Wealth inequality in NZ worse than Australia


Joining us now is the Finance Minister Steven Joyce.

Wealth inequality in New Zealand is worse than Australia and about the same as Canada.

Based on data from Oxfam, two New Zealanders were worth the same as the poorest 30 per cent of the adult Kiwi population.

Those two New Zealanders are Richard Chandler, with a wealth of $3.8 billion, and Graeme Hart, with a wealth of $9b.

Graeme Hart is New Zealand's wealthiest individual.

Graeme Hart is New Zealand's wealthiest individual.

In Australia, two billionaires had the same amount of wealth as the bottom 20 per cent of the population.

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Like New Zealand, Canada's poorest 30 per cent had the same amount of wealth as two of the country's billionaires.

Finance minister Steven Joyce said every New Zealander should have an opportunity to succeed.
Robert Charles/FAIRFAX NZ

Finance minister Steven Joyce said every New Zealander should have an opportunity to succeed.

Oxfam released its wealth inequality report, An economy for the 99 per cent on Monday, which showed eight people owned the same wealth as 3.6 billion of the poorest people on earth.

Those billionaires include Bill Gates, Zara founder Amancio Ortega and Warren Buffett.

The report's release coincided with an annual meeting of political leaders, including trade minister Todd McClay, at the World Economic Forum in Switzerland.

Richard Chandler is based in Singapore.

Richard Chandler is based in Singapore.

Nationally, the richest one per cent of New Zealanders owned one fifth of the nation's wealth, while 90 per cent of the population owned less than half, the report showed.

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The number of the wealthiest Kiwis increased by almost 20 per cent in less than a year between October 2015 and June 2016, jumping from 212 to 252.

Executive director of Oxfam New Zealand Rachael Le Mesurier​ said it was a shock to discover such inequity.

"The gap between the extremely wealthy and the rest of us is greater than we thought, both in New Zealand and around the world. It is trapping huge numbers of people in poverty and fracturing our societies, as seen in New Zealand in the changing profile of home ownership.

"New Zealanders love fairness, not inequality. The Government should be tackling inequality here and globally, by cracking down on tax avoidance wherever it is and using that money to make our country, and the global economy, a fairer place."

The report highlights the disparity in wealth - an individual's total assets - rather than disposable income.

Oxfam says the New Zealand findings were consistent with other countries and blamed the mega-rich and big business.

Hart owned consumer firms and a global packaging empire, and Singapore-based Chandler headed a global investment firm.

The report revealed figures that show the inequality gap is wider than previously thought, Oxfam said.

Seven out of 10 people lived in a country that had seen a rise in inequality in the last 30 years. 

For women, it would take 170 years based on current trends to be paid the same as men due to women often taking on low-paying jobs and facing high levels of discrimination in the workplace.

It showed that the richest in the world were accumulating wealth at such a rate that the first trillionaire could be just 25 years away.

Finance minister Steven Joyce said the comparison of the two wealthiest men and New Zealanders was "a bit nonsensical" and incomes for the bottom 10 per cent of earners had grown at the second-fastest rate within OECD members since 2010, NZME reported.

Speaking on RNZ, Joyce said it was important to point out the analysis focused on two successful Kiwis who had made most of their wealth outside New Zealand. It was a slightly strange suggestion to compare them with New Zealanders.

"Going back through time there are some people that are more successful than others in terms of, for example, in business. I don't think most New Zealanders are regretful of that in the sense that they like to see people succeed. They like to see people get ahead.

"The main thing is actually ensuring that every New Zealander gets the opportunity to do the things they want to do. And some of them want to go into business and be successful and I have met many hundreds of those around the country who want to follow in the footsteps of those guys and be successful on the world stage. Others don't have those motivations, they want other things like the best for their families, or sport, or something like that.

"The whole point from a government perspective is to ensure that people have that opportunity to succeed.

"Everybody wants to know if somebody starting out in New Zealand can make a success of their lives."

Joyce said the government was working on measures to ensure people, and companies, pay their taxes.

"There's always inequality but again you have got to look at those reports carefully because in that report a young medical graduate who has just come out of university would be listed as somebody who is in the poorest 20 per cent because they have a student loan.They'll pay that student loan off in about four years and they'll be earning incomes of over $100,000 very quickly.

"So although they're in those figures today, they won't be in those figures in five years' time."

Joyce said OECD income data showed New Zealand has one of the best records in terms of increases in wages among the poorest 10 per cent of income-earners. There was still a lot of work to be done, he said.

 - Stuff


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