Questions over relief package

Many people will wonder why a household on $1990 a week needs support from the taxpayer.

The sudden loss of a steady job will always spell upheaval and require rapid adjustment. Many in this predicament due to Covid-19 will be grappling with a reduced income but unchanged expenses. Hefty mortgages often require two incomes and the loss of one can make home-owning precarious.

With its $1.2 billion ‘‘income relief’’ scheme announced on Monday, the Government appears to have the battlers in the mortgage belt in mind. Under the scheme, people are eligible for weekly tax-free payments, $490 a week for full-time workers and $250 a week for part-time workers, if their job was lost after March 1. The relief runs for three months and then recipients will have to go on the normal dole. The payments are more than double the Jobseeker benefit for a single person over 25.

The relief will help people like suddenly jobless Air New Zealand executives and middle managers, but also factory workers, hotel staff and many others who get their hands dirty.

The main objection to the income relief is that, by compensating Covid-19 job losers more generously than previously unemployed, it is treating one section of the unemployed as somehow less deserving and second class.

Researcher Jess Berentson-Shaw, who has argued for universal payments for families, suggests the new relief is rightly based on the fundamental belief that people want to work and participate in society. She says that thinking hasn’t applied to jobseekers previously.

Naturally the Government denies any suggestion the new package is relief for a better quality of unemployed person. Social Development Minister Carmel Sepuloni says it gives people ‘‘breathing space’’ while they try to find jobs in a less than friendly market. Finance Minister Grant Robertson says the package recognises that people who have been in work have suffered a very sharp income drop, and ‘‘it’s a recognition that we need to cushion the blow for people’’. Both point out that it lasts for only 12 weeks.

There is some merit in the Government’s claims. In January, New Zealand had about 145,000 people aged 18-64 on the Jobseeker benefit. At the same time, employers all over New Zealand were providing thousands of jobs to work visa holders because they apparently couldn’t fill their vacancies with locals.

The relief package provides other advantages that are not so easy to defend. People will qualify even if their partners earn up to $2000 a week. Compare that to Jobseeker support, where the recipient and their partner can earn only a combined $90 a week before it starts to reduce the benefit.

Many people will wonder why a household on $1990 a week needs support from the taxpayer. That seems an overly generous step by a Government that sometimes seems to be throwing money around.

It also appears that a generous redundancy payment is not taken into account.

Every government tries to ensure its unemployment support maintains a balance between providing enough money for survival and yet not so much as to remove the incentive to work. Clearly this Government believes the latest influx into the unemployment ranks would not be there but for the shattering Covid-19 event, and those people will be likely to get new jobs.

The package’s saving grace is that it is only for 12 weeks, hardly enough time for any injustice to become ingrained.