What the Welfare Expert Advisory Group will recommend

Due to report back this week, here's a selection of what I believe the Welfare Expert Advisory Group will recommend:

1/ No more compulsion to name the father of a child dependent on a beneficiary. That's what scrapping the current penalty for not naming the father will mean. So expect the estimated cost of this move to be grossly under-estimated.

2/ Passing on child support to the beneficiary instead of keeping it to offset the cost of their benefit.

3/ Linking benefits to CPI and wage inflation (as per Super).

4/ Scrapping the 'additional child' conditions National imposed - ie work-testing the mother who adds a child to an existing benefit when that child turns one. They will justify this by showing the condition hasn't stopped people adding children anyway.

5/ Extending the In Work Tax Credit to other beneficiary parents. Perhaps it'll be named the Not In Work Tax Credit.

Then some possibilities:

5/ Scrapping the sanctions system.

6/ Lifting abatement rates to allow parents in particular to earn more without losing benefit component.

7/ Scrapping stand-downs which were introduced in the early 1990s

8/ Removing tax from benefits.

That last one is interesting. From memory Roger Douglas introduced taxation on benefits to solve a problem connected with people who work some of the year and are on benefit for the remainder. I can find reference to this as " a major package of tax reform that included the grossing up and taxation of welfare benefits" in October 1986.

(As an aside, in searching for information about the introduction of tax on benefits I came across this Tax Review report presented to Michael Cullen, then finance minister, in 2001. Searching capital gains resulted in the following, "We do not consider that New Zealand should adopt a general realisations-based capital gains tax. We do not believe that such a tax would make our tax system fairer and more efficient, nor do we believe that it would lower tax avoidance or raise substantial revenue that could be used to reduce rates. Instead, such a tax would increase the complexity and costs of our system.")

All of the above recommendations will cost a great deal and I wouldn't put it past the group to recommend lifting the super qualifying age as a means to afford more working-age welfare. I believe we should be lifting the age (as are the UK, Australia and the US) but not to pay for more welfare.

Remember that the welfare review is part of the coalition deal extracted by the Greens. The panel members are almost exclusively politically left. The public response, on the back of the controversial tax recommendations, will be most interesting.