Govt ramps up threat of sanctions
Tough line to be taken on Jobseeker benefit malingerers
The Government is ramping up its threat of sanctions on Jobseeker beneficiaries not fulfilling their obligations by introducing a new requirement to attend a seminar within a fortnight of their benefit starting.
Social Development and Employment Minister Louise Upston announced yesterday a new Ko¯rero Mahi — Let’s Talk Work seminar, which beneficiaries must attend within the first two weeks after they start receiving a benefit.
Those who didn’t comply could be have their benefit cut unless they had a good reason.
The coalition Government has promised to increase the use of benefit sanctions with Prime Minister Christopher Luxon using his State of the Nation speech in February to tell beneficiaries taking advantage of the welfare system that the “free ride” was over.
Upston said the seminar obligation was one tool to help the Government achieve its target of 50,000 fewer people on the Jobseeker benefit by 2030.
“About 188,000 people currently receive Jobseeker Support but only about 53,000 of them have employment case managers at any given time, so early intervention is required to make sure the others are taking steps towards finding work.”
The seminars would allow beneficiaries to get their employment needs assessed.
“If they’re ready to work, they could be helped to apply for a job. If they need re-training or upskilling, they could be referred to a programme that can help,” Upston said.
“We’re not prepared to sit back and let welfare dependency get any worse, which is why we’re intervening early to get job seekers on the pathway to work.”
In February, Upston announced how the Ministry of Social Development would begin work check-ins for people who had been on the Jobseeker benefit for six months, with a particular focus on young people.
Upston and Luxon also signalled a much stronger use of sanctions.
Under the existing sanctions regime, if a person did not meet work preparation obligations without a “good and sufficient reason” their benefit would be reduced by 50 per cent for four weeks. After a second breach, that would be extended to 13 weeks for someone with dependent children, or suspended altogether if they did not have children.
The previous Labour Government kept the ability to sanction beneficiaries who did not meet their work obligations, but on average sanctions were used at about a third of the rate as under National, as a percentage of the number of those on the Jobseeker benefit.
There were about 12,000 sanctions applied to people on Jobseeker benefits in the quarter before Labour came into government in 2017. This remained relatively steady until the beginning of the pandemic in 2020, when they plummeted as the Ministry of Social Development adopted a much less punitive approach. Sanctions have increased since the end of 2020, with the latest June quarter at 6243 — roughly half the number under National.
The Welfare Expert Advisory Group, founded in 2018, considered the use of sanctions to be “problematic” as there was little evidence sanctions were effective in encouraging people back into work.
“Recent studies recommend moving away from such an approach towards more personalised services,” the group reported.
It found there was some evidence for “less severe” forms of sanctions that existed in New Zealand.
Luxon, however, said he had all the evidence he needed having seen more people spending longer on the Jobseeker benefit during a time when the frequency of sanctions being invoked had reduced.