Hon David Benson-Pope
Minister for Social Development and Employment
Member of Parliament for Dunedin South

27 April 2006 Speech Notes

Speech for launch of Work and Income's New Service Approach

Thank you and welcome. I am delighted to be here today to launch Work and Income's New Service Approach.

I would like to acknowledge guests, including Pat Quinn, and Jason-and-Jade Blodwell, who I understand are sharing their experiences of the new service approach with us today.

Before handing over to Work and Income Deputy Chief Executive Ray Smith, who will talk in more detail about these changes, I would like to provide you with a short overview of how we have reached this point, what I believe is the significance of today's launch, and where it fits into the bigger picture.

We think all New Zealanders should have the opportunity to have quality jobs that contribute to New Zealand's economic growth and that provide stability and security for themselves and their families. Our on-going reform of the welfare system is actively supporting more people into work.

Under Labour 117,000 fewer people are reliant on a benefit today than when we took office, a drop in the number of beneficiaries by nearly 30 percent.

These results have been achieved by opening up real opportunities – not by impoverishing beneficiaries or placing them in make work schemes.

Let’s not forget that under National unemployment grew 11% in the 1990s, so that on taking office in 1999 there were 161,000 receiving an unemployment benefit – as at the end of the March quarter this year, there are just 44,500.

The government believes that ultimately work is the best way out of poverty, and provides the best social and economic outcomes for families in the long run.

I am committed to a programme of welfare reforms that will further update and improve our social support system in ways that provide security and work opportunities for all New Zealanders.

The focus is on supporting into employment those who can work, while maintaining security and protection for those who cannot work.

It’s about investing in people so that they have better lives. We're focused on what people can do, not what they cannot.

In 2001 this government began its overhaul of social security with Pathways to Opportunity, which included:

- A simpler system

- Making work pay and investing in people

- Supporting families and children

- Mutual responsibilities

- Building partnerships

- Tackling poverty and social exclusion.

Domestic Purposes Benefit reforms were introduced in 2002, to help people prepare for a return to work when their situation allows. I am delighted to be able to say that latest quarterly benefit statistics confirm that the number receiving a domestic purposes benefit has fallen by 6.3 percent or by nearly 7000 since Labour came to office.

A Sickness and Invalid’s Benefit strategy was developed in 2004, and we have been trialling initiatives to support people with ill health or disability.

Working For Families, announced in 2004, is designed to make work pay and improve income adequacy for families with children. Three quarters of working families with children now get significant increases in their weekly income.
Making work pay through the In-Work Payment component of the Working for Families package improves people’s opportunities to make a better life for themselves and their families.

We anticipate that by the full implementation of Working For Families in 2007 there will have been a 70 percent reduction in child poverty using a threshold of 50 percent of the median income.

And over the next six months Cabinet will consider a suite of papers that outline proposals for the introduction of a simplified benefit system; ensuring that employment programmes are responding to the needs of job seekers and the labour market; and ensuring that our case management processes are appropriate for the new environment.

This is part of an integrated package across the whole of government to advance the economic transformation we must have to power this economy.

I anticipate that legislation will be introduced by the end of this year, with the remaining elements being introduced in 2007.

The changes to the system are much broader than just changes to benefits. We are refocusing the policies and services to improve the work focus and updating the system to reflect modern circumstances.

The new service approach we are launching here today will mean a broad range of people will be given access to employment assistance. As Ray will shortly highlight, case management and resource allocation will be on the basis of clients’ actual service requirements and employment potential, not their benefit category.

The new and more active approach also recognises that the largest groups on benefit are now those facing health and disability issues and people looking after children alone. So our social support system must adapt to meet their individual circumstances.

We expect the new approach to result in Domestic Purposes, Sickness and Invalid’s Benefit clients having:

- Shorter duration on a benefit before moving into fulltime work

- Increased earnings and participation in part-time work while on income support

These changes will not only affect traditional beneficiary clients. This work-focused approach will also apply to those not currently receiving any benefit, by providing employment assistance earlier in the relationship with Work and Income to enable them to obtain work earlier.

Jason Blodwell, who has received these types of services, is with us today. His is the story of a young family helped into part-time work while undertaking part-time study, without ever needing to access the benefit system. We'll hear a little more about his story later.

The government is committed to a modern, responsive social support system that actively encourages people into work, while ensuring that those who can’t work receive appropriate financial and social support.

We’ve had tremendous success in moving people into work having reduced by almost one third since 1999, the number of people receiving income tested benefits. This in turn has seen a 20 percent reduction in the number of children living in benefit dependant households – that’s 56,600 fewer children.

Further reforms of the welfare system have already been announced and are on schedule. The Working For Families Package is making work pay.

Today’s announcement builds on this by reshaping Work and Income services to provide an active approach based in individual circumstances.

We're committed to getting people into the right job, at the right time, right from the start.

ENDS

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