The politics behind the government’s welfare reform process

by Gordon Campbell

Sometime during the week of February 21, the Welfare Working Group chaired by former Commerce Commission head Paula Rebstock will release its final report on welfare reform in New Zealand. From day one, the exercise has hardly been a wide-ranging or rigorous investigation. The WWG chose to fixate on a symptom (welfare dependency) selected a cause from its ideological kitbag (an alleged lack of personal motivation and of strong incentives to seek work) and shaped its policy recommendations to suit.

A long list of relevant issues have not been part of the WWG agenda. So far, the WWG’s investigations have not involved any substantial analysis of :

(a) the extent of poverty among beneficiaries and low income workers and its effects

(b) whether benefit levels can sustain basic living standards vis a vis rising costs, and the related health outcomes, particularly among children.

(c) the cost and optimum form of work and training schemes for the young unemployed.

(d) the availability and affordability of childcare, region by region

(e) the global recession’s impact on the job market

(f) the adequacy of the government’s current job creation policy.

(g) the job outcomes attributable to the government’s stimulus policy during the recession.

(h) changing social attitude to marriage breakdown and divorce, and the implications for DPB figures.

(i) the social and economic value – including opportunity cost – of parenting carried out by DPB recipients

(j) the net cost of work schemes as opposed to the health costs and law and order costs that are unemployment -related

(k) the extent to which demographic factors such as the ageing population are being reflected in the sickness and invalid benefit numbers…etc etc.

Yes, there is a lot the Welfare Working Group could have considered in depth, but didn’t. Yet the government already seems on board with some of the harsher options even before the WWG’s final report has been tabled. At this year’s opening of Parliament, Prime Minister John Key signalled his intention to enforce a five-year time-limit on benefits, random audits of sickness benefit certification, work for the dole after six months, and tougher conditions requiring paid work for parents (usually, women raising children alone) who are receiving the domestic purposes benefit.

This crackdown will come at a time when the failure of the government to keep its side of the social compact is evident. In December, unemployment reached 158,000, just shy of the 163,000 peak reached at the height of the global recession. Perhaps the people in real need of tougher work tests are the Ministers seated around the Cabinet table.

To soften the image of a government that plans to require more DPB, sickness and invalids beneficiaries to chase after phantom jobs, Prime Minister John Key has begun talking about the need for the state to provide affordable, quality childcare as part of its reform process.

“If we are seriously going to have an expectation that a young mum is going to get off the DPB and into the workforce, even on a part-time basis, we are also going to have to make sure her child is in a safe environment and is cared for and that it is cost effective”.

This concession by Key undermines much of the logic for his welfare reforms. If the work of solo parenting is valuable – and obviously it is, because otherwise Key wouldn’t be saying the country needs to pay someone else big money to do it to anything like the same standard – where is the net social or economic gain in pushing DPB recipients prematurely out to work? At best, the reforms will only replace the parent with a surrogate paid by the state.

For what reason? The current stats on the age of most DPB recipients (the vast majority are aged 25-54) and the limited period of time most solo parents spend on the DPB (see below) do not support Key’s claim that ‘a significant number of very young women [are] going onto the DPB and staying there for a lifetime.’ Really? So many that it can justify the stigmatizing of virtually everyone on the DPB ?

The process is almost entirely about politics. The message of welfare reform is not being aimed at beneficiaries – who are merely collateral damage in this process – but at low and middle income workers. In election year, there are electoral gains to be made from targeting people on benefits, even if only to divert criticism of the government’s own failure to manage the economy. There are precedents in the government of the British Tory PM David Cameron. In January the Cameron-Clegg coalition in Britain used welfare reform as a conscious pitch for what British deputy-PM Nick Clegg has called ‘alarm clock’ Britons who have recently been described by the BBC in these terms:

These are basic rate taxpayers who…. get up in the dark, get their children ready for school and then go out to work. People, who Mr Clegg accepts are seeing their already fairly modest living standards hit by pay freezes, job losses and price rises. [Clegg] points to the government’s welfare reforms which he believes are popular with working families, who perhaps resent claimants on housing benefit who are able to live in homes they cannot afford.

It carries echoes of Chancellor George Osborne’s assertion last year that the government was going to put an end to the “benefits lifestyle” – where he said some claimants were able to lie in with their curtains closed while “hard working families” headed off to work.

