MEDIA RELEASE
Welfare Working Group Ignores Evidence
“The issue is not the supply of workers. The issue has been a lack of jobs.”
9 August 2010
The Government’s Welfare Working Group today published its paper on “Long-Term Benefit Dependency”, claiming that “the benefit system has locked in many people since the late 1970s” and that significant numbers of people have become “permanently discouraged from trying to re-enter the labour market.”
Methodist Mission Chief Executive Laura Black says this is nonsense.
“The issue is not the supply of workers. If there had been a shortage of people available for work over the last 28 years, employers would have raised wages; that’s basic economics. But workers in New Zealand are paid 30% less than their Australian counterparts. The Welfare Working Group has forgotten the damage the oil shocks of the 1970s, the near bankruptcy of the country and radical deregulation of the 1980s, and Ruth Richardson’s 'Mother of All Budgets' caused to the business, to consumers, and to the labour market. The issue has been a lack of jobs.”
She also points to recent research in the New Scientist [1] that says the high rate of teenage pregnancies and solo parenting in tough economic times is “simply biology at work. The research shows that any mammal growing up in a harsh, unpredictable environment, where they are susceptible to disadvantage, will follow a “fast” reproductive strategy. For out of work young people raised in depressed areas, and brought up in families living with intergenerational disadvantage that means that they will get pregnant early and often.”
Ms Black also points the report’s suggestion that the increase in uptake of sickness and invalids benefit over the last 30 years may be due to mental health conditions, and notes that anyone living for a prolonged period on a very low income “Like a benefit, in poor housing which is all that a low income family can afford, eating food with low nutritional values, is likely to be at risk of situational depression”.
“Internationally validated meta-research [2] shows that the size of the gap between the wealthy and the poor in any country can explain the levels of crime, mental illness, obesity, imprisonment, teenage pregnancies and general trust. In the last 40 years New Zealand has gone from being one of the most egalitarian societies to be the sixth most unequal country in the world.” says Ms Black.
“So, the scientific evidence actually says it’s a very human, biological response to living in an unfair economy. Not, as the report seems to suggest, a lack of work testing for those on benefits”.
The Mission is concerned that the framework the Welfare Working
Group is using to analyse benefit uptake, is likely to promote
policy changes that, says Ms Black “Will only make it worse. If the
Government is serious about reducing the numbers of people living in
poverty on benefits, they should be looking to open the doors to
tertiary education, provide incentives and advantages to new types
of business, reduce New Zealand’s vulnerability to overseas
financial meltdowns, and provide encouragement, hope and
opportunity to those having to live on just $160 a week.”
2 http://www.equalitytrust.org.uk
