Poverty defence flawed, claims Labour

Last updated 05:00 28/02/2014

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Finance Minister Bill English continued to quote a report on inequality despite knowing it was flawed, Labour says.

Yesterday the Ministry of Social Development said it estimated that 285,000 Kiwi children were living in poverty, which was 20,000 more than previously thought. It also said income inequality was slightly larger than thought. It came after Treasury and Statistics New Zealand confessed that calculations about household disposable income dating back to 2007 contained a major flaw, with an accommodation supplement counted twice. Treasury insisted that there were no "real world" implications.

In January, as Mr English dismissed Labour claims that there was a growing gap between rich and poor, the finance minister continued to quote the MSD report to claim there was no evidence this was the case.

Yesterday Mr English confirmed that he was told of the error before Christmas, but that the real picture was "roughly the same", a spokeswoman said.

Labour said Mr English's statements were misleading.

"If he is trying to say that [inequality] figures aren't getting worse . . . well, that's just misleading," Labour's finance spokesman David Parker said.

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