Tackling the costs of welfare

The vexed issue of "welfare" attracts extremes of opinions on both sides of a divide all too often defined by political ideology.

There has been ample evidence of this following the announcement of reforms on Monday - and it would be a pleasant surprise for many New Zealanders were the parties to get round the table and form a consensus approach on how to tackle a severe and escalating problem.

The starting point for just such an approach could be a simple and overriding position: welfare should be a safety net, not a way of life. This is a philosophical rallying point around which most reasonable people could assemble.

It encompasses the requirement that those in genuinely dire straits should not be left to suffer undue hardship due to adverse circumstance or misfortune, thus satisfying those for whom the measure of an equitable and compassionate society is that which looks after its weakest members; at the same time, it might please those who repeat, with mantra-like monotony, that many people choose to be beneficiaries of the welfare system simply because they can be.

That is to say, they stay at home with their feet up on the generosity, hard labour and taxes of others.

This week's announcements come as part of a programme of welfare revision arising out of the Government's Welfare Working Group, headed by Paula Rebstock. Generally they do not go as far as the recommendations of that group but follow some of the ideas promoted.

More specifically, they are designed to help address the numbers and cost of benefit dependency. The Government says 13% of the working-age population, or 350,000 New Zealanders supporting 220,000 children, are on some form of benefit and this costs the country $20 million a day, or $8 billion a year.

To this end, solo parents on the dependent person, widow's and women alone benefits will be required to look for part-time work when their youngest child is 5 and full-time work when their youngest child is 14.

Those who have an additional child while on a benefit will be required to look for work after one year.

Most people, not unreasonably, have little truck with the idea of solo mothers on the domestic purposes benefit having further children. Last year, 4300 babies were born in such circumstances.

The new proposals will require the mothers of these children to be available for work-testing a year after the birth.

But as with other beneficiaries required as a condition of their benefit to seek work, the efficacy of the rules is largely dependent on there being work available.

This is where the new system is vulnerable to accusations of being heavy handed or punitive.

It has long been the argument of opponents to such measures that where there is work available most people will take it up.

They now say that some will be forced to queue for non-existent jobs at the pain of losing their financial lifeline.

Less controversial is the notion of staunching the ready flow of young people into the benefit system and of helping those on it to spend it appropriately.

Assisting 16- and 17-year-olds on a benefit into work and with meeting their essential costs is a part of this programme.

Some proportion of those costs - rent and power, for instance - will be paid directly on their behalf and money for living costs will be loaded on to a payment card, with a maximum weekly allowance of up to $50.

Young parents will get a childcare assistance payment to help them study and others who take a budgeting or parenting course could get an extra $10.

The new scheme will also encourage agencies to share information so that school leavers most at risk of going on to a benefit at 18 are targeted.

This makes good sense. It is too easy for some young people to fall into an indolent, dependent lifestyle in which state assistance is squandered on alcohol, or worse, rather than the essentials of living. And once ensconced in such a mindset, it is all the more difficult to wrench them out of it.

 

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