Report shows reforms are workingSocial Development
Social Development Minister Anne Tolley has welcomed the release of a detailed report into the benefit system, which confirms that welfare reform is contributing to huge savings for taxpayers in the decades ahead.
The 2014 Benefit System Performance report is the second actuarial report on the lifetime costs of the benefit system to be produced by the Ministry of Social Development.
“We are seeing great gains in supporting people off welfare and into work, which is leading to better lives for families,” says Mrs Tolley.
“There are over 38,000 fewer people on benefits compared to three years ago, and the number of children in benefit dependent households has fallen by almost 42,000 over the same period.
“The number of young mothers requiring a benefit has almost halved since 2009. This is especially important as teen parents have some of the highest lifetime costs of any group on welfare, and over the year to June 2014 we have reduced the average time they spend in the welfare system from 19 years to 17.5 years.
“The report published today highlights the importance of our support for sole parents to improve the future prospects for parents and children, and how intervention can reduce intergenerational benefit dependence.
“It provides a valuable review of forward liability and the focus on welfare reform, using a summary of the Taylor Fry valuation which was released in February.”
The Taylor Fry valuation found that between June 2013 and June 2014:
- The liability of the benefit system decreased by an estimated $7.5 billion, a ten per cent drop, with $2.2 billion of that total due to welfare reform and Work and Income’s support of beneficiaries.
- Liability for sole parents decreased by $3.3 billion.
- Welfare reform has reduced the expected future time on main benefits by an average of 1.2 years for sole parents and 2.8 years for youth beneficiaries.
The report is available at www.msd.govt.nz
Note to editors:
Welfare reforms were introduced from 2012 to support and encourage people off work and into employment, and include:
- Youth Service, where case managers and providers help young people to gain education, training and employment skills.
- Social obligations for beneficiaries with dependent children, to ensure they are meeting health and education goals.
- Changes to the welfare system, which simplified benefit categories and increased the focus on employment. This introduced new expectations for beneficiaries, requiring them to be available for work or getting ready for work.