How long before the Key government starts singing the praises of ‘alarm clock Kiwis?’ Not long, one imagines. Left to their own devices, low income and middle class voters – squeezed by price rises and job insecurity – might otherwise start to blame the government for the stagnant economy. Far better to channel their resentment against those people who have taken the alleged ‘lifestyle choice’ of being on the dole, or of raising their children alone on the DPB.

The WWG – and government figureheads such as Key and Social Development Minister Paula Bennett –appear to have bought wholesale into a number of myths about welfare and the so called ‘ benefit lifestyle.’ Here are some common ones :

1. Anyone who wants to get off welfare can get a job.

No, they can’t. In the last two months of 2010, the number of people receiving the dole rose by 4,536 to 67,084, and rose again in January to 68, 087. The number of people out of work stands at 158,000. One in three of the people currently on the dole were over 40 years of age – and many of them suffer from age discrimination in the job market. (There were 112,865 people on a domestic purposes benefit at the end of December, 85,105 on an invalid’s benefit and 59,988 on a sickness benefit.)

As one would expect, the dole numbers have risen steeply since the recession began. In the mid 2000s, dole numbers had shrunk to around 17,000 – one quarter of the current number, and solid proof that the problem is not a lack of motivation and/or of strong incentives. The vast majority of people want to work. The history of the last ten years in particular shows that when jobs exist, people work. Conversely, no amount of self-motivation by a solo parent will create a job at her local supermarket when they are laying off staff.

It is a very odd situation. The same politicians who have been unable to manage an economy so that it employs people, are now blaming people for not finding jobs that do not exist. Nothing in this process is directly about reducing or alleviating poverty. It is mainly about reducing costs by making it harder for families to access the assistance they need in adversity – and this is being done in part at least, to make up for the revenue given away in last year’s tax cuts. It is part of the wealth transfer from the poorer to wealthier members of New Zealand society occurring on the government’s watch.

2. People on welfare commit a lot of benefit fraud, at the expense of hard-working people

The evidence for the existence of widespread benefit fraud is paltry to non-existent – despite the fact that a special fraud intelligence unit was set up in the Social Welfare department in 2007 to detect it. Last year, the department checked 29 million records, and found the benefit fraud rate (as a proportion of the total benefits paid) was a miniscule 0.10 per cent. A declining number of prosecutions – from 937 in 2009 to 789 last year – resulted.

Of the $16 million in benefit fraud detected last year, a proportion was carried out by social welfare staff – ten of whom were sacked last year for ripping off the system – and not by beneficiaries themselves. While any level of benefit fraud is unacceptable, the $16 million a year currently being incurred is hardly an intolerable burden. Currently, New Zealanders spend $16,1 million a day on impulse purchases.

Moreover, other forms of unacceptable behaviour leave benefit fraud far behind in the dust without attracting the same negative stereotypes. The major foreign owned banks for instance finally agreed in late 2009 – and only after being pursued at great expense through the courts by the IRD – to cough up $2.2 billion of what they owed in unpaid taxes. Meaning : the settlement figure this case alone was about 140 times greater than the total amount lost in benefit fraud last year..

3. Putting a time limit on how long people can receive welfare is a good idea

No it isn’t – though it certainly sounds like a tough, no nonsense policy doesn’t it? Five years on welfare and that’s your lot. Long before Oliver asked for more, those in power have found it salutary to save the needy from their…needs. In this case, five year term limits were part of the welfare reforms imposed under the Clinton presidency in 1996.

New Zealand officialdom appears to have a strong appetite for US welfare reform models. The last time a National government mounted a major attack on beneficiaries – ie, the “Welfare Time Bomb” exercise of 1997 – the programme included dob-in -your-neighbour proposals and anti-welfare pledges posted to every household. The US state of Wisconsin was the template for that exercise, and several Wisconsin welfare experts were brought to New Zealand to advise officials, and address conferences here on the Wisconsin success story.

One big difference : the Clinton administration (and Wisconsin) imposed term limits in the middle of an economic boom. The Key government is seeking to impose them in the depths of a recession. What has happened to US term limits during the current recession? Late last year Bloomberg’s Business Week magazine reported on the outcomes.

What we know is that more than 3 million people eligible for welfare are not taking part….the reasons people are scared off include rules mandating job-related searches; declining cash benefits, which “have not been updated or kept pace with inflation”; and sanctions tied to the search process. Investigators also discovered state “diversion strategies” to keep applicants from staying on the program. States can steer applicants into taking a lump sum for, say, three months of assistance; then they’re not counted on the state’s regular TANF [temporary assistance] rolls or required to maintain contact with the welfare office.

