Joe Hendren

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Wednesday, February 18, 2009

Beneficiaries need cellphones. Nat + Lab rght wng pollys sux

Letters from Work and Income telling debt ridden families to take out more loans and pawn off cellphones is more evidence of a mean and punitive culture within the organisation that neither major political party has done anything significant to change.

Its a little hard for a prospective employer to ring you if your cellphone is at the pawn shop.

While the letter approved an application for a Temporary Additional Benefit it also suggested some rather obnoxious additional steps to be taken.
  • Taking out loans to cover arrears (in other words talk to a loan shark)
  • Pawning cellphone and children's playstation
  • Ringing debtors to reduce payments or refinance debt (in other words talk to a loan shark)
  • Seeking budgetary advice
It was good to see Social Development Minister Paula Bennett quickly dismiss the practice when she was questioned about it in Parliament yesterday. One wonders if some of her National party colleagues may have been less quick to do so.

The issue was raised by former Labour party minister Annette King, yet it was the decision of the former Labour government to abolish the special benefit that largely created this situation. The 'replacement' Temporary Additional Support (TAS), placed more restrictions on emergency support - removing a degree of discretion the special benefit made available to WINZ staff. In essence Labour were telling WINZ staff they had to be tougher on beneficiaries.

In March 2008 Green MP Sue Bradford explained how Labour's April 2006 changes led to more beneficiaries being forced to susist within "an endless cycle of debt".
"Up until that point the special benefit had provided a third-tier level of last ditch discretionary assistance for people in the situation where the gap between their actual income and the necessities of life was too high to bridge by any other means. With benefits remaining low and even some low-wage workers requiring assistance from Work and Income, the special benefit played a key role in allowing case managers a way of topping up people’s benefits to liveable levels."

One will certainly end up in even more of an endless cycle of debt if your case manager is telling you to take on more.

In order to be eligible for TAS "cash assets" held by a person can not exceed a prescribed amount. Cash assets as defined in the 2005 Social Security Regulations includes cash and "other assets of the person that can be converted readily into cash". Motor vehicles, caravans and boats worth less than $2000 are excluded from the calculation, as are 'personal effects', however cellphones are not specifically excluded. Nor are student loans, even thought WINZ have attempted to claim this as "cash" in the past.

Later Social Security Regulations added further exclusions, suggesting the TAS is simply poor policy. Its worth noting that following the election National passed another such regulation to exclude ReStart payments.

A history of the special benefit by Advkit Para Legal Services reveals that in 1994 Labour (including Clark, Cullen and Maharey) strongly criticised the decision of the then National Government to restrict the discretionary nature of the special benefit, yet in Government Labour abolished it completely.

While Labour may have raised the issue in the house, in fact it was nothing more than their own right wing Blairite welfare policies coming back to haunt them. Policies that National also supports I might add.

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