75 years of social security

HISTORIC GOVERNMENT Prime Ministers Rt Hon M J Savage at his desk, Parliament Filed 20 October 1938

Community: "When the Social Security Act was finally passed, Dad, in a spontaneous dance of delight in which the family joined, removed the [medical] bills from behind the clock and taking the poker from its hook by the stove, lifted the cover and thrust all the bills into the fire." Except from Janet Frame: An Autobiography (1982).

Last month, the Child Poverty Action Group (CGAP) celebrated 75 years since the first Labour government (with Michael Joseph Savage at the helm) introduced the ground-breaking Social Security Act in 1938.

Introduced in response to the Great Depression's extreme poverty, the Act emphasised that all New Zealander's have a right to a reasonable standard of living and equal opportunities to participate in society. Citizens contributed to the scheme through tax and could draw on the benefits according to their need.

With the passing of the Act, a suite of social welfare benefits were introduced, protecting New Zealanders 'from the cradle to the grave'. These measures included universal medical care benefits, family benefits and universal superannuation. It also offered new social welfare entitlements, which had previously been limited to the blind, widows, miners and invalids.

In 1946, the Family Benefit became universal, despite opposition to supporting 'illegitimate' children, Maori children and deserted families.

Other social welfare moves followed. In the 1970s, the Domestic Purposes Benefit was introduced, giving women a chance to leave violent relationships. ACC was also introduced around this time.

In the 1980s, says Associate Professor of Business at the University of Auckland, and CPAG spokesperson, Dr. Susan St John, "the last vestiges of the welfare state ... were obliterated. Now the political rhetoric was that the welfare state causes poverty and creates dependency." The universal Family Benefit was abolished in 1991.

St John says that welfare is no longer being offered on the basis of need and, apart from superannuation, is no longer universal.

She states that the current approach to tackling poverty is short-sighted, failing to address complex issues that underpin poverty including inadequate housing, access to health care, household incomes and education. The latest CPAG report Child Abuse and Poverty: What are the links? shows that these issues are major risk factors contributing to child neglect and abuse.

"Too many of our children are dying from poverty related diseases. Others bear life-long physical, mental and emotional damage, and grow up to endure poverty as adults," says St John. "The evidence is that families are slipping into ever more desperate situations especially with the implementation of recent very harsh and under-scrutinised welfare reform policies."

CPAG has also been embroiled in a legal battle on behalf of the 230,000 children that live in benefit households and do not get access to the full Working for Families entitlement, despite undertaking unpaid work in the home, missing out on a minimum of $60 each week.

The Court of Appeal recently found that the In Work Tax Credit does discriminate against families on benefits, but that the harm was justified. St John says this is inconsistent with human rights legislation and discriminates against families. She says many families are struggling, affected by redundancies and disasters like the Christchurch earthquake.

The Ministry of Social Development report Household Incomes in New Zealand: Trends in Indicators of Inequality and Hardship, showed that one quarter of New Zealand children live below the poverty line, with 175,000 children living in households with 50 per cent of the median income - most from families without full time work.

CPAG says the most effective way to reduce child poverty is to give children's payments to all low income children on the same basis. They say a policy which relies on paid work is not a solution to child poverty.

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