Work and Income's 'low-trust' model for out-of-work Kiwis criticised after father struggles to get help feeding kids

An Auckland father out of work thanks to COVID-19 says he's been treated like a "beggar" by Work and Income when all he's doing is trying to feed his kids. 

And a poverty activist group says it's an example of how out-of-work Kiwis are being treated when they can't get the wage subsidy. 

James (not his real name) lost his previous full-time job in August last year, the same month Auckland had an outbreak. Since then he estimates he's put in more than 150 applications for new full-time work, without luck, so has been relying on the Jobseeker Support allowance and 15 hours a week at a Pakuranga auto shop he secured through a temp agency.

But with rent of $580 and a family of four to feed, it doesn't go far. Then in August the appearance of the Delta variant of COVID-19 put Auckland into lockdown.

"They asked me to stay at home because of lockdown, they needed to cut costs and obviously all garages are closed," he told Newshub.

Despite James' part-time employer being eligible to claim $350 a week for him under the wage subsidy, it wasn't allocated until two weeks into the lockdown, leaving him in the lurch. 

With the Jobseeker benefit alone not enough to put food on the table for his two children, aged one and almost three, he turned to Work and Income for assistance. He successfully got two $250 food grants via the call centre, but ran into trouble getting a third after the Government extended the level 4 restrictions in Auckland on September 13. 

"The guy was kind of like, by the book - not understanding of the whole lockdown situation. He was like, 'Sorry - I can only give you $100.' I was like, 'Half of that is going to go on my kids' nappies."

The Work and Income call centre operator then offered $120.

"I was like, 'You're just throwing me peanuts,'" said James. The staff member went to $150, but refused to go any further - saying it was against the rules without a manager's approval. James said that was an "utter lie" - the previous operators he spoke to had no trouble authorising $250. 

He ended up getting the full $250, but then received an "absolutely shocking" letter from Work and Income saying he'd agreed to "learn to cook on a budget", when he made no such promise - saying that would essentially be feeding his kids just noodles. 

The letter also told him he'd have to do "what you can to increase your income, reduce your costs or improve your budgeting", and said no more money would be granted unless he provided evidence he really needed it - which James says he offered every time in the form of bank statements, but none of the staff until then had insisted on it. 

Part of the message James got from Work and Income. Photo credit: Supplied

'Low-trust' for beneficiaries, 'high-trust' for employers

Auckland Action Against Poverty (AAAP) said James' experience shows Work and Income uses a "low-trust" model when it comes to people on benefits, while employers and employees have enjoyed the benefits of a "high-trust" model when it comes to accessing the wage subsidy, which is usually paid out within 24 hours of an application.

"The Social Security Act 2018 actually gives Ministry of Social Development (MSD) staff powers of discretion, and we've seen a huge difference in the way they use them to offer support to businesses accessing the wage subsidy and people who've become unemployed due to COVID and everyone else," said AAAP director Brooke Pao Stanley. 

"This part of the law actually says that MSD staff need to assess whether not providing support to people and whānau will cause further risk and hardship and if it does, they need to grant that support. Either their staff are unaware they're breaching this part of the law or they've been directly advised by seniors to use it in this way."

Geoff Cook, MSD general manager of contact centre and digital service, told Newshub "everyone deserves to be treated with dignity and respect", and said James was right - he never agreed to "learn to cook on a budget" - and apologised. 

"We are approving a large number of hardship grants for food each day," said Cook, urging anyone needing help to get in touch - even if they're not on a benefit. 

"There were 26,919 food grants made in the week ending September 10. For the month of August 2021, $13,058,326 was paid in grants for food."

Cook said James had so far received $750 of that.

"If our clients need additional support, such as multiple food grants, it’s important that we have a conversation with them to better understand their circumstances and see if they are accessing all the supports available. In this instance we are sorry we did not explain our process better."

