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The Single Benefit – But Not As Maharey Sees It!

Thu, 24 Feb 2005

The Single Benefit – But Not As Maharey Sees It!

Welfare: The Single Benefit - But Not As Maharey Sees It!

This week, Newman Online looks at what needs to be done to achieve real welfare reform in New Zealand rather than the recent Government charade of a single benefit.

The mark of an effective welfare system is not only how well it looks after the genuine needy, but also how quickly it helps those without a job into the workforce. On both of these counts, New Zealand's welfare system - once hailed as one of the best in the world - is now sadly failing.

Corrupted by widespread fraud and abuse, welfare not only falls short in providing a decent standard of living for those who permanently rely on state support, but, fuelled by the changes made by the Labour Party, it has become a gravy train for too many beneficiaries who feel that the country owes them a living.

Amongst this latter group is a growing number of women who have come to regard the Domestic Purposes Benefit as their 'right'. Without an acknowledged stable relationship with any of the fathers of their children, they expect taxpayers to fund their lifestyle choice.

More often than not, these women are the children of mothers who were on the dpb themselves, like Marama, a young women who came to my parliamentary office for work experience: not only was she on the DPB, but so too were all her sisters, her mother and aunties, as well as her grandmother and her sisters. When I asked Marama what had happened to all of the men, she said they were all on the dole - too poor and too violent to look after the women.

In my mind when a benefit system entices the weakest and most vulnerable members of society - uneducated and unskilled girls from broken homes - to become state-funded child-bearers, raising children on their own without the fathers there to support and protect them, then society is clearly heading in the wrong direction.

That is why it is now so imperative that welfare in New Zealand is overhauled and given a fresh start.

In order to turn around our entrenched culture of dependency - which sees children in low socio-economic areas aspiring to little more than going onto the dole or the DPB 'when they grow up' - I believe there is a strong case for putting an end to these institutionalised benefits by replacing them with a single 'temporary' benefit, with exemptions for people who are permanently unable to provide for themselves.

For those who are sick or have very young children, there would also be exemptions from the need to take on work, but those exemptions would be temporary. Everyone else on a benefit would be strongly connected to the workforce, so that welfare again returns to being a system that fast-tracks people into jobs.

Having concluded that a single benefit would mean the abolition of benefits that have become a way of life for far too many New Zealanders who are not truly needy, I thought that the Labour Party's single benefit proposals released this week might have merit. However, as details emerged, such optimism was seen to be ill-founded.

The single benefit proposals are now being widely recognised as an election year stunt by the Labour Party designed to dispel the fact that Labour is soft on welfare.

Part of the problem is that the Minister leading this initiative has already established a track record of announcements that sound tough, but fail to deliver. It's just like his flagship job creation scheme - 'Community Employment Organisations' - which were meant to create 4,000 'real, sustainable' jobs but produced only 400, before sinking without trace.

Then there was the much-vaunted 'Social Entrepreneur Scheme', which gave the country the now infamous hip-hop tour, before it too was scrapped. Later we had the 'Jobs Jolt' programme, which was launched with great fanfare but achieved little, and now this week's re-run of the announcement five years ago about a single benefit.

Sadly for a country that is crying out for welfare reform - with 355,000 working age adults and quarter of a million children dependent on benefits - according to the official papers that were released this week, the facts behind this proposal just don't stack up: the single benefit hasn't been signed off by Cabinet, exposing as hot air the Minister's claim that this is the biggest change to welfare since 1938! Further, the proposal is short on detail, it lacks proper costings, and according to insiders, in its present form it is totally unworkable.

While simplifying the administration of benefits may, without a doubt, result in a welcome reduction in bureaucracy, such a measure on it's own will not reduce welfare dependency. In fact, counter to such claims by the minister, the government's own Treasury forecasts show that welfare rolls are expected to rise by 28,000 over the next four years.

If we as a nation want to end the culture of entrenched dependency, that is so harmful to children, that has fuelled our growing crime rate, and is preventing us from achieving our potential, then abolishing entrenched benefits is only a first step.

We also need to bring back the requirement for an annual review of benefits to cut out fraud and abuse, we need to introduce time limits to create a sense of urgency, and we need to ensure that those who find it hard to get work are engaged in full-time work experience to help them develop the habits and skills of the workplace. Further, a pro-active case management system should be introduced that provides child care support, transport help, financial planning assistance, and the like, so that even those people with the most complex needs, can sort themselves out, get a job and move off welfare.

Finally, it is imperative, that any programme of welfare reform is accompanied by policies to generate jobs including a lowering of taxes and a reduction in business compliance costs in particular, as well as the re-introduction of a trial period into employment law so that more employers will be willing to give those hard to place beneficiaries, a go.


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