11% of working age population receiving a main benefit

Public Policy / news

NZ faces rising living costs and higher unemployment at a time a large number of people already require government support

21st Apr 22, 5:17pm by Jenée Tibshraeny

Image sourced from Pexels

New Zealanders are battling rising living costs at a time 11.1% of the working age population is receiving a main benefit, and hundreds-of-thousands of people are receiving government grants to help pay for food and housing.

According to Ministry of Social Development data released on Thursday, 348,339 people were receiving a main benefit as at the end of March.

That’s 17,595 people fewer than a year earlier, but still 61,890 more than as at March 2019, when 9.5% of the working age population was receiving a main benefit.

The most common type of main benefit is Jobseeker Support. This is available to people actively looking for or preparing for work, including people with part-time work, as well as those who can’t look for work at the moment due to health conditions, injury or disability.

As at the end of March, 177,642 people were on Jobseeker Support. Of these people, 100,854 were “work ready”. That’s equivalent to 3.2% of the working age population.

This aligns with the unemployment rate (calculated differently, via a survey), which came in at 3.2% in the December 2021 quarter. The underutilisation rate was also low in December 2021 at 9.2%.

While the number of “work ready” people on Jobseeker Support fell from last year, there were still 29,668 more “work ready” people requiring support in March 2022 compared to in March 2019, pre-Covid.

So, despite New Zealand having a “tight” labour market, which is helping push up wages and prices more generally, there are around 100,000 people looking for and/or able to work.

Ministry of Social Development data also shows large numbers of people are continuing to receive grants to help them cover food and housing costs.

The Ministry distributed 363,888 food grants in January, February and March this year - 4188 more than the same period last year, and 151,017 more than the same period in 2019.

The number of emergency housing grants distributed in the March quarter increased by 906, compared to the March 2021 quarter, to 35,220. In the March 2019 quarter, around half that number were distributed.

While the increase reflects a lift in hardship, it also reflects an increase in government support to some extent.

For example, the Government in November 2021 temporarily broadened the criteria for hardship support so more people could qualify. Until June, single people earning under $800 a week, or couples earning under $1600 a week may be eligible for assistance.

The closed border also freed up motel rooms, which increased the stock of emergency housing available.

Nonetheless, a large portion of New Zealanders are still requiring government support to get by at a time the cost of living is expected to remain high, and the unemployment rate is expected to rise.

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

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

65 Comments

by Baywatch | 21st Apr 22, 5:34pm 1650519271

Does this include Super?

by Jenée Tibshraeny | 21st Apr 22, 5:51pm 1650520310

No, this doesn't include Super.

by Pragmatist | 21st Apr 22, 5:52pm 1650520365

What does "working age population" suggest the answer might be?

by Baywatch | 21st Apr 22, 7:13pm 1650525184

Plenty of over 65 working...and getting the Superannuation Benefit

by AJ123 | 21st Apr 22, 5:36pm 1650519397

And government decide to open the immigration flood gates, just at right time.

by Brock Landers | 21st Apr 22, 5:49pm 1650520161

These percentages are going get worse as the cream of the working-age population flees abroad ✈️ ✅ and are replaced with 501 deportees and queue jumpers.

by Pragmatist | 21st Apr 22, 5:55pm 1650520506

No wonder they can't afford to index the tax brackets for the rest of us....

by Brock Landers | 21st Apr 22, 6:08pm 1650521314

Of course not. Those who work for a living in New Zealand are tax donkeys and are expected to carry the full burden of taxation for the rentier landlords and various other assorted non-net taxpayers.

by youngdumbandfullofit | 21st Apr 22, 8:43pm 1650530605

Yes let's cull everyone getting a handout. It's only 40 percent of households who receive more tax credits and benefits than tax they pay, and they won't be doing it tough, let alone their children. Just creaming it in from the 3% of households who pay in 24% of the tax take. God. Those top 3% are so hard done by, can you imagine the lackluster lifestyles they live because they're expected to line to pockets of the poor. Jesus. Why can't we just live in a equal society where we all pay a nice equal share. Why should the rich pay more really... Wouldn't society be so much better for increasing that wealth gap. Obvious /s

by Brock Landers | 22nd Apr 22, 4:10am 1650557422

It's forgiveable being so young and dumb.

The problem is that New Zealand relies too heavily on income taxes.

by GV 27 | 22nd Apr 22, 6:24am 1650565474

Pssst the top 3% of taxpayers will almost certainly not be the top 3% of households in terms of wealth. That's a longstanding point of confusion with a tax system that aggressively taxes middle-income wage earners as if they're on $150K by way of hoarding inflationary receipts - and that's by design.

