Welfare Working Group looks at 6 month dole threshold, relocation of unemployed people. Your view?

Welfare Working Group looks at 6 month dole threshold, relocation of unemployed people. Your view?

The government-appointed Welfare Working Group has outlined a number of options that will lead to its recommendations to the government for reforming New Zealand's welfare system.

The group is calling for submissions on the options, detailed in a paper here, as it plans its final report for February next year, ahead of the government's budget in May.

The range of options include possible changes such as a six month threshold for people on the unemployment benefit, at which point a person identified as at risk of long-term unemployment would be placed in either paid or unpaid work (including voluntary work) to enhance chances of entering paid work.

Another option includes stricter enforcement of current provisions about people moving to 'limited-employment locations'.

"More active management of people in these locations to encourage them to locate paid work in other locations. This could also include help for transport," it says in the paper.

Your views?

Questions about the range of options

  1. What changes could New Zealand make to the structure of the benefit system to improve the focus on early intervention to reduce long-term dependency?
  2. What changes could New Zealand make to the structure of the benefit system to improve the focus on paid work?
  3. What changes do we need to the Unemployment Benefit to improve social and economic outcomes?
  4. What changes do we need to reduce long-term benefit dependency of sole parents and reduce child poverty?
  5. What changes do we need to reduce long-term benefit dependency of people on the Sickness Benefit and the Invalid’s Benefit?
  6. What changes do we need to reduce long-term benefit dependency amongst Māori?
  7. What changes do we need to reduce long-term benefit dependency of people who enter the benefit system at an early age?
  8. What changes do we need to financial incentives in the benefit system (including supplementary programmes) in order to reduce long-term benefit dependency and increase the uptake of paid work?
  9. What changes do we need to improve the approach to funding and delivery of employment and other services?
  10. What changes do we need to involve and support employers to achieve better employment outcomes for beneficiaries?
  11. What changes do we need to address benefit fraud and abuse?
  12. How should a new benefit system be introduced?
  13. What are the key components of a successful package of reform to reduce long-term benefit dependency?
  14. Are there other questions and areas for change not discussed that are critical to reducing long-term benefit dependency within the scope of the Welfare Working Group’s Terms of Reference?

We welcome your comments below. If you are not already registered, please register to comment.

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47 Comments

How about each person is allocated 5 years of unemployment benefit for their lifetime. If you use it all in your early 20's, tough.

I dont see why DPB mom's cant start part time work once their kids are going to school. Admittedly the needs to be jobs for them, but there needs to be some way of moving them off the DPB to prevent it becoming a lifestyle choice.

Not sure what you could do about sickness/invalid benefits. I know there are genuine cases in each, but there are cases where people have scammed it. My partner worked in a Otahuhu GP clinic briefly, and saw cases of the GP being threatened if the Doc didn't provide the paperwork necessary to go onto a sickness or invalid benefit (pays more than the "dole"

I have lived in countries without this safety net , and it causes all sorts of problems, so the system is good for those unfortunate enough to find themselves unemployed or fallen on hard times .

The problem I have with the current system here  is the abuse of the system .

Evidence of  this includes:

1) the queues outside Manaukau KFC and Mcdonalds drive-through on dole day 

2) Use of dole money to buy cigarettes and alcohol.

3) Person with drug convictions still on the dole .

4) people sitting in front of  Pokey machines during working hours such as we see in low socio-economic areas

I strongly believe with the use of technology we can issue electronic foods cards ( like eftpos cards ) which governs and restricts these folk to  buying food , using public transport , paying for utilities.

Anything else is a luxury including gambling ,  takeaways , petrol, etc  and I dont see why I should pay for this as a taxpayer

Agree with your points also. You shouldn't be able to get a SKY subscription etc.

We need food stamps of some kind, that require photo ID to prevent any black market situation.

And any benefit should be suspended while doing jail time.

Pipe dream RC....'green stamps' whatever....soon as they start mailing them out the thieving from the postie would begin..."Postie robbed by teens of ten zillion food stamps"....those that got through would be sold at discount and the loot fed into the pokies or used to buy the booze...then it's down to WINZ for some more....then you have the enterprising who print their own!........

Nice idea ( the Foodcard) but all you need is a tame dairy, and @ 80% face value you get the cash; well at least that's how the Luncheon Voucher system got worked in the UK, years back.

The eft-pos type card is the way the food stamp programme is delivered in the US.  Many items get restricted, not only tobacco, alcohol but pet food as well depnding on the jurisdiction.  And you can't get cash out either - the card will only pay for items scanned.  And anyone purchasing their bulk grocery items at a dairy (convenience store in the US) would be nabbed quick smart anyway - as everything is in the data record including the retailer.

