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Letter No.57

27 March, 1997

    Beyond Poverty and Dependency
    Edited highlights from several papers to the Beyond poverty conference and the Beyond Dependence conference.

    The Beyond Dependency and Beyond Poverty conferences will both prove to be a landmark in the NZ debate on welfare initiatives. The Beyond Dependency was successful in generating a widespread public debate and media spotlight on these issues as well as bringing to NZ many controversial case studies on how to deal with beneficiary issues. The Beyond Poverty proved to be a well organised focus for an 'alternative voice' on the welfare debate. It was a networking of activists and community leaders the likes of which have not been seen for some years.

    Our Media Watch reports that while there was extensive coverage of the welfare debate in all media, it was only radio that covered the content of the Beyond Poverty conference ... while the print and television media focussed on the 'opposing nature' of the two gatherings (which actually had many common participants) and the protest actions outside of the Sheraton Hotel, the venue for Beyond Dependence.

    In this issue, the Jobs Letter features edited highlights of several papers at these conferences, focussing in on the theme of "dependence".

    The government's strategy on 'beyond dependence' starts to hit the ground next week when new welfare rules come into effect on April 1st. These changes were first announced in last year's budget. The domestic purposes benefit (DPB) will become work-tested -- applying once the beneficiary's youngest child reaches the age of 14 years. After that, any failure to take up a job or training opportunity without "good and sufficient reason" will be penalised. The new work-tests will also apply to the spouses of unemployed people. If their youngest child is aged over 14, they will also be required to seek full-time work and must register with the NZ Employment Service.

    Both the DPB beneficiaries and spouses of unemployed with children aged 7-13 years must attend a yearly planning meeting with Income Support Service to consider their development towards becoming "work-ready".

    The penalties for failing the work test work on a sliding scale based on a three-strikes-and-you-are-out formula wherein the "fines" get more severe with each of transgression of the work test. Failing a work test includes not going to an interview, not taking up an offer of suitable employment, not complying with an action plan agreed with the Employment Service, or not attending the yearly planning meeting. In the first failure, a person's benefit is to be reduced by 20%, and a further 20% for each 28 days for which the failure continues. On the second failure, the reduction is 40%, and 100% if the failure continues for more than 28 days. On the third failure, the benefit is cancelled, and the person is stood down for three months.

    Source -- New Zealand Herald 19 March 1997 "Work test for sole parents in weeks" by Patricia Herbert, and The Jobs Letter Special issue No.38 (8 May 1996).

  • A spokeswoman for Employment Minister Peter McCardle says that the new work tests have been introduced "because of concerns that long-term benefit dependency was increasing, despite improvements in labour market conditions". The un-named spokeswoman told Anamika Vasil of The Dominion that beneficiaries might be referred to jobs -- for example fruit-picking -- that required different skills from the jobs they sought if they were deemed to have suitable skills for the alternative jobs.

    The spokeswoman said that it was important for beneficiaries to look at jobs in a flexible way so that even though they might not get their ideal job they would take another job in the meantime.

    Source -- The Dominion 20 March 1997 "Jobless work test measures outlined" by Anamika Vasil.

    While NZ begins to extend the work test to single parents after their children reach the age of 14 years ... this is much more generous than the rule for one of the schemes featured at the Beyond Dependency conference at the Auckland Sheraton. The 'Wisconsin Works' programme (known locally as 'W-2'), headed by Jean Rogers, requires that single parents of children over 12 weeks old must participate in work programmes. Jean Rogers describes her approach as "... more real world".

    Other points in the W-2 welfare model include: welfare recipients being required to work for welfare payments, and benefits being paid in accordance with the number of hours worked; people not allowed to receive benefits for more than 5 years (throughout their lives); families will not receive automatic increases in the family grant when additional children are born, except in cases of rape or incest; under-age parents to live at home or in a supervised living situation.

    Source -- New Zealand Herald 18 March 1997 "Furore over 'foreign' welfare policies " by Catherine Masters and Lisa Turner, and Mean Times Vol 8 Issue 5 "Wisconsin Works, or does it ?" by AUWRC.

    The Wisconsin welfare model is not without its critics both here in NZ and in the United States. Scott Barkan, of Washington's Centre for Law and Social Policy says that while the W-2 reflects a serious attempt to restructure the welfare system ... it is important to be clear about what the programme does and does not do. Barkan: "It would be a significant step forward for a state to assume a commitment to provide jobs to parents who are able to work but unable to find employment. However, W-2 does not do this. W-2 makes no commitment to provide a job, child care, or health care to families in need. Most families unable to attain unsubsidised employment will not be placed in a job paying wages; rather, they will be placed in work slots, paid an assistance grant, and remain deep in poverty ..."

    Scott Barkan says that in many cases, the W-2 families working every available hour under programme rules will be poorer than they were under the previous laws. Moreover, the child care spending on the W-2 scheme is funded, in part, by policies that reduce assistance to families who are working or otherwise complying with program rules.

