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The smoke and mirrors of benefit figures

The latest figures released by the Ministry of Social Development (MSD) show numbers of Sole Parent Support recipients are dropping. But a lack of information about what's happened to those families, or why they're off the benefit is cause for concern. As evidenced by researcher Alicia Sudden, people may end up suffering the ill-effects of precarious, underpaid employment that negatively impacts upon the lives of their families. 

I had a maths teacher who used to say “There are lies, big lies, really big lies, and then there are statistics.”

Nowhere is this more evident than in the packaging of the quarterly benefit figures released last week by the Government. Four times a year the Ministry of Social Development publicises figures that show the number of people on a benefit, the number of people who have gone off the benefit, demographic characteristics, geographic patterns, etcetera. When the total number of people receiving a main benefit drops, this is applauded.  To the Government, this is apparently a successful achievement.

The figures released last week are no exception to this narrative. Anne Tolley, Minister of Social Development, praised the drop in benefit numbers, particularly around the Sole Parent Support benefit. However these figures don’t present the myriad factors that contribute to them. For example, 2,484 people on the Sole Parent Support benefit left a benefit to go into work. But another 1,514 left that benefit to go onto another benefit. 566 lost this benefit due to the 52 week reapplication process. This raises significant concerns about how these families are surviving if they have no benefit and have not gone into work. The number of people coming off the Sole Parent Support benefit is not inherently positive.

Yet the Government continues to give themselves a pat on the back because there are fewer people on the benefit now. Off-the-benefit figures are solely used as a measure of a successful system. This single narrative obscures the experiences and wellbeing of people behind these figures, which is particularly problematic given the increased employment instability and financial insecurity fostered by the current labour market. For many individuals coming off the benefit can be a positive step, but there is no guarantee of an improvement in livelihood. The instability and insecurity of jobs is not taken into consideration in these quarterly benefit figures, and the number of former beneficiaries that remain in study or employment is not measured.

During my own research, I surveyed 234 individuals who had come off the benefit either temporarily or permanently. Of them 37.2% were in full-time employment and 16.7% were in study or training. However, 20.9% of respondents had gone back on the benefit since coming off, and on top of that seven respondents were not receiving any income from the benefit or employment. This aligns with similar studies including Rosenberg (2015) who found that 52.8% of those who came off the benefit in 2013 were still in work one month later, and Dixon and Crichton (2006) concluded that only 29% of all those who transitioned from the benefit into work in 2001/2 remained employed and off the benefit for a full two years.

The problem with the push towards dropping benefit figures lies in the goal itself. In order to achieve a reduction in fiscal costs, the primary objective of the welfare system has become to decrease the number of benefit recipients. The Government has set itself a target of reducing benefit figures. Furthering this rhetoric, factors such as lower NCEA achievement for children has been associated with having a parent on the benefit. There is no further analysis given as to why being in a household that is benefit dependent may affect a child’s education. The poverty and stress linked with being on the benefit is overlooked, because the goal that has been set by the Government is not to reduce hardship, but to cut benefit numbers.

Given that the primary objective is to cut benefit numbers, actively preventing people obtaining a benefit through obligations and administrative hurdles is just as beneficial as if a welfare recipient finds work. Obligations and conditions are anecdotally described by those who have been on a benefit as preventing or hindering assistance being provided to those in need. This works against the very purpose of welfare, and highlights the failure of our Government to support its people. One of the research participants I interviewed described what they saw happening while on the benefit:  

“It seemed by the end of it they were bringing in all these measures to try and make things harder so people just give up on it, trying to fill out these forms. I think they are just trying to create barriers to people applying for it. I’m sure there are lots of people that have done that, have given up trying to fill out all the paperwork. I don’t know what they are doing now. Must be on the streets, or maybe they have jobs.”

Pushing people off benefits faster is not going to have positive long-term outcomes for our country. Too often these policies result in people being pressured into incompatible or insecure employment, or into further poverty, creating a highly cyclical benefit system. The wider societal costs of this are hidden through the narrow focus on benefit figures, and instead the short-term financial gains are prioritised. It is vital that we look beyond these figures so we can work toward a welfare system that plays a positive role in the social and economic development in New Zealand.

About the author: Alicia Sudden has recently completed a Masters in Development Studies which included a thesis that explored the current welfare system in New Zealand and the outcomes of beneficiaries in New Zealand. Her research was strongly focused on ground-up data gathering, drawing on experiences, outcomes and insights from former and current beneficiaries. She is currently working in the political sphere, and is keen to be a part of working towards better social security and reducing poverty in New Zealand.