- Benefits are not enough to live on with dignity – this is the real issue.
- The resources of organisations providing emergency assistance are stretched.
- The benefit system is complex and people are often not made aware of their entitlements.
- Housing assistance is inadequate.
Benefits are not enough to live on with dignity – this is the real issue
Real net benefit rates compared to the real net average wage have declined steadily and significantly over the past 30 years and are at levels that leave people in poverty. The Working for Families package has helped wage earners but this has further increased the income disparity between the waged and unwaged.
Benefit levels do not allow families to feed, clothe and house themselves adequately. For example, the PIP Update Report found that the disposable income of food bank clients (most of whom are reliant on benefits) is barely sufficient to cover the estimated food costs required to feed a family of two adults and two children.This leaves little or nothing for other household costs.
The resources of organisations providing emergency assistance are stretched
The waiting lists (or social housing register) for those in urgent need of social housing in mid-2016 (Housing New Zealand or other community housing assistance) has returned to similar levels to 2014 which were the highest level since 2004. Emergency accommodation is in short supply in Auckland and Christchurch particularly and NZCCSS agencies report in the Vulnerability Report series of how foodbanks and other support services continue to struggle to meet the high level of need in our communities.
The benefit system is complex and people are often not made aware of their entitlements
The current benefit system is complex, confusing and overly bureaucratic. Benefit advocates and social workers report regularly that Work & Income clients are less likely to get the income support they are entitled to unless they have an advocate with them. This Caritas report from the Benefit Impact campaign organised by Auckland Action on Poverty highlights in a dramatic way the experience of people who need government assistance.
Housing assistance is inadequate
People most hard hit by high housing costs are those living on low-incomes and there is not enough help available.
Income related rents (IRR) that Housing NZ and some other social housing agencies now offer, cap the rent at 25% of income, which greatly helps people to manage. But only a small proportion of low income households are able to access this (about 20%).
The waiting lists for social housing (mainly Housing NZ) are very long. The waiting list peaked in mid-2014 at 5,840 people in severe or significant housing need, which was the highest level since 2004. More recently the number has declined (see the Social Housing Register for the latest figures).
Not enough help on the private rental market
The overwhelming majority of people on lower incomes must rent their housing on the private market. The Accommodation Supplement is not sufficient to cover the gap between current rent levels and incomes. One reason for this is that it is not inflation adjusted and is based on 2003 rent levels yet average weekly rents for the lower end of the housing market have increased by more than $70 since 2003.
Many private market tenants reliant on a benefit experience ongoing financial distress such as:
- Cash flow problems: difficulty paying bills; needing to get financial help from others
- Hardship: having to go without certain basic essentials such as meals, heating and clothing
- Missing out: inability to participate in leisure activities, hobbies, or have the occasional night out.