‘I am terrified’: How National’s benefit changes may impact disabled community
Saturday, 17 February 2024
Legislation to change the way benefits are indexed was brought under urgency in the House this week.
Advice from the Ministry of Social Development said it would save $669.527 million from the change, which could be used on tax relief.
Advocates say this is a backward step for reducing child poverty and is taking money off the country’s poorest.
Huhana Hickey (Ngāti Tāhinga, Whakatōhea) has only three years until she hits retirement age, and is living in fear of her future when she can no longer work.
The disability advocate and lawyer with multiple sclerosis, who has advised the Human Rights Commission on housing, and is a member of the New Zealand Order of Merit, can only work intermittently.
She may be losing out on more than $2000 over the next four years as a result of changes to the way benefits are uprated. It may not appear substantial, but on a weekly-basis, for those who depend on every dollar, it makes a difference.
“I am terrified,” she said. “I am terrified. I am 62 and I have low earning power, I will be 65 soon.”
Disabled people who can’t work rely on the supported living payment, a figure adjusted alongside other benefits every year to be considered by the ministry to be enough to live on.
National campaigned on changing the metrics on which it is adjusted, and from this April, after rushing legislation through under urgency, it is set to be tied to inflation.
Inflation is high at the moment, so beneficiaries will get about $3 extra a week from autumn as they would have got if their benefit was tied to net wages. But as inflation drops, they will potentially be worse off than if the measure was tied to wages.
In the following April, they will be $4 a week worse off, figures obtained by Green Party MP Ricardo Menendez-March show. Then it will be $11, followed by $16, and $21. By 2028, they would have missed out on more than $2000.
All up, it will save the National-led government $669.527 million, according to the Ministry of Social Development.
The savings, the ministry suggests, can go towards cost-of-living policies including National’s promised tax cuts.
The same advice said an extra 7000 children would be pulled into poverty under one measure, while a further 7000 would be pulled under when using a broader measure.
Social Development Minister Louise Upston faced pressure in the House over the move, but rejected assertions from Labour and the Greens that her government doesn’t care about beneficiaries, or decreasing child poverty.
“This side of the House is very clear that we need to lift children out of benefit-dependant homes, to give them the shot at a great future that they deserve in New Zealand. Currently, 60% of the children in material hardship are in benefit-dependant homes. There is no dignity in them having poor or worse outcomes because of the family circumstances they were born in.”
She also used her personal experience as a single parent on welfare when asked if she could survive off the benefit today.
“I did it,” she said, before conceding it would be very hard.
But Menendez-March warned against leaning too much on an ideological position when developing policy.
“We have a responsibility and a duty of care that if we're going to be introducing policy and legislation, that there's also evidence to back up our ideological positions.
“She [the minister] has been unable to provide any evidence to substantiate that this bill will support people into employment.”
Her government has also promised harsher use of sanctions against people deemed not trying hard enough to find work. This would affect about 362,000 people estimated to be on a main benefit.
Hickey, who became a member of the New Zealand Order of Merit for services to people with disabilities in 2015, said only a small minority of people are abusing the welfare system.
“A good number of beneficiaries are actually disabled people,” she said. “Some of them work part time, some like myself work intermittently. A lot of us volunteer. Some of us are carers.”
The majority of people, she added, wanted to work. “I still don’t know why we are going down this road now.”
Jacqui Southey, advocacy and research director at Save the Children, said there was a wealth of evidence to show sanctions force beneficiaries further into debt.
“Some of the mitigations floated such as budgeting and sanctions, they have existed before, they are not new and they drive people further into debt,” she said.
Southey was concerned the change to benefits would be a step backwards for children living in poverty.
Multiple studies showed infants were three times more likely to die if they lived in severe poverty, for example.
“There is a connection between child poverty and poor health outcomes [from] inadequate living situations, even avoidable death,” she said.
“It undermines children’s rights in so many ways.”
She said there are genuine reasons for people to not be in work, and addressing the cost of living was about bringing housing, food and transport costs down.
“There is body of evidence being ignored. Seven thousand children is the size of a small town. That is not insignificant.”