Hon Paula Bennett
Minister of Social Development and Employment
Minister of Youth Affairs

14 August 2011 Media Statement

Welfare reforms to start with young people

Social Development Minister Paula Bennett today said the National-led Government’s welfare reforms begin with a fresh approach to working with vulnerable and disengaged young people.

As part of a commitment to reducing long-term benefit dependency, the Government is working through the Welfare Working Group recommendations made earlier this year.

“Over the coming months, we’ll set out a clear direction for welfare reform and New Zealanders can expect a series of policy announcements, each with a focus on better opportunities,” says Ms Bennett.

“We intend to make extensive reforms because the social costs of long-term and intergenerational welfare dependency are unsustainable.

“We are starting our programme by focusing on young people who are not in education, training or work, because this group is very much at risk of long-term benefit dependency,” Ms Bennett says.

“When these young people turn 18, 90 per cent of them will go onto a fully-fledged adult benefit, unless we do something to intervene.”

A suite of extra supports and services will be balanced with fresh expectations for young people to be in education, training or work.

Ms Bennett said the Government intends to fundamentally change how it works with young people.

For young people who are not in education, training or employment, the Government will fund organisations to support them into education and training programmes and help to keep them there.

The Government will also amend the Privacy Act and the Education Act so that the most at-risk young people can be identified and contacted.

For all 16-and 17-year-olds on benefits, and also for 18-year-old teen parents, the way they get financial assistance will change.

There will be a much more managed system of payments. Details are still being worked through, but it is anticipated that this system will include:

• some essential costs, like rent and power, being paid directly on the young person's behalf
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• money for basic living costs like food and groceries being loaded onto a payment card that can only be used to buy certain types of goods and cannot be used to buy things like alcohol or cigarettes
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• a certain, limited amount of money being available for the young person to spend at their own discretion.
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Young people receiving this financial assistance will also receive intensive case management and support. They will also have clear obligations, including to be in education, training or work-based learning.

Childcare assistance will be available for teen parents so they can return to education or training.

As the Government works through each section of welfare reform, officials will work on the complex details underpinning the changes.

“This is the beginning of what will be a radical overhaul of an outdated system that has for too long kept New Zealanders trapped in a life of limited choices.

“The hands-off approach to benefits for young people has not worked. So the National-led Government is moving to a more targeted, supportive approach will provide better outcomes for young people,” says Ms Bennett.

ends

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