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Cat MacLennan: We Are Beneficiaries

Written By: - Date published: 10:45 am, May 27th, 2020 - 9 comments
Categories: benefits, Economy, Politics, social democracy, Social issues, welfare - Tags: ,

Cat MacLennan is a journalist and barrister. This post was originally written and published under the auspices of the Democracy Project. Some links were added to references in the publication in this site.

Approximately 2.8 million of Aotearoa New Zealand’s 4.9 million residents are now beneficiaries.

That figure is made up of 1.7 million workers who are wage subsidy recipients; 781,000 people receiving New Zealand Superannuation; 175,000 Kiwis on jobseeker support; and 160,000 receiving other benefits.

On top of that, documents leaked to Radio New Zealand show that the Ministry of Social Development is bracing for up to 300,000 additional benefit applications as a result of the global pandemic.

Covid-19 accordingly means that a majority of Kiwis are currently beneficiaries. Now is accordingly the perfect time for a rethink of our punitive and hostile attitudes to people who receive state support.

In recent years, this country has been characterised by some of the worst attitudes in the developed world towards beneficiaries. Victoria University Professor of Policy Studies Jonathan Boston, in his 2019 book Transforming the Welfare State: Towards a New Social Contract, notes that there has been a fall in support for egalitarian and community values in Aotearoa New Zealand since the 1980s and a hardening of views about those receiving state support.

The proportion of New Zealanders supporting government measures to reduce income differences between the rich and the poor fell from 50 per cent in 1992 to 40 per cent in 2009. In the same period, the percentage of people who thought the rich should pay a larger share of their income in tax declined from 70 to 50 per cent.

By 2009, only 45 per cent of Kiwis agreed or strongly agreed that the Government should provide a decent standard of living for the unemployed. Among advanced democracies, only the citizens of Flanders, Belgium, recorded a lower percentage.

Boston observes that this country’s tougher attitudes to those in need mirror the United Kingdom’s hardening views of those receiving state support: overall, citizens have become less sympathetic to the needs of the poor, the sick and the unemployed.

In the United Kingdom, 88 per cent of people agreed in 2001 that the Government should be primarily responsible for ensuring unemployed people had enough to live on. By 2011, that figure had fallen to 59 per cent. In 1991, 26 per cent believed that benefits were too high and hampered people standing on their own two feet. In 2011, that percentage had more than doubled to 54 per cent.

The International Labour Organisation’s World Social Security Report 2010/11 stated that Denmark, Finland, Sweden and Norway recorded agreement or strong agreement of between 77 and 84 per cent with the proposition that governments should provide a decent standard of living for the unemployed. Only 45 per cent of Kiwis supported that view.

Our negative views of those in hardship are manifest in many other ways. People unfortunate enough to be out of work are labelled “dole bludgers,” while mothers receiving sole parent support are depicted as slovenly, drug or alcohol-addicted, bad parents.

When the media reported that working people were living in their cars, the country accepted that there was a housing crisis. If the stories had been about beneficiaries sleeping in their vehicles, Kiwis would have dismissed this as the result of “poor choices” and people’s own faults.

One social agency has said that the pandemic means it is dealing with people who have never had to ask for help before. That organisation knows this will provoke sympathy from New Zealanders, but the subtext of that attitude is that if you repeatedly need help you are a bludger and greedy.

All of this is a very far cry from 1938, when Aotearoa New Zealand was proud to hone its international reputation as the social laboratory of the world by passing the Social Security Act to sit alongside votes for women in 1893 and pensions for the elderly in 1898.

Prime Minister Michael Joseph Savage said that a new principle was introduced by the 1938 social security legislation

“Citizens of the Dominion are insuring themselves against the economic hardships that would otherwise follow those natural misfortunes from which no one is immune.”

Those words say almost everything and perfectly encapsulate just how far our attitudes to the unfortunate have changed for the worse in the intervening 82 years.

Savage and his government recognised that misfortune is largely a matter of luck, that everyone is susceptible to risk, and that economic hardship often follows.

By contrast, neoliberalism says that poor people are the authors of their own disadvantage: they did not work hard enough; they did not save enough; they had too many children.

All of that is wrong. Luck plays an incredible role in life. People born in a poor country have far less chance of being economically secure. Those born with a chronic illness or disability will face discrimination all of their lives, will find it hard to obtain work and, statistically, will be at high risk of being paid low wages.

White people are overwhelmingly paid more than non-white people, and men are paid more than women.

Similarly, the media regularly publishes stories about people in their twenties who have accumulated property portfolios comprising multiple homes. The headline and general tenor of the articles are that “anyone can do this if they work hard enough.” It is only in the detail of the story that it is revealed that almost all of these property barons got their start by being gifted large sums of money by their parents to purchase the first home. For the overwhelming majority of New Zealanders, that is not a possibility.

In fact, there is no level playing field. Chance deals people entirely different hands when they are born, and that has a huge and enduring impact on their lives. This country recognised that in 1938 when we decided it was right to support people who suffered misfortune. We need to return to the same philosophy now.

