Welfare numbers drop as reforms take effect

Latest quarterly benefit figures show more than 10,000 have gone off welfare and half of those are sole parents.

Social Development Minister Paula Bennett says while the most significant reforms have taken effect from this week, the reduction is due to changes that have already been made.

"Expectations and obligations are clearer and have a much greater work focus, with more support to help people move off welfare into work," she says.

The figures show the new categories effective from July 15 and the old categories for comparison.

“There are currently 309,782 people on benefits in New Zealand, a reduction from 310,146 the previous quarter and down from 320,041 the year prior," the minister says. “That’s a reduction of more than 10,000 on welfare over the past 12 months and I am particularly pleased that 5600 of them are sole parents.”

From July 15, new benefit categories and expectations apply to beneficiaries, including rules around drug testing, outstanding arrest warrants and new social obligations for parents.

Three new main categories, Jobseeker Support, Sole Parent Support and Supported Living Payment, replace the previous seven benefit types. This is in addition to the Youth Services (Young Parent Payment and Youth Payment) implemented in 2012.

Those on benefits include the following:

• Jobseeker Support: 128,608
• Sole Parent Support: 82,897
• Supported Living Payment: 91,862
• Youth Payment and Young Parent Payment: 1180

Under the old system that would translate to:

• Unemployment Benefit: 48,438
• DPB sole parents: 90,801
• DPB caring for sick and infirm: 8084
• Sickness Benefit: 59,127
• Invalid’s Benefit: 83,778
• Widow’s Benefit: 4754
• Unemployment Benefit Training: 4922

The largest reduction in benefit numbers applies to the new Sole Parent Support category, down by more than 1500 in the quarter to June and down more than 5600 in a year.

Under the old system, the DPB for sole parents (which also includes those with children over 14 years old) reduced by more than 7300 in the year to June.

Mrs Bennett says she’s impressed with this reduction, which follows new obligations for sole parents to be in part time work when their youngest turns five, and full time work when their youngest is 14. 

This change has triggered new supports for sole parents, including one to one support for those at risk of long term dependence and a work bonus for those who choose to move into work earlier than required.

“I have absolute respect for those sole parents and I’m proud of the efforts of Work and Income staff who help sole parents prepare for and find work.”

“Statistics show that 50% of sole parents in New Zealand do work. It is achievable with support and children are better off in working households.”

The number of Jobseekers is down by 176 on the quarter and almost 6000 on the year to June. In the last quarter alone more than 21,600 went off welfare into paid work.

“Benefit numbers this June are the lowest they’ve been at this time of year since prior to 2009,” Mrs Bennett says.