Unemployed face work tests

Opinion poll

Rate the Government's welfare reforms:

About right

Too strong

Not strong enough

Vote Result

Relevant offers

Politics

MPs' travel bills leap during election Remedial work for navy's problem ship Wait for new oil law before awarding permits, Govt urged TVNZ included in police Electoral Act investigation Sea law 'an environmental risk' Govt defends 50c an hour minimum wage lift Maori queue-jumping for SOEs raised More claims about PM's man and doco funding Peters demands apology over Whanau Ora row The week in politics

More than 60,000 beneficiaries face having their payments cut if they fail to comply with tough new work tests.

Unemployment beneficiaries face the strictest regime, with Social Development Minister Paula Bennett saying the "dream is over" for those who cannot show an honest attempt to find work after a year.

"If a real, demonstrable effort has been made, their benefit will be reinstated. If not, well, I'm afraid the dream is over."

The Government is also planning work tests for domestic purposes beneficiaries whose youngest child is at least six and sickness beneficiaries judged fit to work at least 15 hours a week.

The main changes will affect 64,000 beneficiaries, according to present figures.

Twelve thousand have been on the dole for more than a year, 43,000 DPB claimants have youngest children over six and 9000 sickness beneficiaries are judged fit to work part-time.

A further 52,000 people on the dole for less than a year will also be subjected to payment sanctions if they don't look for work.

The changes are among welfare reforms announced by Ms Bennett and Prime Minister John Key.

They include granting the unemployment benefit for only 12 months at a time, with recipients having to reapply after that and show what they have done to find a job.

Beneficiaries who do not comply with job-search requirements during the year will have their benefit cut by half, suspended altogether after a second failure and cancelled after a third.

Sickness beneficiaries fit to work face the same sanctions from May next year.

Currently, suspending a benefit is the only sanction for beneficiaries who refuse to seek work.

From September 27, DPB claimants whose youngest child is six will have to be available to work at least 15 hours a week.

Failure to comply will see their benefit cut by half, but they will retain additional assistance.

Exemptions will be available for those in fulltime study or with mitigating circumstances such as special-needs children.

Mr Key said beneficiaries with dependent children would not have entitlements cut by more than half.

Ms Bennett – who lived on the DPB periodically as a young solo mother – said nobody would be required to take work not suited to them, and factors such as childcare would be taken into account.

The changes – which include DPB study loans and additional funds for childcare – will cost $88 million in the first four years, but will save just $300m from the $4.8b benefit bill over the next decade.

Mr Key defended the comparatively low savings, which he said were based on "extremely conservative" Treasury advice.

"If we don't ... tackle the difficult issues where people either won't get a job when they can or won't get the skills when they can ... they will languish on a benefit for the rest of their adult life and ... that's unacceptable to most New Zealanders."

But Labour leader Phil Goff said the Government was cracking down on beneficiaries when there weren't enough jobs.

"Unemployment has trebled ... not because people don't want to work but because the jobs aren't there and this Government isn't focused on creating them."

Maori Party whip Te Ururoa Flavell said the party would support the changes to a select committee, but was reserving its position beyond that.

MAIN BENEFIT CHANGES

Unemployment beneficiaries must reapply for the dole every year and show what they've done to find work.

New graduated sanctions for failure to comply with job search requirements.

New work tests for DPB once youngest child is six.

New work tests for sickness beneficiaries deemed fit to work 15 hours or more a week.