Appendix 2: Child poverty measures and related indicators
For each income-based measure, disposable household income has been "equivalised", which means that it has been adjusted for household size and composition.
The primary AHC50 (fixed) low-income measure uses the year ended June 2018 as the base measurement year. The supplementary outcome measure AHC50 (moving) is different. Both measures have housing costs removed. However, the moving-line approach examines a household's current income relative to the current median for all households. The fixed-line approach examines a household's current income relative to the median income for the baseline year of measurement (2018), while adjusting for inflation.
Further details about the measures and how they are constructed are on the website of Statistics New Zealand. See "Child Poverty statistics: Year ended June 2024 – technical appendix", at stats.govt.nz.
Child poverty measures required by the Child Poverty Reduction Act 2018
| Primary measures | |
|---|---|
| BHC50 (moving) | Low income: The percentage of children in households with incomes less than 50% of the median equivalised disposable household income before deducting housing costs (BHC) for the financial year of measurement |
| AHC50 (fixed) | Low income: The percentage of children in households with incomes less than 50% of the median equivalised disposable household income after deducting housing costs (AHC) for the 2017/18 base financial year |
| Material hardship | The percentage of children living in households in material hardship for the financial year of measurement. Material hardship is defined as going without six or more out of the 17 items in the material deprivation index (DEP-17), which includes such things as having two pairs of shoes in good condition and not putting off doctor visits |
| Persistent poverty | The percentage of children living in households with less than 60% of the median equivalised disposable household income before housing costs are deducted, in the financial year of measurement and for at least two of the previous three years |
| Supplementary measures | |
|---|---|
| BHC60 (moving) | Low income: The percentage of children in households with incomes less than 60% of the median equivalised disposable household income before deducting housing costs (BHC) for the financial year of measurement |
| AHC60 (moving) | Low income: The percentage of children in households with incomes less than 60% of the median equivalised disposable household income after deducting housing costs (AHC) for the financial year of measurement |
| AHC50 (moving) | Low income: The percentage of children in households with incomes less than 50% of the median equivalised disposable household income after deducting housing costs (AHC) for the financial year of measurement |
| AHC40 (moving) | Low income: The percentage of children in households with incomes less than 40% of the median equivalised disposable household income after deducting housing costs (AHC) for the financial year of measurement |
| Severe material hardship | The percentage of children living in households that are experiencing a lack of nine or more out of the 17 items in the material deprivation index, for the financial year of measurement |
| AHC60 (moving) and material hardship | The percentage of children in households with incomes less than 60% of the median equivalised disposable household income after deducting housing costs (AHC) for the financial year of measurement and in material hardship |
Child poverty related indicators agreed by Cabinet in October 2024
| Children in benefit-dependent households | The number of children and young people aged 0-17 in households receiving main benefit |
|---|---|
| Housing affordability | The percentage of children and young people aged 0-17 living in low-income households (in the bottom 40% of the income distribution) spending more than 30% of the household's disposable income on housing |
| School attendance | The percentage of students aged 6-16 who are present more than 90% of the term |
| School achievement | The percentage of school leavers with at least NCEA Level 2 (or equivalent) as their highest level of attainment |
| Potentially avoidable hospitalisations | The rate of potentially avoidable hospitalisations for children and young people aged 0-17 |
Source: Minister for Child Poverty Reduction (2024), Refreshing the Child and Youth Strategy and associated measures, paragraph 15 (table) and Appendix 1, at msd.govt.nz.
In addition, under the Strategy, the Government has set seven wider indicators relevant to children's well-being. Some of these are relevant to child poverty, such as reduced food insecurity. See The Child and Youth Strategy 2024-2027, page 9, at msd.govt.nz.