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Q+A interview with Paula Bennett

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Fuseworks Media
Fuseworks Media

Q+A interview with National's Social Welfare spokeswoman, Paula Bennett.

The interview has been transcribed below. The full length video interviews and panel discussions from this morning's Q+A can be watched on tvnz.co.nz at, tvnz.co.nz/q-and-a-news

Q+A, 9-10am Sundays on TV ONE. Repeats at 9.10pm Sundays, 9:05am and 1:05pm Mondays on TVNZ 7

PAULA BENNETT interviewed by GUYON ESPINER

GUYON ESPINER

Thank you, Minister, for joining us. We appreciate your time. I'd like to start with our latest ONE News Colmar Brunton poll on National's policy to require a sole parent who has a further child while on the DPB to start looking for work when that child turns one. You can see there now on your screen we asked people whether they supported the policy - 54% said that they supported it; 40% said no; the remainder didn't know. So a clear majority. I mean, the country relatively split there, but a clear majority support the policy. Let's talk about why you're doing this. I mean, your policy generally is for mum to start looking for work when the youngest turns five, yet if you're on the DPB, you've got to go out to work when the child hits one. Now, that presumably is an incentive to not have further children while you're on the DPB.

PAULA BENNETT - Social Welfare, National

Yeah. It's probably two-fold. We have quite genuine concerns for those that are having children while on welfare. All indicators say that those children are likely to have poorer outcomes. So we have to do something different, and when we looked at where the obligations and the incentives were, you know, we didn't want to take money off them, which was one of the calls. You know, you could actually remove that incentive, if you like, or take away the desire to have other children by taking money off the kids, and we just didn't want to do that at all.

GUYON OK, I guess the problem, though, is for that to work as an incentive, you'd have to believe that these were planned actions - that people were deciding to have a further child.

PAULA Yeah, I don't think that is the case.

GUYON So how could it work at all, then?

PAULA I think there are some that are and some that aren't, so I think that's quite clear. I think that what we need to do is make sure there are contraception options for people as well, and that they're widely known-

GUYON Do you think, though, that someone is going to come out and go, 'Mm, I better not do this because I'm gonna go then and have to look for work when my child hits one'? Do you think that people are going to make that link?

PAULA I think some will, you know. I think some will think, 'Actually, I'm not going to just get to stay on welfare without there being any obligations on me,' which is what does happen, I mean, has happened previously. So I think we can do better in that respect. But I don't think everyone is going to sit there and make that kind of decision like that, either.

GUYON Because this will, in some cases, mean that mum has to work full-time when the first child hits one, won't they? Because it's about returning to work obligations. So if you've got a 14-year-old, say, and you have another child when you're on the DPB, you'll have to work full-time when that child is one year old.

PAULA So your other children are 14. So you've got other children that are 14 years and older, you're on welfare, and then you have another baby, so there's not many. So last year, there were about 70 of them, and yes, they will have to look for full-time work.

GUYON So who's gonna care for the kid?

PAULA Well, it's within respect, as well, that it does need to fit in, so we're not gonna make them work all night, for example, and then look after children all day. The job kind of needs to fit with them. But there is going to be childcare options. And, actually, people do it now.

GUYON Let me take you back to when you first came into parliament. You made a speech in 2005. I'll quote from it. You say, 'As we are pushed to increase women's participation in the workforce, we need to ask the question of who will be raising the next generation, and a lot of women are saying that they would like to - that staying at home and raising their children is an option they would like not only to have, but one they would like to be actively encouraged to do.'

PAULA Yeah.

GUYON Have you changed your mind on that?

PAULA No, I just think that it does come down to individual choices as well, and that actually people should get to make those choices, but taxpayers shouldn't have to pay for it. And I know that-

GUYON But you were worried then that mums were being pushed out into the workforce too soon, and now you're saying-

PAULA For a range of reasons, though, Guyon, as well, I do think that there was a real time then when people were going flat screen TV and having two cars and doing everything, or actually cutting back a bit so that one parent can stay at home. And so there are those sorts of choices as well. So I do believe that people should get their choice. I do think that it's great for mum or dad to be at home.

GUYON Just not for beneficiaries, though. Cos they don't have that choice, do they?

PAULA They do. They do. We're talking 15 hours part-time work in general, until your child is 14. That is pretty generous. We have one of the most generous systems in the world, and I stand by that, but I do think that there's a level of individual responsibility as well, and I think that's fair.

GUYON Do you think that people will be materially better off? Because if you're working for probably minimum wage jobs, are you going to be any better off working for 15 hours a week?

PAULA You are much better off working 20 hours a week. There's no two ways about that.

GUYON How much better off?

PAULA Oh, around about $90 to $100 a week better off, if you're working 20 hours a week on the minimum wage, once your in-work tax credit and everything else kicks in. So that is absolute. The other thing-

GUYON At 15 hours?

