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COVID-19 Requires Urgent Fix To Welfare System

Auckland Action Against Poverty is calling on the Government to urgently make our welfare system fit-for-purpose to handle the effects of COVID-19 and a likely recession.

“The Government needs to urgently increase benefits, permanently remove the stand-down period, benefit sanctions and implement all of the recommendations of the Welfare Expert Advisory Group if it wants to have a safety-net that is fit for purpose during these uncertain times”, says Brooke Fiafia, Auckland Action Against Poverty Spokesperson.

“As Aotearoa heads into a likely recession and faces the impacts of Covid-19 more people will see themselves in need of a safety net that is fit for purpose. Our welfare system is not prepared to face the impacts of a recession or a public health crisis. Many people could see themselves in severe hardship, whether through losing their employment or restricted access to Work and Income offices due to public health considerations.

“As we see food grant numbers on the rise our benefit levels remain largely stagnant. Unless we see a drastic increase in benefit levels, we risk saturating Work and Income with more hardship grant requests than they can process. Our advocates already struggle ensuring that every person that comes through our doors has their emergency needs assessed by Work and Income due to lack of staff and new restrictions, which leaves families without income for basic expenses for days. Low-benefit levels also increase the need for people on the benefit to have to queue and congregate at Work and Income offices to receive hardship assistance, which increases the likelihood of close contact with people.

“While we commend the Government for ignoring the calls from major banks or the National Party to cancel the increases to the minimum wage, there has been no significant changes to lift people receiving welfare assistance out of poverty. Despite ongoing calls from people on the benefit, unions, NGO’s and faith groups the Government has not committed to lifting baseline benefit levels or enacting major welfare reforms. The 3% increase to benefits due to the indexation changes will make no substantial difference to people who are struggling to make ends meet.

“A welfare system that is fit-for-purpose is not only crucial to carry us through the effects of Covid-19 and a likely recession, it also future-proofs our social safety net for any future crises. Our welfare system does not guarantee that no one lives in poverty, including people who may lose their jobs during these uncertain times.”

Auckland Action Against Poverty is calling on the following changes to our welfare system:

- Remove the limit of hardship grants people are eligible for in a period of 6 months before they must show they have exceptional circumstances.

- Increase benefits to liveable levels.

- Remove all benefit sanctions.

- Proactively call all income support recipients to offer hardship grants where required.

- Remove work-testing obligations that mean people lose their benefit if they do not accept an offer of employment.

- Increase the abatement rate to enable people in part time employment to receive income support.

- Increase the income threshold for income support recipients.

- Implement all the Welfare Expert Advisory Group recommendations.

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