Pubdate: Mon, 15 Jul 2013
Source: New Zealand Herald (New Zealand)
Copyright: 2013 New Zealand Herald
Author: Simon Collins


Drug-testing expected to cost up to 5800 their benefits, and 8000
others with arrest warrants also in jeopardy.

Thousands of people are expected to be chopped off welfare benefits as
sweeping changes in the social security system come into force today.

The reforms represent the biggest upheaval in the welfare state since
the Social Security Act was passed by the first Labour Government in

All sickness beneficiaries, and sole parents and widows with no
children under 14, are now subject to the same requirement to look for
fulltime work as other jobless people, although sickness may be
accepted as a valid reason to postpone work temporarily.

Other new obligations include drug-testing for jobseekers in relevant
industries, which is expected to trigger benefit cuts for up to 5800
people, and a requirement for beneficiaries to clear outstanding
arrest warrants.

About 8000 beneficiaries have arrest warrants outstanding for issues
such as unpaid fines. Unless they clear them within 38 days, their
benefits will be halved if they have children, or stopped completely
if they don't, in what is likely to be the biggest single purge of the
benefit rolls since the system was created.

The co-ordinator of the Pikorua Community House in a low-income part
of Papakura, Michelle Neho, said many people with outstanding warrants
would go back to drug-dealing rather than pay their fines.

A Herald investigation into how the changes will affect people's lives
in Papakura, as a case study of a high-welfare area, has found
widespread fear of the reforms even among those who are supposed to be
exempted from the work-search requirements.

"A lot of people are scared about the warrants to arrest," Ms Neho
said. "There's a lot of people that have thousands of dollars of fines
outstanding." Some would rather come off the benefit than pay all
their fines.

The huge reorientation of welfare shifts the focus from the short-term
unemployed, which largely left other beneficiaries alone, to a new
"investment approach" aimed at finding work for those who are likely
to stay on benefits the longest and cost taxpayers the most - mainly
the sick, disabled and sole parents.

Work and Income chief Debbie Power said 85,000 people - mainly the
sick, long-term unemployed, and sole parents and widows with no
children under 14 - would move today into intensive "work-focused case
management" with 760 personal case managers to help them find jobs and
overcome barriers such as transport and childcare costs, addictions,
debts and workplace attitudes to mental illness and other conditions.

A further 1000 sole parents and 1000 people with mental health
problems will be handed over to contractors who will be paid from
$2250 to $16,500 for each person they place in employment for at least
a year.
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