Reforms To the Welfare System: How Do They Stack Up?

By Georgia Osmond

Last year an article was written discussing the current state of New Zealand’s welfare system. In particular, it focused on section 70A of the Social Security Act 1964; now section 192 of the Social Security Act 2018. Under this section, sole parents could be penalised for failing to name the other parent on their child’s birth certificate. This penalty was the reduction of their benefit of between $22-28 a week. Sole parents could also be penalised under this provision if they failed to apply for child support. The section was criticised as being unfair and unduly punitive, as there are a myriad of reasons why parents choose not to name the other parent.  

Since the publication of this article, the Welfare Expert Advisory Group have published their report on reforms to the welfare system. Within this report are 42 recommendations the Group believes will dramatically improve New Zealand’s welfare system and allow greater participation of families and individuals on benefits in the community.

The Welfare Expert Advisory Group Report

With a foundation of ‘whakamana tangata’, restoring people to dignity, the Advisory Group focused on changes to the social security system that move it away from being a safety net for people to one that allows families and individuals to participate meaningfully in their communities and establish sustainable long-term outcomes for people.  

The 42 recommendations of the Advisory Group are across a variety of areas of concern, ranging from improving outcomes for Māori, to better assistance for those with disabilities and carers of those with disabilities, to a call for change in the housing system. Recommendation 11 suggests the removal of obligations and sanctions, including the section 70A sanction on sole parents who do not name the other parent of their child.

The removal of this sanction is one of the recommendations the government has agreed to follow through on, and it has been a long time coming. Social Development Minister Carmel Sepuloni has stated that, in 2016, National were told there was insufficient proof the sanction achieved the purpose of getting child support money off the unnamed parent. The legislation removing the sanction will come into effect in April 2020 and will cost approximately $113.4 million over the next four years.

Despite groups such as Family First criticising the removal of the sanction, stating that women should have to name the father of their child for the benefit of both the father and the child, response to the removal of this sanction has been overwhelmingly supportive. This is positive especially considering the discriminatory nature of the provision itself. With 56.7% of those receiving main benefits being women, and 91.1% (or 54,7778) receiving the Sole Parent Support, it was largely women — and to a greater extent, their children — that were suffering under the enforcement of the sanction.

Other recommendations in the Advisory group’s report are also trending towards becoming more supportive of sole parents, especially women. This includes increasing the abatement threshold for sole parents to $150 a week and, even more importantly, passing the payment of child support straight onto the carer of the child, rather than being taken by the government as payment. This recommendation was made on the basis that parents might be more willing to pay child support if they knew the money was going directly to the care of their child, and the carer would be more likely to apply for child support if it actually went to them and enabled them to properly care for their child. Recommendation 13 also suggested that the government assisted those on Sole Parent Support in returning to part-time work when their youngest child turns 6, as opposed to the current age of 3. This relieves some of the pressure on sole parents to return to work earlier, but also gives them the opportunity to earn for themselves rather than relying on Sole Parent Support.

A further suggestion of the Group related to the meaning of ‘relationship in the nature of marriage’, making it a more flexible definition that reflected the changing nature of New Zealand society. Rather than giving those in a developing relationship only 6 weeks from the time of moving in together the chance to determine whether it will work, the Advisory Group suggested a period of 6 months. If implemented, this change would be beneficial to sole parents. It would give them to opportunity to test out a new relationship without fear of being accused of relationship fraud or having their benefit reduced because of being in a relationship.

Government Response To The Report

While the support for removal of the section 70A sanction has been positive, overall there is criticism of the government’s response to the Advisory Group’s recommendations. Of the 42 recommendations, only three will be implemented by 2020: Removing the sanction on sole parents, increasing the abatement threshold, and allocating funds to employ approximately 263 workers to assist beneficiaries into ‘good work’. Though the government through Carmel Sepuloni has claimed that the recommendations will be implemented over time, this is not enough. There are still sanctions contained in the legislation that have not been removed despite the Advisory Group recommending their abolition, such as benefit reduction where an individual fails or refuses to undergo drug tests, or where they breach arrest warrants.

Further criticism has been levelled by Children’s Commissioner Judge Andrew Becroft, stating that the government’s lacklustre response to the recommendations continues to ignore children. In a country where 240,000 children live below the poverty line, his response to the government’s inaction is well-justified.

There are areas in which the welfare system continues to punish sole parents — and as a result, women. This includes penalties for women that have more children whilst on a benefit (sole parents not being able to receive child support if they are receive a main benefit) and the reduction of the benefit for each dependent child that a sole parent does not receive child support for. These are further areas that need to be addressed to ensure that sole parents are not continually punished for being in a situation they likely did not choose to be in.

 There is no denying that the removal of the section 70A sanction is a good step forward for the New Zealand welfare system. However, to achieve the Advisory Group’s vision of a welfare system where people have an adequate income and standard of living, are treated with dignity, and can participate fully in their communities, the recommendations of the Advisory Group need to be taken seriously and implemented in the near future, not in the decade that has been implied.

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