Work best way out of poverty trap

September 1, 2014

Welfare has a place for people who can never support themselves and others who, for a variety of reasons, need temporary help.

But it’s a safety net that can turn into a poverty trap.

The best way out of that trap, and the best answer to poverty, is work which is why National has put so much effort, and so many resources, into helping those who can help themselves to do so.

The policy is working for the people going off benefits on to work and its working for New Zealand by reducing the long term economic and social costs of welfare dependency and poverty which comes with it.
Clearly, our policies are #working4nz.


Better off not just about money

August 19, 2014

The Herald is comparing party’s policies and gives an example of a woman who says she’s not much better-off working than she would be on a benefit:

Solo mother Mia Silverman works 20 hours a week in a professional job – but she is virtually no better off than she would be on a benefit.

A media production assistant at Auckland University, volunteer yoga instructor and established singer-songwriter, Ms Silverman is multi-talented.

But when she tried working fulltime when her second son Frankie was still under 2, soon after her marriage broke up, it was too much.

“After working two weeks fulltime, I did a breakdown of my budget,” she says.

“What is better – being really, really stressed and working is great, but the stress of running around was too much.”

She received $680-$690 a week on a benefit. Current rates are $299.45 for a sole-parent benefit, $157.17 in family tax credits for two children, and Ms Silverman got about $205 a week in accommodation supplement for rent.

Now her 20-hour university job pays $430 a week after tax, her tax credits and accommodation supplement are reduced, but she also gets the $60-a-week in-work tax credit, taking her total net income to about $850 a week after tax.

Out of that she pays a net $100 a week for Frankie’s childcare after allowing for a government subsidy, a $16 top-up for her older son Monty’s kindergarten because he needs to be there slightly more than the 20 free hours a week, plus $35 for parking at university and $100 a week for petrol.

“I enjoy being back at work, but I’m not really that much better off.”

“My feeling with National’s approach to welfare reform is that the focus on obligation in much of the wording needs to be replaced with the idea that there will be some incentive to get back to work.”

There is no mention in this story of the children’s father and how much, if any, support he gives his family.

It also misses the point that being better-off isn’t just about money.

Children raised in benefit-dependent homes are more likely to be represented in negative social statistics for health, education and crime.

She admits she really enjoys the work – that should count for something.

That she is helping herself, albeit with top-ups from the taxpayer should also be taken into account.

By helping herself she is not using scarce tax-payer funds which can be better used on those who need more help than she does.

We’re all better off when those who can help themselves do so by both financial and social measures.


Green for slow

August 18, 2014

The Green Party wants to give in-work tax credits to people who aren’t working and fund it with an envy tax.

The motivation to end child poverty is noble.

But in taking away the incentive to work they are going to increase benefit dependency, which as Lindsay Mitchell, says is one of the major determinants of poverty:

Let’s remember is was Labour that introduced the IWTC, the rationale being to attract more parents, mainly single, into employment. Clark and Cullen believed that the best way to get children out of poverty was to get their parents into paid work. From Cullen’s 2006 budget speech:

The Government believes that ultimately work is the best way out of poverty, and provides the best social and economic outcomes for families in the long run. Making work pay through the In-Work Payment component of the Working for Families package improves people’s opportunities to make a better life for themselves and their families.

In Social Developments author Tim Garlick wrote

The decision to strengthen work incentives by not increasing the income of non-working families was strongly criticised by some academics and community groups…

 But they stood by their conviction.

And the courts have upheld the policy’s legitimacy against multiple challenges from the Child Poverty Action Group.

Yet the Greens see no value in paid work. No value in children growing up with working role models.No value in actually earning an income; participating, contributing and producing.

All they see is a quick cash cure (with no gaurantee the money will be spent on the children) which comes with the almighty risk that more children will grow up welfare dependent as the financial rewards of working, as meagre as they are, disappear.

I must have said it hundreds of times. Welfare made families poor. More of it is not the answer.

