What? No benefit increases

By
Susan St John
-
77
1805

Now we know. It is official.  No more pretence of working on the fundamental WEAG reforms to core benefits. No plans to address the rising child poverty rates projected by Treasury under the current COVID recession. Just more rhetoric around how paid work solves everything and some minor policies that should have been done 3 years ago.

On Sunday 27th September Q & A both Carmel Sepuloni and Louise Upston spoke of the need for more jobs and training. Neither mentioned the valuable work of parenting. 

Judith Collins displayed her feeling for farmers who she feels are not valued enough for the tough work  of farming animals, but what about affirmation of the vital work of procreation and raising the next generation, mostly by women, battling on, raising children in impoverished circumstances? And in ageing society in which very soon the elderly will outnumber youth on whom they will depend? 

Neither Sepuloni nor Upston mentioned that quality, well paid flexible work will be even harder to find for those on benefits with children in the recession.   Both of these women benefited from the Training Incentive Allowance as sole parents themselves that allowed them to escape the low wage cycle.  This policy, along with allowing beneficiaries to earn a realistic amount should have been part of the 100 days plan following the 2017 election, not an election bribe that doesn’t even have a start date.   

The child poverty data is two years out of date by the time it is officially reported so that government can always say it doesn’t reflect ‘this’ or ‘that’ policy introduced subsequently. The first report of progress on child poverty reduction targets, based data collected in 2018/2019, for example doesn’t pick up Labour’s full family package.  Using  2018/2019 data  Stats NZ tell  us

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  • rates of low-income have generally declined from 2017/18, but most of these decreases are not statistically significant
  • material hardship rates show no significant change from 2017/18 to 2018/19

Yet on Q&A on Sunday we hear that the government is proud of these outcomes, citing that 18,000 children have been lifted above the 50% After Housing Cost (AHC) line. Some who were close to the 50% line, the low-lying fruit, may have been lifted over the line but 235,000 children are still below it.   Many children fall well below this line: 168,000 children below the very low 40% AHC representing 15% of children. That is where they look set to stay.

Who asks the question-why are 15% of our children under the 40% line? How are they helped by the relentless focus on paid work as the way out of poverty mantra? Why do we deny these children the full Working for Families package on the grounds their parents need an incentive to work?  

The first three-year targets are supposed to be reached by 2020/21 (year ending June 2021) and be reported on in 2022.  Even if government’s 3 -year targets are met on the 50% after housing costs primary measure (which they won’t be) there will be still be 20%, or around one in five children below this line.

In the meantime, COVID has changed things for the worse and even by 2022 we will not be picking up the full negative impact of the lockdown and recession. The $25 a week increase in core benefits was swallowed up in reduced hardship and accommodation assistance. Many hardly noticed.   Besides, the poorest of all, couples with children on benefits got only $12.50 gross increase each. CPAG modelling shows that without WEP doubling, the couple with two children on Jobseeker support in Auckland requires $208 extra per week over and above their core benefit and accommodation supplement to reach the 50% AHC poverty line. 

The $25 a week was not ‘nothing’, but what the figures show us is that there needs to be a very substantial boost so that the worst off families can be released from the noose of highly targeted supplementary payments and trips to foodbanks to eat. We also need a programme of debt forgiveness and removal of all sanctions that cripple parents.  

In spite of COVID relief, the indicators from the social sector are that the worst-off families are worse off than ever with no relief in sight. Then on 1 October  the Winter Energy  Payment ends removing $40-60 dollars a week from already over stretched budgets.  At the same time, other wage subsidies are phasing out forcing many more onto the bleak welfare system.  The children in these families face a grim Christmas of toxic stress, food insecurity, ill health, debt and poor housing. Just where is the transformation we expected?

CPAG continues to call for all families receiving benefits to be made eligible for all family support tax credits so those families under the 40% line on benefits would receive at least another $72.50 a week. This could be enacted immediately and should have been done three years ago. It wont of course be enough on its own, but it is very well focused spending if child poverty is to be tackled, will return all weekly child tax credits to their rightful role of child poverty prevention.  It is also a way to stop policies that say parenting is not proper work. 

