Families still locked in poverty after benefit rise

April 2024

Increases to benefits on April 1 will still leave families locked in poverty, a study released today by the Fairer Future collaboration says.

Liz Davies, general manager of SociaLink, the umbrella organisation for the Western Bay’s social agencies and charities, agrees.

“As we are seeing more working people accessing local services such as the Foodbank for the first time you can only imagine how much people relying on benefits are struggling.

“Without sufficient income to cover the basic costs of life, many people inevitably end up in debt which makes it harder to climb out of poverty,” she says.

“Local social service providers are working very hard to support and empower people on low incomes and benefits. However, ensuring people have a liveable income would make a huge difference to whānau, who then wouldn’t require food parcels and would be more likely to access health services.”

Fairer Future collaboration spokesperson Brooke Pao Stanley, of Auckland Action Against Poverty, says it’s time for the Government to “level up” income support so everyone can live with dignity. Poverty was forcing people into impossible situations.

An update of the Welfare Expert Advisory Group’s modelling on what income is needed to meet basic costs shows the majority of people receiving income support still won’t have nearly enough to live on, even after the April 2022 income support increases.

The work compared WEAG family cost estimates, inflation-adjusted for 2022, to Government estimates of April 2022 benefit entitlements, and found some of the country’s worst-off families will face shortfalls of up to $300 a week. Of 13 families, 12 won’t be able to meet their costs, and nine won’t be able to meet core essential costs, like rent, food and transport.

In mid-2022, a couple with three children receiving Jobseeker will need around $300 extra a week to meet their total costs, including children’s sport and contingency for unexpected bills. To meet just their core costs, they still need an additional $165 a week.

A sole parent with three children will require around $240 more a week to meet total costs or an additional $111 a week solely to meet core costs. A single person receiving Jobseeker and sharing a house will need about $90 more every week to cover all costs.

“We urge the Government to do the right thing and ensure liveable support for all,” Stanley says.
The research was launched online with speakers Stanley, Aaron Hendry from Lifewise, Nick Stoneman from the Disability Advisory Trust, and Max Harris from ActionStation.

The Fairer Future collaboration is calling for seven key changes to income support.

These include increasing core benefit levels to the standard of liveable incomes, raising the minimum wage to the living wage, increasing the Disability Allowance, overhauling relationship rules, removing sanctions, wiping debt owed to the Ministry of Social Development and improving access and supplementary supports to meet basic needs.