It’s back to work you go

The government has signalled that it would like parents to go back to work when their youngest child reaches 12 months.

Parents can only go back to work if they have a job to go back to. The government can’t make parents “go back to work” – or even look for work - unless they are on a benefit.

But it is beneficiaries that this policy is designed for – those who, by definition cannot go “back” to work, but must find work. But it is not just any beneficiaries – it is targeted at sole parents. And in some cases it could cost taxpayers more than leaving them on the benefit. Not that it is a good or bad thing, it just is.

A sole mother with three kids on the DPB gets $326.82 in benefit payments, plus Working for Families payments. Some get a WINZ accommodation supplement.

If she gets a job for 20 hours a week she loses her benefit. But if she earns less than $80,000 – which she will – she can get an $11.52 an hour WINZ childcare subsidy - to a maximum of $576.00 a week - to look after her kids. Her Working for Families payments will also increase by $60.00 a week.

Say she has three kids under five. She gets a job for 20 hours a week at $23/hr – she’d get $460.00 a week. She works four hours a day and takes an hour to get to work. While she works 20 hours, her travel time is 10 hours so she`ll get 30 hours of state-subsidised childcare a week – that’s $345.60 - which is more than the DPB. She’d also have to pay about $30 each week to travel to work.

If she got a job at $16 an hour for 20 weeks, she’d be getting slightly more than she got on a benefit, due to the $60 In Work Payment - but the state will be contributing even more to childcare.

But - the theory goes - it is better for the state to contribute more to pay someone else to look after kids, than for a mum on the DPB to stay home and look after children.

Much better for the worker to contribute to the economy and pay transport costs to keep the buses running – because she is paying more tax.

Governments appear to think that staying home to look after your kids is only a good idea if you have an earning partner.

Work testing beneficiaries

Danyl at Dim Post thinks it is patently moronic to start work-testing beneficiaries and suspending their incomes for non-compliance when there aren’t any jobs around for them to apply for.

There are plenty of jobs to apply for. The problem is that most are unsuitable for many unemployed people and also that more people are applying for each job, making interviews harder to get. If you apply for a job you won't be work tested - even if it is a job that you are not likely to get an interview for.

What should happen (if Work and Income does its job) prior to work testing is that that those who have little money in the bank could be told that if they have confirmation of a job interview, they can get up to $300 for free to buy clothes for the interview. For guys, at the moment at Hallensteins, I think, that`ll get you a suit, an extra pair of trousers, a business shirt, and a tie.

They then have some decent clothes for job interviews.

Who knew that?

Scaremongering

I think some bloggers are scaremongering about National's benefit policy. Some are implying that loads on the dpb will be worktested off benefits and the system is harsh and the government is uncaring. I don't for a moment think the system is harsh. In reality I don't think people on the dole will be worktested off benefits any more than is currently happening.

It is not exactly happening to thousands at the moment. And I`ll be surprised if any person on any benefit who is meeting their obligations as a beneficiary is worktested off a benefit. And if you are not meeting your obligations, you simply don't deserve a benefit.

Getting people off benefits

Every week on average, some people have their benefit cut - not because they have found work or returned to study, not because they are leaving the country - but because they are going to prison. Guess how many..
a.20
b.46
c.59
d.85

Not exactly a luxurious life

I wouldn’t get too concerned that the government is planning to stick 7000 unemployed people into McDonalds. The scheme is over a five years period, equating to 26 per week on average. That is if the 7000 figure is reached. What if they only get 4000 into McDonalds – that’s about 15 per week.

And that is about how many people are being employed at McDonalds every week anyway, due to the high staff turnover. But this deal is not driven by a desire to get people work. It is driven by a desire not to pay so much money on benefits, as John Key explains:

When we spend a lot on benefits it means there are a lot of New Zealanders not really earning a lot. Life on a benefit is not exactly a luxurious life.

When lots of people work at McDonalds, it means there are a lot of New Zealanders not really earning a lot. Working at McDonalds is not exactly a luxurious life.

