Welfare reforms effective – report

REFORMS aimed at breaking the cycle of welfare dependency among teenagers have made significant inroads, a new report says.

It said more focus was needed to stop people returning to benefits after they had found a job.

The Government has passed a raft of welfare reforms since 2012, the first with a heavy focus on teen beneficiaries and solo parents.

In the report issued yesterday, the Ministry of Social Development said figures showed 16 and 17-year-olds on a benefit accounted for 70 per cent of the ministry’s future welfare liability.

At June 30 last year, that welfare liability was $76.5 billion – $7.4b lower than forecast.

The report found 90 per cent of new 16 to 17-year-old beneficiaries had been supported by main benefits at some point through their childhood, one-third had recorded findings of substantiated abuse or neglect, and one-third of new youth clients entered the system as parents.

That was based on a cohort of young people born in the first half of 1993.

Among the reforms championed by Social Development Minister Paula Bennett was a crackdown on the management of young beneficiaries’ money – something she’s unapologetic about.

Young people in the Youth Service programme must work with a Youth Service provider, and participate in education, training or work-based learning and budgeting.

They have little control over what their benefit could be spent on – most of it is paid directly to their landlords and utility providers to cover their bills.

The teens get $50 in the hand and the rest is on a payment card they can use only to buy groceries and essential supplies.