New Zealand Prime Minister Christopher Luxon has recently unveiled new measures aimed at reducing welfare dependency in the country. Luxon announced a strict regime of sanctions that could result in benefits being reduced or cut entirely if recipients fail to meet certain requirements, such as attending job interviews. The decision to implement these measures comes after a significant increase in the number of people relying on welfare for extended periods of time.
Luxon emphasized the negative consequences of long-term welfare dependency, stating that it leads to a lack of hope, opportunity, and dignity from work. On average, New Zealanders spend 13 years on a benefit, while teenagers on welfare are trapped for an average of 24 years of their working life. The prime minister argued that there is a need for further welfare sanctions, as the previous government’s decision to drop them resulted in more time being spent on unemployment benefits.
Social Development Minister Louise Upston supported Luxon’s stance, stating that remaining on a benefit has become the rational choice for too many people. She argued that while the welfare system should act as a safety net for those in need, it should also come with certain responsibilities. Upston criticized the previous Labour government for significantly reducing the number of sanctions applied, while the number of people on Jobseeker benefits continued to increase.
Official figures from the Ministry of Social Development reveal that there were approximately 12,000 sanctions applied in the quarter before the Labour government assumed power in 2017. This number remained relatively steady until the beginning of the pandemic in 2020 when they significantly reduced as a less punitive approach was adopted. However, since the end of 2020, the number of sanctions has increased again.
The new measures proposed by the National Party include a “traffic light” system, where beneficiaries who meet all their obligations would be categorized as green, those with one or two breaches would be on orange and subject to additional requirements and support, and those with three or more breaches would be on red. Sanctions could involve cuts to payments, suspension of benefits, community work experience, or the Work and Income department taking control of beneficiaries’ money and spending it on their behalf.
In addition to these measures, job seekers will now need to reapply for benefits every six months and provide evidence of job applications and interview attendance to continue receiving support. The Ministry will also introduce “work check-ins” for job seekers who have been on benefits for six months, particularly focusing on young people. These new rules aim to address the high NEET (not in employment, education, or training) rate among 15 to 24-year-olds, which currently stands at 11.7 percent.
While the government believes that these measures will help reduce welfare dependency and encourage meaningful employment, opposition parties have criticized the move. Labour MP Carmel Sepuloni argued that the changes would disproportionately affect marginalized groups such as Māori, women, Pasifika, and disabled individuals. She accused the government of taking money from the poorest New Zealanders to fund promised tax cuts. Te Pāti Māori MP Tarsh Kemp urged the government to gain a better understanding of poverty in New Zealand by visiting marae or consulting organizations like the Auckland City Mission. The Green Party’s spokesperson for Social Development and Employment, Ricardo Menéndez March, claimed that the government’s goal was to push more people into poverty through benefit sanctions and that sanctions do not effectively support people into meaningful employment or community participation.
Prime Minister Christopher Luxon’s implementation of these new measures aims to tackle long-term welfare dependency in New Zealand. While the government argues that welfare sanctions are necessary to encourage self-sufficiency and reduce reliance on benefits, opposition parties criticize the move as potentially exacerbating poverty. As the debate continues, it remains to be seen how effective these measures will be in achieving their intended outcomes.
