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Better off in work

Hon Paula Bennett
Minister for Social Development
Associate Minister of Housing

20 November 2013

Better off in work

Figures released by Social Development Minister Paula Bennett illustrate the benefits of going from welfare to work, factoring in tax credits for families.

“On average around 1,500 people a week, move off welfare into work which brings pride to individuals and families and is financially beneficial.”

An average sole parent with two children under thirteen, living in South Auckland would receive around $642 on benefit, including accommodation supplement and a minimal extra allowance for costs.

“If that sole parent works just 15 hours while receiving benefit, they would be $107 better off, taking home $750 a week.”

“If they are able to go off benefit and by working just 20 hours a week on a minimum wage, they would be $171 better off each week at $814.”

Going off benefit and working 40 hours a week on a minimum wage, that same sole parent would be $190 better off at $833 a week with the Family Tax Credit, Accommodation Supplement and In-Work tax credit.

“I get how hard it can be to make the move from welfare to work, but it makes such a difference to your state of mind, not to mention financially.”

Lisa, a sole parent in West Auckland wanted to work and earn her own money and found a part time job with 20 hours work a week.

Her work focused case manager did a Better Off Assessment and Lisa was able to see how much better off she’d be doing 30 hours a week, without a benefit but picking up the In-Work tax Credit.

Lisa said her case manager showed her, “there is light at the end of the tunnel”.

The benefits of work for a single person are also clear.

The average single person on Jobseeker Support with Accommodation Supplement and minimal additional allowances earns $320 a week.

“If they work 10 hours a week while on benefit, they’re $57 a week better off.”

“If they work 40 hours a week, on a minimum wage and go off benefit altogether, they will be around $200 better off, earning $520 a week.”

“No one says it’s easy; it can be hard to find a job and it can be tough putting yourself out there time and time again,” says Mrs Bennett.

“The first job may not always be the best job, but it’s a doorway to the next one and the feeling of standing on your own two feet is worth it.”

There are currently 2,900 job vacancies with Work and Income around the country, SEEK has 15,600 jobs and Trade Me has 12,800 jobs listed.

ENDS

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