    Internet bookmark : Scott Barkan's paper "Wisconsin Works: Significant experiment, troubling features" is available from Welfare Reform Watch on the internet at The Welfare Reform Watch group also produces a weekly email digest of relevant news and case studies on welfare issues.

    Source -- Scott Barkan's paper "Wisconsin Works: Significant experiment, troubling features" 20 June 1996.

    The Beyond Dependency conference now has an ongoing website dedicated to continuing the discussion surrounding issues raised at the Sheraton conference, and elsewhere. The web site has been established by the Social Policy Agency of the Department of Social Welfare, and will give them a continuing international presence in the welfare debate. The site contains a database (with search functions) of 'positive' welfare initiatives from around the world and the agency is also running an ongoing email mailing-list conference which will share information on "policies, programmes and initiatives that work ... the focus on helping working-age people make successful transitions out of long-term welfare dependency into paid work and self-reliance."

    The website can be found at

    Tasman MP Nick Smith is describing last month's job advertisements for thousands of crew members for deep-sea fishing vessels as a farce. More than 7000 job vacancies were advertised by the Fishing Industry Board, which is bound by the Immigration Service to ensure that NZ'ers get first preference for jobs on charter vessels.

    Dr Smith says that NZ'ers are likely to fill only a small percentage of the jobs. The ads try to disguise the sham that foreign crews will be employed because they are prepared to accept lower wages and conditions than NZ'ers. Smith: "This is a shallow attempt by the companies to bypass NZ's immigration laws ..."

    Source -- New Zealand Herald 5 march 1997 "Fishing jobs netting few NZers says MP" by NZPA

    An increasing number of nurses are being employed as casual workers, and the Nurses Organisation says this is leading to wards being staffed with employees unfamiliar with the patients and their surroundings. Nurses Organisation adviser Diana Gunn says that since the health reforms began, there has been no work-force planning, and there was no overview of just how much casualisation was going on, nor the implications for patient care. Gunn: " One of the major concerns with casuals is unqualified staff who have no accountability or responsibility to a regulatory body..."

    Source -- The Christchurch Press 19 February 1997 "Casual jobs concern nurses" by NZPA

    Economist and social commentator Brian Easton has produced a new book The Commercialisation of New Zealand, published by the Auckland University Press. It "describes the origins, theory, history and politics of the dramatic changes in economic policy in New Zealand from Robert Muldoon's interventionism to Roger Douglas's commercialisation and beyond". It also contains case studies of how the "more market" policies have swept through health, education, broadcasting, the environment, the labour market, cultural policy and science.

    Source -- email from Brian Easton to the Jobs Letter March 1997

    Situations Vacant: thousands of COBOL computer programmers will be needed to solve the programming 'glitch' that effects the date on the world's computers once we reach the year 2000. Esquire magazine reports that there are only 90,000 COBOL programmers worldwide, and the estimated number of programmers needed to defuse the 'Millennium Bomb' on the world's computers is three million!

    The computer glitch will effect everything from automated missile defence systems, the world stock exchanges, flight control software to hole-in-the-wall ATMs. The US government estimates the cost of software upgrades to be from $13-43 billion.

    Source -- New Zealand Herald 22 February 1997 "The day the computers crash" by Gilbert Wong

    In Brussels, tens of thousands of European trade unionists and politicians turned central Brussels into a sea of colour and noise last week as they vented their anger at rising job losses and what they described as "inhumane companies and uncaring governments."

    French automaker Renault and chairman Louis Schweitzer came in for particularly harsh treatment -- he was hung in effigy --after the company's decision two weeks ago to close its profitable plant at Vilvoorde near Brussels with the loss of 3,100 jobs. As one banner read: "Renault is developing turbo-charged unemployment." There were delegations to the Brussels protest from France, Spain, Portugal, Germany, Luxembourg, the Netherlands, Italy, Greece, Austria, Hungary, Slovenia and the Czech Republic.

  • Union leaders at the protest rally say they want consultations with employers on working hours and are calling on governments to cut the tax costs of employment and introduce tax policies that encourage jobs, a coherent social policy and moves to encourage economic growth.

    French Socialist opposition leader Lionel Jospin says: "We need a better balance in the European economic and social model. It has gone too far in liberalisation."

    EU social affairs ministers who met in Rotterdam over the following weekend say there should be a clear code of conduct for multinationals both opening and closing factories.

    Source -- "Europeans rally against layoffs" by Reuters, web-posted Monday, March 17, 1997; 6:01 a.m. CST


    "Groups like ours have been denied a voice at the conference, even though for many years we have done our best to publicly represent the views of those most affected by welfare and unemployment policies ..." "The continuing promotion of 'benefit dependence' as the major problem facing beneficiaries flies in the face of all the evidence and is an insult to the poor. The real causes of benefit dependency are poverty -- low wages and low benefits -- and the lack of jobs. Anything else is both a lie and a red herring ..."
    -- Protest leader Sue Bradford of the Auckland Unemployed Workers Rights Centre.

