Bryce Edwards: What’s changed for welfare beneficiaries?

Bryce Edwards: What’s changed for welfare beneficiaries?

The plight of welfare beneficiaries came into focus last week with a photo taken outside an Auckland Work and Income office, of clients who had been queuing from 2am in order to apply for emergency hardship payments. This has sparked a debate about whether the Labour-led Government is doing enough to provide for this group in dire need, with some arguing that things are actually getting worse for those at the bottom.

The original news story by Nita Blake-Persen was published on the RNZ website, and relayed how “Parents lined up in the torrential rain for hours this morning outside Manurewa’s Work and Income office to meet with advocates who help them with their claims. Without them, they say their desperate pleas for cash are almost always denied” – see: People queue from 2am outside Work and Income for help.

The first person in the queue, who arrived at 2am, told the reporter he needed a grant, as he was struggling to buy basic necessities for his three children: “I need to buy long pants, jumpers, jerseys and that, and then I need to get food, because I stay in a three bedroom house – I pay $610 a week.”

Like others lined up at the Work and Income office, he had come on that particular Thursday because the advocacy group Auckland Action Against Poverty (AAAP) come along on that day every week to help beneficiaries obtain their full entitlements. Those advocates claim that beneficiaries are otherwise being turned away from proper grants.

One of the AAAP advocates appealed to the Prime Minister to sort out the situation – Kathleen Paraha challenged Jacinda Ardern, saying: “The government needs to get off their bums and come down and have a look for themselves.”

The story has provoked some strong reaction on Twitter, with many saying it epitomises this Government’s failure to deliver the transformation it has promised. For example, Newsroom editor, Tim Murphy, stated “This is one of those stories that will be remembered about a government’s time in charge”, and “The more that this Governments term progresses, the more clear it is that that they are at their core no better than the last guys, or the ones before that. Virtuous media soundbites & photo ops aren’t making a difference”.

And his business journalist colleague Bernard Hickey pinpointed the conservative fiscal approach of Ardern and her Government as being responsible, saying the 2am welfare scenes occurred “At the same time as a ‘progressive left’ Government has a $7b budget surplus and has net debt so low that even Moody’s says we could almost double it and keep our AAA rating. Yet…budget Rules…”

Political activist and former MP Sue Bradford suggested that the Government was not following through on its promises: “Minister Sepuloni used to talk about the culture change she wanted at Work & Income, but the ongoing desperation of people who need help to get the most basic of needs from W & I flies in the face of Labour’s supposedly ‘kinder’ approach to welfare.”

In the blogosphere, some on the political left expressed their frustration. Steven Cowan blogged to say the continued plight of beneficiaries was a case of Paying the price of Jacinda Ardern’s austerity policies. He argued “these Auckland beneficiaries provide more stark evidence of a society where the depth of poverty continues to deepen and the chasm of inequality continues to widen”.

And he pointed out that “It was only two months ago that the Labour-led government declined most of the recommendations of its own welfare working group”. Similarly, Martyn Bradbury argued the incident was an example of The Toxic culture of WINZ & MSD laid bare,

But is it really fair to see the 2am Manurewa event as representative of the Government’s failed welfare reform agenda? The Minister of Social Development, Carmel Sepuloni, went on RNZ’s Checkpoint programme to dispute this version of the story – see: Long queues outside MSD ‘shocking’ but not the norm – minister. Sepuloni’s reaction to the story was: “I saw the image and I saw the story and no one would pretend that it’s not shocking to see that… that is not a normal occurrence at MSD (Ministry of Social Development) offices around the country.”

The Minister’s main point was that the queues from 2am in this instance were not directly due to Work and Income decisions, but because the advocacy group AAAC had arranged for beneficiaries to gather in a way that they needed to arrive early to get the chance of advocate help.

She said: “They’re not meeting with MSD at that hour, they’re actually meeting with their advocates… We tell AAAP… on Thursdays they have guaranteed appointments for their clients, that we will see them on that Thursday – so there’s no reason for them to turn up at that hour of the morning.”

In another interview, Sepuloni explained “I am advised that the long queues seen at Manurewa are the result of benefit recipients being encouraged by their advocates to all congregate at the same time on Thursdays”. She has also called on AAAP to work differently to help beneficiaries: “The queues can be avoided if AAAP works with MSD to deal with these cases in an orderly way across the week, rather than creating a bottleneck that forces everyone to be there at once in the rain” – see Michael Daly’s Auckland Action Against Poverty hits back at Government over WINZ queues.

