Number on welfare a tragedy: Thinktank

Report pushes social investment model some condemn as punitive

Kiwis are richer but more are on benefits than ever because of a failing welfare system, a new report states. With income per person double what it was in 1970, a minimum wage up 50 per cent (inflation adjusted) and better medical care boosting life expectancy and reducing child mortality, New Zealanders should be prospering.

But the facts are “tragically different” argues the Welfare, Work and Wellbeing report from the New Zealand Initiative — a right-wing thinktank.

Instead, in 2012, the proportion of Kiwis of working age on a sickness or invalid’s benefit was six times greater than in 1970.

Now 10 per cent of the working-age population are on a main welfare benefit, compared with 2 per cent in 1970, and about 500,000 people received some kind of income support from the Ministry of Social Development this year.

Report author Dr Bryce Wilkinson said New Zealand had a serious and entrenched problem of disadvantage coming through the welfare system.

The social investment approach was the way forward and held the key to breaking intergenerational benefit dependence. The report found nearly three-quarters of all beneficiaries under 25 had a parent on a benefit.

“The Government has to take more responsibility than just passing out welfare cheques,” said Wilkinson. “The important thing is continuing to thrust to find out what works to help people make more of their lives.”

He said shortage of money was a symptom rather than a cause of poverty. Efforts needed to be made to address drug addiction, alcoholism, mental illness, low skills, poor parenting and a lack of understanding of work habits.

The report said the welfare system should “nourish rather than smother self-help”.

Social investment is about applying evidence-based investment practices to social services. It requires vast amounts of data to determine what social services work over