$60 a week more to be on a benefit

November 9th, 2012 at 6:38 am by David Farrar

Parliament Today reports:

The Income Tax (Universalisation of In-work Tax Credit) Amendment Bill was defeated at its first reading by 61 to 60 with National, ACT and United Future opposed.

This bill sought to make the “In Work’’ tax credit payable to those on benefits.

The Green Party, which sponsored the bill, put pressure on United Future MP Peter Dunne to back the bill to select committee. However Dunne said during the week the bill would remove a financial incentive for beneficiaries to work.

Labour. Greens. Mana and NZ First all voted for DPB beneficiaries to get an extra $60 a week for not working.

As Peter Dunne pointed out, it disincentivises beneficiaries to seek employment. The in work tax credit is designed to recognise that you have extra costs when working such as transport to work, clothing etc.

 

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45 Responses to “$60 a week more to be on a benefit”

  1. Manolo (13,745 comments) says:

    Some bludgers deserve no money at all. The welfare system, aimed at people in real need, is being abused by loafers and idlers.

    Up you go to find work, should be the message.

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  2. Pete George (23,559 comments) says:

    A Question Time exchange between Turei and Dunne just prior to the vote shows a clash of ideologies.

    Turei had previously (in parliament) made outlandish claims, as she did here:
    Metiria Turei: Why will not the Minister support this potential solution at least being considered at select committee, when all the evidence suggests that it could make the crucial difference to a quarter of a million Kiwi kids, and that he today could be the difference between an empty and a full plate for many of these children?

    Hon PETER DUNNE: I reject that assertion entirely.

    Metiria Turei: You reject those children entirely.

    Hon PETER DUNNE: I am not rejecting those children. That is a ridiculous statement.

    “All the evidence” and “a quarter of a million Kiwi kids” keep being repeated by Greens (and Labour) MPs without challenge by the media.

    And the Greens keep claiming Dunne (and National) don’t care about ‘the children”. Turei said recently in parliament “I am advised by his office that he does not consider that the Government can afford to assist the poorest children in New Zealand.” That is an obvious lie.

    Struggling families and income gaps are real problems that we should find ways of addressing.

    Turei took the wrong (and therefore doomed) approach trying to extend in-work tax credits to beneficiaries. And she didn’t help her cause by making extreme claims and lying.

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  3. Keeping Stock (10,337 comments) says:

    Metiria Turei seeks to give an extra $60/week to people like this:

    http://www.stuff.co.nz/dominion-post/news/wairarapa/7926180/Mother-stole-benefit-money-to-help-family

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  4. RF (1,396 comments) says:

    But wait, there’s more… Turei will now arrange to print more money.. Problem solved. The perfect solution for our future.

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  5. duggledog (1,554 comments) says:

    At the next election, Key needs a list of all this proposed stupid shit, incl free lunches, extension of PPL, maybe chuck in Maori TV and all the other existing nice to haves, price it all up and just put it in front of New Zealanders on billboards etc

    Alongside a column of how much we earn as a nation and what the tax take is. If it could be done as a list of simple figures then maybe more people would get their heads around it because most kiwis know how to run their own household budgets. At least I hope they do.

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  6. Nostalgia-NZ (5,191 comments) says:

    Of course none of this relates to JK managing to lead the country to record unemployment. Rest assured however, he thinks the figures may be wrong.

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  7. Yoza (1,872 comments) says:

    Punishing people for not working in jobs that don’t exist. More whacky logic from the right-wing-nut-jobs on Kiwiblog as the unemployment rate climbs to 7.3%.

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  8. mikenmild (11,247 comments) says:

    I’m looking forward to some bold proposals from Peter Dunne to address the far more pressing issue of income splitting.

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  9. bhudson (4,740 comments) says:

    Ah, Yoza and your distortions. No one is being punished; nothing is being taken away. The extension of the in-work tax credit, a key policyplatform for Labour in last year’s election, was resoundly rejected by the electorate.