What you need to think about is the untaxed revenue from things like gains on property, which flowed through to people in chunks bigger than 99% of salaried incomes, and without a cent of tax flowing through on them. That's how you really build wealth in NZ, apparently.

by RickStrauss | 22nd Apr 22, 11:56am 1650585381

>$4 billion per year taxed from work and given out as Landlord Benefits, and then we haven't taxed wealth income from property speculation.

Bit of a crock, really. No surprises for guessing what MPs invested in heavily over the past decades...

by hootenany | 28th Apr 22, 7:55am 1651089336

Even if the top tax payers are the richest people it doesn't really matter. Since the rich are getting indirectly subsidized by taxes. If you have an employee and the get a topup for food, health care. roading to live an ok life then you are using that in order employ them at a lower wage than they need to live at an acceptable level. If the government pays for your doctor it doesn't go to you it goes to the doctor, if they pay for a rent subsidy it goes to your landlord not you. If they pay for food it goes to the supermarket.

The whole idea you not paying your way because the tax take from you is less than you pay is just silly. If you work 40 hours a week no matter what your wage is you are contributing more than you are taking. This is probably more true than if you are simply own something and collect economic rent and pay tax on it, no matter how much you earn.

Please note I am not against landlords, I am one, although I don't speculate in property for moral reasons. There are few people would pass up the opportunity to make easy money if they have the chance.

by nznew | 21st Apr 22, 6:16pm 1650521806

Well I think the time has now come for the government to make a call on handouts, local productivity is not making up for what we’re giving out to the ones on benefit

by Fitzgerald | 21st Apr 22, 8:26pm 1650529613

First benefit to be cut should be the accommodation supplement. All it does is push up rents.

There is no sense in having a benefit that goes directly to lords of the land.

by Solve_it | 21st Apr 22, 9:37pm 1650533826

Agree, and next to go after that must be the non means tested super

by GV 27 | 22nd Apr 22, 6:28am 1650565738

I reckon we fix the glaringly stupid bits of Kiwisaver first before we go yeeting non-means-tested Super, like taxing it annually instead of on withdrawal like a sane super scheme would. Plus you don't really to go giving too much of an 'up yours' for people who have saved for their retirement just so those who didn't bother can have an easy ride. I wonder if some sort of state annuity option with tax-free interest distribution could be offered to those who actually did the right thing.

by rastus1 | 22nd Apr 22, 8:49am 1650574186

Means tested super would require an army of accountants to chase and would come at the delight of the legal and accounting professions who would have a new revenue stream.

It would only be applied at any degree to that easily targeted group - those on paye. Those with Companies, Trusts, overseas income and so forth would walk away.

I believe Mr Muldoon worked this one out and gave up.

TOPS UBI however would sort it. This is where the young should be voting.

by RickStrauss | 22nd Apr 22, 11:57am 1650585456

Just means test it on the value of one's primary residence(s).

But no, there are more preferable alternatives to means testing super. Like an LVT on the unimproved value of land.

by Squishy | 21st Apr 22, 6:18pm 1650521922

We created the working poor with immigration policies, it seems only fair that we should be forced to bail them out.

by JimboJones | 21st Apr 22, 6:31pm 1650522684

So 7.9% are on the sickness benefit or DPB (look it ends in a 9 it must be fake news right). Sounds about right I guess.

by streetwise | 21st Apr 22, 11:22pm 1650540175

But don't forget that people-breeding has been a legitimate life-style choice for years. Breeding to multiple fathers has been a career choice. The mothers don't even have to name the fathers so the state can be reimbursed by maintenance payments because the state now realizes that the mothers will be bashed or even killed by the fathers in retribution and the judges will then pat the fathers on the head. What trash our society has to put up with......

by Jonny.Foe | 22nd Apr 22, 7:07am 1650568036

If you put 1,000 people into crap housing without enough money to live with dignity or take part in society, then you make sure there is only 1 job for every 10 of them looking - and that's sporadic shifts in a warehouse or call centre two buses away - and, then you surround them with people driving around in expensive BMWs towing boats, and then you expose them to loony tune commentators in the media calling them 'trash;.... what do you bloody expect?

Don't worry, you don't have to have reckons on it - there is plenty of cause and effect evidence. What you get is a large proportion of those 1,000 people getting depressed, living under stress, making crap decisions they regret, feeling crap about life, taking risks, self-medicating with drugs and alcohol, and hurting each other and those around them. You can point to the 'one that made it and now owns a Pak n Save' as a shining example to everyone else - but that is like pointing at the 500-1 horse that came in first on the nose, and saying that all 500-1 horses should win.

