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Dr Muriel Newman

The dark underbelly of welfare

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According to Saturday’s Herald, the co-leader of the Maori Party, Pita Sharples, is trying to save a Black Power gang house from being demolished by the city council because it caters for the spiritual and cultural needs of Maori. He claimed that the Mt Wellington property – which had been the Black Power headquarters and hub of a $1.5 million cannabis ring before being seized and sold under the Proceeds of Crime Act – was sometimes used as a marae.[1]

In a letter to the City Council written on Maori Party letterhead in March, Dr Sharples said, “I can confirm that the large room in the middle of the house was set up as a wharenui [meeting house] and as such provided for the hui that we were present at to be conducted in much the same way as if at a marae.

As the local member of Parliament for Tamaki Makarau I have no hesitation in supporting the application to consider a waiver to the resource consents compliance on the grounds that this house has been utilised for cultural occasions and events.

The property was owned by Dr Sharples’ electorate manager, a former Black Power gang member, before being sold to the gang. Black Power has already moved back into the house, in spite of the property now having a new owner.

Meanwhile, the Council, which conveniently turned a blind eye to major building consent breaches while owned by Black Power, has come down hard on the new owner with enforcement orders and council fines. This approach is typical of various arms of government when faced with the truly menacing – instead of forcing compliance they ignore them and instead focus on pushing around basically law abiding citizens.

What this case highlights, besides the self-serving views of Maori fundamentalists like Pita Sharples, is the existence of the welfare society in New Zealand . The welfare “underclass” is not only alive and kicking, but now has its own cheerleaders in our House of Representatives.

The underclass is the dark underbelly of New Zealand ’s welfare system: unskilled, uneducated, teenage girls getting pregnant and going on welfare to raise children fathered by transient partners who have no intention of ever taking any responsibility for the mother or the child. Tragically, all too many of these children end up being shaken or molested, bashed or neglected, often ending up in state care. Denied proper love, care, and protection, as well as adequate healthcare and a decent education, a large proportion of these children gravitate to gangs and onto welfare, unable to escape from the deadly grip of the dependency cycle they were born into.

Entrenched long term welfare dependency is the scourge of our society. Permitted to destroy the life opportunities of generations of children, it is a real blight on New Zealand ’s social policy record. And while successive governments must share culpability for the magnitude of this problem, at last there is a faint glimmer of hope that something might be done to address this scandal.

The Welfare Working Group, established by the government in April to conduct a wide ranging review of New Zealand ’s welfare system has been looking at the problem of long-term welfare benefit dependency. Asked to come up with some recommendations (by the end of the year) on ways to turn around the growing benefit numbers and poor social and economic outcomes, the Working Group was asked to consider a wide range of issues: how long-term benefit dependency can be reduced and work outcomes improved; how to promote opportunities and independence from benefits for disabled people and people with ill health; how welfare should be funded; and whether the structure of the benefit system and hardship assistance in particular, is contributing to long-term benefit dependency.[2]

Last week, the Working Group released an Issues Paper outlining the results of their initial investigations. It does not paint an optimistic picture of the state of New Zealand ’s welfare system.

As at the end of April, over 365,000 working aged people were receiving welfare benefits – one in eight of the working age population. Of those, around 75,000 were on the dole, 66,000 were receiving a sickness benefit, 96,000 an invalid’s benefit, 108,000 the domestic purposes benefit, 6,000 a widow’s benefit, 3,000 an emergency benefit, and over 2,000 teenage mothers were receiving an emergency maintenance allowance (the sole parent benefit available for those who do not qualify for the DPB – girls who are too young, new immigrants and so on). While these figures included the 13,800 partners of people receiving one of the main benefits, there were an additional 14,000 people under the age of 18 and over 65 who were also receiving full benefits, bringing the total number of welfare recipients to 370,000.

The Welfare Working Group wanted to know how many of those on benefits had been there in the long-term. They found 171,000 had spent more than five of the past ten years on a benefit: 12,000 on the unemployment benefit, 24,000 on the sickness benefit, 65,000 on the invalid benefit, 53,000 on the domestic purposes benefit, 1,000 on the widow’s benefit, 3,000 on an emergency benefit, and 13,000 partners. Almost 60 percent – 100,000 – had spent nine or more years of the last ten years on a benefit.

When they investigated the prime factors leading to long term dependency, they found what we could have all guessed, that people who receive welfare as teenagers are the most vulnerable to becoming trapped in the system. What is particularly disturbing is that with over 10,000 young people aged from 16 to 18 years old entering the welfare system every year, there is a strong likelihood that many will remain dependent on benefits in the long term. With a high proportion coming from dysfunctional families, unless something changes, the cycle of benefit dependency and severe disadvantage will continue unabated.

The great Maori leader Sir Apirana Ngata warned of the dangers that social welfare would bring to Maori, and it is a sad indictment of the welfare system that this situation has been allowed to come to pass. Figures produced by the Working Group show benefit dependence amongst Maori is more than double the rate for the population as a whole, with census figures from 2006 showing that 27 percent of Maori between the ages of 18 and 64 years are receiving a benefit compared to 12 percent in the total population. One in three Maori women are on welfare, compared to one in five Maori men. If age is factored in, the highest welfare dependency rate is for Maori women in their twenties, with 40 percent on welfare (largely the DPB), while for men the peak is in their thirties with 20 percent on welfare (largely the unemployment, invalid or sickness benefits).

In general terms, the Welfare Working Group has pointed out the glaring reality that New Zealand ’s welfare system has a very weak employment focus. Apart from the Unemployment Benefit, there are virtually no requirements for beneficiaries to get a job. That’s also why New Zealand does so poorly on international child poverty comparisons – with one in five children (220,000 in total) being raised in families dependent on welfare benefits that have few work incentives, the mechanisms to pro-actively help such families to get employment and leave poverty behind are lacking.

What the Working Group’s report also shows, which is what we have been arguing for years, is that it is systemic failure within the welfare system itself that is nurturing the underclass, entrenching disadvantage, and costing the country its economic progress. If welfare went back to providing support for those who genuinely cannot look after themselves, giving everyone else a hand up in times of need, the whole country would be far better off.

This week’s NZCPR Guest Commentator, welfare analyst Lindsay Mitchell, has been closely following the progress of the Welfare Working Group and also makes the point that its work offers the best opportunity in years for a sensible debate about welfare reform options. But she makes the point that this will only happen if there is sufficient supportive feedback. In her article Welfare reform becomes a political football – again Lindsay explains that the objective of the ‘welfare industry’ is to turn public opinion against reform. She asks:

“And what of the views of those who want to see more New Zealand children realise their potential in life rather than grow up with the same low expectations and sense of entitlement as their parents? Who are alarmed at the economic implications of allowing long-term dependence to continue growing? Who are convinced that welfare has had a hugely detrimental impact on the family? Don’t wait for the media to come looking for them. Sensible is not sexy.

“Which is why the Issues Paper provides an opportunity for every interested party to make their view known. Make the effort because this government is as poll-driven as any other. They need to know they have support for change. They need a mandate to accept at least some of the recommendations that the group will make in December this year. Don’t let the naysayers carry the day again. If this opportunity is lost we may wait years for another.”

Public submissions are due by September 17 – details can be found on the Welfare Working Group’s website at: http://ips.ac.nz/WelfareWorkingGroup/Index.html  

1.Herald, Minister weighs in to save gang pad
2.Welfare Working Group, Long-Term Benefit Dependency: The Issues