NZCCSS Vulnerability Report July 2015

Financial Sanctions Undermine Social Investment For Better Outcomes For Vulnerable New Zealanders

The New Zealand Council of Christian Social Services (NZCCSS) has released the 21st edition of the Vulnerability Report and finds financial sanctions undermine the Government’s focus on better lives for vulnerable New Zealanders.

The data received from the Ministry of Social Development indicate Work and Income applied 80,202 sanctions to working age main benefit recipients during a fourteen month period [July 2013 to September 2014]: Job seekers (60,255), sole parents (19,551), supported living (33) and other (363). “These are high numbers for such a short timeframe and at best suggest a lack of understanding by Work and Income staff about the real-life stressors many vulnerable people face on a day-to-day”, says Lisa Woolley, President of the Council of Christian Social Services. “The reality of any reduction to an already inadequate income is more debt to cover basic necessities. For many of the families our Christian social service members see, this means more stress over how to afford rent, food and electricity, whilst paying back the debt”.

The official data identifies not attending an arranged appointment as the main reason for the first sanction. The report identifies legitimate reasons for people not attending appointments at Work and Income such as appointments scheduled during the school holiday and no child care available, lack of transport, no permanent address to receive written notifications, and people with mental health and addictions not well enough to attend appointments without an advocate. Others report that some people feel too intimidated to open letters received from Work and Income.

Budget 2015 acknowledges “Two-thirds of children in more severe material hardship have a parent on a benefit, and nine out of 10 of those are sole parents”. It also acknowledges beneficiary family income is not sufficient to ‘pay for family necessities”. For children, the reality of a financial sanction is coming home to an empty fridge, a cold home, and going without the necessities the majority of New Zealand children take for granted. "Financial sanctions increase children’s vulnerability to hardship and work against the Government’s commitment to reducing material hardship amongst our most vulnerable children," says Lisa Woolley.

The report calls for an environment of trust and collaboration at the Work and Income interface with people receiving benefits, along with more understanding by Work and Income staff about the barriers and stressors faced by many vulnerable people to comply with work-test obligations.

"Better lives for Vulnerable New Zealanders is an outcome we all share for those living in hardship, financial sanctions however undermine any ability to be self-sufficient and to lead better lives," says Lisa Woolley. "Financial sanctions are not a solution and long-term may act as a real disinvestment as children’s vulnerability to hardship increases, and the lives of families become more complex and difficult to move towards self-sufficiency."

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