What if they were to offer a McDonalds fulltime position - 30 hours a week in WINZ language - to a main unemployed breadwinner with children? If they were to get $15.00 an hour, they`d get $450 a week ($23,400 a year), compared with a benefit payment of $18,850 a year before tax. That's an extra $87.50 a week.

Beneficiaries can earn $80.00 each week and retain the benefit. Effectively squared up. But the person in this example will be spending money on transport to get to work so he is worse off by working at McDonalds.

Would you do it?

National's welfare policy is work for the dole in drag

National released its welfare policy today.

Although there's a focus on work, its not work for the dole, because too many of those on the dole are now on sickness and invalids benefits. But beneficiaries must work or be sanctioned. Those on the DPB will have to enter work or training for 15 hours once their youngest child reaches six. Most care for children under six and the best way to avoid this is to have more kids.

About 5,600 sickness and invalid beneficiaries have been categorized as capable of working, and John Key says even Invalids beneficiaries will be required work for at least 15 hours per week in employment, training, or job-seeking activities. Like telemarketing and pushing trolleys at supermarkets, thus keeping wages where they are.

Yet, the MSD guidelines state that to qualify for an Invalid’s Benefit you must be 16 or over and unable to regularly work 15 hours or more a week, unless you are blind. Those on sickness benefits will have to get a doctor's medical certificate every four weeks instead of the current 13 weeks. Doctors will be very happy with the extra income.

National will require those who have been on the dole for more than a year - about a third of the register - to re-apply for their benefit and undergo a comprehensive work assessment. It is not clear those who have transferred to the sickness benefit after being on the dole for a year also need to reapply. It appears they don't, which will increase the numbers on the sickness benefit as many transfer to other benefits to avoid reapplying.

Those who are working will get the first $100 before their benefit is abated by 70% for each dollar earned, which is really equivalent to a CPI adjustment and should have already been done. They should make the threshold at least $140 to align it with the increase in the minimum wage.

John Key has said paid work is the route to independence. What he didn't say was that it didn't matter if that paid work was undertaken while on a benefit.

It does matter, but National's policy does not reflect that, because there's little that enables beneficiaries to get full time jobs.

This only leads one to conclude that National doesn't care if people are on benefits as long as they are working.

Pay rises for the sick, who just get sicker

The Dom Post has a story on the blowout in numbers of drug and alcohol addicts recieving sickness and invalids benefits. This has been a problem for years. Those on the sickness and unemployment benefits get $219.25, and if you transfer to the invalids benefit - as many are doing - you get $277.50. That's more than students get.

The problem is that the 5279 on such benefits because of these problems are not required to get treatment. However they can be put on literacy and numeracy programmes but Work and Income isn't bothering to do this, either. Wouldn't it be better puttting the extra $52.25 into drug and alcohol rehab for these people instead?

We have a classic " I am confident" comment from the Minister

However, Social Development Minister Ruth Dyson said she was confident that programmes such as Paths (Providing Access to Health Solutions) ensured alcohol- and drug-affected beneficiaries got the treatment they needed

This is despite giving National MP Judith Collins the miniscule numbers, that majority who are not hard druggies, but have ill health or disabilities, or are stressed or depressed. And in the very next sentence, the report explains that they are not getting the treatment they need.

Ms Reade said case managers could not force beneficiaries into treatment programmes.

That's not the issue. They don't even have to encourage them to get treatment either. PATHS doesn't even assist drug and alcohol abusers unless they are stressed or depressed, and many who exit a benefit after PATHS go back on the benefit. It's more likely to give people gym memberships or physiotherapy.

Until compulsory intervention of drug use is introduced, we taxpayers will continue to divert money which could be used to reduce hospital and Court waiting lists and provide road maintenance, into keeping these people in the manner to which they have become accustomed.

And on a side issue, the Aotearoa Legalise Cannabis party has today put out a call for candidates. Perhaps they should put up posters at Work and Income offices.