    "I have a major difference with advocacy groups for beneficiaries, because I believe they want to support people to stay on benefits while we believe most people on benefits do want to work. Groups that support people to stay on benefits are misguided ... My assessment is that most taxpaying New Zealanders would not be supporting the advocacy groups."
    -- Margaret Bazley, chief executive of Social Welfare, interviewed by David McLoughlin in North and South, April 1997.

    "Margaret Bazley made a worrying freudian slip when asked the intelligent question: Why didn't they allow Sue Bradford platform time at the Social Welfare conference to make her case, rather than have her protesting outside? "Bazley's answer was that other conferences of practitioners did not have their customers along. The police, for example, did not invite their "customers" when they held conferences. That was the only example she gave. Was this a glimpse into her mental picture of her role and that of beneficiaries?"
    -- columnist Gordon McLaughlin, writing in "The Way We Are" New Zealand Herald 22 March 1997.

    "To see Sue Bradford, a woman who has devoted the best part of her adult life to defending the rights of the unemployed and beneficiaries, dragged away from the conference venue in handcuffs was as outrageous as it was shameful ..."
    -- Christ Trotter, editor of the NZ Political Review

    "My criticism is not towards welfarism per se, but rather to see the emergence of a perpetual cycle of poverty where we are in danger of robbing children of ambition and dreams, destroying their self-esteem, denying them the prospects and dignity of earning a living and social mobility ..."
    --Mick Brown, retired principal youth court judge.

    "The old system looked at the client as the victim. Wisconsin Works looks at our clients as job-seekers who come with the same hopes and dreams and potentials for success as you or I ."
    -- Jean Rogers, leader of the Wisconsin Works programme and international advocate for welfare reform

    "What would participants in this Beyond Dependency conference know of having to choose between taking a kid to the doctor and having enough money for petrol to get to work? or about keeping a kid home from school to mind the younger kids because you'll get sacked if you do not turn up to your grotty, minimally paid, part-time job? "Or about losing your accommodation supplement if you get a month of casual labour, and ending up with less money than if you were not working? and having to wait a fortnight (or considerably longer) to get any money at all when your three-month job finishes? "
    -- Charmaine Pountney, principal of Hillary College, Otara

    " I have great concern that these people have been brought in to provide a platform to legitimise cost-saving measures which have nothing to do with getting people out of welfare and into work ."
    -- Rev Charles Waldegrave, of the Lower Hutt Anglican Family Centre

    "Any able-bodied person ought to be out there making their own way. I see no reason for the government through taxation having to allow people to be idle at will. In fact I think that's insanity. "I think the problem is that people equate compassion with welfare and that's not the same thing at all. Compassion is being with, being among; welfare is giving with no reason, no accountability, and no responsibility ..."
    -- Sister Connie Driscoll, catholic nun from Chicago's St Martin de Porres House of Hope, brought to NZ by the Business Roundtable and ACT to speak at conferences.

    "I am not sure whether those who talk of welfare reform are really talking about reform or getting out of welfare and abandoning people. No policy that increases the poverty of children could be called successful ... "
    -- Ruth Smithies, director of the Catholic Office for Justice, Peace and Development.

    "I think the reason that beneficiaries are not in jobs is not because the jobs aren't there. It's because other people are more attractive to employers ..."
    -- Margaret Bazley, chief executive of Social Welfare, interviewed by Catherine Masters in the New Zealand Herald 20 March 1997

    "When Sister Connie Driscoll spoke with even more passion about the harm done by government welfare, it almost seemed she might have been Martin Luther nailing up his famous theses on the church at Wittenburg, so powerful was the moral force of her words ..."
    -- Martin Hames, Free Thinking columnist for New Zealand Herald, reviewing Sister Connie's Wellington after-dinner speech.

    "The best lack all conviction, while the worst are full of passionate intensity ..."
    -- Susan St John, Auckland University economics lecturer (after W.B.Yeats).

    "Concern over the growing welfare lists is not because the community is losing its compassion for people who truly need help, but because of the realisation that for many, welfare is feeding a problem it ought to solve.
    That problem is the withering of individuals' responsibility to do as much as they can for themselves before holding out their hand for their entitlement.
    They become dependent on other people's willingness to work and support them; and the more easily other people's taxes fall into their laps, the less inclined they become to help themselves ..."
    -- editorial in The Dominion, 24 March 1997

    "Roger Sowry's little feints this week -- watching wide-eyed the Beyond Dependency conference in Auckland and reconfirming changes enacted last year to the work test for beneficiaries -- underline that the direction is towards tighter, more targeted social policy. "You can understand from this why Act sees itself as the party of the future. Everything seems to be going its way [...] And when National itself gets 'beyond dependency', Act is waiting ..."
    -- Colin James, columnist in National Business Review 21 March 1997

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