I have no idea why we haven't implemented this.... I can only assume the liquor industry lobby has our politicians in their pockets.

Interesting how frequently indirect references are made to lobbying, lobbyists, peak-industry-groups, and influencers, yet it never gets the air time it deserves ..

theres a number of distinct categories - those that are geuine and those that are quite frankly bludgers. i think time limits on the dole / dpb must happen. restrictions must be placed on long term beneficiaries so that in time they "see the light". the plethora of grants / handouts / assistance need to be reigned in and come under the umbrella of one state service - not the adhoc system we have now with winz / ird / acc / wff / hnz all operating independantly, and at cross purposes. controls need to tigthened massively . if we go for a period where some individuals end up on the street. so be it. we need to harden up, suck it up and get with the program. we aren't that far off the "Pigs" and now is the perfect time to act.. a system of tax credits for lowly paid in my opinion is a far more equitable and simple solution and will foster aspiration not the handout mentality we have now.   

Agree with tax credit system.Why not return to the future and give tax breaks for health insurance ,life insurance,interest tax credits,all former means of savings.Does seem to be an element of superiority coming through here today,maybe ,just maybe,most of the bloggers here have had opportunities that a large proportion of our population didn`t have ,because they didn`t have families who had aspirations for their kids.They just worked to put food on the table.Always am concerned when the "old money" of the country seek to give the rest of us the benefit of their wisdom ,from lifelong vantage point of privilege and opportunity to stuff up then have enough family resources to have another go.Yes we have become a dependent country,but not only the manual labourers are dependent,but so are all walks of life as taxpayer funded handouts run whole teirs of business.Moneygoround

OK. If they want to change the system, put the onus on the Gummint to provide the job bank to allow those who wish to work to do so.

Same ole problem -no solution that will work without adjusting the whole Economy

So go back to the basics like getting the exchange rate sorted.

These flash Harrys and Harriets (or Paula actually) always come up with a solution to the wrong problem or a wrong solution to the real problem.

I wish I could get paid megabucks to help in supervising of moving the deckchairs around.

fair cop. however those that are working now are paying so much goddam tax to support a growing welfare problem that our productivity is shot.. those with any get up and go will leave. its a catch 22 resulting in a downward spiral. improve productivity by getting people off their backsides - the rest will take care of itself. thats if you beleive in economics 101 or basic human nature  

You hand out the dole..It goes in five mins.Back into the economy..if the Dole is stopped the economy will suffer with more unemployed..The problem is systamatic.Like Wolly said only a crisis will cause the pressures for adaptive change.The security blanket is a 1/4 acre section with a vegie patch and chooks.If they cant be bothered to work it they deserve to starve.The scramble for profit has almost stuffed the 1/4 acre.

I disagree ,  while the dole does go back into the economy ,its unproductive money spent by an unemployed person  , money that someone else sweated to produce and paid in tax AND  the money is being spent by a government that does not have it .

We run a budget deficit of $ 250 ,000,000 a week , and when spent by layabouts on smokes , a slice of it it goes to foreign owned tobacco companies , foreign  owned burger joints etc .

You and I are going to have to repay the deficit one day or at the very least pay the interest on debts incurred while the lazy bugger who got to smoke it will never have to pay for it.

If they put the unemployed into a public works program for just 20 hours a week and paid them to

sweep streets

collect garbage

cut school lawns

clean and cut  road verges

do road works

answer telephones at local authority/ council call centre

do menial work for KiwiRail 

clean hospitals

Clean clinics

Clean schools

Clean police stations

Clean district courts

Wash windows of Government buildings

cut down alien vegetation in rural areas

clean up riverbanks

Clean up beaches

Repair fences on roadways

the list of jobs is endless 

While I believe we should help those in need , the present dole system is a LOSE - LOSE situation for EVERY Kiwi that has got up and done an honest days work .

Its little wonder Kiwi's are voting with their feet and going to OZ 

What are you going to do with the people who are actually employed to do those jobs now?  Fire them and put them on the dole to be used 20 hours a week as slightly cheaper slave labour?

Regarding the quarter acre security blanket:

I had occasion to look over some Council Houses in South Auckland a couple of years ago.   1/4 acre sections which had been left to grow wild ... not a veggie patch or fruit tree in sight.   Inside all of the houses was infestations of many types of insect and holes punched in many walls.  This was not a one off, this was common.   Admittedly there are some careful and proud tenants.   How do we encourage the latter and deal with the former?  We can't put them out on the street, that would create another, worse, problem wouldn't it?