Dear me.

by rastus1 | 22nd Apr 22, 8:55am 1650574556

Overlooking again that the state sponsored breeding programme is a career choice.

You don't have 8 kids by accident. You have them for the $ incentives and the ability to get every little bit of assistance going - screaming down the local winz office and prime time tv if you don't get what you are 'entitled' to. Which for many of these breeding units is nothing.

by Jonny.Foe | 22nd Apr 22, 9:30am 1650576639

There's no helping you is there?

by rastus1 | 22nd Apr 22, 10:04am 1650578668

I don't need help. I didn't go out and breed multiple kids and then expect tax payers to play daddy.

2 x Units in emergency housing $3k per week. Add another $1,000 + in benefits. That's the cost of one breeding unit per peek with multiple kids.

Yep....$200k ish per anum we pay per breeder and offspring.

by RickStrauss | 22nd Apr 22, 11:58am 1650585514

Approximately how many on the benefit do you think are "professional breeders"?

How big exactly do you think that specific problem is?

by hootenany | 28th Apr 22, 8:15am 1651090504

I don't believe that people that are unemployed deserve to live in dignity, and there is no amount of money you can pay them that will make it happen. Dignity is what you get when you work for a living.

What we do need to give people is to give them a reasonable opportunity and motivation to get a job. To me this includes free education including higher education, removing police checks for even the most menial of jobs. Free health care, enough food, and reasonable housing. The ability to keep more of your income once you start working.

However society should still judge them for not having a job, that is part of the motivation part.

by WestieAJ | 22nd Apr 22, 2:00pm 1650592835

People farming has also been a legitimate lifestyle choice for the last 30 years. With government subsidies to boot. Also when your stock becomes uneconomic to farm. You don't have to knock them on the head. You can just send them off to the government farms to be looked after.

by Jonny.Foe | 21st Apr 22, 6:58pm 1650524327

A few afternoon drinkers on this evening then?

Govt 'handouts' are of course either:

A subsidy for employers who would not otherwise be able to pay their staff enough for them to survive in NZ, or
A payment to job seekers for their help with fighting inflation - remembering that we apparently need at least 100,000 people unemployed to prevent wage inflation

On the point of unliveably low wages, our problem is not scarcity - total wages in the country are more than enough for all people working to live comfortable lives. The challenge is how those wages are distributed.

For example, we could raise the same amount of income tax (just over $40bn) with the folllowing tax bands:

$0 - $48k: 0%

$48k - $75k: 20%

$75k - $200k: 40%

$200,000: 66%

I am not advocating these change by the way - a land tax would be far preferable. I am just trying to illustrate that a more progressive tax system would mean far less people needing Govt support. The issue of course is that middle class swing voters have got used to decent wages and cheap prices that are enabled by subsidised domestic wages and sweatshop labour overseas. For example, if shop staff were paid a true living wage - enough to rent more than a pokey room in a mouldy shack with seven other retail slaves - the stuff we bought in shops would be more expensive, and middle-class NZ would have to accept a real terms drop in disposable income (or bide their time so they could vote in an ACT / National wellbeing demolition derby)

by nznew | 21st Apr 22, 7:19pm 1650525554

I understand the need for assistance to the most genuine cases, which will make up the 100,000 you have suggested to combat wage inflation.

in broader terms people on benefits (without a justifiable reason, with large families) and in prisons cost us more through healthcare and social housing, rehabilitation, which adds to existing pressure on the middle income earners through high rents, overworked healthcare system, increased taxes etc., and cannot be sustainable in the longer run. This cannot be fixed with immediate policies as welfare is ingrained in our economic setup

Land tax is absolutely a good start but you will have complications around implementing them throughout the country especially where Māori interests are vested and will increase operational costs for the government

As for the goods we buy in shops, there is no other option than to rely on cheap overseas labour.

by Jonny.Foe | 21st Apr 22, 7:56pm 1650527813

There is a logical flow of sorts there - but I would suggest the place to start is with the 100,000+ unemployed people and the other 200,000 who are working but can't get enough hours. Our hugely expensive prison, criminal justice system, and healthcare system is full of people that have been (or whose parents have been) in this cohort. The direction of causality here is absolutely known... if you grow up in a stressed household with no money, your chances of offending, having relationship breakdowns, being homeless, going to jail, needing mental health support etc is massively higher.

So, how about we reject the very notion that we need an underclass in the first place? Maybe a cheaper option would be to guarantee anyone that wants work a job that pays a liveable income. And if the jobs aren't there, just create them. It is not like there aren't loads of jobs that communities need doing - fencing off streams, maintaining trails, trapping possums, doing shopping for older people, teaching kids music, etc etc.

by Nzdan | 21st Apr 22, 8:37pm 1650530260

Agreed, I used to walk through an alley way to the train station each day. Path covered in lichen, overgrown trees dropping fruits, fences that need repairing and a bit of love.

