Friday, October 31, 2008

Labour's job search allowance is discriminatory

Helen Clark said Labour’s job search allowance for redundant and laid off workers is fair, applied to everyone and was simple to administer.

First, some important points based on what the PM said yesterday. The important point to make is that all - without exception - will get this allowance if they have been working for five years and are made redundant or are laid off due to an economic downturn – and cant get the unemployment benefit due to partners income.

The second point is that the allowance is equal to the unemployment benefit. The third point is that a partners income is not means tested against the allowance. Once redundant, you`d be entitled to the job seekers allowance for up to 13 weeks, and your partner can keep his or her income.

But the student allowance is also classed as income.

The Herald today said only “working couples” would get this allowance. That’s slightly incorrect as the Ministry told me today that student partners would be able to keep their allowance and other income like everyone else.

Say the partner was a student earning $150.00 a week. Normally, they'd be entitled to student allowance at the married rate if no one earned. Clark said her announcement will extend to ALL who are redundant or lose their job (and couldn’t claim the dole due to partner’s income) after five years in the workforce. The student applies for the allowance timed for the day her partner becomes redundant. She now has income. He doesn't so applies for the allowance, which is not means tested. The newly unemployed partner would effectively be paid twice by the state if he was to collect the job search allowance – and the Minister’s office says that is fine - earning partners don't lose any income, why should student families?

The only other option is that they keep the full student allowance To get an extra $150.00, the partner will have to go back to work to earn it.

update The Ministry has rung back. They made a mistake. You can't get both – as I suspected. So the job search allowance will discriminate against the source of income – student income - similar to the way the In Work Payment discriminates against employment status. It doesn’t apply to everyone, without exception, at all. And if the newly redundant partner was working 25 hours a week and the partner 10 hours, they'd lose the In Work Payment as well, whereas a good deal of families entitled to the job search allowance will keep it.

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