Call for 50 per cent rise in benefits

An alternative welfare review group will call today for raising welfare benefits by as much as 50 per cent to meet the basic needs of jobless families.

The alternative group, chaired by Massey University social policy expert Mike O'Brien and including former Green MP Sue Bradford, says current benefits of $194 a week for a single adult or $366 for a sole parent with one child are "simply too low to live on".

It calls for restoring benefits "as a first step" to the proportion of the average wage that applied before they were cut by up to $27 a week in 1991. That would mean raising the single dole by 53 per cent to about $296 a week and lifting the benefit for a sole parent with one child to about $536 a week.

Its proposals challenge a Government-appointed welfare working group chaired by economist Paula Rebstock, which has proposed options of cutting benefit rates after one year or five years as a signal that benefits should only be temporary.

Ms Rebstock said yesterday that the alternative group's 163-page report would be considered with other submissions on her report. Submissions close on Christmas Eve.

The official group said in its first report in August that the current welfare system was unsustainable in an ageing society which is likely to swell already growing numbers on sickness and invalid benefits.

It suggested almost everyone on sickness, invalid and domestic purposes benefits look for at least part-time work, with extra targeted help from case managers, appropriate training and childcare.

But the alternative group says there is actually "no immediate crisis". It says beneficiaries fell from 15 per cent of the working-age population in 2000 to only 10 per cent in 2008 when jobs were available, and have risen to only 12 per cent in the current recession.

"A key determinant of trends in the number of people receiving social welfare support is the state of the labour market," the group says. "This means that Government policies should aim to maintain full employment, with an emphasis on developing 'good quality' or 'decent' jobs."

It reaffirms the principles of previous royal commissions that social security is "a community responsibility providing a safety net for those who cannot support themselves because they are out of work, sick, injured, disabled, aged and (in more recent times) a sole parent".

That means benefits should be "enough for people to meet their basic needs and to participate fully in community life".

After restoring benefits to their pre-1991 levels, it says long-term rates should be based on basic needs such as "food, clothes, shoes, play, leisure, health, insurance, a daily newspaper, telephone and reasonable allowances for housing and electricity".

The current $194 dole barely covers only two of these items - food, costed by Otago University at $64 a week for a man or $61 for a woman in Auckland on the most "basic" diet, and rent, using the tenancy bond lower-quartile national average of $125 a week for a single room in a flat.

The group says people on sickness, invalid and domestic purposes benefits should all be offered training and personal case managers to help them get paid work, but only unemployment beneficiaries should actually be required to look for work.

It says the $60 a week "in-work tax credit" for families with at least one fulltime worker should be paid to all low-income families.

The group was set up by the Anglican and Catholic social justice agencies and the Beneficiary Advocacy Federation. Its members are Professor O'Brien, Ms Bradford, economist Paul Dalziel, lawyer Maamari Stephens, Bishop Muru Walters and Disabled Persons Assembly policy adviser Wendi Wicks.

WELFARE OPTIONS

OFFICIAL GROUP
* Work-test almost all beneficiaries.
* Work-test sole parents when youngest child turns 3 or 1.
* Cut benefits after one or five years.
* Target case-manager time at potential long-term beneficiaries.
* Target early childhood subsidies at low-income parents.
* Increase sick leave so employers help keep workers well.

ALTERNATIVE GROUP
* Work-test for dole only as now.
* Raise benefits to cover basic needs.
* Extend in-work tax credit to all low-income families.
* Pay all benefits to individuals regardless of partner's income.
* Personal case managers to support all beneficiaries to find work.
* Maximum training opportunities for all beneficiaries.

ON THE WEB

www.welfarejustice.org.nz