In other words, tougher work tests and term limits certainly do succeed in dumping people off welfare – in good times and bad, and regardless of the consequences for them and their children. The Clinton-era reforms have slashed the number of Americans on welfare from 4.8 million in 1996 to around 1.7 million in 2008. Instead of receiving monthly cash payments as before, people have had to register in a Temporary Assistance programme for Needy Families (TANF) which has work conditions attached and a sixty month lifetime term limit.

Leave aside the fact that getting people off welfare bears little or no relationship with lifting them out of poverty. ( Pushing people into low income, dead end jobs with no job security is not a cure for poverty.) If work requirements are to have any chance of success, the state also has to make childcare affordable, usually through increased subsidies. (Last year, the Key government cut childcare subsidies but as mentioned are now talking of creating them afresh, for beneficiaries.) Moreover, since the Clinton reformers knew that jobs would decline during a recession, they set aside some $2 billion a year to cope with that eventuality. What similar emergency funding – if any – will Key be setting aside to ensure that families reaching their welfare term limits in a recession will not be abandoned?

Well, the recession has finally arrived in the US and – superficially at least – the consequences have been somewhat surprising. Even where the recession has wiped out jobs, the people displaced have not sought assistance in any predictable or uniform way. Between states, there has been wide variations, as Business Week reported, between the unemployment rate and the requests for cash assistance.

What seems to have happened is that the hurdles erected by welfare reform actively deter people from seeking assistance, even when they and their children are eligible, and are in need. People ration out their term limit period of eligibility, such that even the eligible avoid seeking assistance. It is the industrial version of people not going to the doctor when they are sick, because they feel they cannot afford the cost of the visit. Worse – and more costly social conditions – then tend to develop.

The Business Week report was largely based on a highly relevant March 2010 survey by the US Government Accountability Office, available here.

What the GAO report indicates is that stringent welfare eligibility conditions deter people from seeking assistance during the recession – and have especially discouraged the most vulnerable people, who are suffering from disabilities. For example :

..”Other families may have found it difficult to apply for or continue to participate in the program, especially those with poor mental or physical health or other characteristics that make employment difficult... Research also suggests that, in response to lifetime limits on the amount of time a family can receive cash assistance, eligible families may hold off on applying for cash assistance and “bank” their time, a practice that could contribute to the decline in families’ use of cash assistance.

The pattern is undeniable. Tighter work conditions, low benefit payments and five year term limits not only combine to reduce the numbers of people eligible for assistance – they also deter the people who are eligible from seeking help. As the GAO report continues :

In total, about 420,000 fewer families were eligible for cash assistance in 2005 than were eligible in 1995, according to HHS data. However, most of the decline in the cash assistance caseload—about 87 percent—resulted from fewer eligible families participating in the program. In 1995, about 84

percent of eligible families participated, but over the decade, participation in cash assistance fell dramatically, to about 40 percent of eligible families in 2005.

Primarily, the welfare reform process has served the interests of politicians and bureaucrats – not families in need, or the wider wellbeing of society It has resulted in falling caseloads, even during the recent times of greatest need. Business Week again :

The law has altered the public perception of welfare and the culture of state administrators. It has been a sign of weakness to have caseloads go up, meaning new state welfare chiefs, like Jennifer Hrycyna in Illinois, confront not only their staffs’ reflex to deny benefits, but also the challenge of easing onerous rules….’Work requirements should be structured to provide meaningful opportunities to recipients that will lead them toward long-term self-sufficiency,’ says Hrycyna, ‘rather than pushing people into unstable low-wage jobs that get families off the rolls but leave them in poverty.”

Term limits deter people in need, and systematically cheat people of their entitlements. Why would we want to import such a scheme here when we already know the consequences in its country of origin?

4. People who go off on the dole go onto sickness and invalids benefits. We have to crack down on them, too.

Welfare bashing reaches its lowest form with the stigmatizing of those on sickness and invalids benefits – the bulk of whom are there for valid and ongoing reasons, such as serious physical and psychological ailments. If there is a problem with a minority being mis-diagnosed, surely the blame and policy pressure should be being directed at the GPs concerned, not at their patients.

