Monday, August 08, 2011

What's behind Paula Bennett's 'good news'?

Social Development Minister Paula Bennett says Future Focus changes implemented last September have saved taxpayers more than $6 million.

The changes implemented last September as a pre-cursor to major reforms introduced clear obligations and greater fairness to the benefits system.”

Future Focus changes include requiring:
• Unemployment Beneficiaries to reapply if they remain on the benefit after a year and prove their eligibility to continue receiving assistance.
• DPB recipients with children over six to look for part-time work.

“This common sense approach has seen 7,400 people go off Unemployment Benefits and taxpayers have saved more than $6 million,” says Ms Bennett.

About half of the 7,400 didn’t complete the process, more than 2,000 were in work and 1,400 had left the country, were studying or just failed the work test.

“This simple policy change alone is expected to save a further $3.5 million by October,” says Ms Bennett.

Since September last year, more than 10,800 people have gone off the DPB into work.

“The number of people who’ve found jobs and gone off the DPB since last year’s welfare changes has gone up by 20 percent, that’s significant”

Prior to Future Focus changes there were 13,700 people on DPB doing some part time work and now there are 15,300.


DPB statistics

Sept 2010 112,765
June 2011 113,429

Doesn't matter how many go off when more come on.

And those going off most likely represent short-termers best capable of gaining employment while those coming on most likely represent young unskilled and uneducated types quite likely to stay for years.

In earlier years (granted they were years of lower unemployment) MORE people were leaving the DPB and going to work with NO work-testing regime.
2004 12,773
2005 13,484
2006 16,132

One other thing. $6 million represents about 0.03 percent of the $20 billion MSD budget. Big deal. They could easily save the equivalent by dropping some of the highly paid bureaucrats.

Having just been reminded about our $300 million a week borrowing here, that also makes $6 million look skinny; not even worth the iou it was printed on.

1 comment:

New Kiwi said...

The $6m is not exactly a saving, rather the cessation of an overpayment.