Trailing the World in Welfare Reform

Two countries that New Zealand likes to compare itself to, Australia and the United Kingdom, are acting on their growing concerns about the huge number of working-age people who rely on the state for their income.

Australia are getting tough on work-testing. The unemployed, including single parents with school-age children, must now accept any available job. Minister for Workplace Relations, Kevin Andrews, when challenged to defend the new policy said; "We believe that the best form of welfare that a person can have is to have a job. When a person gets a job it's the best way of getting another job. We know that within a year four in 10 people who have got a job have moved on to another better job. The greatest bargaining power people have got today is a shortage in the workforce. Wherever I go around in Australia - and this is backed up by the data - we are looking for workers."

Admittedly, the rules for single parents, introduced in July, have already been eased under pressure from advocates of welfare "rights". But what are these rights? Rights to live off somebody else's efforts?

As Peter Saunders from Australia's Centre for Independent Studies points out, workers don't enjoy these "rights". He says, " Workers have to resolve their problems, welfare recipients are allowed to hide behind theirs. There is something fundamentally unfair about this."

The Australian government seemingly agree claiming fewer than 10 percent of single parents will be exempt from the new work requirements.

Simultaneously, in the United Kingdom, Work and Pensions Secretary, David Blunkett has just announced that he believes at least one million of their 2.7 million people on an incapacity benefit - equivalent to our sickness and invalids benefits - are capable of working. (It is hard not to notice that Blunkett's own disability, blindness, hasn't held him back.)

He plans a new approach to stem the flood of people starting on an incapacity benefit - currently 1,070 per week. (Our net growth is around 150 per week, proportionately greater than the UK's.)

And the Brits are also getting deadly serious about welfare fraud.

"Hard hitting benefit fraud ads warn of relentless crackdown," says Work and Pension's media centre. "The chilling adverts warn listeners that these investigators 'work relentlessly, never take a day off and don't even sleep.' They describe powerful computer systems that help identify fraudsters by constantly cross referencing information across government departments."

So what's the message in this for New Zealand? The government should be noting the cyclical change occurring across the western welfare states. Just as economic cycles are a fact, so are welfare cycles. They just occur at a much slower pace. They occur on the back of economic necessity but more importantly, changing public attitudes. Historically they have happened in the United Kingdom and the United States where public welfare has peaked and then been severely pared back.

British immigrants to early New Zealand were trying to leave behind public collective responsibility for the poor which had begun to undermine effort, independence and good living. Parliamentary debates about the role of the state in the provision of welfare took place during the 1800's when it was generally accepted that private charity did more good than public.

But successive generations forget (or ignore) the wisdom and warnings of those who went before. Hence we are back where older countries than ours have previously found themselves. The more assistance that is made available, the more people will take it up - often to their own detriment.

Putting aside unemployment benefits (which, in most other countries, comprise a form of insurance as opposed to a universal entitlement) the growth in our dependent working-age population continues.

Removing the unemployment benefit from the equation leaves a rise of six percent in working-age people on a benefit in the past five years. And this during a period of strong economic growth. That should have the politicians eyes watering.

But what is the government's response? Put the Ministry of Social Development and Employment, which is responsible for spending the lion's share of taxpayer money, in the care of David Benson-Pope who is ranked a lowly fourteenth in the cabinet. Hardly a pointer to any sense of urgency or priority surrounding this portfolio.

This Labour government can never do what an increasing number of New Zealanders want, which is to adopt a tougher and fairer approach to welfare. They showed why when they narrowly won the last election by securing a strong voter turnout in heavily welfare-dependent South Auckland.

Let's face it. We led the world in forming our own welfare state but we are now trailing in reforming it. In these globalised times, when countries compete for the most productive and skilled, the rest of the world is about to get the jump on us.

Lindsay Mitchell
Petitioner for a Parliamentary Review of the DPB

ENDS

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