, Ben Phillips, told Fact Check there had been "a slight upturn" in recent years after a couple of lower years in the middle. "But our report found that child poverty rates had remained unchanged over the last 10 years," he said.

ACOSS released its own report this month, the third edition of "Poverty in Australia 2012", based on research by the Social Policy Research Centre at the University of NSW. This report does not chart a growth in child poverty.

At the industry forum organised by ACOSS on November 12, Professor Bettina Cass from the UNSW research centre said: "Recent estimates suggest that about one child in every seven lives in a household where income is less than half the median for the country. This rate is higher than the average for all OECD countries. While the definition of poverty is subject of debate, there is some agreement that the overall rate of relative child poverty in Australia has not changed greatly since the mid-1990s."

'600,000 children' living in poverty

The ACOSS report defines the poverty line as 50 per cent of the median disposable income of all Australian households. It assesses income left after housing costs have been paid. The UNSW centre's research on which the report is based used income and expenditure surveys by the Australian Bureau of Statistics for 2009-10.

The poverty line equates to:

Two parents and two children: $752 a week after housing

One parent and two children: $573 a week after housing

The report says that in 2010, 575,000 children under the age of 15 were living below this poverty line. This equates to 17.3 per cent of all children in that age group.

The NATSEM report for the same year estimated only 10.6 per cent of children under the age of 15 were living in poverty. The report did not contain an absolute number for 2010. For 2012, it said 495,000 children under the age of 15 were living in poverty.

A spokesperson for ACOSS says the difference is explained by the fact that the ACOSS figures are based on after-housing income. It thus captured fewer households where housing costs are low, such as retirees who have paid off their mortgages, and instead captured more low-income households with high housing costs, including more households with children under the age of 15.

The Melbourne Institute's HILDA report does not put an absolute number on children living in poverty but estimates it was 10.5 per cent of all children under the age of 18 in 2010.

The OECD, which defines a child as under the age of 18, estimates child poverty was 14.4 per cent in Australia in 2010.

The number of children living in poverty is dependent on the method used to calculate poverty.

The verdict

Overblown. The claim that child poverty is rising doesn't stack up. Leading research in the field shows child poverty has stayed stable over the last 10 years, with some bounces along the way.

Sources

Topics: poverty, charities-and-community-organisations, charities, australia

First posted