What you need interested, is a govt with the courage to stop pissing around....I see the building of fit for scum tenants high rise solid concrete nothing to bust piles with police stations included into the structures. Every aspect of life under 24/7 CCTV and for those who damage such places there would be one more stop....being arsed out the door of a chopper onto one of the Auckland islands with a blanket and fishing line and toothbrush. Extra supplies air dropped in every month. 

Have a read of Francois Raynal's amazing book , " Wrecked On A Reef " ............ The Auckland Islands are a pretty cool place to hang out .

Alot of this is about Location of unemployed and Dole or DPB being considered a socially acceptable lifestyle. It is not a lifestyle and should be discouraged or disincentivised.

How come we invite Malaysian, Phillipino, Samoan and other countries workers as migrants when we have the numbers in South Auckland to work on our dairy farms, pick fruit and prune vines? Making the South Auckland mob work is a sunk cost - we are paying dole anyway, why not force them to work in the farms and fields. Move them to Southland, Marlbourgh and other regions. They already have the infastructure to support them and actually need the population to increase School rolls, hospital numbers and fill the empty state houses.

Also making the South Auckland mob work in a non-crowd out area is important. Don-Key wants a national bike trail. We can't afford it. We have an army of unemployed capable of turning the rail corridor into a bike track, give them picks and shovels. Job done. They are a sunk cost.

Other non-crowd out roles with social benefit include - Possum trapping, painting over graffitti etc.

On the DPB we should;

- Removal of DPB after the Child turns 5. Moving down to basic dole. 

- No DPB after you have had 3 kids - Sterillization after 3 years. 3 is enough if you are having many multiples of solo kids, it is not a good environment and your probably not good at making decisions. NZ does not need more buldgers. 

No more crappy education courses to make the unemployment numbers better and better screening of the sickness benefits.

 

 

 "Move them to Southland, Marlbourgh and other regions.".....get stuffed....we don't bloody want them...they bring crime and problems and nothing else.

See kakapo's comment above.  There are already people working in these jobs.  They get paid a bit more than the minimum wage.   They are employed by Companies that sub-contract to Councils (mostly) and other organisations.  The better Companies screen their staff for drugs, criminal records and security and have to keep their staff productive because there is little, if any, profit margin in this work.   These employees deserve their jobs, majority of them work hard, live as well as they know how, and have not had the opportunities to do anything else.  

There is work that the Companies can do to help their staff to improve their lives if they want to, and Govt incentives would help these cash strapped employers to do that, thus some of their staff could move onwards and upwards and make room at the bottom for new entrants ...

But if you merely replace these employees with volunteers or work schemers, where do they  go?

Can someone please explain why we need to have DBP in the first place?

In the current world, contraception is virtually 100% effective (especially if you consider the ECP). We want freedom (i.e. sex without a long-term stable relationship). This is fine, provided people take responsibility for themselves.

The DBP is socially, financially and environmentally destructive. It stands for "Destructive Poverty Breeding".

Therefore, the solution is:

a. Abolish DBP for any child born effective 9 mths from now;

b. Offer free contraception in low social-economic areas; 

c. Ensure that young woman in high-risk are offerred support to ensure they have the opportunities to persue careers and to have meaningful jobs;

d. Parents who separate should be responsible for caring for their children. Temporary assistance could be provided to assist those on low incomes to allow them to transition to a two household (i.e. offer temporary safe houses with food). 

We have the DBP ( Development Bank of the Philippines ) to assist credit flow into poorer areas , to encourage entrepreneurship , and to improve the lives of Filippinos . They do good  work !

 "Ensure that young woman in high-risk are offerred support".....this would cost more than handing out the free money!

Can someone explain the difference between receiving an unemployment benefit and being the indirect  beneficiary of 'fiscal stimulus'? 

No worries Haggis...the former is given to peasants and the latter is called a business or enterprise subsidy.

I can imagine them picking the fruit.  They would drop half of it, throw a quarter at each other and eat the rest....just the sort of pickers that growers want.

Bloody clever idea to limit the dole to 5 years, especially after letting the bankers run a rort over many years that is about to plunge us into an abyss that will see unemployment rise exponentially. Through the 1930's unemployment hit 30% and it was really only the second world war that brought the world out of that depression. But if they cut the dole then we won't have to worry about a world war, we will have a civil one! Hungry, idle and desperate people will soon create problems.

