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Key’s review of benefit adjustments a surprise

1 April 2008

Key’s review of benefit adjustments a surprise

John Key’s statement that National is reviewing annual adjustments to benefits is a worrying sign that he is either not on top of policy detail, or is working on a more radical agenda than he has been publicly claiming, Finance Minister Michael Cullen and Social Development and Employment Minister Ruth Dyson said today.

Benefits and superannuation payments have been adjusted today to take account of rising consumer costs over the past year – a move that will require a $280 million investment over the next financial year. Benefits have been adjusted every year since the late 1980s, except for a three year superannuation freeze under Ruth Richardson.

On television Sunday night, Mr Key was asked if he supported annual adjustments to benefits and said:

We're looking at those policies. I mean at the moment, ah, some of them have already have built in clauses, others don't. Ah, we'll be reviewing those in due course.

“Mr Key is looking to cut spending to ‘out tax cut’ Labour, but I don’t think anyone saw a review of benefit and super adjustments coming,” Dr Cullen said.

“Mr Key needs to clarify what exactly he meant with talk of ‘reviewing’ annual adjustments. He either has a very worrying policy under development or he has been caught again making something up when he didn’t know the right answer to a question.

“Either way, Mr Key has been leader for some time now and needs to get on top of policy detail or start telling people what he actually believes.”

“Not adjusting benefits and super really means cutting support for older New Zealanders and vulnerable families,” Ruth Dyson said. “The government has a legislative obligation to adjust superannuation levels for inflation – I suppose that’s what Mr Key means by ‘built in clauses’.

“It is true that we are not required by law to adjust benefit payments, but I think most New Zealanders understand that we have a moral obligation to do so. Both National and Labour governments have understood that for some time.”

ENDS

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