The Need For Real Welfare Reform

Hon Heather Roy, ACT Deputy Leader
Friday, March 26 2010

Welfare dominated much of the news this week following the launch of 'Future Focus', the Government's new package of reforms designed to break the cycle of welfare dependency.

With 345,000 working-aged New Zealanders currently on a benefit, welfare dependency is one of the biggest problems we face. 'Future Focus' aims to rebalance the welfare relationship to one of mutual obligation – where Government provides assistance for those who genuinely need it, while those who can work do so – and to shift the focus from what people cannot do, to what they can. The reforms include:

* Requiring Unemployment Benefit recipients to reapply after 12 months.
* Part-time work testing for DPB recipients whose youngest child is six or over – requiring those who qualify to be available to work 15 hours per week.
* Requirement for Independent Youth Beneficiaries to be in education, work or training.
* New criteria for hardship grants – repeat applicants will have to show how they manage their money; occasional applicants will receive streamlined assessment.
* Graduated sanctions – first failure to comply with a work test will result in a 50 percent benefit cut; and a full suspension if there is ongoing non-compliance.
* More rigorous re-assessment and part-time work testing for Sickness Beneficiaries.

An ongoing issue, especially in the current economic climate, is that some people receive more on welfare than they could through work.

The 'Dominion Post' wrote this week about Cassey Quy, a sole mother on a weekly DPB of $357. Struggling, and wanting to work, she took a part-time job as a lab assistant at Canterbury University – a job she thought, after speaking to WINZ, would see her $100 a week better off. Instead, she ended up $10 a week worse off under her a part-benefit part-wage income and – with a child to raise and bills to pay – had to reluctantly quit her job. It makes absolutely no sense to have a situation where people are disadvantaged by working.

In a bid to address issues like these, the Government has included a number of new measures to support beneficiaries back into the workforce:

* Boosted abatement levels for certain benefits – to allow recipients to earn more through work without affecting their benefit payments.
* Legislated benefit increases in line with the Consumer Price Index to give beneficiaries certainty about their income.
* Training support for sole parents who are studying.
* Increased childcare options for sole parents.

ACT has always campaigned for welfare reform. The welfare experiment has damaged an entire generation of low-income New Zealanders, trapping them in government-created poverty and eroding their incentive and ability to care for themselves. ACT wants to empower people to take responsibility for their lives – which is the only way to address dependency and return welfare to its original form as a temporary safety net for those genuinely in need.

This can only be achieved by first recognising, and then tackling, the drivers of welfare dependency – resulting in a system that makes it irrational for people to remain on welfare rather than working to improve their situation, trapping families in the cycle of poverty.
Assistance for these 'at-risk' families is currently fragmented; entitlements and benefits delivered in an uncoordinated approach that often results in duplication of services. No single agency is accountable for the outcomes this spending achieves for the family – meaning families can remain 'at-risk' despite large sums of assistance.

What is needed is the removal of disincentives in welfare and taxation making it more financially viable to work rather than to remain on a benefit. The Government must encourage people to take responsibility for their lives, to learn to rely on themselves, and to return to the workforce.

Programmes to assist 'at-risk' families and individuals must also co-ordinate and complement health, education, superannuation, and law and order policies. Improved – rather than increased – spending on welfare can be gained through better co-ordination of departmental resources.

One initiative that ACT promotes is a programme where dysfunctional families are identified by WINZ and provided with support from a mentor – whom the family helps select. Mentors would come from the local community; they would be skilled and experienced in counselling, guidance, interpersonal relations, parenting and life skills, and would be highly trained.

Mentors would work with a limited number of families – promoting effectiveness through a concentrated programme – and learn the families' goals, aspirations and problems. They would diagnose the problems the family faces and assist it into full community participation and self-sufficiency. They would also have discretion to establish a programme suitable for each family – emphasising a return to work, providing childcare assistance, and helping with upskilling, further education, budget control, better housing and reduced crime, improved health and education.

Such programmes must include goals, rights and responsibilities for all parties and ensure accountability. Results would be measured in the real terms of improvements in the family's well-being and its progress towards self-sufficiency.

State handouts and control of beneficiaries' lives erodes their independence and motivation –trapping them in the system. Only by supporting them back to independence, through coordinated and targeted assistance, can we break the cycle of poverty and welfare dependence.

Lest We Forget – James Stellin

I have previously written about Scots College Old Boy James Stellin, who left New Zealand in 1943 to fight in WWII and was killed in action in France in 1944.

On Tuesday this week (March 23) Wellington Mayor Kerry Prendergast – joined by French Ambassador Michel Legras and Trevor Wellington RSA President Trevor McComish – unveiled an information board at Stellin Memorial Park in Wellington's Northland suburb.

Stellin was one of several thousand Kiwis who flew with the RAF over Europe in support of the D-Day landings. On August 19 1944 – following an operation to attack German transports – Stellin's plane went down near the French village of St Maclou la Briere.

Villagers witnessed his plane heading straight toward the village, but Stellin managed to steer the aircraft away before crashing – saving many lives. He was buried in the local cemetery and a memorial to his self-sacrifice was erected in the village, where he is considered a hero.

ENDS

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