But the DPB is another story. Tens years ago I was reading Robert Jones and came across a comment about 9 out of 10 Maori being born into a family without a father. I double checked and the figure was close to correct at 8 out of 10. That is appalling and no wonder we have a mess. How the hell do you extract the country from that problem?

Also what some might not realise is that our wonderful capitalist system requires unemployment to stay above 4%, otherwise the pressure on wages creates unacceptable inflationary pressure.

There is a story that you can tell the quality of a society by the way they look after their poor and disadvantaged.

What we need is a better quality of society.

What we need is a better quality of society. 

How true - and unless we change the incentives away from not working and benefitting to working and benefitting we won't get that quality.

Which is why I love Gareth Morgan's GMI - everyone from 18 years of age gets $12,000pa - whether working or not, whether you have O, or 1 or 100 children, whether you are an invalid or a sporting icon, whether you are on the minimum wage or on a merchant bankers bonus scheme.

Everyone gets $12,000pa - no exceptions, no top ups.

SUDDENLY - for every unemployed person - every hour you work makes you more money - and for every teenager... children are no longer a meal ticket.

The quality of our society would improve immediately. 

 

so if you have 5 kids that equates to say $2k for each child and $2k for yourself to last the entire year? 1 month in you’d be out of cash. what then, euthanise the kids? great policy. will solve all our woes. nice one GMI.

what then? 

Hopefully if you have five kids, you also have an over 18 year old partner - that makes a $24K income. Find Work. Busk. Sell used childrens clothing on TradeMe. Move in with Mum and Dad. Babysit the neighbours kids so they can work. Take in boarders. Hopefully one of the kids will turn 18 soon. 

won't happen. they'll just go and have more kids 2 another another father and flog the kidiwinks off to the aunts. eventually cyfs will get called in and find them asleep in the back seat of a car. with mum off somewhere else. same old same old. these people don't think like us. we are talking about generation upon generation of bludgers. thats all they know. 

And I would be prepared to bet the farm that if we introduce a GMI, that we would witness the last generation of welfare dependence as the more attractive lifestyle choice.

Why?  Because there would be no welfare.  There would simply be a GMI. 

Children turning into adults learn quickly - very quickly.

If every person earned just $12K then the cost of living would have to come down to match wouldn't it?

interested2, every adult would not JUST earning $12K - that is the GMI (guaranteed minimum income).   

If for example, there was a flat tax rate of 25% - a $12K GMI equates to every employed person getting their first $50K in earnings tax free.  For those who don't work - they just get $12K tax free.

I believe the present benefits are taxed (which seems plain stupid, unnecessary admin to me!) - and beneficiaries have benefits deducted in some kind of prorata way if they take on part time work.  This is a dumb disincentive for people on a benefit to get out and do something productive with their lives.  A GMI gets rid of all those perverse incentives.

Good you clarified that Kate because I didn't look up GMI to see the detail.

Yes that would address the issue I have seen with the dole for a number of years, in that the difference between working and not working isn't enough. In some instances by the time some low paid workers run their car, buys work clothes, pay higher tax + ACC etc, they are working for only $40-50 over what they would get for not working. You could just about make the difference up by growing your own veges.

I have a friend that lost his job around ten years back through no fault of his own and when he found up how much he was getting paid for not working, he didn't for two years(except for cash jobs that supported his lifestyle). He was off fishing and hunting and having whale of a time.

I was jealous because as a professional I wasn't getting much more either.

Gareth is on to it alright.

It's such a simple solution, scarfie, (Gareth Morgan's 'Big Kahuna, that is) that it frustrates me to no end that Key's Government totally ignored it.  And it was so appropriately named as well by Gareth - because, as he pointed out, there is no sense in addressing tax and welfare systems via DIFFERENT processes/working groups.  They are fundamentally intertwined.

You can only dole out as much welfare as your tax take allows you to.

But this Government seems intent on reducing the tax take and borrowing for the welfare - but even in saying that, they aren't addressing the big, big, big, biggest-by-far welfare ticket item - superannuation.

The other thing about the GMI - imagine going around to all the first year intermediate student classroomjs and explaining as part of the sex education program that there is no longer any DPB - no special benefit associated with raising children.  If you have children you have to raise them on your GMI.  And work through a budget with them - just to show them how impossible that would be.

Also with the GMI, we get rid of accommodation supplements and market rent subsidies - that'll save us over a billion a year, and all those private landlords presently renting to beneficiaries will have to lower their rent if they want to keep their tenants.  Heaps of DPB beneficiaries would move in with family, and frankly it would likely benefit the children immensely - as well as boost the overall income in those households.