The reason this is vital is that, until we change our attitudes to beneficiaries, no significant benefit reform will occur. New Zealand governments have fostered punitive and negative attitudes to those who require state assistance and those views are now so prevalent that no government is going to use its political capital by doing what obviously needs to be done to restore proper benefit assistance.

(Even the word “beneficiary” is regarded as a negative description: I know that some superannuitants will be indignant that I have included them in the list of beneficiaries at the start of this article. They say that they are not beneficiaries because they have paid taxes to fund their pensions.)

The current Government set up the Welfare Expert Advisory Group in May 2018 to report on how to deliver a social welfare system to ensure that people had an adequate standard of living, enjoyed dignity and could participate meaningfully in their communities. The group reported a year ago and made 42 recommendations, including the obvious proposal that benefits should be lifted to liveable levels.

However, the Government speedily made it plain that it did not intend to implement the bulk of the suggestions – aware that it would need to spend a large amount of political capital to make the changes and being unwilling to do so.

It was not by chance that Prime Minister Jacinda Ardern at the start of her government’s term pinned her reputation to tackling child poverty, rather than tacking poverty as a whole. Reducing child poverty is a far more acceptable goal because it is much harder for people to blame children for their unfortunate circumstances. The labels “bludger,”  “addict” and “lazy” are rather difficult to apply to children and so there is more sympathy for their plight, and more willingness to spend money on addressing it.

The Covid-19 pandemic means that many middle-class Kiwis are having their first experiences of dealing with the Ministry of Social Development. They are about to find out how low benefit levels are and how hard it is to obtain one’s legal entitlements. For the first time, these New Zealanders will learn that this country since 1991 has deliberately set benefits at rates so low as to be unliveable, on the basis that this will incentivise people into jobs.

Already, there have been media stories about people being shocked that they are denied support, as well as suggestions that the ministry has been misapplying the law relating to the impact of redundancy payments on benefit entitlement for decades.

Misinterpretation of the law by the ministry to wrongly deny people support is nothing new. In the past, the ministry has wrongly applied the law to deny people the Domestic Purposes Benefit, the Accommodation Supplement and the Special Benefit on a large scale. However, the difference then was that those misinterpretations of the law affected people who needed long-term support and fitted the country’s images of the non-deserving beneficiary.

Despite lengthy campaigns by beneficiaries, advocates and lawyers to draw these issues to public and government attention, it took years to try and obtain remedies and changes in policy.

By contrast, I expect that the issue about redundancy and benefit entitlement will be speedily addressed and remedied by the ministry and the Government, because the middle-class people affected have the power to draw media and political attention to the matter.

Ardern in her communications about the pandemic refers to New Zealanders as being a team of five million, while the Government’s Covid-19 announcements state that “We are in this together.”

Both of those statements are right. So, let’s also accept that New Zealanders are one in the good times as well as in the bad. People do not choose to have accidents, contract serious illnesses, lose their jobs, or have their relationships break down. All of these occurrences are Savage’s “natural misfortunes from which no one is immune.”

Punishing people who suffer misfortune by deliberately setting benefits at levels so low as to be unliveable merely doubles citizens’ misery and makes it far less likely they will ever recover from their misfortunes. Condemning large numbers of Kiwis to poverty also piles additional costs on taxpayers.

People in poverty have poorer health and contract preventable illnesses, thereby requiring health care they would not otherwise need. They are also more likely to be victims and perpetrators of crime, which leads to higher spending on police, the courts and prisons. And unemployed people require benefit support and do not pay the income tax the Government would receive if they were employed.

Thus, our punitive and mean-spirited attitudes to the vulnerable not only make their lives far more miserable, they also cost us money. Let’s get back to Savage’s philosophy and extend a proper helping hand to Kiwis in need so they can overcome their bad luck as soon as possible and have a future of full participation in society.

Covid-19 has shown us that #WeAreBeneficiaries. Those New Zealanders who only need state support for a short time in their lives are incredibly lucky. Let’s stop looking down on and punishing those who are less fortunate.

A good start would be to show the Government that there is broad public support for implementation of the Welfare Expert Advisory Group’s recommendations.

Cat MacLennan is a journalist and barrister

This article can be republished under a Creative Commons CC BY-ND 4.0  license. Attributions should include a link to the Democracy Project.  

9 comments on “Cat MacLennan: We Are Beneficiaries ”

  1. bill 1

    There are some good points being made in that piece, but why's she buying into liberal myths around "chance" and "fortune"?

    Poverty is a direct consequence of capitalism, and that's either acknowledged and remedial policies advocated for or set down in light of that acknowledgement, or the time worn nonsense of individual circumstance opening into liberal 'solutions' set around private charity get oxygen.

  2. JanM 2

    As a superannuant, I am perfectly happy to be called a beneficiary. It has little to do with whether I have paid taxes or not, as the system is basically founded on the premise of 'from those who have to those who need'. In the past I also spent a couple of years on the DPB, mainly because, in the absence, back then, of any support for daycare, my salary as a kindergarten teacher was too low to afford the cost of it.

