Budget 22 – People on Income Support Excluded from Cost of Living Budget Measures – Anti-Poverty Groups

Source: Action Station

A coalition of anti-poverty groups has challenged the Government for excluding people receiving income support from today’s cost of living ‘helicopter payments’, saying they have chosen to leave families living in the harshest poverty further behind. 

The cost of living payments will not be paid to those who get the Winter Energy Payment, excluding those on core benefits and New Zealand Superannuation.

The group says this is of particular concern because of evidence in today’s Budget documents that the gap between lower-income and middle-income households is set to grow larger in the coming years.

“The Budget has addressed 0 out of the 7 key steps that we called on the Government to take to close the gap between the cost of living and incomes for people on income support”, says Fairer Future spokesperson Brooke Stanley Pao. “People on benefits face big deficits every week – they are hurting and the situation is urgent. The changes to emergency dental care and child support are well overdue and welcome, but it’s disappointing to see these changes won’t come into effect immediately.”

The group says while the extra $24 on average from child support payments will help, it won’t fix the big deficit these families are facing. Figures released by the Fairer Future  in March this year showed that even after the 1 April 2022 benefit increases, people on income support would still face shortfalls between income and costs, with sole parent  households facing average weekly deficits as high as $239.  

“Income support has not kept up with inflation and the cost of living”, says Stanley Pao. “The announcements today, leaving out people on income support, are a slap in the face for some of the people in our community. It’s past time for the Government to finally increase core benefit levels to the standard of liveable incomes and fully implement the recommendations of the Welfare Expert Advisory Group (WEAG).”   

 

Statistics released as part of Budget 2022 also show that the Government has failed to meet its before-housing costs child poverty targets, which measure the gap between lower income households and middle-income households. 

 

“The Government risks driving a gap between those in desperate need and those on meagre incomes in work, and the cost of living payment today could widen that gap by excluding people on core benefits,” says Max Harris, another spokesperson for the Fairer Future collective.

 

“But it’s not too late for the Government to act and make the transformative change they themselves have said they want and which many vulnerable New Zealanders so desperately need,” added Harris.

 

 

Notes

• Fairer Future’s 2022 Budget scorecard is attached.
• The cost-of-living payment announced today applies to those earning less than
  $70,000 per annum in the past tax year and will not be paid to those on
  the Winter Energy Payment, therefore excluding those on core benefits.
• The Before-housing-cost ‘moving line’ measure projects the percentage of children in households below the BHC50 poverty threshold will increase through the mid-2020s and late-2020s on the basis of all commitments already made: see page 52 of the Wellbeing Budget 2022: A Secure Future.

• The Fairer Future collaboration originally penned a letter, signed by around 75 organisations, calling for benefit levels to be lifted in advance of Christmas 2020. Since then it has campaigned for changes to the welfare system, including through updating numbers released by the Welfare Expert Advisory Group on what constitutes liveable incomes in 2022.

• Most recently the collaboration release ‘Seven Steps for a Fairer Future’ which was endorsed by 38 organisations.

• The updated modelling for what people on income support need to live on in 2022 can be found here.