On the international evidence, New Zealand does not have a problem in this respect. Late last year, the OECD released comparative figures which showed that one of the main reasons for the recent rise in people receiving disability benefit is that New Zealand has been from a very low base – mainly thanks to the pre-Rogernomics policies of full employment and prior methods of institutional care. True, in the wake of the initial carnage wreaked by Rogernomics in the 1980s, unemployment and disability benefits both rose sharply – and since then, unemployment has fallen but sickness and disability benefits keep on increasing.

Even so – and this is the relevant point – the numbers of working age people who receive sickness and disability benefits in New Zealand is still well below the OCED average. In 2008, this ratio was 3.8% in New Zealand, as compared to the 5.7% OECD average. Moreover, the share of people on disability benefits is among the lowest in the OECD for older workers aged 50-64, but fifth highest for young adults aged between 20-34.

Therefore, if there is mis-diagnosis going on here – as Paula Bennett would no doubt suggest – it is among young adults, which represents even worse news for the Key government. It means that the already calamitous figures for youth unemployment are even worse than they currently seem. Either way, the bulk of those people on sickness and disability benefits likely to be re-classified as work-capable by the Bennett reform process (ie, young people on sickness and disability benefits) are going to be tipped out onto the very part of the job market where the shortage is already the most extreme.

To continue : New Zealand’s spending on sickness and disability as a share of GDP was also lower in 2008 than the OECD average – 1.3% to 1.9%. A further sign that if anything, New Zealand has been skimping in this area. Moreover, the unemployment rate for New Zealanders suffering from chronic health or disability was in 2006 (the most recent comparison period available) only 7.4% – which is far, far short of the 13.7% average unemployment rate for such people among OECD nations as a whole. Conversely, the employment rate for sick and disabled people in New Zealand is among the highest in the OECD – 59.5% compared to 43.6%. The sick and disabled are already working in large numbers here even though, as the OECD also noted, such poorly paid work still leaves their incomes lower than that of the general population of New Zealand.

In the light of such figures – that show by international standards we have proportionally fewer of the sick and disabled on benefits, allocate relatively less of our national wealth to meet their needs, have more of them in work, and fewer of them on the dole – Bennett should be deeply ashamed of mounting any further attack on the people who currently receive such benefits.

5. Most of the people on welfare are unmarried mothers – many of them teenagers – who have extra children so that they can get more money

This is a hoary old myth that combines the resentment of beneficiaries in general, with prurient resentment of the sexy young having too much sex. In fact, the US and New Zealand evidence is that young people are having less sex, later than their parents’ generation.

The Salvation Army’s recently published State of the Nation report contains similar positive findings for New Zealand :

Teenage pregnancies and abortions have fallen during 2009, which is perhaps welcome news that there are fewer unplanned pregnancies. The number of 11–14 year olds giving birth or having an abortion dropped from 122 in 2008, to 108 in 2009….Although this decline is on a very small base, this number of pregnancies is the lowest in at least eight years. For older teenagers aged 15-19 years old, there was a 10% decline in the rate of pregnancies between 2008 and 2009

Such figures help contradict Key’s scaremongering use of the young as a pretext for welfare reform. More to the point, the NZ figures on DPB recipients do not bear out Key’s specific assertion about ‘significant numbers of very young women going onto the DPB and staying there for a lifetime.”

In fact, only 3.1 % of those on the DPB are under 20 years of age – and that figure has barely flickered since 2005, when the figure was 2.9 %. Put another way, 97% of the people on the DPB are NOT the ‘very young women’ of Key’s lurid imagination. There are in fact, significantly more people on the DPB over 55 years of age (5.6%) than there are ‘very young women’ receiving this benefit.

The vast bulk of DPB recipients (nearly 75%) are what you would expect : they are aged between 25 and 54. Some 61% of them are caring for children six years or under – a figure that, again, has barely changed since 2005. Nearly half are caring for two or more dependent children.

Many of these women are caring for children alone because of a marriage breakdown, which is rarely a lifestyle choice. They have not only borne the opportunity cost of foregoing career opportunities to raise a family but are also now doing the bulk of the parenting alone and – if one can believe the child support payment figures – very often without the financial support that is due to them. Even so, more DPB recipients are engaged in part-time work (16%) than those on the dole. Far from being left at home to look after their children in ways that low income workers cannot, people on the DPB have since last September, faced a regime of work tesing.