    The benefit system works pretty well for superannuants in most cases, as their basic amount is a lot higher, but there definitely needs to be an overhaul for everyone else. It's not just about the money, although that's a big issue, it's about the lack of empathetic support for people who, for one reason or other, need to avail themselves of this source of income. This, in my opinion, needs to be seamless and engaged in by government staff who have adequate knowledge and understanding of the opportunities, as well as the limitations, that people face in their lives.

    The attitude of the staff when I went to apply for my superannuation was an eye-opener – it was positive, helpful and polite, unlike much of what I have seen and experienced elsewhere in the department. It did not escape my notice that we were in a separate space from everyone else, This needs to be the standard approach. As you state, people do not choose to be in most of the situations they find themselves in, and the proper support will surely help in the struggle.

  3. ianmac 3

    Agree that all people are entitled to a fair assistance to living.

    The problem faced by Governments is to have benefits "too high" means that it can be better to live on a benefit that work for a lower wage.

    Perhaps this Government is remedying this by lifting minimum wages and or introducing a living wage. And as Cinny points out the basic benefit is supplemented by other allowances.

  4. barry 4

    But the neolibs are not being stingy. They are, in fact, showing kindness by 'encouraging' people to better themselves by looking for work.

    <sarcasm – off>

    the evidence shows that people without enough money to survive make worse decisions in general BECAUSE they are poor. If we want people to be out looking for work and improving themselves we should be giving them the wherewithal to do it.

    In the 1970s, when the baby boomers and their descendents discovered unemployment, the government had job schemes to keep them busy and provide them with a decent income. The Labour/ACT coalition in 1984 decided to save money by canning the job schemes, but left the benefits at liveable levels. It was considered that job schemes were inefficient as they didn't encourage real jobs.

    It was not until the next National government (which was ashamed that Labour had beaten them to it) that benefits were slashed to force people to take whatever shitty conditions the slave-master-inclined employers could throw at them.

  5. KJT 5

    The “Others”.

    "

    National, “dogwhistling” about “solo mums, breeding”, “lazy unemployed youth” or “generational welfare dependency” , is a recurrent staple whenever they flag in the polls, or need a distraction from dishonesty, arrogance or incompetence.

    Labour, to their discredit, largely went along with it. Welfare has been deliberately set below the cost of a minimal living, since Richardsons, “mother of all budgets”, to force people into underpaid jobs.

    The underlying memes, behind much of the “othering” in New Zealand are “useless mouths”, “deserving and undeserving poor”, “the meritocracy” (that money you are paid, reflects your value to society), “productive and unproductive people” , “welfare bludgers”.

    Few who use these self serving justifications, for their own greed and privilege, are stupid enough to use those exact words. The supporting train of thought, however, is obvious".

  6. ianmac 6

    Kat wrote on Pundit to Sue Bradford that:

    This is a specific response to those immediately negatively affected by Covid 19 and for a limited time. Based on your response you would not support sole traders or private sector business receiving the Covid 19 wage subsidy either. You are just politicising for politicising sake.

    Seems to me to have a good point.

    • bill 6.1

      Well, seeing as how Sue Bradford was writing about two tiers of benefit being applied to unemployed people, how does that equate to the wage subsidy? (It doesn't).

      Whoever 'Kat' commenting at Politico is, they're a prat.

  7. Dennis Frank 7

    Like Jan @ comment 2, I'm a superannuitant who has no problem with being called a beneficiary. Whilst I have no real disagreement with the framing used by the author in pointing out that more than half the people of Aotearoa can accurately be identified as beneficiaries, I'd like to point out the lack of political import in the essay.

    That's due to the fact that many – if not most – don't self-identify as such. Since identity politics replaced class consciousness, political alignments and developments tend to be produced by how people identify themselves. When govt bails out business folk, they don't actually start viewing themselves as beneficiaries, for instance. They continue to self-identify as business folk – even in receivership, when the business has gone.

    Similarly, they don't see Jacinda, Winston, et al as their rescuers and enactors of state socialism. Even though they have experienced a life-transforming benefit of practical state socialism. Joining them in denial are the socialists. Nobody in either group has written or spoken in the media about this excellent example of large-scale practical socialism, as far as I can tell.

    Perception by self is based on long-standing social categories and their labels, deriving from group conventions, that mask reality. It would help rehabilitate socialism as a belief system if people were able to perceive it when it actually happens to them…

  8. Fifi 8

    Over the years no matter who is in Government, it seems that it is easier to pay benefits rather than provide wrap around services to help these people move into suitable paid work or training.

    My daughter became a solo Mum after her marriage broke up. That was 15 years ago. Since then she has been on a benefit. She is quite happy to do nothing to help herself, and at no time has been required to seek work.

    One of her children has now chosen the same lifestyle.

    I would like to see her required to actively seek work, or be required to retrain or do Community work.

    WINZ has become her financier. If she needs a new fridge or washing machine, WINZ provides one, usually a brand new Fisher and Paykell model.

    Meanwhile, I see another young relative, working full time on the minimum wage, and receiving less income than my Daughter.

    is this fair? I don't think so.

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