I've always wondered why we cannot provide incentives for jobseekers to put their hands up, do some work and earn some money. Provide a van/bus that can pick them up/drop them home if needed, highly likely they'll all live within the same suburbs anyway. It doesn't need to be a profit making exercise, but can be rewarding for those who just need an opportunity. Even if it's just an honest days work for some beer money for the weekend *shrug*.

by Pa1nter | 21st Apr 22, 10:17pm 1650536261

The problem with such schemes is that individuals lacking the skills/experience/ability to obtain and keep a job like repairing fences or pruning trees aren't going to deliver very good bang for buck. Potentially a net loss by the time you also pay for the infrastructure to organise and transport them.

by Jonny.Foe | 21st Apr 22, 11:34pm 1650540876

A net loss measured how?

by Pa1nter | 22nd Apr 22, 6:30am 1650565828

If it's a task you genuinely wanted carried out, it'd likely be cheaper, faster and more effective to pay someone that does it for a living.

by Jonny.Foe | 22nd Apr 22, 6:40am 1650566424

Yes, the job guarantee does not replace professionals or public service, it supplements them. Basically community groups identify suitable projects and activities, and people looking for work get assigned to them based on their skills. If people have particular skills (eg journalism) they might get special projects like recording local history. There is nothing new in any of this - Roosevelt new deal was similar and India have run a huge rural job guarantee scheme for the last couple of years.

by Pa1nter | 22nd Apr 22, 7:29am 1650569394

Sure, nothing new, but there's a reason why they're not sustainable. You're wanting to use people that aren't even up to the standard of being temporary labour hire job type workers, creating a system that finds and administers tasks for them to do around the community, tracks they're being done safely and effectively, and pay them to do it. If you got 10 cents value in the dollar, it'd be impressive.

by Inthecentre | 21st Apr 22, 10:39pm 1650537563

We used to have that. They were called the Ministry of Works and the Railways, but neo liberalism did for them.

Sadly, neo liberalism has infected the minds of a lot of people in this country, where they think it is OK for people to own 50 houses, rather than people being able to house themselves. Unfortunately, housing investment in this country is a zero sum game. For someone to win someone has to lose.

Talking of an underclass, the place of Maori at the bottom is an indictment on all of us in the majority whether we like to admit it or not. We should do more to fix the issues, but are unfortunately a great number of NZers are too racist to countenance it. Just look at the way co-governance makes people froth at the mouth without knowing any of the detail. Its just easier to say they have the same opportunities as the rest of us and ignore the problems.

by RickStrauss | 22nd Apr 22, 12:00pm 1650585609

It's often a socialism for me, free market capitalism for thee paradigm, too. They want their universal welfare benefit, landlord benefits, and tax-free income via property, but folk at the bottom should stand on their own two feet.

by Rumpole | 22nd Apr 22, 11:12am 1650582759

Land tax we already have its called local rates.

by Brock Landers | 22nd Apr 22, 2:47pm 1650595653

Local rates are not a land tax. Do you understand why?

by Nzdan | 21st Apr 22, 8:31pm 1650529862

I know you're not advocating the changes, but sheesh we hear enough about how the upper earners shoulder so much of the tax burden, despite anyone with a basic grasp of 5th form maths knows that the amount of tax you pay is directly proportionate to the amount you are paid, not how hard you work.

Imagine the noise if those brackets came into play.

by lucenera | 21st Apr 22, 10:40pm 1650537638

I would suggest to don't tax at all jobs and tax only assets.

Not the exchange of assets, just assets.

That would be fair.

by GV 27 | 22nd Apr 22, 6:34am 1650566063

Nothing says "stop treating housing as an investment" like "We're going to tax everything you own as if it's an investment".

Unsure what sort of economic return my hoon car is meant to be generating me. Does this mean I get to offset that against what it's cost me? Do I get to claim a portion on my mortgage interested thanks to the space it's taking up in my garage? After all, if it's supposedly generating me income then I should be able to claim holding costs.

This is how you end up with tax codes as long as your arm.

by lucenera | 22nd Apr 22, 7:19am 1650568778

lol

Well, if you think about it I am suggesting to forget the idea of income at all.

You just pay for what you have, not what you make.

That would be the most just and easy tax ever.