More here: Why can't WINZ force druggies to get treatment

WINZ Deputy Chief Executive stretches truth in Dominion Post

Patricia Reade, Deputy Chief Executive of Work and Income stated in a letter to the Dominion Post this week that there is no link between the number receiving an unemployment benefit, and a sickness or invalids benefit.

She felt the need to do that because a former staff member pointed out that there was indeed a link and people were going to the doctor claiming depression so as to go on sickness and invalids benefits. Unfortunately for Ms Reade, most of the figures of benefit transfers are in the public arena, and nearly a quarter of new applications for the Sickness and Invalids Benefits are made by people already recieving a main benefit.

Of those who were on an Unemployment Benefit last year, 193 transferred to the Invalids benefit and massive 8579 transferred to the Sickness Benefit. That’s just last year. Of those who were on a Sickness Benefit, 5968 transferred to the Invalids benefit, including probably some of the ones that were transferred from the Unemployment Benefit earlier in the year, hence the link to the Unemployment Benefit. That’s the highest amount since 2002. Fewer than 300 transferred the other way off the Invalids benefit.

So now we have a little bit of an idea as to why the Invalids Benefit numbers have increased. For Ms Reade to say that there is no link is simply untruthful. Even her own Ministry does not agree with her. From the Ministry’s research:

Through disillusion with their prospects as job seekers, or as a result of being moved by the employment services or by benefit administrators, [people] progressively moved on to incapacity-related benefits.

How easy is that!

Christchurch GP Pippa MacKay, who performs abortions at Lyndhurst Hospital, said she applies the law."If someone says to me they will suffer depression if they have a child, then I accept that." Lets put that into plain English.

So, this is how you have an abortion:
They ask the woman whether having the pregnancy would cause them depression, the woman says “Oh yes it will” and the doctor says “Okay”.

And that's not all...

How to get a sickness benefit
They ask the person if they are sure they have depression and the person says, “Oh yes I am” and the doctor says “Okay”.

How to reduce child abuse
They ask the Children`s Commissioner if a smacking ban will reduce child abuse and she says "Oh yes it will" and Parliament says "Okay".

How to get a civil union
They ask thousands in the the gay community if they will get a civil union if such laws are introduced, they say " Oh yes we will", and Parliament says "Okay".

How to get parole
The Parole Board asks a prisoner if he [or she] will be good if they were to be let out of prison and they say "Oh yes I will" and the Parole Board says, "Okay - we`ll see you in a few years".

Record number working while collecting the Invalids Benefit

This quarter's benefit numbers are here. Unemployment has gone up but this increase has not translated to the unemployment benefit as the majority of the 29,000 people who left jobs in the past quarter don`t qualify for a benefit as they have a working partner or are not looking for work.

One thing hasn't changed. Just as many people are working while collecting a benefit. Those on the Invalids Benefit are supposed to be on it because they are unable to work more than 15 hours a week, although they can trial out a job for more than 15 hours a week for a limited time. Yet more than 11,000 people are collecting income on the Invalids Benefit -the most ever. In fact 67% more people are working while collecting the Invalids Benefit than those working and collecting the Unemployment Benefit and Sickness Benefit combined.

Someone should ask how many Invalids beneficiaries have been working for for more than 15 hours a week for longer than a month, and if so, why they are on the Invalids Benefit. Some of them will be blind, which is fine, others should be on the sickness or unemployment benefit. I have a friend who was on the Invalids Benefit and got a full time job. She was no invalid - she was studying towards her PhD.

Meanwhile the Household Labour Force stats are here. Of these aged 20-24, there's is an 7000 increase in unemployed, up from 11,000 to 18,000 in just one quarter. Given that December and March has the highest employment growth of any quarter, why this year is there a 29,000 drop in employment in seasonally adjusted terms?