These are the women that the WWG and the Key government want to stigmatise? Even Paula Bennett’s own department doesn’t believe the real problem here is a lack of personal motivation, or an absence of strong incentives. The Social Development Department’s December fact sheet on the DPB blames the economy instead :

The number of clients receiving a Domestic Purposes Benefit at the end of December decreased from 106,000 to 98,000 between 2005 and 2007, then increased to reach 113,000 in 2010. This pattern reflects changes in economic conditions. (My emphasis.)

One further crucial piece of evidence shows there is no social or economic crisis in the country’s current DPB figures. The ratio of those on the DPB – if taken as a percentage of the working age population – was actually lower in December 2010 (at just over 4%) than it was when National left office in 2000, when the figure was heading for 5%.

6. Lots of people are on welfare for years and years, and then their children and grandchildren become welfare dependent.

This myth is based on stereotypes about the chronically shiftless and teemingly fertile poor. Lets stick with the DPB for a moment. Since the DPB involves the care of children who are dependent at least until they are 18, you’d think it would reflect lifetime dependency very strongly. Yet instead, over two thirds of DPB recipients (67.7%) are on the DPB for less than four years. More than a quarter of them (26%) are on it for less than a year, even during the recession. If this is a lifestyle choice, it is hardly a fashionable one.

Looking across all forms of benefits, 61.4 % of recipients are benefit dependent for four years or less. Only 14.3 % are on benefits for more than ten years – and since those figures include people with chronic physical and mental disabilities, the ratio of those staying on benefits because it is a “lifetime, lifestyle choice’ is lower again. In an excellent piece last year, Tim Watkin made much the same point :

Of the 28,701 people who have been on the sickness benefit for a year or more, 40% of them have psychological or psychiatric conditions. Given that we have to run ad campaigns to reassure New Zealanders that even people with depression, let alone more serious mental health issues, can be good workers, does that number seem outlandishly large to you?

Again, people who are temporarily in need of assistance – and who are using that help and moving on as quickly as most of them can – are being stigmatized in the cause of fixing what is virtually a non-existent problem.

Finally, there is a serious definitional problem with the whole notion of generational welfare dependency – the very existence of which usually turns out to be anecdotal. Namely, what is to be counted as generational dependency? When a child of low income parents in state housing accommodation loses their job and needs the dole temporarily, is that to be taken as generational welfare dependency? What it more often reflects is that the children of parents on low incomes are more likely to go into badly paying jobs that offer little in the way of job security. For similar reasons, the children of parents on high incomes find it easier to find stable, better paying jobs. Personal motivation is a minor factor in this process. For that reason, perhaps the government would be better advised to focus its efforts on fostering an economy that offers employment prospects and skills training for the people most at risk.

7. Making unemployment insurance compulsory would be a good idea.

It would certainly be a bonanza for insurance companies. It might also seem like a good idea to Finance Minister Bill English – who could not only shift much of the cost of welfare provision onto employers and beneficiaries, but could count the gigantic fund this scheme would quickly generate on the positive side of the nation’s accounts, and thus lower the cost of borrowing. That’s what has happened in Canada, where the federal government has been able to count the unemployment insurance scheme surplus on its books.

The Canadian experience with UI has been – surprise , surprise – that access hurdles rise, and payments don’t keep step with rising cost of living. In Massachusetts, the UI scheme has also exploded in rising costs to employers during the recession :

That’s the sticking point, politically speaking. UI amounts to a new tax on firms and their employees – and employers would make the loudest noises about it. The provision of welfare by private operators and insurance companies also opens up fresh avenues for fraud and abuse. For all that, UI schemes could well appeal to the far-right side of the government’s support base and to many entrepreneurs who would reap millions from the benefits trade. Given the way the economy is being managed, welfare does look like a growth business.

But the levy on employers? A levy that would keep on climbing as economic conditions got worse – and which would make employers gun shy of taking on new staff – would have the perverse effect of generating more ‘clients’ on the dole and keeping them there for longer. Some harmful outcomes of UI for employers in Washington state during the current recession are spelled out here :

Under the state’s unemployment-insurance formula, companies pay higher taxes if anytime in the previous four years they laid off employees who then received unemployment benefits. And all employers, regardless of whether they let go workers, pay a “social cost” tax to cover the workers of businesses that have closed.