The same article reports Work and Income regional commissioner Mark Goldsmith claiming that the AAAP advocacy group had refused “numerous attempts” made to work together. And, further, that “We would be happy to pre-book appointments with clients and AAAP advocates so clients don’t have to wait, but so far AAAP haven’t agreed to this.”

The group has responded, disputing this: “It’s categorically untrue we’ve refused to engage with MSD re:Manurewa.” And in open letter to the Government, published on The Spinoff, the group say: “When you say we should go to different offices to spread out the work of Ministry Social Development staff and avoid ‘creating a bottleneck’, what you are admitting is that MSD staff all over Aotearoa New Zealand are failing the people they are meant to be assisting. You are admitting that there is something seriously wrong with our welfare system” – see: We should not have to do MSD’s job for them.

The group also challenges the Government on its welfare policies in general: “There is enough money to end poverty but you need to be bold. You need to tax wealth and redistribute it into social welfare and public housing. You need to spend that surplus you are sitting on. It is socially and fiscally irresponsible to allow people to continue to live in poverty. We would like to see this rhetoric on well-being and kindness materialise in the lives of the people we work with.”

To get a better understanding of the work that the AAAP group is doing with welfare beneficiaries at the Manurewa office, it’s worth reading Michael Daly and Joel MacManus’ Minister responds to Manurewa Work & Income queue problem. In this, it’s explained: “The arrangement with Work and Income was that AAAP advocates were allowed to help 65 people in the queue on Thursday mornings. There were usually about seven advocates at the office, and they interviewed those 65 people.”

AAAP coordinator Ricardo Menendez March is reported saying: “In reality we always see far more. People have the right to have a support person at Work and Income… Throughout the day we end up helping far more people, explaining to them the process and making sure the case managers are doing their work and following the law adequately”.

Menendez March says that this has been going on for about two years, during which time the queues have always existed but are getting worse. Why? He says: “We know beneficiaries have been the most disproportionately impacted by the rising cost of rent. More people than ever require hardship grants to get by.” And according to this article, “The Manurewa WINZ office gave out $698,000 in Special Needs Grants for food last year, the highest in the country by more than $200,000.”

This article is also useful for providing the Government’s side of the story on what it is changing at the frontline to help welfare recipients, with Sepuloni stating: “this Government has sent a clear instruction to frontline MSD staff that anyone coming in is to be provided with the full financial support they are legally entitled to…. As a result of this instruction the number of hardship grants provided by this government has increased 60% year on year. The value of hardship grants has gone from $81m to $128.5m from March 18 to March 19.”

In addition, the article points out that “The Government has also announced funding for 263 new frontline MSD staff over the next 4 years.”

Perhaps this means that Work and Income offices will also stop referring beneficiaries to loan sharks to help raise their necessary funds, as reported recently by 1News – see: ‘Fundamentally wrong’ – Ministry referring beneficiaries to loan sharks, activists claim.

What else can be done to alleviate the plight of those on benefits? University of Auckland economist Susan St John has come up with a list of possible solutions that could be implemented immediately. Her “emergency package” includes the “Payment of the full Working for Families tax credits to all low-income families”; “An increase in the allowable income before any benefit is lost to 10 hours at the minimum wage or $170 per week”, and “A suspension of all student loan repayments for families who get Working for Families” – see: Poverty: not an earthquake but still a crisis.

As to what reforms the Government has already come up with, St John is derisory: “The tiny changes made in the 2019 budget will miserably fail to make a difference to the immediate problem. Worse still they don’t come in until April 2020.”

And like other economists, she criticises the fiscally-conservative approach of the Government as being at the root of their failure to act: “It may be laudable for the Government to be fiscally responsible, but not in the very narrow ways it has chosen. The nation is facing a crisis, it’s like a slow earthquake shaking our values to the foundation. You don’t store up goodies for the future when faced with life damaging catastrophes, you invest in reversing the damage and in preventing further damage.”

Finally, is there a need for reform of how the welfare system treats people in relationships? A new report out last week challenges the “traditional” and “current rules” in which people’s eligibility for benefits is based on whether they are in “relationship in the nature of marriage” – see Sarah Robson’s Welfare system needs to change how it defines relationships – report. And for a personal version of this story, see Sarah Wilson’s The consequences of love: how finding a partner left me penniless.