When will Labour get it right for the worst-off children?

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At last there will be attention to the divisive issue of the In Work Tax Credit (IWTC).  From today (1st July) parents no longer have to meet rigid fixed weekly hours of work to qualify for this weekly payment of at least $72.50 made to the caregiver for the support of their children.

At least there is some small progress, after many years of fighting the shortcomings of this tax credit which is supposed to provide support for children and simultaneously alleviate child poverty and yet is denied to around 170,000 of the poorest children.

Families that have insecure and variable hours of paid work will not continue to have that uncertainty compounded by the loss of the $72.50 of  IWTC. But it is expected to help just 19,000 families at a tiny cost of $32 million.  It is a surprisingly timid reform in light of the government’s own projections of increased child poverty in this crisis. 

Doubtless, some families will be helped, but the requirement that there must be some hours of  paid work to qualify for the IWTC may rule out others who can’t fulfil the paid work requirement and will make it complicated to administer.

All of this adds to the confusing muddle of measures implemented since lockdown. Parents not in paid work on the wage subsidy have been counted as ‘working’ and they can receive the  IWTC. On the other hand the new COVD19 income relief payment (CIRP) has a requirement for there to be no paid work at all, so the children of these recipients cannot have the IWTC.  However, if the partner of a CIRP recipient is working the family will qualify. Sole parents on CIRP are clearly at an unfair disadvantage.

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And what of those poor parents working say 20 hours a week on a part-benefit ? Their children are denied the $72.20/week value of the IWTC. These parents’ paid work is clearly not ideologically acceptable only because being ‘off-benefit’ is another requirement. Absent is any recognition of parenting as valuable though challenging work as many families registered during lockdown

Intensifying the muddle, additional legislation is being introduced to protect the IWTC in the first two weeks of a parent being out of work in the case where is no paid work undertaken.  But what happens then? The worst off will end up on a welfare benefit and their children will lose the benefit of the IWTC. 

The concept that a child tax credit is magically a work incentive just because it is called an ‘in work’ tax credit was flawed from the start and proven to be ineffective. As CPAG and others have called for over a very long time period – it must be joined up to the rest of working for families support and paid on the same basis to all  families with children The cost will be about $450 million but there is no more cost effective expenditure that could be made immediately to show the government is serious about the surge in child poverty that is expected.  

 

  

 

24 COMMENTS

    • Helpful comment.

      Paula and John would have conducted bogus meth tests on the family’s home and kicked them out on the street or put them in a motel and put them into un-payable lifetime debt…while the Double Dipper would have sold off the state house to a private Aussie housing firm…and who would have then jacked up the rent…

    • Here’s a couple of useless bums with their kid loafing around in decadent indolence on a beach. Lazy hippy no account trash with B.A’s probably. Never amount to anything. And all they can do is strum guitars and sit around talking about peace and love.

      A classic example of the neo liberals idea of uselessness. Hell !,- these never do wells even wrote a song apologizing for getting nothing done while they stuffed their faces full of tea and butter pies!

      Paul & Linda McCartney – Uncle Albert / Admiral Halsey
      https://youtu.be/XI6C7L66zq8?t=32

      • @ Bert. Here’s another one.
        @ SSJ.
        You ponder…
        “When will Labour get it right for the worst-off children?”
        When we ditch the bastards along with the natzo’s in favour of politicians who do what they’re told, not what they please.
        Remember? Before the Mosque massacre and c-19 labour was just another yawn fest. A ‘Lets do this’ which meant ‘Lets do nothing.’ as it turned out.
        Now? It’s a new idiotic catch phrase. ” My team of 5 million.”
        Well, I’m no fucking team player.
        I watch labour like a hawk and all I see is the same neoliberal crypt but with a fresh paint job where that stunted vampire bat douglas can still be found hanging from the ceiling. ( No disrespect to actual vampire bats.)
        Mandatory voting. Now. Please, thanks, cheers.

  1. Yes it does seem more than a little skewed towards maintaining the neo liberal status quo, Susan St John… good article. As we can see the discrepancy’s you highlight. 36 years of neo liberalism is a hard thing for some politicians to have to admit hasn’t worked. Much like the die hard flat earther’s of 500 years ago had in admitting they were wrong….

    Still, a little more social unrest and failure should see them right…after they have had a ring put through their noses and led to the correct conclusions… it really beggars the mind how infinitely blind so many of them actually are despite the taxes from the battlers of this country who pay them to have their handsome salary’s and lifestyles at our expense…

    All I can say is they all had better start walking the straight and narrow from here on in, – if they know whats good for them. And whats good for the Kiwi battler will in turn be good for them. To do otherwise and neglect that demographic will not go well for them or any other aspiring government.

    The fun and games, frolicking and rorts and lavish lifestyles of the neo liberals of yesteryear are over.

    Things have suddenly gotten very , very serious indeed.

    And New Zealanders are in no mood to suffer liars and fools any longer.

    • Politically it is not very astute for them to leave the running on this issue to the green party. It will be interesting to see national’s families policies- will they reinstate the hours worked rule or have they seen the light?

      • Yes,… but now we get down to basic human psychology,… did Blackbeard see the light?. Or was it ”just one more guinea, one more guinea?”… And I know you can see where this is going…

        As for National,… Eddie Teach could hardly have taught them any new tricks to an old sea dog…

  2. The elephant in the room is that wages are now less secure than benefits, and you can be worse off financially working, than being on a benefit in today’s gig/low wage economy.

