Government warned benefit changes could see 7000 more children in poverty

The Government has been warned that the changes it is making to benefits could see 7000 more children in New Zealand living in poverty.   

The Coalition on Wednesday rushed through changes to how main benefits are indexed as part of its 100-day plan.  

"Our Government is relentlessly focused on getting New Zealanders into work," Social Development Minister Louise Upston said.   

The Government is changing how benefits increase, tying them to inflation rather than rising wages, meaning over time they'll get less. The Government says it will save $670 million over four years.   

"Yes the Government is going to get an extra $670 million to support them to pay for tax cuts but who is that money coming from? It's coming from the poorest New Zealanders who are struggling more than anyone else in this country," said Labour's Carmel Sepuloni.  

Advice to the minister said her changes would mean by 2028 beneficiaries will likely be getting $18.15 less than they would under the current settings and that they would see 7000 more children living in poverty.  

Though there was a large variance of meaning it could be as low as 3000 or as high as 11,000 extra children in poverty.  

"We want people who are receiving a main benefit to continue to have enough income to meet their basic needs but also to ensure that the best way to get ahead is to get a job," said Upston.  

Sepuloni said: "Where there is evidence that clearly states that it will actually reduce their ability to reduce their child poverty targets they should be ashamed of themselves."  

The Government was also told their changes would disproportionately impact disabled people, women, Māori, and Pacific peoples.  

Officials said the changes might incentivise work-ready beneficiaries to get jobs but warned disabled people who could not work had no ability to change their situations.  

"I am absolutely focused on getting more people off welfare and into work because they will have higher incomes and more opportunities," said Upston.    

The ones left behind officials say will fall further into poverty.