Green MP Ricardo Menendez March and Labour's Carmel Sepuloni, Minister of Social Development.
Green MP Ricardo Menendez March and Labour's Carmel Sepuloni, Minister of Social Development. Photo credit: Newshub.

'Hard to get the slightest bit of compassion'

James said he understands Work and Income staff would be having a tough time right now too, with the workload.

"People like me who don't really want to stay unemployed, [we] sound like beggars begging for something we're kind of entitled to. I've been paying taxes for many, many years and it's so unfortunate that COVID happened and we end up unemployed and now we're like, begging for the money we've already paid for. 

"Some of them have been real nice - some people from Work and Income have been really, really nice and really understanding - but every other call I make to speak to someone, it's just really hard to get the slightest bit of compassion."

In response to an Official Information Act request by AAAP, MSD said the "high-trust" model used to administer the wage subsidy - which cost $13 billion last year - was set up to "to deliver funds as quickly as possible", and its investigations had found "in the majority of cases, applicants have done the right thing". 

Stanley said Work and Income should adopt a similar attitude to those struggling outside the wage subsidy system. 

"Everyone needing support from Work and Income should be able to access it without being made to feel judged, ashamed or guilty for their personal situation and we want MSD to operate from a high trust model for everyone."

Political response

Green Party MP Ricardo Menéndez March said the Government doubled the amount of money struggling Kiwis were allowed to access from Work and Income without having to "have your circumstances queried" for 2020's lockdown, but chose not to in 2021. 

"Making people sign up to budgeting when they do not have enough money to meet basic costs is dehumanising. You can’t budget your way out of poverty when you don’t have liveable incomes."

He said he asked Social Development Minister Carmel Sepuloni if the same would happen this year, but was told there was no need "because Work and Income is equipped to answer calls quicker compared to last year, despite hardship continuing to increase in Aotearoa". And a motion to start an inquiry into the culture at Work and Income backed by the Greens and a dozen or so community organisations didn't make it past the first vote at select committee.

"We keep hearing stories, and we keep seeing media stories time and time again, of the ill-treatment people are receiving at Work and Income," said Menéndez March. 

"The current processes at Work and Income continue to be punitive and prevent people in hardship accessing the support they need. Meanwhile the income support systems for businesses have been made readily available and without the scrutiny that low-income earners experience before they can access help. We will continue making the case for an inquiry in my Select Committee and advocating for a high trust model of service by Work and Income.

"We've had opportunities to hear from the minister on what has happened - an inquiry gives us the opportunity to hear from the community about what is happening on the ground. I'm concerned that the Government is disconnected from the reality of people on the benefit, and their decisions are not reflective of what people are experiencing on the ground." 

Sepuloni told Newshub she wasn't "disconnected from the frontline", regularly meeting with groups "in order to find out what’s going on", as well as Work and Income centres. 

 "While I can understand why he wants a select committee inquiry, I feel the work on this was done by the Welfare Expert Advisory Group and MSD have taken this direction on board and are making sound progress.  

 "The ministry wants people to feel manaakitanga (respect and support) whenever and wherever they contact the Ministry and when they transact online. They are working hard to drive culture change and reinforce the importance of delivering a positive experience to clients.

"Changes are also being made through staff training to ensure case managers can better respond to clients’ needs, in providing the correct information and advice and providing the right support and full entitlements at the right time."

Sepuloni said the ministry's latest survey showed "clients rate them an average of 8.4 out of 10 for their service", which is "good" but could be better.  

"Our staff reflect the community, and sometimes they don’t always get it right, but as you’ve seen in the media when mistakes are made, MSD are owning them and working hard to make it right."

Auckland's level 4 restrictions were lifted on Wednesday, allowing James to get back to work. He told Newshub he won't be needing another grant for now because his employer's wage subsidy finally came through, and MSD got in touch to ensure he was getting everyone he was entitled to - and it turns out his accommodation supplement was being underpaid.

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