Contrary to what the Greens believe, neither more welfare nor higher taxes are the answer to reducing poverty:

The Greens/Labour recipe of more and higher taxes would stall New Zealand’s economic recovery just when we are getting back on our feet after the Global Financial Crisis, National’s Associate Finance spokesman Steven Joyce says.

“The Greens have proposed a 40 per cent top tax rate that would affect many hard-working New Zealanders, including school principals, doctors, and many small business owners,” Mr Joyce says.

“We’ve been here before. A 40 per cent tax rate is damaging to the economy because it increases tax avoidance, penalises hard work, and sends some of our best and brightest offshore.

“And it is of course just another in a long list of new taxes Labour and the Greens want to introduce including a capital gains tax, a big carbon tax, taxes on water use, higher personal taxes, and regional fuel taxes.

“Just when the New Zealand economy is heading in the right direction and we are growing the largest number of new jobs in a decade, the Greens want to go back to the old tax and spend approach that clearly didn’t work in the lead up to the GFC.

“Back then, our best and brightest were flooding out the door for better opportunities in Australia. Now migration out to Australia has stopped.

“Back then, welfare rolls were already growing because of our domestic recession. Now 1600 people a week are moving off welfare and into work because of our growing economy.

“Back then, government spending had jumped by 50 per cent in just five years, pushing floating mortgage rates close to 11 per cent and leaving us with forecasts of budget deficits and soaring debt into the future.

Mr Joyce says the economic recipe that’s working includes lower, not higher, taxes and a government that is relentlessly focussed on growing jobs and getting people off welfare support and into meaningful work.

“National’s economic plan is working for New Zealand. We have just become one of the fastest growing economies in the OECD. Keeping with the plan is the best way of helping people the opportunity to get off welfare and into work. We should not go back to the failed recipes of the past,” Mr Joyce says.

And let’s not forget that the Greens are also promising a carbon tax which would impact directly on every individual and business adding costs not just to luxuries but to basic necessities including food and heating.

Anything they “give” to reduce poverty will be more than counteracted by what they take away in direct and indirect cost increases and the brake their policies would impose on the economy.

Green is supposed to be for go, but Green influence in government would be for slow and low when it comes to economic growth and the social progress and environmental protection and enhancement that depend on that.


Working for every man and his dog . . .

August 17, 2014

The left like to demonise the National Party as being interested only in the top end of town.

They couldn’t be more wrong.

The party is a very broad church with people of all ages, occupations and incomes.

To achieve its vision of a safe, prosperous and successful New Zealand that creates opportunities for all New Zealanders to reach their personal goals and dreams it has to have policies that work for all of us.

That must take account of the fact that some, for a variety of reasons, will need more help than others.

This is why the government has focussed on the quality of its spending – to make sure scarce public money is spent where it is needed most and where it will do most good.

One example of this is the wrap-around care being given to teenage parents on benefits.

They get one-to-one support from someone who gives them the help they need to help themselves and their children.

Helping these young women care for themselves and their children, get educational qualifications and ultimately jobs has social and financial benefits.

These families are less likely to be long-term beneficiaries with the risks that go with it including poorer education and health outcomes and a greater likelihood of being involved in crime.

Putting them on a more positive pathway is better for them and for the rest of us.

This isn’t cheap. But spending more money at the start will lead to bigger savings in the long term.

National is working for New Zealand and all New Zealanders – every man, woman and their dogs – and at least one dog is working for National:

National is working for all New Zealanders, even four-legged ones! #TeamKey


Most help where needed most

August 12, 2014

When National did an extensive review of welfare in 2008 it found most resources were directed at the people who needed them least while those who needed the most help were left to languish on benefits.

One of the costly, but effective, policies has been one-to-one help for teen beneficiaries.

It’s working and it will be extended if National is re-elected:

A re-elected National Government would extend payment cards, money management, and intensive support and guidance to all teen parents and many 18 and 19 year old beneficiaries.
 