One in five unemployed are on a training benefit

I have been saying for a while that much of the reason the unemployment benefit numbers are low is because of the amount of people on training benefits. Those on training benefits are excluded from official dole figures. Training benefits last from six weeks to more than a year, depending on the type of training.

About one on five of those who would normally be on the unemployment benefit are on a unemployed training benefit (UBT ), thus significantly skewing the dole figures to a greater extent than those who are transferred from the dole to sickness and invalids benefits.

For example, at the end of June, 23000 were in receipt of an unemployment benefit and 6368 were in receipt of a training benefit. Some are transferred from other benefits like sickness, but these are few. Ths is because training benefits require you to be in training for 30 hours a week and if you can't work 30 hours a week because of depression or whatever, you shouldn't be able to cope with training for that period either - but some slip through.

And what happens after they finished training? What proportion enter sustainable employment? Well, the MSD staff won't say, because they don't know. However they do know that many go on to other training options or onto the sickness or unemployment benefit again. Some get part time jobs and have their benefit abated. But the MSD has no idea how many people get jobs or go to further training such as university as a result of training they put their "clients" though.

It is important to note that these figures do not include those under 18 who would normally be on the independant youth benefit. And given that half all on the unemployment benefit are over 40, and the vast majority of those on training benefits are under 40, this could mean that of all those under 40 who are eligible for the unemployment benefit and are receiving income from Work and Income, up to a quarter could be on training benefits or the reason half of all unemployment beneficaries are over 40 is because fewer of those over 40 are trained because they are tougher to train.

Unemployment figures are not what Dyson claims

Well, Ruth Dyson says the unemployment benefit figures are at a 28 year year low, with just over 20,000 people getting it now

She's right. This post attempts to explain why - and where the other unemployed are on the benefit system.

Much has been made of the transfer of unemployed onto sickness and invalids benefits, and ther are a lot of them. Yet of all the people who transferred from the unemployment benefit to other benefits up to June this year, nearly half of them transferred to training benefits. A training benefit is an unemployement benefit for those that supposed to be training full time while getting the dole.

So while Dyson may say that 20,000 people are on the dole, papers released under the Official Information Act show that more than 20,000 transferred from the dole to training benefits alone in the last year, and more than half of these were under the age of 25. This means that there are many more people on an unemployment benefit-its just that they are not on the dole. Some go on the dole and before the end of the week they are on a training benefit, and that is counted on Dyson's 141,000 figure when she says "Over 141,000 have come off this benefit" since 1999 - when 160,000 were on the unemployment benfit and training benefits didn`t exist as a functioning benefit.

Training benefits are like a waiting list for the waiting list.

They are a key reason why youth unemployment is so low. The Government do not include those who are collecting the dole on training benefits in these figures.

Furthermore, the MSD is attempting to transfer as many people on to training benfits as they can, to cut down the dole figure, and I have that on authority of someone who is specifically employed to ensure case managers do just that. However he smiled when I asked if all trainees in reciept of a benefit were transferred back to the unemployment benefit after training, meaning that some people may well be on training benefits even though their training is finished. But according to my Official Information Act response, the MSD is unable to advise how many people transferred from training benefits to other benefits. The Ombudsmen has followed this up, but the MSD still won't say why they are unable to provide figures.

There are also hundreds of unemployment beneficiaries who are on a suspended benefit or stand-down for various reasons, some dubious, meaning that they are not included in Dyson's 20,000 figure either as they are not "receiving a benefit".

Finally, anyone who has been on a benefit for a few months were entitled to a job plus subsidy up til June 2006. This is a subsidy that is given to employers to employ a job seeker off the benefit. Yet just 9,184 employers got job subsidies - for employing beneficiaries who recieved all manner of benefits - last year.Yet 83,000 unemployment benefits were cancelled last year - because thousands enrol for the benefit for short times in between jobs or study.

So the MSD can't claim that unemployment is low because Work and Income are increasingly getting people jobs, as this 9184 figure is the lowest since 2002 by a long shot.