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Current benefits 'not sufficient to survive on', social welfare groups say

The government is being warned many more families will fall into poverty if it doesn't boost support for people losing their jobs because of Covid-19.

Photo: 123RF

Beneficiary advocates and groups working with the country's poorest said it was disappointing yesterday's Budget did not include further increases to benefits or reform of the welfare system.

Treasury is forecasting unemployment to hit 10 percent by September, and the number of people on the main unemployment benefit to double.

Prior to the pandemic, the government appeared to be tracking towards achieving its child poverty reduction targets.

But child poverty is now also expected to rise - with material hardship rates expected to rise sharply.

Council of Christian Social Services executive officer Trevor McGlinchey said more needed to be done to stop people falling into hardship.

"Families are suffering now," he said.

"There'll be a wave of people coming off those [wage] subsidies and going on to unemployment benefits and the benefits are just not sufficient to survive on.

"There's going to be a very strong response to that I think from people who start to experience that level of poverty, often for the first time."

If the government does not do more to support those on the lowest incomes, by raising benefits and lifting the minimum wage, McGlinchey said child poverty "will most definitely blow out."

The Child Poverty Action Group, the Salvation Army, Lifewise and Auckland Action Against Poverty have also expressed disappointment in the Budget's failure to address benefit levels.

Back in March, as part of the government's initial response to Covid-19, benefits were increased by $25 a week and the winter energy payment was doubled for this year.

However, the organisations said that did not go far enough and benefits were too low for families to cover their essential costs like rent, bills and food.

They hoped some of the $20 billion the government has not yet allocated will be used to remedy this.

Liz Davies, general manager of SociaLink in the Western Bay of Plenty told Morning Report there was significant poverty in the region and it was often overlooked because it was thought of as a prosperous area.

It was 1700 short on the number of social houses it needed and social services had seen a sharp drop in funding from gaming trusts and donations, since the Covid-19 crisis began.

Mariameno Kapi-Kingi of Te Runanga o Whaingaroa said the numbers in the Budget were "bedazzling" but for the 8000 projected new state houses it mentions, it was hard to know what it would mean for her region, Tai Tokerau.

She hoped it meant more housing for the area but those hoping to build on Māori land in Northland still faced "a mire" of regulations to make it a reality.

While Finance Minister Grant Robertson had referred to the Covid-19 pandemic as "an opportunity" to build back better, Kapi-Kingi said not enough detail had been provided.

"That's for us to decide if it's an opportunity and I did not get that."

Scott Figenshow, CEO of Community Housing Aotearoa, said the Budget was a great start but would deliver only about half of what was needed. Delivering more permanent affordable housing was vital, he said.

Davies said some good things had come out of the way people worked together during the lockdown and she hoped Budget funds could be spent strategically to strengthen the social sector and work with their whānau and other communities to greatest effect.

Read more about the 2020 Budget:

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