“While the numbers have been reducing, too many teenagers are still at risk of falling into the welfare trap,” says National’s Social Development spokesperson Paula Bennett.

“We want to do everything we can to ensure young people have the opportunity to get ahead.”
 
National introduced the Youth Service approach in 2012 for 16 and 17 year olds, and for teen parents up to 18. The service involves mentoring and advice, money management, and budgeting and parenting obligations.
 
These young people have a capable adult from a community-based organisation to work with them, help them pay their bills directly, and have money loaded onto a payment card for groceries and essentials. They get help to find an education or training course, or to get a job and go off the benefit.
 
“This approach is working well, and that’s why we are going to extend it to 19 year old sole parents, and to many other 18 and 19 year old beneficiaries who need more support or who are at risk of long-term welfare dependence.
 
“Many 18 and 19 year olds coming into Work and Income need more than job search assistance – they need help to get their lives on track, manage their money and pay the bills.
 
“National supports people in need, but expects them to do everything they can to get back on their feet when they are able”, says Mrs Bennett.
 
Under the new policy, Work and Income will assess all under 20s who are seeking a benefit. Self-motivated young people who are not likely to spend long on a benefit will continue their job search with the help of Work and Income, just as they do now.
National wants to do everything we can to ensure young people have the opportunity to get ahead. http://ntnl.org.nz/1ssLCjM #Working4NZ
 
Others with more complex needs will be referred to a youth service provider, where they will receive intensive support and guidance, together with budgeting support and the use of a payment card.
 
There will be no change for young people receiving the Supported Living Payment.
 
“Since coming into Government nearly six years ago, we have made significant reforms to the welfare system and we are seeing positive results,” says Mrs Bennett.
 
“I’m proud of what we have done and we are now seeing 1,600 people go off welfare and into work every week.
 
“But there is more we can do, and that’s why we’re going to extend the successful Youth Service model to take in more young people who really need a hand to get on their feet.”
 
The total lifetime cost of all people currently on welfare is $76.5 billion and more than 70 per cent of that is attributed to those who went on benefit as teenagers.
 
The National Government has already increased training and education opportunities with fees-free Youth Guarantee places for 10,000 16-19 year olds as well as 20,000 Apprenticeship Reboot places and 5,250 Trades Academy places a year.

The number of young people under 20 who are not in education, employment or training, is now the lowest it’s been since 2004.

“National is investing in young people to ensure their time in the welfare system is as brief as possible, so we help them avoid welfare dependency”, says Mrs Bennett.

Keeping young people off a benefit is the best approach.

Ensuring those who are on a benefit get the help they need to get their lives on track, manage their money and get into training then work is the next best policy for the people involved and the rest of us who pay the cost of long-term benefit dependency.

While the numbers of teen parents have been reducing, too many teenagers are still at risk of falling into the welfare trap. http://ntnl.org.nz/1ssLCjM #Working4NZ


BPS working for NZ

July 22, 2014

National set targets for its Better Public Services programme which are showing positive results.

Long-term welfare dependency is reducing and more young people are achieving higher qualifications under the Government’s Better Public Services initiative, Deputy Prime Minister Bill English and State Services Minister Jonathan Coleman say.

The Government today published the July update of BPS targets, which confirms more good progress in tackling some of the most challenging issues facing New Zealanders, however making headway in other areas is slower, Mr English says.

“The Government is committed to making progress on the really difficult issues that affect our communities and families, and particularly the most vulnerable,” he says.

“Taxpayers spend billions of dollars a year on public services to help their fellow New Zealanders and this Government is determined to ensure they get what they pay for. Our focus on reducing welfare dependency, increasing achievement in schools and reducing crime require government agencies to find better solutions and to work with others to implement them.

“We are prepared to spend money on effective programmes which change lives, because what works for the community also works for the Government’s books.”

Dr Coleman says the ambitious goals set by the BPS initiative were chosen to make a real difference to the lives of New Zealanders.

