Monday, July 20, 2009

Phil Goff's idiotic idea

Phil Goff wants the dole paid to people made redundant due to the recession even if their partners are working. He wants partners income to be disregarded in means testing.

To pay the full unemployment benefit to partnered redundant workers, the whole benefit system would need to be revamped as when an unemployed person with a non-earning partner gets the benefit, half the benefit is paid to the partner, and half to the unemployed person.

Here's what could happen within the current system: A person is made redundant. She earned $35,000 a year - about $670 a week - and does not live with her partner, who has the four children and earns $80,000. Both have separate bank accounts. Instead of getting the dole as at present, the couple move in together. Both get the dole, as the benefit payment is split between partners and into each bank account, and the newly unemployed woman no longer has to pay child support. Good idea, they think. As she is unemployed, Working for Families payments are paid through WINZ. If WINZ do not note the partner's income - because that will abate the benefit instead of waiving it - WINZ would also pay Working for Families payments - as she now has the kids - and the accommodation supplement to pay for the high mortgage.

They'd get about $500.00 extra each week. On top of that, if the unemployed person's bank balance went below a certain threshold, she could get food grants and advances to pay power bills as WINZ disregard the income of her partner.

A nice little earner to ride over the recession. And no childcare to pay too as the unemployed man can look after the kids while his wife works and collects the benefit.

But there's a downside to this arrangement. Guess what it is.

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Anonymous toad said...

Dave, I think Goff is talking about exempting partner income for the purposes of calculation of unemployment benefit only - not for Working for Families, so your scenario is based on an incorrect premise.

As I've blogged here, I actually think it is a good idea - one of the few good ideas Goff's had since he came to the leadership. People are taxed on an individual basis. Weekly compensation is paid by ACC on an individual basis. So why are not benefits paid on an individual basis?

WFF is for the support of children, so is in a different category.

July 20, 2009 at 1:25 PM  
Blogger Swimming said...

Because benefits are based on need. Need is based on a family situation. ACC is based on entitlement.Taxes fund both needs and entitlements in this country.

In terms of waiving abatement for benefit only, that will be difficult to administer within the current system, as I have highlighted. WFF is paid usually to a female partner. Perhaps you should be asking why.

July 20, 2009 at 1:56 PM  

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