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National's Half Baked Scheme

Hon Ruth Dyson
Spokesperson for Social Development

30th October 2008 Media Statement

National's Half Baked Scheme

National’s half-baked attempt to provide security for workers means two-earner families would be cut adrift, Social Development Spokesperson Ruth Dyson said today.

“Labour’s Job Search Allowance announced yesterday will provide meaningful relief for workers made redundant regardless of their partner’s income. Labour would give immediate assistance to a two-income family when one earner loses their job," said Ruth Dyson.

“Labour’s policy covers the over two-thirds of couples with one or two children are both work.

“National’s pale imitation focuses on families who would already be eligible for government assistance through the Unemployment Benefit, Working for Families, the Accommodation Supplement, and Temporary Additional Support in the event of a redundancy.

“That means National’s plan provides nothing for the very people who currently get the least assistance when there is a redundancy in the family.

“Labour’s Job Search Allowance acknowledges that many moderate-income families have two-earners to make ends meet.

“Last weekend John Key talked up his package, today it has become clear he was making it up as he went along and has disappointed the very people he claimed he was trying to help,” Ruth Dyson said..

“The package is so ill-thought out they have omitted to include the effects of the Temporary Additional Support (TAS) in the first two examples they used. TAS is a short-term payment to people who need extra help to manage.

“This omission means that the gains National claims their example families would receive under their scheme are significantly inflated. (See attached backgrounder).

“This omission was either deliberate to mislead the public over what their scheme means for people or National does not understand New Zealand’s social security system. Either way it is not good enough,” Ruth Dyson said.


Backgrounder on Temporary Additional Support

The National Party have forgotten that Temporary Additional Support (TAS) is available as a short-term payment to people who need extra help to manage.

TAS can be granted for up to 13 weeks. During this time, case managers work with people to help them take reasonable steps to reduce their costs or increase their income.

There will be some situations where the client may not be able to improve their financial circumstances. In these cases a client may still qualify for TAS. People with ongoing hardship will be able to reapply and may receive further grants of TAS if they still qualify.

The rate of payment of TAS takes into account what “allowable costs” a person has. These allowable costs are essential ongoing expenses that people cannot meet from their regular income or other sources. Examples include accommodation, essential household items, medical and disability-related expenses.

People may also be able to access extra financial help through other hardship programmes such as Special Needs Grants or Benefit Advances.

Example 1
The National Party indicate that Louise, a sole parent on unemployment benefit would gain $116 from their proposals.

In fact, as a sole parent, Louise would probably receive domestic purposes benefit, so she would not be work tested (unlike under National’s welfare policy).

In addition, Louise would be eligible for up to $79 in TAS, based on her accommodation costs alone she would receive $72 a week and if she had any additional costs such as paying hire purchase on a fridge she could receive $79.

With the additional income provided through National's proposals, Louise would not receive any TAS. This means the real difference is $37 not $116 as they claim.

Example 2
The National party indicate that Keith and his family would gain $160 under their proposals.

Again they have failed to take account of Temporary Additional Support which would provide Keith’s family with an extra $92.08 a week.

Under the National Party's policy Keith and his family would be eligible for only $16.95 in TAS, a reduction of $75.13.

That means they really gain $84 under National's policy, not the $160 claimed.

Example 3
The National party have misunderstood Labour’s Job Search Allowance policy proposal.

They have stated that Duncan would receive $307 a week which is the married rate. In fact Duncan would receive half of the married rate at $153.46.


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