 

77 COMMENTS

  1. That’s why it’s called Work and Income and not called Income and Work.

    Dpn’t expect anything other than neoliberalism from a neoliberal government.

    • Yes, the so often recited ‘increase in benefits’ that supposedly benefited all from 1 April 2020 have been a dishonest exercise also. Those receiving supplementary hardship top ups such as Temporary Additional Support (TAS) or the older Special Benefit (SB), they have never received the 25 or so dollars often talked about by the PM, Ms Sepuloni and others.

      In return for the humble increase of the main benefit rate, their supplements in the form of TAS and SB were CUT accordingly. This affected over 75,000 persons, as far as I know. They are already those most in need and they were thus left NO better off at all, while the politicians in charge praise themselves for having done so well for them.

      Also remember this post on TDB, perhaps:
      https://thedailyblog.co.nz/2020/04/12/did-winz-scum-just-screw-over-the-very-beneficiaries-jacinda-grant-tried-to-help/

      COVID 19 and the extra spending to bail out so many large and not so large businesses, paying also billions in wage subsidies, offering cheap loans, and other measures, have given this quasi neoliberal government the perfect excuse to be fiscally frugal from now on, so the poor will continue paying the price for the crisis, more so than anybody else.

      Labour does not want to upset those swing voters that have come to them in the form of former National voters, hence they do as they do now.

  2. I was rather surprised that Labour didn’t announce a benefit increase. I would have thought they had a mandate to lift the basic unemployment benefit to $300 (currently $281 prior to tax) for those over 25, with all other benefits increasing proportionally.

    Instead they focussed entirely on the abatement thresholds, as if that was enough.

    While I don’t agree with the WEAG recommendation as to the level of the benefit, since it would basically have the benefit rate virtually the same as the minimum wage, the current levels are too low, especially in the larger cities with higher accomodation costs. The Accomodation Supplement does not entirely bridge the gap.

    Labour could have done a bit better, given the increases in unemployment and when not everyone can get part-time employment.

    • While I don’t agree with the WEAG recommendation as to the level of the benefit, since it would basically have the benefit rate virtually the same as the minimum wage,

      So what are people meant to do there aren’t enough jobs well not that I have seen.

    • Awe shucks Wayne. You’re going all soft in your old age!.
      If I were you, I’d concentrate on getting together a few of your old half decent sort of mates over a G&T or scones and tea (maybe the likes of Spud and Don McK and that fella from Seatoun Heights) and work out ways you can claw back the Nats of old before the current crop completely send it all tits up. (You could probably do well though to leave out Burton and Jen and that fella that still hasn’t worked out what caused his children)

  3. Benefit increases are alright providing they have policies in place to get people back into sustainable mahi.I was on a benefit when needed it has its purpose. And I know first hand it is not good for our people or any people for that matter to be languishing on a benefit. The trouble with Nationals benefit and social polices is they are too punitive and we just had nine years of them and their policies didn’t work. Yet despite nationals policies not working they still keep flogging the dead horse. I see under national prison rates rise, more Maori die, more homelessness and all the poor statistics are something they should be ashamed of. But they (national) don’t have any shame, they will claim the horse is still alive when they have in fact killed it.

    • they will claim the horse is still alive when they have in fact killed it.

      They have to claim it’s still alive, so they can keep on flogging it.

  5. Very good points and right on topic SSJ. I thank the heavens that the National Party is gone at long last but is the Labour Party much better? Our core problems are still as bad or worse, the CPTPP signing, No CGT, Poverty, Housing all appallingly bad with no end in sight. Go Greens.

  6. Well obviously, Labour are useless .. glad to see you’re starting to realize this.

    You’re realizing it painfully slowly, but it’s a start.

  7. Remember Metiria Turei – former Green Party co-leader. Her attempt to give voice to beneficiaries and their struggle was met with a level of working and middle class vitriol usually reserved for child killers.
    The Labour government are obeying the law of democracy which is that the majority view of the world takes precedence over rational economic and social policy.
    Taking care of people who didn’t do well in school or who can’t earn enough to get by is considered to be morally reprehensible by the majority of the voting population.
    Beneficiaries are subjected to a form of apartheid in which government agencies are required to treat them as second class citizens and ensure they are only given a narrow prescribed set of options to manage their lives. The TOP party UBI would be a good start in reversing this culture of neo-feudal lording it over the poor. Some courageous leadership from Labour in challenging the incumbent attitude towards beneficiaries wouldn’t go a miss but is unlikely to make an appearance in this election.