    Democracy in action.

    That rejection has now been formalised in Parliament.

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  10. Pete George (23,559 comments) says:

    Income splitting is an important issue. Currently wage earners are at a tax disadvantage to those who can “arrange their finances”. Just another way middle New Zealand get’s screwed – wage earners getting WFF get a way out but those that don’t pay through the nose. There’s a lot of lower income people affected by this.

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  11. paul henry (49 comments) says:

    ‘$60 a week more to be on a benefit’

    To be on a benefit? To be or not to be. Some people really have no choice.

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  12. Pete George (23,559 comments) says:

    The extension of the in-work tax credit, a key policyplatform for Labour in last year’s election, was resoundly rejected by the electorate.

    Yes, it was resoundingly unpopular, there would be a lot of grumpy wage earners if the in-work tax credit is extended to beneficiaries.

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  13. Monique Watson (1,062 comments) says:

    Yoza, the reason why you’re being a dick about it, in this instance, is that it is not punishing people to not give them something they don’t have in the first place.

    Unless of course you’ve been sucked in by some entitlement cult like socialism.

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  14. Monique Watson (1,062 comments) says:

    Any bugger can get out and earn an extra $60 dollars a week on their own. I could give you at least three ways.
    There is no need for the gummint to hand out more muny than they already do based on the $60 a we week argument.

    And how do people have no choice exactly?

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  15. Lee C (4,516 comments) says:

    This simplistic bullshit paying people extra not to work. The majority of people who get a benefit paid their taxes while they worked.
    They would rather be in work. In fact they are probably sick to the stomach if they can’t find work. To have this kind of bullshit peddled as wisdom is frankly offensive, It’s getting old.

    Where is the bright future we were promised at the last two elections – simple DOA. Instead we get the same offensive, lazy divisive claptrap so we can beat up on teh needy, and we don’t get to discuss the government’s management of the economy on the morning after we get to hear about 7.3% unemployment rates..

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  16. Carlos (683 comments) says:

    Peter Dunne gets a lot of flack here on Kiwiblog but let’s face it, we should be grateful that he voted against this. Thank you, Peter Dunne!

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  17. Manolo (13,745 comments) says:

    Currently wage earners are at a tax disadvantage to those who can “arrange their finances”. Just another way middle New Zealand get’s screwed – wage earners getting WFF get a way out but those that don’t pay through the nose.

    More important issues are the abolition of WFF, welfare to middle-class families, accompanied by a reduction of tax rates, so the same people can keep more of their money without any state intervention or handout.

    Income-splitting is Dunne’s hobby-horse. He uses it as a campaign prop every three years.

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  18. RightNow (6,994 comments) says:

    If it’s that important to pay NZ beneficiaries more, perhaps Labour, Greens et al should propose we cut our arts and overseas aid funding and exploit more of our mineral resources so we can pump more into welfare. Or is it not that important to them?

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  19. scrubone (3,099 comments) says:

    Income splitting is good for the enviroment because the current system encourages two commuters from each family.

    Don’t agree? I’ve seen the greens support less odvious connections than that.

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  20. KiwiGreg (3,255 comments) says:

    “Punishing people for not working in jobs that don’t exist. More whacky logic from the right-wing-nut-jobs on Kiwiblog as the unemployment rate climbs to 7.3%.”

    Strangely 92.7% of people DO have jobs so they DO exist. There is a reason that 13 in 14 people who want a job have one and taking $60 a week off them and giving it to the 1 in 14 without one isn’t going to help anything.

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  21. Mobile Michael (451 comments) says:

    I believe National now has a great selection of quotes from Green, Labour, and NZ First MPs on how they want to extend welfare so it is better to be on a benefit than working.

