Catherine Delahunty

Welfare changes: private profit and political posturing

by Catherine Delahunty

Did I miss something?

Did the Prime Minister say he was going to work with the business and community sectors to create jobs at a living wage for the 27 percent of young people with no jobs?

No. But he did promise to privatise the management of youth benefits for profit via a food stamps system and require sole parents to be in training.

This is a great opportunity for private providers to get into what could be called “the human misery industry.”

Organisations will have power over young people’s benefits and will supposedly provide them with magical solutions – but with funding linked to how many people they move off the benefit, there will be perverse incentives to move young people into inappropriate placements so that organisations can make a profit.

This has all made me think about the contrasting tone and approach towards youth unemployment in a small rural centre called Otorohanga.

There, Mayor Dale Williams is actually serious about the need for youth to get jobs and become part of the working community.

Dale and a team of committed people from across the community work with high schools to help place school leavers in appropriate job opportunities, and help the young people stay in a community where they are valued.

He is far more optimistic than we are about the Government calling for outcomes from agencies who will be working for a cash bonus, because he comes from a community that works together.

This morning, I was inspired to hear a young woman who was formerly on the Independent Youth Benefit speak on Radio New Zealand’s Nine to Noon show.

Felicity Perry spoke about treating young people like adults so they can become competent at managing their lives.

She has very legitimate fears that agencies will simply place young people in any kind of training or work to get the cash bonus, even if the placement is totally inappropriate. Judging by what I have learned from my welfare tour of both islands, “tick the box” placement is already the norm at Work and Income.

John Key said young sole parents would be required to be in work or training. Because bringing up children isn’t work, is it? Seems like child-rearing is work if you’ve got a husband supporting you, but not if you need state support.

I’d love it if all for young parents had access to Teen Parent Units, but I’m concerned if this policy means separating mothers from their young babies. This could cause serious harm to maternal bonding and breastfeeding outcomes.

A better policy change would be to restore the Training Incentive Allowance to support young parents to study at University. That’s how Paula Bennett got her degree, but she has kicked the ladder out behind her.

In his speech, John Key asked if the numbers on young people without jobs was what the architects of the welfare state had in mind.

We need to remind him that the welfare state was built on three principles: state housing, full employment, and fair benefits for people who needed them. His Government has shown no interest in any of these principles and has now committed to scapegoating instead of job creation.

It’s getting more like David Cameron’s UK Government by the day.