  8. And still people claim that this govt are somehow “magically’ on the left and voting for them is supporting the left? Left of what exactly? Younger people forget it was Labour who started us down the road to global neo liberalism back in the 1980’s. Is it any surprise they have not changed much in terms of philosophy or policy?

    Why would anyone left learning vote for them? The Greens I can understand they are far from perfect in my view too but at least many of their policies are more Socialist. I get why someone describing themselves as left leaning and Socialist would vote for them.

    The real tragedy of all of this self deluded stubbornness on the part of some voters is what we see play out in poverty, homelessness, under and unemployment and ever increasing pressure, in particular, on the middle classes to somehow carry all of this on their backs in the form of ever increasing taxes which are in turn not managed or spent where they are most urgently needed. Not to mention “policy inertia” that see’s little reformed and as a result, little changed.

  9. There seems to be a hierarchy of need. If you are a child or woman your need is seen as more important than if you are a single male living alone on a benefit. That is how it appears.
    If there is queue to limited resources who gets put first and who goes without?
    If we are honest then we already know the answer.

    • plus one to that.
      Add to that if you are young in a relationship get refused a benefit and then have to find several $100 dollars every week to pay for state refused to fund medicines on top of your living costs.
      All the while your mental and physical health is going down the gurgler and no one seems to give a shit.

  12. I’ve just posted this elsewhere, but it really belongs here:

    If the Greens can just get this on the table, then change will begin to happen: POVERTY ACTION PLAN.

    It is NOT perfect. But it is a starting point for a change that is so long overdue that there is now a groundswell of opinion out here in the wider population that significant change MUST happen. …even among normally conservative people. Even among economists. And among the wealthy. How desperately ironic that it is Labour themselves who seem to be the last, the very last group to comprehend this??

    The danger is that Sepuloni, Robinson and co will bury the most desperately poor, out of sight, under the cemented “Two Tier” system. THAT cannot happen. And only the Greens seem to recognise this. And only the Greens have any clear policy to begin to address it.

  13. Oh please Child Poverty is so 2017 and Jacinda has a)moved on to religious hate speech, b) forgotten that she was going to do something about it 3 years ago (memory like a sieve) and c) is not interested in solving the real problems of NZ/AO including housing which contributes to the levels of poverty and the children that live in sub-standard accommodation, in cars and other hovels.
    Looking forward to her doing absolutely sweet FA for the next 3 years.

  14. Labour do not increase benefits which are needed but doubled the winter energy payment . While I am sure there are a few getting the pension who needed it I do not know any . To most it has meant a meal out but Labour held it up to show how they were the party that looked after people.
    Where are the programmes that help couples hold off on having a family until they have the means to look after the child.

    • Heard a war veteran pensioner on National radio the other day Trev. His story is appalling. He is left with $40 a week even after the winter energy payment and accommodation supplement for everything else. I tried to imagine how he managed through the winter previously, He answered the host question by saying he froze. He stated that whilst he struggles to survive on the pension and supplements, the winter energy payment was enough to convince me of the benefits.
      As for your last sentence, I’m sure ACT will tell you these people have choice to choose when to have children, personal choice and freedom of speech and all that sort of stuff.

  15. Id rather be asking what! no rent reductions? No crackdowns on residential property speculation? This is the bottom line for poverty in this country. State, state, state housing. The defining moment for the first Labour government and the defining wimpout for this one.

    • You are right. This is the real issue here. Rent and house prices are totally out of whack with NZ wages.
      This has built up over successive governments over the last few decades. The reserve bank further stokes this fire.
      WFF and accomodation supplements are Labour and Nationals can kicking ways of avoiding resolving the underlying causes of unaffordable housing and rents. Raising benefits will just continue to feather landlords pockets, and be music to their ears, and to all the MP’s with real estate stuffed in their family trusts, and super schemes.

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