Statistics New Zealand reveal the top 10 per cent of the population owns 60 per cent of wealth while the poorest 40 per cent held just three per cent.

The concept of a "punitive welfare system" makes very little sense, but sadly it may be the reality for many New Zealanders struggling to get by.

A new textbook by Massey University and the University of Waikato argues that over the last 20 years the welfare system in New Zealand has sunk to a cruel, unconstructive entity that reinforces the idea of those in need as failures.

"The myth of an over-generous welfare state still features strongly in public imagination," lead author, Professor Darrin Hodgetts, says.

"The levels of scrutiny and interrogation are therefore often surprising to people who end up engaging with welfare for the first time due to redundancy, failed businesses, serious illnesses or other misfortunes."

The study uses the term "structural violence" to describe the behaviour that welfare providers often deal out to recipients.

"They often resemble violent relationships between intimate partners, involving coercion, detailed monitoring, denying resources, blaming, threats and intimidation, victimisation, and the minimising of legitimate concerns," Hodgetts says.

One participant quoted in the book described Work and Income New Zealand as "very judgmental" and "traumatising".

The book compiles 200 years of research on urban poverty in New Zealand, Australia, Canada, the United States and Britain to highlight developments and similarities across countries.

The cause of the "punitive welfare system" according to the study is the emergence of neo-liberalism as a dominant political ideology.

The study critiques neo-liberalism as creating a society "characterised by increased wealth concentration."

"Neoliberal-inspired governments have employed the common strategy of deliberately underfunding government services, which eventually lose their efficacy due to resource restraints," the study says.

Professor Hodgetts says the majority of people on welfare want to work but they are often presented with unviable options of low-paid casual work, not enough to live or support families on.

Introducing a living wage or Universal Basic Income are potential solutions suggested by the study, but Hodgetts believes any policy changes must be made in consultation with those living in poverty.

The new textbook is entitled Urban poverty, penal welfare and health inequalities and co-written by Professor Hodgetts and Dr Ottilie Stolte​.