That would very strongly discourage toxic behaviours like landbanking / ghost houses,billion dollars account that you never plan to use, etc...

by Warwick D | 21st Apr 22, 7:24pm 1650525875

The developing economic situation here is looking like some massive 'train wreck' about to happen. If I thought this government had any answers then I wouldn't be quite so worried but results are definitely not their strong point. Most of New Zealand will be scratching their heads by the end of this year and asking themselves what actually was the meaning of those so-called "Well-being Budgets".

by kpnuts | 21st Apr 22, 7:52pm 1650527526

think you will find they are now called well meaning budgets !

by David Chaston | 21st Apr 22, 8:08pm 1650528530

fyi

I have deleted a vast array of toxic comments (which will have included some that were sensible, sorry).

That conversation was dispiriting - that there are some who think so banally. Some of you have been banned for taking the thread into the sewer. Please don't ask to be reinstated.

If you want to post trash, please do it on Facebook or YouTube. Don't do it here.

grrrrr ....

by Nzdan | 21st Apr 22, 8:41pm 1650530517

Oh no, 2022 got banned :'(. Keep an eye out for a new account, will likely be 2023 or 7PercentRatesLoL or something.

by Pragmatist | 22nd Apr 22, 7:39am 1650569964

Enjoy the absence of repetitive brainless ranting more like it.

by blobbles | 21st Apr 22, 8:48pm 1650530907

Look at the absolute rocket under the Emergency Housing since 2019. Yet the number of payments has been fairly flat.

Weirdly since the pandemic has struck and borders have closed, its been a fantastic time to own a motel. Name your price rates that the government will pay you on a long term basis.

by gnx | 21st Apr 22, 9:15pm 1650532510

Blocks of flats are probably the most efficient way to sort the problem.

by Foxglove. | 21st Apr 22, 10:05pm 1650535555

Tenements?

by hogiela | 21st Apr 22, 9:28pm 1650533309

Isn't this weird when our unemployment rate it apparently at record lows?

by Davo36 | 22nd Apr 22, 8:26am 1650572789

It's the way they measure it. It's a BS measure. So we can have record numbers on the dole and record low unemployment at the same time.

by Waikatohome | 21st Apr 22, 9:51pm 1650534687

We have an extended family member who is in their mid 30s and has never worked a full day in their life. Able bodied, intelligent as a kid but from a violent home (Father was a hitter). They are now a P addict with their mother raising their kid for them. Wider family have tried to help but made no progress. There is little to no professional support available. If this can happen in our family it can happen in any family. There is a percentage of the working age population who cannot or will not work unless there is some wrap around care and support for very complex needs.

by Pa1nter | 21st Apr 22, 10:44pm 1650537879

Sorry to hear about the family member.

There's all manner of help available, the two biggest hurdles you can't solve with money are:

- the addicts desire to change (and willingness to stick at it)

- the addicts relationships with other addicts

Sadly the family members situation is fairly common now in NZ. We broke our society to the point where addiction and mental health issues are rife, and expect to be able to solve it like it's rudimentary.

by Waikatohome | 22nd Apr 22, 7:24am 1650569055

Your comments are sadly very true. Breaking away from those that supply and enable is almost impossible in small town NZ, no matter how hard the family tries to help. People in this situation do need state support. Just telling them to buck up and get a job won’t work. They also often have kids who need care, this falls to older family members who may have limited funds themselves. There will always be some people for whom benefits are a way of life due to the mental and financial hole they are in.

by Pa1nter | 22nd Apr 22, 7:44am 1650570260

Yeah it's a bit of a mess. From my limited experience, even moving towns can be problematic, they go to some rehab meetings, meet other local druggies, back to square one.

by IT GUY | 21st Apr 22, 11:23pm 1650540205

my many south african fiends tell me they do not have these issues in their country. its because they cannot afford to pay these people, We may well become the same, if we do not reconcile the cost of these payment to our ability to afford the payments. I do not understand how we have employers begging for truck drivers.... my partner got her truck license in 3 days.... oh yes they drug test test drivers.....

by structural engineer | 22nd Apr 22, 6:45am 1650566734

So since 2017, the number of people on jobseeker support has increased by about 50 percent and the cost of Emergency housing grants has gone up by 900 percent. Cost of food grants has gone up 300 percent. Something is very wrong with NZ society.

by Rumpole | 22nd Apr 22, 11:17am 1650583070

Its called a Labour Govt.

by RickStrauss | 22nd Apr 22, 12:01pm 1650585687

Indeed, why can't we just keep people off the lists like we used to while pumping housing costs?

by RickStrauss | 22nd Apr 22, 12:01pm 1650585660

Moteliers are making bank off the taxpayer as we push people out the bottom of the housing market. But hey...our marvelous "wealth effect"!