7. SUE BRADFORD (Green) Link to this
to the Minister for Social Development and Employment
What work, if any, is the Government doing within the benefit system to directly address issues identified in the Ministry of Social Development report Pockets of significant hardshipandpoverty?
Hon RUTH DYSON (Minister for Social Development and Employment) Link to this
This Government’s huge investment in the Working for Families package is designed to significantly reduce poverty, and early results show it is delivering to families and is making a difference. Forty-six percent of the 371,000 families receiving support through Working for Families tax credits in the last tax year were beneficiaries who received three of the four main elements of the Working for Families package. Three-quarters of those receiving tax credits had incomes under $50,000. Our Government is committed to supporting New Zealand families and we will continue to identify ways to target that support at those most in need.
Does the Minister accept the findings of her own ministry’s report that beneficiaries are worse off now than they were in the wake of the 1991 benefit cuts; if so, will she be pushing to lift core benefit levels, in line with Labour’s public commitment to a fair and just society?
As I am sure the member is aware, the information to which she referred in both her primary and supplementary question was based on 2004 data, which was prior to the introduction and delivery of the Working for Families package. The comparability of benefits to wages is able to be viewed in a number of ways. Of course, during the 1990s, when we saw the minimum wage frozen, except for a one-off increase of 87.5c, and benefits increased in line with the CPI adjustment only, that difference was not as large as it currently is. Wages have increased at a more rapid rate in the last 8 years than benefits have. That is why there is that difference.
Sue MoroneyWhat reports has the Minister seen regarding the Government’s progress in reducing the number of families living in poverty?
I have seen a report where the Government’s Working for Families package is described by social policy researcher Charles Waldegrave as “the greatest redistribution of wealth—downwards—we’ve had in 30 years.” I have also seen a report from the Child Poverty Action Group that indicated that child poverty in New Zealand is the result of policies implemented by the National Government in the 1990s. The report identified areas of progress made by this Government, including “substantial reductions in poverty, as a result of the Working for Families package”. It also clearly identified areas where there is still work to do to eliminate child poverty.
Judith CollinsDoes the Minister recall that this Government promised in 2002 to make the elimination of child poverty a core policy and its top social priority, yet 6 years later 185,000 children have been identified as living in poverty and beneficiary families are worse off now than they were in 1991—could the record of failure get even worse?
It is bitter irony having questions like that, which are suddenly supportive of beneficiaries, from that member and her party. Since Labour has had the privilege of leading this Government the number of New Zealand children living in poverty has been reduced by 130,000. We do not have elimination of child poverty, but a reduction in the number of children living in poverty by 130,000 is something we should be proud of, and we should be resolved to continue to reduce that number because having children living in poverty in our country is not acceptable.
Taito Phillip Field Link to this
Given the recognition of the problems of the cuts to benefits in the “mother of all Budgets” and the poverty generated by that, and, also, the position of New Zealand at fourth bottom out of 25 rich countries in relation to child poverty, what is this Government doing to look at reinstating the equivalent of benefit levels prior to 1990?
The total package of Government support provided for our poorest families includes not only income support but also help to reduce essential costs such as doctors’ fees, prescription charges, and childcare, and also individually tailored intervention to help families meet their needs. I know, as that member is well aware, that those particular supports in relation to access to doctors and childcare have been particularly advantageous for Pasifika families. We have also ensured that the incomes for beneficiary families have kept pace with inflation. In regard to the OECD figures that the member referred to, he will be pleased to know that, with the reduction in child poverty as a result of our increased employment and also the Working for Families package, it is estimated that we will have moved New Zealand’s position from the bottom quarter of the OECD to the top half in relation to child poverty.
Dr Pita SharplesWhy is it, as reported on page 4 of Pockets of significant hardship and poverty, that being Māori or Pasifika “increased the likelihood of experiencing severe or significant poverty and hardship.”?
It is true that for many years in our country those in the lowest socio-economic level have also been Māori and Pasifika. I do not accept that race determines socio-economic status, at all, but it is clear that there is a link between poverty and Māori families. That is why we have put a particular focus not just on the specific areas of delivery of income support but also on the methods of delivery, because we know that access to social service, which was widely available, was not accessed by Māori and Pasifika unless it was delivered by Māori and Pacific groups.
Does the Minister accept that basing the annual increase in benefit levels on the CPI is a totally inadequate way of doing it, especially now at this time of steeply increasing fuel, food, transport, and other costs, and will the Government take urgent measures to reduce the gap between wages and benefit levels by, for example, linking benefit rates to a fixed percentage of the average wage, which is what happens already for superannuitants; should not our beneficiaries be treated with the same equity and decency as our older generation?
I agree with the primary point of the member’s question, which is that a number of our low-income families, particularly people on benefits, are feeling financial stress at the moment, and our Government is committed to continue to look at ways of addressing that. I do not believe that a blunt measure such as linking benefits to wages would necessarily address the issue the member is raising, because if we had a National-led Government, we would end up with the same situation we had in the 1990s when wages were suppressed and benefits, having been cut, were then adjusted only in line with the CPI.
In light of the Minister’s answer to me, what are the systemic barriers that increase the likelihood of experiencing severe or significant poverty and hardship?
I might repeat the points I made in the answer to my primary question, but the member is aware of them so I will not insult him by doing that. But I can say that one of the areas of which I am most proud is that this Government, at particular political risk, has ensured that all our interventions, and the outcomes, are publicly measured and therefore accountable through the Social Report. That was an initiative that our Government took so that we now have nearly a decade of reporting of the interventions that the Government has invested taxpayers’ funds in delivering and of the outcomes that have been achieved. We can see the results that we have made through these interventions and we can better focus on the areas in which we need to do more work.
Will the Minister give urgent consideration to restoring a discretion that was lost to the benefit system when the special benefit was abolished, especially in light of the findings of this report; if not, why not?