Budget forecasts 23 p.c. rise in unemployment

Press, 20 July 1987, Page 5

Budget forecasts 23 p.c. rise in unemployment

PA Dunedin The Budget forecast of a 23 per cent increase in unemployment means an average of 74,850 beneficiaries in the present financial year, according to official figures. This is about 10,000 more than the latest available number of recipients, and about 4000 fewer than the number of people officially looking for work. The Social Welfare Department’s head office has provided this figure after a request by the “Otago Daily Times”

under the Official Information Act. The Budget forecast has since been used extensively by politicians as an election' plank. The department said in its response that the prediction was made by the Treasury and was an average estimate. There was no indication given by the Treasury of peaks and troughs in the forecast. The department was asked for a breakdown of the forecast by regions, but said that because of “unpredictable factors,” which could cause variations in regional distributions, no regional forecasts were made. A check with the department’s Statistics Division showed that in April, 64,087 people were receiving the unemployment benefit (including the emergency benefit); in May the number was 64,342. The June figure was not available. The cost of these benefits in the current financial year is estimated to

be $632 million, net of tax. Earlier this year the Government announced it was going to spend $325 million to try to get people off the dole and into productive employment, using, among others the new Access scheme. The number of registered unemployed in April was 78,769 and rose to 78,994 in May. The Budget estimate reflected the economic adjustment process being undertaken to create more permanent alternative jobs and reverse New Zealand’s relative economic decline, said the Minister of Finance, Mr Douglas. “The predicted increase in unemployment is predominantly because of the growth in the labour force,” Mr Douglas said. The Leader of the Opposition, Mr Bolger, announced recently that a National Government would pay nothing to unemployed people who chose to ignore a threepronged job-search and retraining programme.