Being poor is not an excuse for not taking care of your hygiene.
But yes, the school should have called social services to investigate. The child can't just never go to school. Surely she's behind on classes after being suspended so much, probably not going to move to the next grade level with her classmates on time, which can be a huge blow to a child's self-esteem and give them an inferiority complex (if she doesn't already have one), and make them more apathetic and not want to even bother trying anymore.
If she's really that unwashed, then that's grounds for child neglect.