US welfare reforms show one size does not fit all

Selective dissemination of recent US welfare reform studies by Act and the National Party have no relevance in New Zealand and demonstrate nothing more than a frustrated attempt to derail this Government's positive social policy direction.

Repeated attempts by opposition social service spokespeople like Muriel Newman, comparing what she describes as New Zealand's welfare failures with so-called "irrefutable" evidence that major welfare reforms work shows no more than a maladjustment to reality.

In short, Dr Newman and other beneficiary bashing cronies like National's equally misguided Eastern Bay MP Tony Ryall are scraping the bottom of the barrel with inconclusive overseas research. It's a vain attempt to tarnish social service policies here that are clearly working.

In case no one has told Dr Newman or Mr Ryall, New Zealand is about as far from Washington as you can get.

But let's be pragmatic about the issue. Act and National are opposition political parties. Their key tasks are to project party views, while attempting to embarrass the Government.

Dr Newman and Mr Ryall claim to possess scientific evidence that the sweeping welfare reforms pushed through by the US Government in recent years would also be dandy here.

In reality, they base this claim on a fragment of welfare research recently undertaken by several US universities.

Researchers spent 16 weeks studying the lives of 2402 low-income families, grappling with the mind-boggling Personal Responsibility and Work Opportunity Reconciliation Act (1996).

The study's findings, published recently in Science Magazine, acknowledged that since the mid-1990s US welfare caseloads had plummeted, presumably due to the federal five-year lifetime maximum term for beneficiaries and other draconian rules.

US opponents of the welfare changes now being endured by millions in that country claimed that one of the system's original goals was to enable impoverished mothers to raise their children at home. This was seen as crucial for the development of young children.

Dr Newman asserts that the study of mothers moving from welfare to employment showed that "no harm" was caused to the emotional development, intellectual achievement and mental health of their children.

Actually, the study concluded no such thing! What the report said was that mothers' transitions off welfare and into employment "are not associated with negative outcomes for pre-schoolers or young adolescents".

Furthermore, associations noted by the researchers provided only "slight evidence" that mothers' entry into the labour force was related to improvements in adolescents' mental health.

Researchers also noted: "we could be estimating a spurious correlation" as comparisons of the study group could not account for many individual characteristics of mothers during their shift from welfare to employment.

In conclusion, the researchers noted the need for "a more detailed psychological model" to justify the study's findings.

Clearly then, no firm conclusions could be drawn from the research, despite Dr Newman's claim that it provided yet another link in the "irrefutable chain of evidence" that such welfare reforms were beneficial.

In fairness, one part of the research the opposition parties were right about was that in families with either pre-schoolers or adolescents, the entry of mothers into the workforce related to a significant increase in family income across the board.

And that is precisely the type of social and economic outcome this Government is moving towards through well-defined, realistic policies such as the recently introduced Social Security (Personal Development and Employment) Amendment Act.

>From 10 March, the new legislation abolished the arbitrary work test on 21,924 sole parents receiving the Domestic Purposes Benefit.

In return, all people receiving the DPB, Widows or Emergency Maintenance Allowance through Work and Income will receive enhanced case management to help them in training and work planning for their future.

The new legislation delivers on Government promises to develop a social security system that better meets the needs of individuals and their families.

This Government is not trapping sole parents in the benefit system and DPB clients will now be assisted towards employment with greater support from Work and Income.

DPB clients will now be responsible for the creation of a personal development and employment plan (PDE), which will include a client's employment goals and action points to reach that.

Work and Income case managers will also work more holistically with clients, covering areas such as parenting responsibilities, and personal, social and health needs alongside training and employment goals.

Caseloads for DPB case managers have been reduced to ratios of 1 to 150 clients to help achieve that. Caseloads previously averaged 1 to 250/300 clients.

The PDE plan is compulsory. Any client who, without good and sufficient reason, fails to achieve their goal plans may face benefit reductions of up to 20 per cent after four weeks and 50 per cent after eight weeks.

Dr Newman and Ryall may also be surprised to learn that the average time spent on the DPB is currently three-and-a-half years. That's well below the five-year benefit limit recommended by Act and further good news for taxpayers.

Everyone knows the welfare system costs millions of dollars to maintain, but taxpayers can rest assured that the Government is totally committed to assisting all beneficiaries and their families towards an independent and financially secure future.

Treasury estimates that declining overall benefit numbers have saved the taxpayer $937 million in projected spending on benefit payments.

Judging by New Zealand's sliding unemployment rate, 4.9 per cent, and core unemployment beneficiary numbers now at 98,178 - both 14-year lows - I think it's fair to say that this country is doing very well. We don't need backward and draconian social policies.

While Dr Newman and others try to bamboozle people with pseudo science, the public know that you don't need a degree in meteorology to know which way the wind is blowing.

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