Frequently Asked Questions
Q.1. Why reform the welfare system, isn’t encouraging people into work a more logical step to eliminating poverty?
A. CPAG believes that sufficient paid work of good quality can eliminate poverty for those lucky enough to both be able to work and to have such work. Currently the transition from welfare to work is not working well for families. Nor does welfare support and protect children adequately when such work is not possible. CPAG recommend solutions in our welfare fit for families campaign which include a higher minimum wage, flexible working conditions; better government support through working for families tax credits and other subsidies and an overhaul of the abatement of benefits
Q.2. But won't the Families Package mean that children will be much better off?
Some families will get relief from the families package, but families whose incomes fall in the very low income range will not be helped sufficiently to lift them out of poverty. The principal tool used in the Families Package, a modest increase in the Family Tax Credit (FTC), can be expected to lift those children whose family incomes are closest 50% and 60%. While measured poverty rates will fall, helping achieve the government’s targets, children who fall well below those lines will continue to languish. For example, a one-child family will only receive another $20 a week in additional Family Tax Credit payments, and a family with two children under 13 will get an extra $47, reduced to $38 if one is aged over 13. Furthermore, rising costs of living such as increased fuel costs and rents may undermine family incomes if tax credits and benefits are not increased yearly along with wage and CPI inflation.
Q.3. Won't taking a less punitive approach toward people on benefits, mean there will just be more people on benefits?
Sanctions are penalties that are applied to people on a benefit for failure to meet specific, stringent obligations - and may be applied for as little as missing an appointment. The penalty is a benefit reduction that may be temporary or permanent. The assumption behind sanctions is they may motivate people to get paid work, or they will get separated parents who aren’t the primary caregiver to pay child support contributions. It’s worthwhile noting that if children are supported by a benefit, any child support payments from the other parent go straight to the MSD kitty and not to the child or the caregiver, and do nothing to boost their incomes, as they would for parents not on a benefit. Punishing people receiving a benefit is ineffective and harmful, and there’s research to prove it. Sanctions cause great harm to children and stress to families, when benefit levels are already far too low to be up to the task of providing all a child’s needs. Benefit sanctions don’t help motivate people into work and may even lead to long-term welfare dependency. They are worse for people personally, physically, and financially. In contrast, appropriate and meaningful support has a much more positive all-round impact. Benefit levels are already far too low to cover even the basics - food on the table, books in backpacks, and shoes on feet - and sanctions that reduce family incomes cause even greater harm to children and more stress to families.
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