    But the government wants to pretend you are better off working, thus giving extra benefits to their ideological workers (which don’t seem to be beneficiaries doing work, but workers on benefits)…

    It must relive the stress of business (sarcasm) knowing that the rest of the country has to prop up with significant welfare benefits, their workforce. And they can afford to pay more, but simply don’t have too. https://www.scoop.co.nz/stories/BU1808/S00537/oh-thats-where-they-get-their-profits-from.htm

    • “But the government wants to pretend you are better off working, thus giving extra benefits to their ideological workers (which don’t seem to be beneficiaries doing work, but workers on benefits)” love it so perverted it does your head in

      • @Susan St John, Exactly!

        I would also love to see anybody on a benefit (student/worker/) be able to earn a lot more before being taxed above a minimum waged worker when they start working. They should be able to earn up to what the expected expenses costs are for the essentials in Auckland (rent, power, phone, internet, food, insurance, transport, probably, circa $600 p/w) and taxed at the same rates as a minimum waged worker not at crazy ‘benefit’ taxes.

        • yes allowing beneficiaries to earn more and abate more slowly is a clear actual work incentive that makes sense

    • There is another option.A National government encouraging poverty through restrictive and punitive policy. Through their ideological ideas that more money to business means more jobs to enable everyone the means to a better working life . No thanks, I’m happy to have my taxes contribute to those less fortunate whilst others are happy to create a bigger divide and increased poverty.

  3. Labour need to tidy up the entire benefit system.They also need to sort Oranga Tamariki out starting with getting rid of all the Chief executives all feeding out of the public trough (and failing) I noticed too many have no background in that area of social work. Too many chiefs not enough Indians comes to mind. And while (labour) are at it start with cutting of the head, chief Moss who is obviously extremely unsuitable.

  4. While on the subject of work, it would be good if ‘good’ work championed by government was not of such a drudgery nature demonstrated by the title ‘shovel ready’. No doubt helping to contribute to NZ’s growing mental health issues to have such a one dimensional focus.

    Demonstrated today by
    Only in NZ! Watch – Papamoa blocklayer’s epic piano performance on job site goes viral
    https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12344454

    Recall the movie, The Pianist when Władysław Szpilman works as a bricklayer to survive during the holocaust because only essential workers doing slave labour are deemed worthy to survive.

  5. Guide to welfare in NZ,

    It is important to remember you need to get your low wage job BEFORE you apply for benefits because going Benefits to low paid job, could ensue you pay more taxes under the current system.

  6. Ah, yes, the usual topic, what about all those 80 thousand on TAS and SB, who never got the 25 dollars increase promised by lying PM Ardern and Useless Sepuloni? Most in need get their hardship supplements cut when the main benefit goes up a bit. BS galore from this government.

  7. Yes so far it’s still not a perfect world surprise surprise children, if you got a problem with that and think National will do better feel free to vote for Todd and Jude!!

  8. Until we change the current 35 year old deeply ingrained ” profit before people ” narrative we will not tackle the levels of destitution that exist for a great many of our people.
    The Greens have been bold but still have that block wall of neo liberal defenses to break through including the current Labour party and its membership who are happy with feel good slogans and minor incremental change.

  9. Short answer is “if” not when Labour finally abandon’s the global neo liberalism that has been its guiding philosophy since the mid 1980’s. Still amazes me people hope for Socialism from a party that to my mind looks more and more like National.

    Still the tribalists will argue up is down, trot out and blithely vote for “more” and then complain when that’s exactly what they get.

    • You are right Sean – I have never understood the tribal thing,
      ‘you seriously continue to vote for Labour no matter what they do’
      “yes well who else could you vote for there isn’t anyone else”
      ‘well the Greens are better than Labour not as much as we would like but still better’

      Until we have party that says there will be absolute full employment then what do you do.

      It is totally possible to have full employment:
      We would be rid of every wilding pine in the country;
      We would have no rubbish on our streets;
      We would have clean pristine rivers that anyone could swim in;
      We would eradicate all the creatures that have invaded our lands;
      More of us ‘with help’ would grow our own vegetables.
      We would have FREE classes for whatever people wish to learn.
      There would be free public transport and free bikes for people to borrow to get around.
      We would have some community owned electric cars.
      All visits to doctors would be free.
      Everyone would have a warm dry home and a diet that means they get sick less often.
      Food that is handed out would be nutritious and simple to put together with recipes!

      We would drop our prison population @ $100,000 per person a year by 2/3 as done in one of the Nordic countries.
      All of those still in prison would have drug, alcohol and mental health counselling and learn a trade and come out with support in the community etc.

      All of those doing community service instead of expensive prison service and a ridiculously personal high cost go in groups to do community work.
      Every state rental and council house in the country would be in excellent condition with their gardens properly looked after.
      Those who are lonely would have regular visitors.
      We would have state owned care for the elderly.
      The disabled and sick would be properly looked after.
      Everyone would be on at least the living wage.

      At that point you stop unemployment benefit – if you are able bodied YOU WORK to contribute to yourself, your family and society. Not necessarily full-time.

      Of course there will still be benefits for the disabled, sick etc.

      Just read The Spirit Level we know from that research that if we did all these things we would have
      less inequality
      lower teenage pregnancy rates
      fewer drug and alcohol issues
      less crime and frankly happier people in Aotearoa.

      This could all be done but frankly there is no ‘will’ – the politicians just don’t have it in them.

      However we know that business would not want this, unemployment suits them absolutely.
      And the two major parties would never ever upset big business.

  10. Nowhere here is there a mention of the root cause of poverty – child or not. Housing. It was the defining moment of the first Labour government. We need to get back to state run housing. Until rents are reasonable and affordable, even working couples cannot afford to save for their own home. And beneficiaries and the poor cannot afford decent living conditions.
    Take property speculation out of the equation for building and rentals. CGT on all but the family home. No house purchasing for non-residents. If I hear the term “mum and dad investor” one more time I’ll scream.
    Until something is done about affordable social housing all the rest is just talk and window dressing.

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