Social Welfare benefit amounts ‘too little’

Press, 7 October 1987, Page 25

Social Welfare benefit amounts ‘too little’

PA Social Welfare benefit amounts are too little to provide many beneficiaries with acceptable housing, health care, power, transport, clothing and food, says the Hutt Valley Family Centre’s director, Mr Charles Waldegrave. Mr Waldegrave, the coauthor of a book about poverty in New Zealand, was commenting on a Treasury discussion paper written for a Royal Commission on Social Policy seminar held in August The paper says welfare benefits are too high compared with wages and suggests changes to national superannuation and youth benefits. It also suggests abolishing the family benefit as a universal payment to parents. Mr Waldegrave said the Treasury was completely out of touch with the poor and was wielding power over the most vulnerable citizens. It argued that benefits were too high because they were tied to increases in prices and

therefore had risen faster than wages. What it did not realise was that benefits had never been enough to provide for beneficiaries* basic living needs, he said. “If Treasury officials took the time to meet many of New Zealand’s beneficiaries and applied their financial acumen to their budgets I am sure they would be appalled at the problems people on benefits confront In trying to make ends meet,’’ Mr Waldegrave said. “They are saying that protection from inflation should be denied to the lowest-paid people in our society.

“The fact that wages have increased at a substantially lower rate then benefits only shows how low-income people have been crushed further below the poverty line. Treasury would like to crush them lower still.”

The Treasury said national superannuation was too costly but that view ignored the fact that most old people were

poor, almost half relying entirely on their weekly payments of $l2O to $l4O, he said. The latest available figures on superannuitants’ incomes were from a Social Welfare Department study based on Inland Revenue Department figures. In 1982, 42 per cent of superannuitants — about 185,000 — had no income apart from their superannuation payment of less than $lOO a week. Recent Statistics Department figures showed fewer than half the superannuitant population had mortgage-free properties. He said the Treasury assumed the provision of superannuation took away people’s motivation to provide for themselves in their old age, but it failed to realise that people who began life on low incomes would probably stay on low incomes because it was almost impossible to break the poverty cycle. The paper said superannuation cost $3.9 billion

a year but did not include the fact that a lot of that was taken back in tax. “Each single person on superannuation pays $25 in tax each week and every other aspect of income is also taxed,” he said. New Zealand treated old people with gross disrespect and indignity, and most of them lived in a deprived state, he said. The Treasury paper says Mr Waldegrave’s book on poverty, grossly over-estimates the number of poor people. It estimates one million New Zealanders are living in poverty. Mr Waldegrave said the paper made its attack using one set of statistics the book had used, but the book used an enormous amount of ’Statistical sources that the Treasury had chosen to Ignore. He said the book tried to show a real picture of New Zealand’s standard of living based on community experience and the widest statistical base possible.