Thursday, August 12, 2010

Pushing those on the DPB to work

The NZ Herald reports:
A sole parent with three young children paying the $332 average rent for a three-bedroom house in Papakura would get $206 in family support and $165 in accommodation supplement on top of the $278 DPB, a total of $649 a week.
Lets assume that she could walk straight into a job.

What would happen if she got a job for 25 hours a week at $20 per hour, or $500 per week – by no means the minimum hourly rate.

Firstly, because she is working more than 20 hours, she'd get the in work tax credit. She’d get $500 ($407 net) a week in income. Her family support will be the same, her accommodation supplement would reduce just $5.00. But the $60 In work Tax Credit bumps up her income to $833.00 - an extra $184.00 per week .

Sounds good. But even if she get 20 hours free, she`ll still be paying at least $180 a week in childcare and after school care, assuming she has two preschoolers at the right age and one child who is at school - leaving her nothing extra to pay for transport to get to work and clothes to wear to work.

Would you work for about $1.00 extra an hour? If so, what would you do if your child gets sick? What would you do if you cant get 20 hours free childcare because your childcare centre doesn't offer it or your kids are the wrong age?

If she got a job for $17.50 an hour for a 40 hour week - that’s $700 ($562 net) - she`d get $110.00 accommodation supplement and the same WFF assistance – totalling $878.00. That is $229 extra than the benefit and allowances.

Even better. But after child care costs, an income of $36,400 would leave her less than $50.00 extra to pay for transport to get to work and clothes to wear to work.

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Blogger Lindsay Mitchell said...

What would make a huge difference is existing DPBs providing childcare
FOC. In some US states providing childcare could be treated as
eligibility for continuing to receive TANF (their DPB equivalent). Most DPBs are looking after only one child. Huge capacity there.

August 13, 2010 at 1:11 PM  
Blogger Swimming said...

Yeah, provided they are not subject to the work test AND get the In Work Payment, which you cant get as a beneficiary. The Govt would not have a bar of it, neither would most on the dpb.

But would a person on the dpb want to look after another persons child for free - at all hours - so their parent can go to work - when they`d rather go to work for money themselves. Also, what happens should they get called out for a job interview?

August 13, 2010 at 1:39 PM  
Blogger Lindsay Mitchell said...

You just don't want to see the possibilities. Often people on the DPB are clustered in similar socio-economic communities. They get to know each other through their children. What I am suggesting is one retains a non-work-tested DPB payment as a condition of child minding while the other works. Or they could job share a full-time job while minding each others children. All I am saying Dave is that the government doesn't need to come up with more money for child-minding when there is existing capacity. How do you think many partnered mums go to work part-time? Families and friends get involved, especially grandparents. Why does the government have to solve every problem?

August 14, 2010 at 12:48 PM  
Blogger Swimming said...

In that case, from a policy perspective, you'll agree that the "existing capacity" can extend to mothers of partnered couples who also want to go to work, or study full time. In that case why then, can't a spouse on the dole - or a single childless person for that matter - look after a group of kids whose sole parent is in work etc etc?

August 14, 2010 at 7:35 PM  
Blogger Lindsay Mitchell said...

Are you suggesting that anyone who is the primary recipient of a benefit should be able to provide childcare as a condition of continuing to receive state support?

August 16, 2010 at 9:32 PM  
Blogger Swimming said...

No. I thought you were, provided that benefit is the dpb. I was just extending your suggestion to other benefits. I dont agree with it, of course.

August 16, 2010 at 9:40 PM  

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