Auckland Expensive, Cost Of Living Explodes, Poverty Increasing.

Thinking of emigrating to New Zealand and looking for a better lifestyle? You may be better off staying put and not risk becoming caught in a poverty trap.

An article in today’s Stuff  highlights how outrageously expensive Auckland has become over the last two years,  due mostly to a strong NZ dollar. Living costs have risen by almost 60%, outstripping wages by 13%.

Executives salaries in the largest city in New Zealand are lagging behind their contemporaries in other countries:

Workers Struggling in City of Sails

“Executives in Zurich, Geneva and Sydney are the best paid in the world after taxes, according to a survey by Swiss bank UBS – but Auckland workers are not flourishing to the same extent.

Though the survey shows wage levels – taking into account exchange rate effects – have risen over 45 percent in Auckland over the past two years, its living costs have risen by 58 percent over the same period.

Two years ago, Auckland was the world’s 43rd most expensive city of 73 surveyed, on 49.6 points, now it was ranked 24th, at 73 points…” more here

UBS didn’t survey any other New Zealand city but we suspect that it’s a similar story in Wellington. Auckland is likely to be a barometer for any reasonably sized of employment in the country.

It’s not all down to the strong dollar though. Rising food, fuel and energy prices also have had a signficant part to play. And it’s not just the executives that are doing it tough and falling behind, at the other end of the scale low income families are in dire straights.

Published research from the University of Auckland shows that low income families can’t afford to buy basic nutritious food for their children. The Child Poverty Action Group has called for more support for families and say the effects of poor nutrition are being seen in New Zealand’s hospitals every day.

The highest cost for families is rent, then electricity, transport and education. It’s far more than not being able to budget properly, its about having money left after the basic essentials for life have been met to afford luxuries like healthy food. It is now cheaper to buy cola in New Zealand than it is to buy milk

“Latest research from the University of Auckland supports recent claims that many low-income families are unable to afford even a basic nutritious diet for their children. A paper published in Nutrition and Dietetics in December 2010 found that low-income families may not be able to afford meals recommended by the national nutritional guidelines, especially if there are teenagers in the household whose meals cost a lot more.

In response to the findings Child Poverty Action Group (CPAG) is calling on the Government to increase support for families so they are able to provide nutritious food to their children.

Professor Asher says, “In reality, rent is the highest cost faced by most families, closely followed by unavoidable expenses such as electricity, transport and school-related costs. This leaves little for a good diet, especially for older children who eat so much more.

Nutritious food for children is beyond the reach of many low-income families, especially those thousands of families ineligible for the full Working for Families package. This study clearly highlights that using food banks and purchasing cheap poor-quality food is not always a matter of choice. “

CPAG is calling on the Government to help all families better afford nutritious food by extending the In-Work Tax credit to all low-income families. The cost of basic food items have increased over the last year, exemplified by the rise in milk price – 9%. “We see the outcome of poor children’s nutrition in our hospitals every day. This problem can’t be solved just by budgeting, and will not go away through magical thinking.”

Spokesperson Professor Innes Asher i.asher@auckland.ac.nz 021492262″ (Voxy)

In 2010- 2000 more children were admitted to hospital with poverty-related illnesses than during 2007-08

“What seems to have slipped below the radar is the fact that a crisis is occurring in our hospital admissions.

That’s the fact that medical conditions which occur more frequently for children living in poverty have been increasing over recent years – particularly for Maori and Pasifika children.  Or that close to 250,000 children are living in homes reliant on the benefit for income…

…We’re talking about admissions for respiratory problems, infectious diseases, and other conditions with links to poor housing and economic hardship –all diseases of poverty which could have been prevented if children were taken to see a doctor earlier… Rahui Katene, MP for Te Tai Tonga

You may also find interesting:

Travel, food, and power prices push up CPI

“…Significant upward contributions in the year to the June 2011 quarter came from higher prices for transport (up 11.0 percent), food (up 7.0 percent), and housing and household utilities (up 4.4 percent). Petrol prices increased 20.1 percent, cigarette and tobacco prices were up 16.0 percent, and electricity prices rose 7.8 percent..” Statistics New Zealand 18 July 2011

No milk price inquiry but probes continue:

“The Commerce Commission has ruled out a milk price probe but is investigating claims that dairy giant Fonterra is misusing its market power.

However Prime Minister John Key said it was important that the Government continued with an investigation into prices, because many people struggled to afford milk…” Business Day 2 August 2011

Winter and disasters hit food prices:

“Families have been dealt a double blow today with the announcement that the cost of food has increased 7.5 per cent this year and petrol prices are rising.

Statistics out today show fruit and vegetables had the largest impact on food prices in June, rising 12.2 per cent.

The Green Party blamed the rise in GST last year for exacerbating the problem of food costs.

Child Poverty Action Group co-director Mike O’Brien says families can’t keep up with the rising costs and were increasingly utilising budgeting and food bank services… “Business Day 13 July 2011

Our other blogs:

“NZ: 100% Pure Rip-Off” (July 2010)

NZ’s Poverty Gap – Fat Cats Feast Whilst Queues Form For Bread And Jam (July 2010)

Immigrants Caught In Cold Poverty Trap (July 2010)

10 thoughts on “Auckland Expensive, Cost Of Living Explodes, Poverty Increasing.

  1. I briefly worked in the tourism sector in New Zealand . The people working for Tourism New Zealand and Regional Tourism Organisations know very little about tourism or travel. They are just bureaucrats making money off the taxpayer.

    Tourism in New Zealand is about making money off foreigners whilst not providing value commensurate with the money the tourists pay. For instance, prices for meals at restaurants, tours, etc rival those of Switzerland, but the quality is so much lower. One hotelier noted that tourists complained about being cold and not having central heating. Rather than taking the complaint as an opportunity to acknowledge the shortcomings and improve his business for future customers, the owner simply described tourists as whingers. Of course, this owner had never travelled outside New Zealand himself.

    Employees of Tourism New Zealand and Regional Tourism Organisations cast aspersions on backpackers. However, they are too stupid to realise that backpackers that enjoy themselves will return in the future when they are older and have more money to spend. This is typical of the short term mentality of Kiwis.

    In some towns, hotels operate cartels where they agree not to lower the price. I pointed out the inanity of this practice, but the Kiwis made a virtue of “not undercutting each other.” Of course, the hotel owners do not realise that the high accommodation prices of the town was one of the reasons a nearby town with a glut of accommodation and much more to offer “stole” visitors.

  2. http://www.stuff.co.nz/waikato-times/news/6323829/Poverty-in-New-Zealand-shocking
    A British debt counsellor invited to take part in a social justice panel discussion […] says he has seen an underbelly of poverty in New Zealand that is shocking. […] “Sixty seven per cent of our clients can’t feed their kids. One third of them have contemplated suicide. It was their level of poverty . . . this is the 21st century.” Kirkby, who founded the charity after losing his UK home in the early 1990s and ended up living in a bed sit, said New Zealand’s level of poverty had surprised him , “and I am still working as a case worker. “I have been shocked by what I have seen in your country. Children without shoes whose parents cannot find them breakfast. You have some massive, massive problems.”

    • nz is a third world country, with the same problems as other third world countries, the problem is the fakery pretending to be what they are not, and in the process attracting unwary migrants to this hole

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