NZ government under fire for ‘underwhelming’ response to welfare report

The New Zealand government’s response to a welfare review has been slammed by community groups, who say the call to transform a broken system has been left unanswered.

The Ardern coalition government has committed to implement just two of 42 recommendations from a welfare expert advisory group’s 200-page report, which said the welfare system was “no longer fit for purpose and needs fundamental change”.

Social Development Minister Carmel Sepuloni said major systemic change would take years, adding that the government had decided not to implement a major recommendation to increase welfare payments by up to 47 per cent immediately.

“We will be looking at a staged implementation of the report,” Sepuloni said.

“There are a range of ways to improve people’s financial wellbeing and reduce the number of people on benefits that live in poverty, in line with our commitment to reduce the overall rates of child poverty in New Zealand, and we will be looking at these over the coming years.”

Community groups were dismayed by the response. Northland Urban Rural Mission said in a statement “the call to transform a broken system has been left unanswered”.

NURM’s community development worker Tim Howard said the government’s response so far was no more than a shuffle in the right direction.

“The government’s response is underwhelming, and does not signal the ‘transformative’ and ‘kind’ approach to governance, or the overhaul of the welfare system, that earlier rhetoric had led us to believe,” Howard said.

The government has agreed to repeal a sanction that cuts payments to single parents who don’t identify the other parent, which is expected to benefit about 24,000 children by increasing sole parents’ incomes by an average of $34 a week.

The abatement thresholds of main benefits will also be lifted in line with minimum wage increases for the first time in more than 20 years.

Howard said this was a good move but would have a limited impact.

“Lifting the abatement levels a bit does not go anywhere close to meet the recommendation that a 47 per cent increase of benefit levels was necessary … to be able to live reasonably,” he said.

“How will government reduce poverty when the poorest have yet to have any increase of income?”

Auckland Action Against Poverty coordinator Ricardo Menendez-March told RNZ he was disappointed the government’s repeal of the single parents sanction will not come into effect until April 2020.

He also lamented the government’s failure to commit to welfare payment increases.  

“For us to have to wait for most of the term for a decision and now pretty much until the end of the term for it to come into place is disappointing. We think the government is not acting with enough urgency on poverty,” Menendez-March said.

“Increasing the core benefit levels and ending all sanctions is one of things they could have done this wellbeing budget to make a real tangible effect… so far we’re getting more rhetoric than action.”

But Sepuloni said the government was determined to fix a welfare system that was not providing the right support for people in need.

“This is contributing to issues of inequality and hardship which have been long-term problems for New Zealand that this government is committed to fixing,” she said.