PAULA At 15 hours you are a bit better off, so more like about $50 a week better off. But you also get-

GUYON So that's effectively working for $3 an hour, isn't it? 15 times 3 is 45.

PAULA The taxpayer is actually also investing quite a bit of money by getting benefit and everything else. And it's not all about the extra money you get in your pocket. That job is more likely to lead to another job. We all know the outcomes of work beyond just the financial.

GUYON Let's talk about whether this has been working. Because this is a further step in some reforms that you've already announced. You've reduced the age where mum has to go back to work now - when the child reaches six years old. Now, the DPB numbers have been rising despite that. In fact, they've risen every year you've been in office. There were 98,000 in 2008; 108,000 in 2009; 113,000 in 2010; 114,000 in 2011. This is not working, is it?

PAULA Well, no it is. We're-

GUYON Well, how can it be working when the DPB's going up?

PAULA We're seeing more going into part-time work. You're not counting-

GUYON Well, why are the DPB numbers going up, though?

PAULA You're not counting those that are going into part-time work.

GUYON No, I'm talking about- With respect, I'm talking about the number of people on the DPB. It's going that way. (POINTS UPWARDS)

PAULA Yeah, but we've also got more that are in part-time work than that were, and that's what we're asking people generally to do. But, Guyon, what you're not-

GUYON But the point of this policy is to reduce the number of people on the DPB. It's not working.

PAULA I think you've also got to accept that we've come out of the worst global recession. We're actually dealing with a really tight labour market. We are backing this, and we're doing exactly what we said we would do as well, which is not just kick them off and make them go into anything, and that sort of thing. We're actually being quite pragmatic about it. So I think it's incredibly fair. It's going to take time to bed these things in. We have seen the unemployment benefit go down by 13,000 in the last 18 months. So the reforms actually are working. We need to do more of it, but we need to do it over time and also consider people's individual circumstances and, actually, the effects that the global recession has had on the labour market.

GUYON Well, those comments are backed up, in a way, by the fact that the years that the DPB did drop were in 2004 and 2005 - a drop of 5% in 2005. Good economic times. So it's not pushing people out, is it, to work - it's actually the economics of it.

PAULA Actually, it was the tax credits that made them drop at that time. So people saw that they could actually take the $60 back into the workforce with them when they went in there. So that was the big difference it made there. What we have seen is the unemployment benefit move around as the economy does, but actually invalids and sickness benefits both went up those very years that you mentioned by 50% over that time, so there was a real shifting of people from one benefit to another from 2000 to 2010, and we've turned that around. The figures that you see now, the people on benefits are true and true to that benefit, so we've sort of stopped that movement between.

GUYON The sickness benefit, though, has not come down under the reforms that you've done. You've asked for more work testing, more work obligations. It hasn't resulted-

PAULA Well, that's since May, right, so it's May and we're only in November. I think we've got to accept that we've been in really tough times, but the unemployment benefit has gone down, so that's where- And this is the very nature of these reforms. It's around the investment approach. So you start going, 'Whom do we actually invest more money in up front?' At the moment we do that on those that are on the unemployment benefit. Should we be doing it more on those on the sickness benefit, on the DPB, on the invalids and change those, as you know, and that will work, Guyon. It really will.

GUYON Your policies were put on hold initially, weren't they, because you said the economy was too fragile to do this, yet you've got unemployment at roughly the same level it was then and you're surging ahead with it now. It doesn't seem to stack up.

PAULA Well, no, unemployment's coming down. I believe we can do this, and we do need to reform this welfare system. It's been around for years and years and years and hasn't had reform. The whole concept of it is on what you can't do. It's a very passive system, and we can turn that round to be more positive, and that's what the reforms are about.

GUYON Let's talk about numbers there, because from my recollection - and someone will ping me if I'm wrong - but it was 7.1% that the unemployment rate peaked at. It's, what, 6.6% now?

PAULA Yep.

GUYON Well, you know, for 0.5% of a difference for unemployment, where's the material difference? Where are the jobs, to quote Labour?

PAULA Well, we've seen 43,000 jobs in the last year. We see thousands going off benefit each month to go into work. There's 10,000 jobs on Trade Me. I looked this morning. So, you know, there are jobs there as well. Is it easy? No, it's not, so that is about actually encouraging people, getting the right skill match for them to get into that job, getting a better pathway, wrapping better support around them. I think we can do better at that, and that's what these reforms are about. So I'm gonna back people and I'm gonna back this government. What it's not going to do, though, is by making it harder for business to actually employ people, and that's what we see with Labour.

GUYON All right, well, we'll talk with Labour in a minute, and we'll get their take on that. But we better leave it there. Thanks, Minister, for joining us. We appreciate your time.

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