Gone are the expectations of transformation, game changers, or long-term vision. Could Labour please just fix some little irritations before the election? Please. Last century’s outmoded, anomalous and harmful policy quirks can’t be justified by any rational argument. They should have been fixed by Labour eons ago.
Here are just 3 examples which exasperate and inflict great harm for no good reason, but there are many others.
- Penalties for having sex: A couple on the Supported Living Payment get a total of $654 net compared to two adults sharing accommodation on the same benefit who in total receive $768 net. Why? Does MSD think there should be a tax of $114 a week on having the possibility of, if not the actuality, of sex? Worse still two sole parents sharing but deemed by the bedroom police to be in a relationship, would see their core benefits drop in total by a whopping $341 per week.
In principle we should load tax on things we want less of. Good relationships promote vital wellbeing and yet we penalise them? Recent modelling from CPAG shows that couples on benefits suffer the biggest gaps between their basic expenses and benefit entitlement income compared to other types of family grouping.
Note too, a couple on a benefit gets a total of $700 in winter energy payment, but two singles sharing get 29% more at $900. Why? Is it that 1950s reasoning insists that couples will save power by cuddling in one bed?
How could Labour go about fixing this problem? Just align married and single rates by lifting the married rate to the singles rate. Now that didn’t hurt did it!
Next step, allow an individual income test and an individual threshold for abatement, currently set at $160 per week (jobseeker) for a couple, but two adults sharing can each earn $160 per week, or 100% more.
- If you have a partner who is on a benefit in their own right (regardless of whether you have children): the first $160 (before tax) per week that you and your partner earn in total doesn’t affect your main benefit
- after this your payment reduces by 35 cents for every dollar of income you and your partner earn. MSD
Crazy stuff. Grinding couples down when they earn a bit extra because they also may have sex is very weird.
There is hope! It took a long, long time to get some sense into superannuation policy. Finally, after 15 years of conferences, petitions seminars and political advocacy, Labour decided that an individual would not have their superannuation reduced dollar for dollar for the excess overseas state pension state pension of their spouse. It shows it can done! Nobody died and some now feel they are actually people in their own right regardless their choice of bed-mate.
2: Pathetic asset limits for the accommodation supplement: The numbers of older people coming into retirement with fewer assets, and in more hardship are increasing. However, only a minority of those in high-cost housing can excess the accommodation supplement because to qualify they must have less than $8100 in the bank. Think about how ridiculous that is for somebody who has accumulated a small nest egg to last for what might be a retirement of 30 or 40 years in length. It is a sudden, cliff-edge policy: one dollar over the limit and ALL the accommodation supplement (that can be up to a maximum of $165 for a single per week) is lost. What is the origin of this stupid threshold? You have to go back 35 years. In 1988, $8100 was the allowable amount in the predecessor to the accommodation supplement. Nothing has changed since then! LOL.
I am aware of retirees who are putting money under the mattress as they try to store up enough to fix their teeth, get hearing aids or go on a short trip to see their grandchildren.
Fix this now please Labour. If we must have a cash asset test raise it to $150,000 and index it annually to inflation.
- Forcing a harsh repayment of student loans: We expect young, skilled nurses and teachers and others to re-pay student loans from very low incomes. Income over a gross $22,000 is taxed at an extra 12% for loan repayment. But wait, the gross sole parent benefit is now $28,600—so she has an extra $792 to repay. That $22,000 threshold was set in the early 1990s and has scarcely budged since then.
Our young have no incentive to stay here, and going to any tertiary institution is increasingly disincentivised by the spectre of a large loan and its punishing effects. Sole parents with student loans, trying to get ahead by working can face additional clawbacks for the Accommodation Supplement and Working for Families, leaving them with very little reward for their extra work effort. Nuts!
The population is rapidly growing older, intensifying pressures on the healthcare and aged care sectors. Does society have a death wish? Here’s an actionable idea: write off the assessed loan repayment every year for every nurse, teacher, caregiver that stays in New Zealand. Just do it!
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No wonder I’m pissed people don’t work. “A couple on the Supported Living Payment get a total of $654 net compared to two adults sharing accommodation on the same benefit who in total receive $768 net.”
I could end my business & stay at home and look after my sick wife and get $700 – 800 a week.
But my wife and I don’t see that as honest when I own and run a business and do not want to rely on the state doing nothing.
I’m pissed people get this much on a benefit – why would you work when you can get this?
I get it for short term issues or disability but long term non workers – ffs!
For goodness sake grow up, you have a business…
What’s the point of this narrative? I also have a penis – does this mean I haven’t grown up?
Neanderthal attitudes like this are one reason Govt.s won’t act to end benefit stigma and get MSD to pull their sadistic heads in.
“Last Place Aversion” is a real phenomenon studies have found, whereby low paid workers resent and fear increases to the minimum and living wage because essentially it means they have to face their own miserable reality and not having an inferior group below them anymore.
True, Tiger Mountain.
I struggle to understand one of mankind’s basic needs as I see it: The need to have somebody to look down upon and despise.
The only way that some sad people can find to bolster their own lack of self-esteem.
You make some good points regarding inconsistencies Susan. I would go further:
Why not slap an import duty on gas guzzling SUVs that currently litter the streets? At the same time zero rate Japanese ‘kei cars’ (they zero rate this class of light weight low powered cars)
Yes there a lot of obvious policies like the one you mention Andrew that can be picked off one by one by a government who listens.
Electric EV’s are twice as heavy because of the batteries, just saying.
Gone are the expectations of transformation, game changers, or long-term vision. Could Labour please just fix some little irritations before the election?
So much they could have done but no point in holding your breath.
Thanks Susan.
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