The Generosity of New Zealand’s Assistance to Families with Dependent Children: An Eighteen Country Comparison

Robert Stephens, Jonathan Bradshaw

The extent to which parents and the state share the burden of responsibility for bringing up children varies between countries, within a country over time, and at different standards of living. Over the last decade New Zealand has changed from the provision of universal benefits (eg, the universal Family Benefit was abolished in 1991) to assistance targeted on the basis of family income (eg, health care and student allowances). The history and rationale for this change have been well covered elsewhere. Instead, this paper aims to use international comparisons to investigate how generous New Zealand’s assistance is towards children.

The approach used is the “model family” method, which focuses on the comparability of results rather than their representativeness. We see that New Zealand policy attempts a “vertical redistribution” of poverty relief, but the results show this country to be mildly generous in child support only at low levels of income: the level of support drops with additional children, the income bar is low, and tax levels are relatively high, indicating that fiscal savings dominate poverty relief.  The conclusion is that the degree of vertical redistribution is relatively slight.