Friday, December 10, 2010

Reminder of why welfare is in such a mess

The NZ Herald reports;

"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"."


But most beneficiaries are not living on just the basic benefit. The following illustrates the additional support someone on the DPB might typically be receiving and why that disincentivises work;


TAS = temporary additional support
DA = disability allowance
AS = accommodation supplement
FTC = family tax credit

Next;

"... 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."




12.5 percent is a crisis when compared with the 30 years that followed the creation of social security when the total number of working age people receiving a benefit never exceeded 2 percent.

Also ignored is that those making up the current 12.5 percent are on typically much longer term benefits than the dole which made up half of all benefit uptake in the early 90s.

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.


This claim has been made ad nauseam. The Child Poverty Action Group took their case to the Human Rights Tribunal and lost. The Tribunal found the government had the right to discriminate in order to encourage people to work. And remember it was a Labour government they were fighting.

There is no way any of the stuff in this report is going to fly. It merely serves to remind us of the type of sentiment that got us into such a mess with welfare.

(Graphs from the Treasury Report to the [official] Welfare Working Group)

15 comments:

Manolo said...

Aren't these do-gooder bastards greedy?

FF said...

Thanks for doing the serious analysis of the stats, something the media is too lazy to do.

And also for reading the Herald so I don't have to.

Anonymous said...

Yes, thank you for your analysis. I predict that next year will herald a raft of problems as the tenure of state housing is addressed. There presently seems to be a perception of ownership of state houses by long term tenants, despite their rents being met in many cases by benefits. State housing for life will be an election issue.

Cadwallader

Adolf Fiinkensein said...

I've always wondered about this and for the first time, here it is in stark relief. Many thanks for the effort.

Question

Is the $40k per year subject to income tax or not?

Della said...

Lindsay, as you probably well know, many people don't actually receive the adds-ons you're whining about.
I am on UB, single woman, and getting the absoolute minimum. If I work (and I do when I can as a relieving teacher) I lose most of what I earn.
Get real! (Oh, forgot - you have no interest in facts - just prejudice.)

Lindsay Mitchell said...

Debbie, Facts: In 2009 237,655 beneficiaries received the accommodation supplement and thousands more got income-related rents paid by Work and Income. Every caregiver on a benefit receives family tax credits for their children. Around 63,000 beneficiaries receive hardship assistance. Those not receiving add-ons are a minority.

Lindsay Mitchell said...

Adolf, Basic benefits are taxed. Don't think the rest of supplementary assistance is.

pollywog said...

Lindsay : do you have any facts and stats on expenditure for these beneficiaries...what their outgoings are ???

average rents, power bills, groceries, phone, fuel, vehicle maintenance, clothing, bare arse living costs, that sort of stuff ???

Anonymous said...

smokes $20, pokies/lotto/gambling $5-100, rent if oon state house $75, booze $20-250,McDs/takeaways $10-150, work seeking expenses 0.....

pollywog said...

sky TV $40, weed $30, broadband $40, cellphone $50...ZzzzzzzzZzzzzzzz

...dream on asshole

FF said...

'Lindsay : do you have any facts and stats on expenditure for these beneficiaries...what their outgoings are ???'

Well Pollywog, that's the point isn't it?, why should Lindsay have any more data on what people spend their money on than you do?

Everyone is different, even people on low incomes have choices.

I am on a low income, so I choose to have a vege garden and to not have Sky TV, unlike 90% of households in State housing areas by the looks.

pollywog said...

Well FF

in the interests of providing a balanced outlook on beneficiaries lifestyle and income vs outgoings and struggles it might be pertinent to average out some fact based costings to provide some real statistics

lest we all assume being on the DPB is a lifestyle choice where one can afford to sit around in a drugged up haze all day, watching SKY TV, waiting for bingo in the evening while their kids run feral and unkempt all over the neighbourhood and having takeaways for dinner every night

in line with that, Lindsay, as an 'expert' who has been researching and commenting on welfare since 2001, should have a better idea of what those she criticises spend their money on than i.

so i'm just putting it to her...

does she have any information regarding average rents, power bills, groceries, phone, fuel, vehicle maintenance, clothing, bare arse living costs, that sort of stuff for beneficiaries ???

sue said...

it's too easy to select so called statistical evidence to suit - the reality is rarely so simple. I've worked with families at the bottom of the food chain for over 30 years now - on both sides of the world. There are some 'free loaders' - but then look at some of the rich who avoid paying taxes! Not everyone who is wealthy is a con, neither is every family on DPB. Go and see where they live. Talk to them. talk to their children. Live a day, a week, a month in their homes, with their pay packet THEN comment. Until then - you have nothing to say.

rashid1891 said...

this site is good

Anonymous said...

Why do woman pop out more kids while on the DPB.another father etc.and on there for years and years.and the get more than a average worker.people have had a gutsfull of this.no wonder everyone goes to aust.