Inequality is the buzzword this election year. The usual vernacular is that the rich are getting richer and the poor are getting poorer. Inherent in this line is a notion that the rich somehow cause poverty.

Bryan Perry, Ministry of Social Development guru on poverty, inequality and hardship, published a 211-page tome on the issue last year. It is a complex beast that this piece cannot possibly do justice to.

However, there are some clear stories from Perry’s work.

First, the rich do hold a disproportionate amount of wealth. The top 1 per cent of earners in New Zealand take an 8 per cent share of total income. Income builds on income of course; while the top income decile receive 25 per cent of total income, they hold 50 per cent of the wealth. 

Second, the gaps have widened. The incomes of the bottom 30 per cent (adjusted for inflation) are only slightly higher than in 1982. But as Perry points out, there were more substantial gains for the richest half. “The income distribution was therefore more dispersed in 2012 than in the 1980s.”

So inequality is real, and the rich have certainly become richer. But have the poor become poorer?

Measured by income, while the poor certainly have not become wealthier in the last 30 years, they haven’t become any poorer either.

Perhaps material hardship is a more appropriate measure of poverty than income, given that low-income households are disproportionately affected by rapid rises in the cost of living.

Those who miss out on more than six things in a list of 16 (which includes being in arrears on bills because of a lack of cash, and not having two pairs of shoes in good repair), are classified as experiencing hardship.

The proportion of children in New Zealand living in hardship increased from 18 per cent in 2007 to 24 per cent in 2011, and dropped to 20 per cent in 2012. However, the picture is muddied by the global financial crisis, and because the data does not stretch back further than 2007, it is difficult to see the long-term trend.

There is no denying that poverty is a problem. It means that some children who get the basics like nutrition, shoes, and books in the home get a head start. The good news is that of those who were in deciles 1-3 in the year 2002, a quarter had moved into deciles 4-5, and another quarter into deciles 6-10, by 2008.  

Inequality is real and the gaps have widened over time. But whether the poor have become poorer over time, in absolute terms, is less clear. And whether the gains of the rich are coming at the expense of the poor is another question again