RNZ’s headline reads:
Jobseeker: Parents earning more than $65k must support 18-19yo children
Intergenerational welfare dependence is a thing. A big thing.
The 2014 actuarial findings revealed:
For Youth benefit clients as at 30 June 2014:
§ 88 per cent (nine in 10) were from beneficiary families, the majority of whom received a main benefit for most of their teen years.
§ 51 per cent were in beneficiary families for 80 per cent or more of their teen years.
The correlation is striking enough to believe that early entry may be a proxy for intergenerational benefit receipt (with the notable exception of teen-aged SLP [Supported Living Payment/Invalid] entrants).
A more recent Taylor Fry report for MSD found that in 2022, 69.5 per cent of those aged under 20 on a Youth Payment or Jobseeker/Work Ready benefit had an intergenerational benefit history.
The government wants to stop this.
Kids raised on welfare, go onto welfare – often egged on by their parents wanting to grow household income.
So the government is saying, parents should continue to support 18- and 19-year-olds rather than they go on a benefit.
But the test threshold for parents deemed able to continue to maintain their young person is $65,529. It’s set at the income of parents receiving the Supported Living Payment (previously Invalid Benefit) – the highest benefit income. The average benefit income for a couple or single parent with two or more children falls below that.
So what is this policy? Another go at saving a bit of money by chasing after low-hanging fruit? A pragmatic response to their middle-class voters struggling to get unmotivated kids off the couch?
As policies go, it’s a plus, but barely positive and would rate a one out of 10 in the overall need for real welfare reform. An eight out of 10 would be removing Ardern’s Best Start cash for babies payment, which has only resulted in more children being born onto a benefit, where many will remain until they are young adults.
Chris Luxon says:
“Look, we are saying we care about you, we love you, but we really want you to realise all that potential that you’ve got,” he said. “We’re here to help and support as much as we can, but you also have to take responsibility for that and actually just consigning you to a life of welfare for 18 years is unacceptable.
“We’re not doing our job, if we’re letting that happen.”
By setting the threshold too high he is doing exactly that. Giving high risk 18- to 19-year-olds the green light to go on a benefit.
This article was originally published on the author’s blog.
