Wednesday, March 22, 2023

Heather du Plessis-Allan: Should those on the benefit get the Working for Families tax credit?

If we don’t watch out, we are going to end up in a situation, if we haven’t already, where we make the gap between getting the dole and getting paid for work become so small, that it again ends up being a smart move to just stay at home and collect free money rather than work for a living.

Right now, the Government is considering a change to Working for Families that will only exacerbate this problem.

Working for Families is money that is paid to families who work; the clue is in the name.

But now the Government’s considering also giving the in-work tax credit to families who don’t work, families on the dole.

Because a review on the desk of the Deputy Prime Minister Carmel Sepuloni says anti-poverty groups argue this tax credit “should be paid to all families and not just those who are in paid work”. They argue the "payment was discriminatory or unfair, particularly given children were unable to choose whether their parents were working." 

That's true. But there are other ways to support those children, like food in schools.

This though, is bastardising the system. Because the whole point of Working for Families was to widen the gap between the dole and earning a crust.

It got too close and Helen Clark’s Government wanted to give these people an incentive to get off the dole, so they bumped up their pay with Government money.

So it’ll be completely pointless if this Government now decides to give it to just anyone with kids. We'll be right back at 2004 with people on the dole not wanting to work because they wouldn’t get that much more anyway.

This is already a significant and growing problem. Chris Hipkins already made this worse just over a week ago when he indexed benefits to inflation.

Which means as long as inflation stays at 7 percent, the dole will keep going up by 7 percent every year. Hands up, who else gets a 7 percent pay rise every single year? Nope. Just them. 

We already have more than 300,000 people on a benefit. That's 1 in 10 of every one of us working age Kiwis, that's too many people. 

And anything that makes that number grow should not even be considered, extending Working for Families to beneficiaries included.

Heather du Plessis-Allan is a journalist and commentator who hosts Newstalk ZB's Drive show.

1 comment:

Anonymous said...

Bankruptcy looms ahead.......

Why work?
The nanny state