Simon Collins

Simon Collins is the Herald’s social issues reporter.

Parties offer clear choice on welfare

Annette King. File photo / Mark Mitchell
Annette King. File photo / Mark Mitchell

New Zealanders face a sharper choice over the future of welfare in this election than they have for at least 20 years.

National would trim welfare entitlements by radically extending requirements to work. Separate sickness and widows' benefits would be abolished, and sole parents would have to look for part-time work when their youngest children turn 5 and fulltime work when they turn 14.

Moreover, any sole parent who has another baby while on the benefit would have to look for work again after just one year.

In contrast, Labour would revert to the pre-2010 law that merely encouraged rather than forced sole parents to work.

It would raise all welfare payments in net terms by abolishing tax on the first $5000 of all incomes, including benefits, lifting the net domestic purposes benefit (DPB) by $10 a week.

And it would give another $60 a week to all beneficiaries with children by axing work requirements for the in-work tax credit - a move it opposed when it was in power.

Massey University professor Mike O'Brien, who in 2008 wrote a history of welfare, said National set up the royal commission that recommended the DPB in 1969 and Labour implemented it in 1973, with no work requirements.

Labour opposed National's benefit cuts in 1991 but never reversed them in office, so its policy this year departed from the practice of both parties.

"It's a clearer differentiation than we've had for a very long time.

"The line that National has taken has gradually presented a more punitive kind of approach.

"And while Labour in some ways had that same emphasis on work through the nine years they were in government, what they have now grafted on to that is a direct engagement with trying to do something about poverty, particularly for children," Professor O'Brien said.

"It's being a little bit simplistic, but both parties have reverted to their traditional kind of position."

National has turned tougher because, it argues, our "passive" welfare system has not been good either for the 331,000 working-age adults now on benefits or for their 222,000 children.

"[The state] simply writes a cheque to whoever turns up and leaves them to their own devices, uninterested in what happens to them," said Minister for Social Development Paula Bennett.

National promises an extra $130 million a year on more training, budgeting, parenting courses, childcare, addiction treatment, other health services, and phasing out benefits gradually by $100 a week for sole parents who go back to work sooner than required. It says it would get an extra 46,000 people off benefits and save $1 billion over four years.

Labour also wants to help beneficiaries back to work, but refuses to force sole parents back when their children reach any fixed age.

"Some people will have skills that will help guide them to work," said deputy leader Annette King. "Others have no skills and their youngest child is disabled. To say there is some magical arbitrary age is wrong."

Instead, Labour would also spend more on training, including converting the dole into an apprenticeship subsidy to employers for 3000 young people a year.

It says it would lift at least 100,000 children out of poverty by spending an extra $350 million a year by 2018 on giving beneficiaries higher net benefits and the in-work tax credit.


PARTIES' WELFARE POLICIES IN BRIEF

National: Free polytechnic training for 2500 youths under 18, rising to 7500 next year; eight trades academies rising to 20; schools to refer school-leavers to training; sole parents to seek work part-time when youngest child turns 5; pay youth benefits by card, not cash.

Labour: Pay dole for a year to employers to take on 3000 apprentices aged 18 or 19; schools to report all school-leavers to support agencies; six months paid parental leave by 2015; scrap sole-parent work test; raise pay for beneficiaries with children by $60 a week by 2018.

Greens: Remove age and funding limits on apprenticeships; 13 months paid parental leave; scrap sole-parent work test; universal child benefit of $18.40 a week for first child and $13 for each extra child; raise pay for beneficiaries with children by $60 a week.

Act: Open trades courses to more competition; privatise job placement support; compulsory work for dole if job refused; compulsory drug rehab if test failed; compulsory budget advice for sole parents; axe family tax credits to higher earners.

Maori: Mentor all school-leavers; ask every Maori entity to employ two young people; marae-based learning; more apprenticeships, internships, Maori trade training and subsidised work; raise pay for beneficiaries with children by $60 a week.

Mana: No one to leave school without job or training; priority for Kiwis for jobs in state enterprises and Maori entities; minimum-wage jobs for unemployed; scrap sole-parent work test; reverse 1991 benefit cuts; raise pay for beneficiaries with children by $60 a week.

United Future: Encourage all young people to be learning or earning; incentives for non-profit agencies to hire unemployed; subsidised work or training for unemployed after a year; 13 months paid parental leave; income splitting for couples with children.

- NZ Herald

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