End of support payments brings flood of people to budgeting service

Thursday, 8 October 2020

With interest rates low, the budget service is recommending landlords keep the rents at the same level

A budget service is pleading with landlords not to raise rents as wage subsidies and winter energy payments end.

Nelson Budget Service board member Rosalie Grant said she had been involved with the service for 11 years and it had never been busier.

“It [demand] has increased in the past month significantly,” Grant said.

Nationally, The Salvation Army is also experiencing greater demand for its services and bracing for further increases with the end of the wage subsidies and the winter energy payment, which stopped on October 1.

Labour leader Jacinda Ardern, centre, with Nelson Labour candidate Rachel Boyack greet people gathered inside the Nelson Budget Service office last week. Labour’s commerce and consumer affairs spokesman Kris Faafoi is behind Ardern while finance spokesman Grant Robertson and Te Tai Tonga MP Rino Tirikatene also attended.

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Ministry of Social Development statistics reveal the number of people receiving Jobseeker Support in the Nelson Work and Income region has been rising. (File photograph)

While The Salvation Army had been “flat out” during the Covid-19 lockdown, with food parcels in particular, Grant said the Nelson Budget Service was relatively quiet.

“Now the pinch has come on a lot more,” she said.

Labour leader Jacinda Ardern discusses the major issues people are raising with her on the 2020 campaign trail. In 2017, mental health was a major issue.

The Nelson service helped about 500 to 600 people a year.

“Each person represents a family,” Grant said. “The struggles are a lot harder now than when I started; the cost of living has gone up significantly.”

The increase in demand had been fairly gradual until the past month when it jumped markedly. However, there had been a noticeable increase in the complexity of issues over the past five to six years along with a hike in “the anxiety levels of the people presenting”.

“The effect on people’s lives has become more acute,” Grant said.

Housing was “a huge part of it”, both the limited supply of homes and the cost for renters and people hoping to buy.

Manager Catherine Wild said the number of interactions at Nelson Budget Service was trending towards 1200 this year.

“There’s just not enough income in families,” Wild said.

Many people were also worried about potential increases in their housing costs following the end of Covid-19 rent freeze that applied from March 26 to September 25.

“People are nervous rents are going to go up,” Wild said.

With interest rates low, the budget service was recommending landlords keep the rents at the same level.

Salvation Army spokeswoman Louise Parry said most people on low incomes were very good at budgeting. “They have to account for every last cent.”

Meanwhile, Ministry of Social Development statistics reveal the number of people receiving Jobseeker Support in the Nelson Work and Income region climbed from 4880 in the week ending January 3 to 7022 for the week ending September 25.

That increase of 2142 is a hike of 43.9 per cent. The 7022 recipients of the Jobseeker Support represent 6.3 per cent of the estimated working age population.

The Nelson Work and Income region includes Nelson-Tasman, Marlborough and the West Coast.

Parry said it was expecting a big rise in approaches for help.“We’re getting a lot of inquiries about housing as well.”

The consequences of an end to the wage subsidies for businesses and levels of staffing were yet to fully play out but The Salvation Army was already seeing a new cohort of clients who had lost their jobs.

“These people have never come to The Salvation Army before,” Parry said.

However, it was the “most vulnerable” who had been most affected such as people on low wages working multiple jobs who lost a job or some hours of work, along with those on benefits that were inadequate, she said.

When they were hit by a doctor’s bill or the car broke down, they had no capacity to pay.

“There’s just no extra,” Parry said.