“We have always said some of the targets will be challenging and require determination and teamwork to achieve, and it’s pleasing to see agencies working co-operatively.

“The latest update shows we are making good progress overall. We have now met the targets for reducing total crime and youth crime. There has been good progress in reducing long-term welfare dependency, increasing Level 2 NCEA pass rates and those with New Zealand Qualifications Framework Level 4.

“Progress in the past 12 months towards our target of reducing long-term welfare dependency is encouraging, with 6434 (8.5 per cent) fewer people continuously receiving jobseeker support for more than one year. We are also seeing people stay in employment for longer.

“In other result areas, more work is being done to reduce rheumatic fever, reduce assaults on children, and improve online business transactions.”

Dr Coleman says that because of the BPS programme, agencies are working together more effectively and delivering results through collaboration and innovation.

“Agencies are making better use of data to drive better services and to meet the needs of local communities. Agencies are also learning about what works through research and evaluation,” he says.

“There is a greater focus on chief executives doing what is best for the system as a whole, rather than just looking at the short term interests of their department, and that is supporting the changes needed to achieve results.”

The BPS programme began in 2012 when the Prime Minister announced goals and measurable targets in 10 challenging areas, including reducing long-term welfare dependency, supporting vulnerable children, boosting skills and employment, reducing crime, and improving interaction with Government.

The Better Public Service Results July update is here.

Money is being spent where it will have a positive impact.

This is often more expensive in the short term but it will pay off with both social and financial dividends in the medium to longer term.

Behind these numbers are individuals whose lives and outlook are better than they would have been had National not introduced targets and policies that are working for New Zealand.

We’re committed to tackling some of the most challenging issues facing New Zealanders. You can check out our good progress here: national.org.nz/better-public-services #Working4NZ


Welfare numbers lowest since 2008

July 19, 2014

Social Development Minister Paula Bennett has released latest benefit figures showing the number of people on welfare for the June quarter is the lowest since 2008, with sole parents leading the impressive results.

“There are over 16,000 fewer people on welfare compared to June 2013, with the total number currently 293,586,” Mrs Bennett said.

“When we look back just a few years to 2010, when benefit numbers were around 352,000, it’s clear to see the difference that welfare reforms are making, alongside New Zealand’s strong and growing economy.” 

Numbers on the Jobseeker Support benefit have decreased by almost 7,500 since last year and have been consistently declining since 2010, even as the overall working age population has increased over the same time.

“Most significant is the 10.7 per cent total drop in people on the Sole Parent Support benefit in the past year, which is happening nationwide with 12 per cent drops in Nelson and Waikato, and an 11.9 per cent drop in the Bay of Plenty, as well as big decreases in Canterbury and Auckland,” Mrs Bennett said

“Sole parents, particularly those who go on benefit in their teens, have the highest lifetime costs of any group on welfare and are more likely to stay on benefit the longest.”

“We’ve deliberately targeted our welfare reforms at sole parents by investing millions into intensive support and training and into help with study and childcare, so that working while raising children alone is achievable, and rewarding.” 

The latest figures also point to positive trends in the years to come, with the number of teen parents aged 18 and 19 on the Young Parent Payment decreasing by 11.7 per cent.

“With teen parents spending an average of 19 years on benefit and costing around $246,000 over a lifetime, the headway we are making now will pay off for generations,” Mrs Bennett said. 

The intensive wrap-around support through Youth Services and the tailored support Work and Income case managers are providing each person they work with is paying off – for taxpayers and for people who were otherwise at risk of long term welfare dependency.

The drop in benefit numbers is good for those directly affected and indirectly for all of us.

Moving from welfare to work has economic and social benefits for those who do it and their dependants.

The more people who can help themselves do, the more there is to support those who can’t.

Reducing the long-term cost of welfare provides significant savings which benefit the country as a whole.

 

I’m proud that our growing economy and welfare reforms are enabling more Kiwis to take control of their own lives. http://ntnl.org.nz/1mT7i5r #Working4NZ


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