The battleground over hardship

It’s the price of meat and tomatoes that alarms Kafa as she walks down the supermarket aisle. Add this to petrol, and the 43-year-old sole parent of four says the $200 each week left to cover other bills simply isn’t enough.

Which leaves Kafa, who declined to provide a last name, one of an escalating number of people asking for $26 million in hardship grants, provided by the Government, to put food on the table.

‘‘Everyone is financially struggling – it’s just not beneficiaries, it’s also the workers,’’ she says.

And it’s made her the subject of a political battle over the cost of living.

The National Party, promising a tough and targeted approach to welfare, has for weeks challenged the Government on the rising cost of hardship grants.

Leader Simon Bridges blames it on regulation, such as the extension of the bright-line test (which amounts to a capital gains tax on investment properties) leading landlords to lift rents $50 a week.

And he says the 3.5 per cent per litre rise in the fuel tax has more families struggling to pay the bills.

But figures show the rising cost of living isn’t solely the invention of the Labour-led Government.

It says the increase in hardship grants simply reflects a need that’s long existed in the community.

What’s the answer? Those with Kafa on the front line say it’s neither the Nats’ tough welfare pledge nor the Government’s muted response to a cry for welfare reform.

Cost of living

The consumer price index – otherwise known as inflation – has counted at least a 1 per cent increase in the cost of living each quarter since September 2016.

Rent and food prices have largely driven the increase in the past year, at 1.5 per cent. Rent has climbed 2.9 per cent and food 1.8 per cent. Meat was up by 6.4 per cent.

Tenancy Bond Service numbers, which tally the cost of each new rent, have the average weekly rent climbing from $400 to $445 since Labour came to power in 2017.

Rent was also climbing under National but less steeply.

But any attribution of blame isn’t straightforward for petrol, which has decreased by 2.9 per cent in the past year.

Compare the rise in the CPI to the median hourly wage and salary, which rose 2 per cent in the year to July. The median weekly income from National Superannuation and benefits in general remained unchanged, at $341.

Though increases in the cost of living and income aren’t distributed equally. Those on a benefit and National Super faced a roughly 2 per cent increase in living costs, and low-earners a 2.1 per cent increase, in the past year.

The country’s highest earners faced a 0.7 per cent increase.

Help for hardship

The sum total, in Work and Income offices around the country, is a sharp increase in hardship grants — a $167m bill in the past four months.

Of these, 270,000 grants totalling $26m were given for food costs. Accommodation was at $41.6m, and benefit advance payments, which must be repaid to the Government, also increased.

There’s been no substantial change to how hardship grants are handed out but Social Development Minister Carmel Sepuloni has put the increase down to high housing costs, blaming the previous government.

‘‘We said we would provide assistance to those who need it and this increase demonstrates that we are,’’ she said on Sunday.

Salvation Army senior policy analyst Paul Barber said the hardship grants were becoming more accessible to those in need. ‘‘Those grants show benefit levels are too low and people need to seek additional support.’’

The Government has committed to indexing main benefits to wage growth from April 2020. The abatement threshold will also be lifted, by $150 a week.

A rise in the abatement threshold was also proposed by National in a policy document last week.

Its social development spokeswoman, Louise Upston, said the party’s focus remained firmly on reducing the cost of living. ‘‘Whether it’s benefit numbers, whether it’s a hardship grant, actually, the Government’s just doling out money and doing nothing about the underlying issues.’’

But neither Labour nor National has committed to tackling the sweeping reform, and substantial benefit raises, recommended by the Welfare Expert Advisory Group in May.

Auckland Action Against Poverty (AAAP) co-ordinator Ricardo Menendez March said he knew of clients still being denied hardship grants as the Government delayed making substantial changes. ‘‘And meanwhile . . . we’ve got this weird political football with beneficiaries.’’

Kafa, who both receives help from and advocates for AAAP, says she’s been declined in the past. The end to her hardship is not on the horizon, she says.

‘‘I went to go get our gas and it’s gone up to $2.26 . . . And I felt angry.’’