The depth and breadth of the Great Recession have meant all employers are being hammered by increases in the social-cost tax. Printcom, for example, has seen its rise 316 percent over the past two years to just over 2 percent of payroll

Similar problems exist in Massachusetts such that in mid February, the Massachusetts Senate voted 36-0 to impose a ‘freeze” on UI levies to help employers to survive the recession – because the scheduled level of the levies was likely to send many firms to the wall.

For these and many other reasons, trying to introduce such a system in New Zealand would be likely to cause a political revolt among National’s support base in small and medium size business. Its a non-starter.

8. People on welfare are bludging on the rest of us.

Yes, some people do bludge – just as some people cheat on their taxes and some people don’t pay their parking fines. Arguably though, many more people on welfare are receiving the help they have already paid for. After all, one reason people pay taxes is to ensure that an adequate safety net exists for them and their children, if and when they need it. In that sense, they’ve already paid for such help – taxes are a form of social insurance – and it is outrageous that the state that has cheerfully taken their taxes in the past, should now be reluctant to meet its part of the social bargain.

People are usually in hardship for economic reasons, and not due to a lack of moral fibre. The churn of jobs and the likelihood of multiple careers in one’s working life – ie the labour ‘flexibility’ so beloved by Treasury and its corporate friends – means that it is more and more likely that at any given time in their working lives, more people (and their children and grandchildren ) will be at risk of needing temporary welfare assistance during thedir job transitions. Making such assistance miserly and more difficult to access is in no-one’s personal interest. It is also damaging to the economy (because beneficiaries spend their benefits on essential goods from retailers) and detrimental to the country as a whole.

9. Young people need welfare reform in order to teach them the value of work.

In fact, nothing exposes the hollowness of the current rhetoric about welfare reform than the cavalier treatment of the young. Just under a third of the people on the dole are aged 18-24 – again, and not by choice. Yet the government has just axed one of the most successful work schemes for young people at risk :

The Community Max programme was introduced by the Government last year and aimed at unskilled 16 to 24-year-olds with few or no qualifications.

It provided thousands of youths with six months’ work placement on a community or environmental project. Work and Income subsidised each person’s wages and also provided a training component of up to $1250 a person. It cost the Government $40.3 million.

But with all 3000 placements now filled, the scheme is no longer available, except in Northland, Bay of Plenty, Waikato and the East Coast, where the Government is offering a further 1500 placements due to high unemployment.

Greater Wellington regional council had 15 youths placed with them for six months up till June. The group helped maintain the region’s parks and resources and were given training in various aspects such as health and safety.

“It was a great success really,” council biosecurity manager Wayne O’Donnell said. “There were huge benefits for all parties involved. We are really disappointed that it’s not continuing.”

There is one other deadly outcome of the current treatment of young job hunters by New Zealand politicians. As the OECD notes, New Zealand and wealthy Norway are the only OECD countries where the rate of suicide among the young is higher than among older people.

10. Thank goodness the Maori Party is at the Cabinet table, to ensure the genuine needs of Maori are being met.

The meltdown between Hone Harawira and the Maori Party is not simply over the foreshore and seabed legislation, serious though that be If the Maori Party endorses the government’s announced plans for welfare reform, Harawira would find it very difficult to remain in its ranks. The current rate of Maori unemployment is a catastrophic 36.7%*. That is hardly a platform for punitive measures that would fall disproportionately upon Maori – who are not only being left behind by the current economic policy settings, but are most at risk from cutbacks in social services. In addition, the dismal level of funding for the Whanau Ora scheme is not much of a figleaf for Taraiana Turia and Co to hide behind.

In sum, we face real options in the current welfare reform process. If we regard poverty – and its causes – as the basic problem (whether that be among beneficiaries or low income workers) we could at least make a united start on solutions, and would frustrate the current attempts by politicians to divide us against each other. We elect them, and we pay them to manage the economy in a way that fosters sustainable employment. Good jobs are the best pathway out of poverty. Perhaps it is time the government acknowledged it has failed to honour its side of the bargain – instead of trying to divert public criticism by harassing the very families it is failing the most.

ENDS

* Correction The departmental December 2010 figures list 35.7% of dole recipients as being Maori. The unemployment rate for Maori in December 2010 however was 13.7%, at a time when the unemployment rate in general, was 6.8%. As mentioned, the impact of punitive welfare reform measures would therefore be likely to fall disproportionately on Maori.