Anyway I could go on and on about the benefits of a GMI... what I probably should do is make a submission to the latest working group.  Fat chance however that will make any difference as their terms of reference are all wrong, as they only deal with the welfare side of the tax/welfare ledger. 

I think you should make a submission, why not?

Personally I have a problem with cutting superannuation  ... well not for the future, people can prepare for that, but I would not cut those that are already on it or near to it because they have little or no chance to change their circumstances now.   It is not on to 'change the rules' on superannuation for people who have 'played the game' according to how they anticipate things working out.   That would be cruelty.   I would change superannuation on a sliding scale depending on how old an individual was at the time of the change.

The DPB should be given to them from childs age of 0 - 5. After that nothing. And any kids after that 50% of the cash value of the first from 0-5, then any kids after that, nothing.

The dole should be, 6 months at 100%, the following six months 90% and so on.

Sickness / Invalid... The same help but a doctors visit annually to renew. (also a general check up for any new medicines...)

Housing benefit. Each bedroom needs someone in it. Isn't there houses at present with 1 person with 3 bedrooms? Can't this person get "flatmates"? If you don't like living with others well go and get a job and get your own place. Everything for free is not right.

 

Red Necks are sure out in force today.

Are they ready to spend their low taxed income on walls for their estates?

14 questions on the "range of options", all of which amount to "How do we force beneficiaries into work?" That is only option 1. Option 2 might be "How do we create more jobs?" but that's rather pathetic. Option 3 "What changes do we need to make to address fraud and abuse in the financial system that results in poverty for the majority and loadsamoney for too-big-to-fail bankers?" Option 4 "What incentives do we need to give to people so they aspire to greater things themselves instead of kicking down on the people on the bottom rung of the ladder?" There are many options, but if you set up a remit for reactionaries, that's what you get. Judging from some of the responses on this blog, it has been successful already.

The global economy is currently all about welfare for corporate beneficiaries. We are all going broke bailing out global banks. And you're worried about unemployed Maoris? Some people having too many children for your liking?

Careful, Korual.  I might start thinking you have brains, common sense AND empathy.  That's a dangerous combination for the status quo.  Sit on your helmet, mate.

If reducing the welfare bill is the goal, the following graph suggests there may be other areas that provide a better return.

http://dimpost.files.wordpress.com/2010/08/welfare.png

 

Great post AC. It really does tell an interesting story. 

We all know 90% of sickness beneficiaries should really be classified as unemployed, so that gives a good picture of where we are in real terms.

Trouble is if you kick the DPB then a portion of that money gets transfered across to the family tax credit.

Gee if you are retired you might want to have a re-evaluation of your budget.

 

How scary is that pie chart!

Yikes.

Clearly the unemployed ain't the problem - it's the retired and the working poor that are the big welfare spenders.

For starters - life the minimum wage (and thus massively reduce those family and other in- work tax credits) and means test super!!!!

How hard is that?!

@ Kate

I agree with your thoughts around the GMI and the long term benefits around welfare dependency. I would like to see this idea at least debated and analyzed within the range of options. 

@ Anonymous Coward

Agree around the cost of NZ Superannuation. Clearly this has to change and it will eventually change. John key thinks it will not be politically acceptable, but I think most NZ'ers realise that universal super is not sustainable.

I think the issue around other benefits such as unemployment, sickness and DPB is that they are so socially destructive.  

if working your butt off and caring about where your next pay cheque comes from to feed your family, and actually caring about your country classes me as a " red neck". then sure i must be one according to you. too many of my friends and colleagues have left nz citing social problems as being a big reason for there departure. Most won’t return. if you are a doctor working in an A&E and spend your weekends patching up dick heads who come in intoxicated abuse you and the staff why wouldn’t you want to head off overseas to another part of tie world, where people in the main are relatively civilised. life is too short and the world a very small place. I’ve got 2 mates who have done exactly that. A total waste

if working your butt off and caring about where your next pay cheque comes from to feed your family, and actually caring about your country classes me as a " red neck". then sure i must be one according to you. too many of my friends and colleagues have left nz citing social problems as being a big reason for there departure. Most won’t return. if you are a doctor working in an A&E and spend your weekends patching up dick heads who come in intoxicated abuse you and the staff why wouldn’t you want to head off overseas to another part of tie world, where people appreciate your skill, in the main are relatively civilised. life is too short and the world a very small place. I’ve got 2 mates who have done exactly that. A total waste