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  22. kowtow (8,436 comments) says:

    duggledog

    Key should also include the incredibly stupid treaty settlements that his mates ensure certain maoris get in perpetuity.Brilliant!

    http://www.odt.co.nz/news/national/233198/iwi-get-cash-top

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  23. bhudson (4,740 comments) says:

    Mobile Michael,

    Very true. Toad was on KB just a few days ago complaining how benefits were not enough to sustain a family long term. Clearly he, and the Greens, view welfare as an alternative to working.

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  24. In Vino Veritas (139 comments) says:

    Yoza, it probably should be pointed out to your ilk that in 2008, Treasury estimated that worst case, unemployment would rise to 7.1% by 2011. The 25 year average for unemployment in NZ is 6.5%. Labour managed to get it down over 9 years soley because they endured the best economic conditions in a generation (and somehow managed to leave a permanent structural deficit). National have endured the worst economic conditions in a generation, were left with a permanent structural deficit and a mulit billion dollar hole in ACC future funding, so what do you expect?
    And punishing people for jobs that don’t exist? How can not giving someone an “in work” benefit be punishing someone who’s not working? The proposal by the socialists and communists is just a smokescreen for increasing the benefit.

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  25. Manolo (13,745 comments) says:

    … the Greens, view welfare as an alternative to working.

    They always have, they always will.

    That’s the electoral base the Luddites and socialist Labour go after. People who receive freebies will never vote against the “benevolent” hand that feeds them.

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  26. Pete George (23,559 comments) says:

    Clearly he, and the Greens, view welfare as an alternative to working.

    I don’t think that’s accurate, for some of them anyway. They view being a beneficiary as an alternative kind of working that deserves equal rewards.

    They use the words ‘deserve’ and ‘fairness’ a lot.

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  27. dave (988 comments) says:

    Well if you are going to discuss income splitting you should really read this

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  28. Key is our man (888 comments) says:

    Don’t worry guys. When the Labour-Greens-NZ First-Mana combo is in power in 2014, they will implement this policy.

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  29. scrubone (3,099 comments) says:

    The thing that amazes me is that some people actually seem to believe that National is attacking beneficiaries. Or at the very least, they think that repeating the spin line is morally ok.

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  30. Pete George (23,559 comments) says:

    dave – that doesn’t make sense. Secondary tax on a second job (and subsequent jobs) is not a fixed rate of tax, it simply contributes to the total tax take.

    At the end of the tax year someone who works one job and earns $50k per year will end up paying the same total PAYE as someone who has two or more jobs and earns a total of $50k a year.

    Income splitting will work on total earnings, not on income for each job.

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  31. Keeping Stock (10,337 comments) says:

    @ Yoza; what part of In-Work Tax Credit do you not understand? 92.7% of us grasp the concept with some ease.

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  32. thedavincimode (6,759 comments) says:

    Soooooo. We don’t want to discriminate against homosexuals and those in homosexual relationships, but we don’t mind discriminating against those who aren’t in any form of relationship by making them pay more tax. How does this work … yes of course, single 16 year old out of school flips burgers at say $13.50 / hour and subsidises a couple where one chooses not to work with WFF and now income splitting. Wow, that’s a good deal – for the couple.

    It’s just so easy for those who stand to benefit to support rules that will put somebody else’s money into their own pockets. And all on the basis of “reasonableness”, “fairness” and “common sense”.

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  33. Viking2 (11,467 comments) says:

    Want to fix unemployment?
    two simple things to do.
    Remove mandated wage rates and allow particularly young people to be paid what an employer can afford.
    Add $100 to super per payment for people who quit work and remain that way and allow someone else to take up the job.
    Less than the dole payment and may result in nett tax paid when added together.

    And for those that think that eliminating mandated wage rates is so diabolical. Mandated rates haven’t worked, youth employment is soaring as is unemployment generally, so what ‘s your next argument.
    Keep everyone poor.

