Child Poverty Action Group (CPAG) is deeply concerned about the impact for sole parents and their children of losing their financial independence when Work and Income decides the parent is in a de-facto relationship.
“This system is based on out-dated notions of relationships and financial co-dependence when a sole parent re-partners,” says CPAG Executive Officer Georgie Craw. “Parents need adequate time to establish whether the relationship is healthy and going to be long-term, but the current system works against them, and makes some fearful of entering any new relationship at all.”
It is problematic that the facilitation guidelines (which give people up to six weeks to consult with the Ministry of Social Development on a new relationship) have likely been interpreted and executed wrongfully as ‘rules’.
“The problem is the grey area here – the mishandling of this guideline by Work and Income staff. There is a high risk of wrongful interpretation and unfair scrutiny of parents’ private lives through unnecessary investigations being carried out. The results may be dramatically reduced incomes, and at worst, prosecution.”
The very low ‘married rate’ benefit is problematic to begin with. For example, if Jane is on a Sole Parent Benefit of $339, and starts dating Jim, an over-25 beneficiary on Jobseeker Support benefit of $218 – between them their income is $557. But if Work and Income applies its guidelines and decides they are in an “emotionally committed” relationship, they may decide to move Jane and Jim to a couples rate benefit ($391) which would be $166 per week less than before. Jane may be deemed to have been overpaid and would be expected to repay the difference. They may also possibly start an investigation without her knowledge.
Further problematising this issue is the interaction with Working for Families tax credits, which as one mother discussed, can be cut off if a new partner is found to be earning over the threshold for payment.
CPAG says that the most critical first step is to individualise benefit entitlements. Increasing the per-person married rate to equal the single rate should be an immediate first step.
“We are very concerned about the dangers associated with unwarranted investigations and the impact of this stress on people’s lives,” says Craw. “Work and Income can investigate even earlier than six weeks if they think there are grounds to, and women are more at risk of being investigated without their knowledge. One woman told us she suffered severe PTSD after finding out she was being investigated, even though she was found not to be living in a marriage-type relationship.”
In the 2017/18 year there were 12,578 phone line allegations, which resulted in 5,490 completed investigations of which 3094 were related to a marriage-type relationship. Of the total investigations 1664 overpayments were established and 277 successful prosecutions resulted.
This just shows how tragically, the public has been encouraged to undermine the ability of parents to make healthy relationship decisions and to keep a watchful eye out for benefit recipients who may appear to be entering a relationship. It is voyeuristic and intrusive in the extreme.
The Office of the Privacy Commissioner launched an investigation earlier this year which found that “the Ministry of Social Development systematically misused its investigatory powers while pursuing benefit fraud, unjustifiably intruding on the privacy of many beneficiaries”.
This is why the facilitation guidelines need to change from six weeks to three years, and longer in accordance with the experience of the sole parent who receives a benefit, and the Government should act swiftly to make this change on good faith – so that Work and Income can’t make any mistakes or mishandle these guidelines, don’t expect new relationships to be financially co-dependent, and to reduce the risk of creating dangerous situations and trapping sole parents (mostly mothers) and their children in poverty.
“All conditions should be built upon allowing parents enough time to make healthy choices about their and their children’s lives – just like people not on a benefit get to,” adds Craw.