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  34. hinamanu (2,352 comments) says:

    Here’s a very big economic statement on social security and medicare from Karl Denninger.

    http://www.realecontv.com/videos/crashing-markets/watch-for-market-dislocations.html

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  35. hinamanu (2,352 comments) says:

    Anyway, it’s no secret the standard wage rate is going to be replaced by employer contracts who decide how much you are paid by productivity. Business Round Table has been talking about it for decades. You will be paid on the whim of the employer

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  36. david (2,557 comments) says:

    Easy answer is to remove the in-work tax credit. That way beneficiaries can’t complain about not getting something they haven’t worked for. Might piss off 92.7% of the population who get out of bed each morning and go to work but hell, it is consistent with the attitude expressed by unions over the years – “If we can’t have it no-one will have it”. There have been strikes over this principle, so abolishing the tax credit should get the support of the CTU

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  37. BigFish (132 comments) says:

    Probably just better to get rid of the tax credit and introduce a tax-free threshold for all. Would be simpler to implement.
    And for those who think abolishing welfare and minimum wages would fix unemployment, why? Protections like these separate developed nations from the squalor, disease and desperation of the third world.

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  38. Viking2 (11,467 comments) says:

    BigFish (73) Says:
    November 9th, 2012 at 11:31 am

    And for those who think abolishing welfare and minimum wages would fix unemployment, why? Protections like these separate developed nations from the squalor, disease and desperation of the third world.

    What rot.
    Singapore?

    What does that is excess income over spending and a satisfactory attitude to your house.
    Neither of which we have in NZ.

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  39. Bevan (3,924 comments) says:

    The majority of people who get a benefit paid their taxes while they worked.

    So what? I paid taxes when I worked in NZ – if the unemployed get their $60, then can I get my mine too?

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  40. BigFish (132 comments) says:

    Singapore?
    To those who need it, Singapore provides fairly generous means tested assistance through various schemes to low-income earners, free medical care, school fees assistance, training grants and extremely cheap studio apartments. Besides that Singapore has one of the highest rates of income inequality in the world, and plenty of people working 12 hour days.
    If New Zealand was a city sized state operating as a non-corrupt, western-friendly hub port centred in a large and otherwise politically unstable but mineral and labour-rich region then maybe we could do the same, but I’m not sure working 12 hour days is progress.

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  41. publicwatchdog (2,593 comments) says:

    “However Dunne said during the week the bill would remove a financial incentive for beneficiaries to work.”

    Where are all the jobs Peter Dunne?

    Penny Bright

    ‘Anti-corruption / anti-corporate welfare’ campaigner

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  42. Grendel (1,002 comments) says:

    There are 11000 on trademe right now Penny, why dont you apply for one of them.

    there will be heaps not on trademe, small businesses who dont advertise and employ via people they know.

    get your socialist mates to stop making new laws that make employers like me decide not to risk hiring someone and there will be even more jobs, and especially at the tail end for your unskilled, mostly unemployable mates.

    but you and your ilk have made them utterly unemployable, you have priced them out of the market, and you have made the barriers to employment too risky for small to medium businesses, the vast majority of businesses in the country.

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  43. Steve (North Shore) (4,559 comments) says:

    Penny wrote two sentences, congratulations Penny.
    Did DPF delete all of the shit that you usually write?

    Attendee: Ponsonby Road Cork Soakers Parade (observer)
    Attendee: Gelenfiel Trolley Racing Derby (got trolleyed real bad)

    http://www.doggypenny_hasnoclass.com

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  44. Steve (North Shore) (4,559 comments) says:

    $60 per week is just more money being ripped off us TAXPAYERS to pay the fucking lazy scum who are unemployable and refuse to work – end of story.
    Lefties can shove it where the global warming sun don’t shine

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  45. SPC (5,619 comments) says:

    In some countries – say Oz, the gap between the wage paid and the benefit is so large there is no problem with universal tax credit support to families.

    The National obsession with low wages to create jobs (1990’s policy) is what requires the poverty of beneficiary families to provide the incentive to work – and we wonder why we have a child poverty problem. Why some of those under this stress abuse children.

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