One man's story: How a 'tough' benefit system costs us all thousands of dollars
PLUS: Flexible working's contribution to the drive to reduce inequality
We’ve made this bulletin free for all to read because we want its messages to get out far and wide. The first item comes from Paul Stevenson, a Wellingtonian whose recent battle with WINZ reveals the inadequacies and inefficiencies of our welfare system. A failure to invest in a system that works properly, or treats beneficiaries as people deserving good service, results in confusion, mistakes and costly efforts to fix errors.
For over a year I have been fighting WINZ over communication failures and the design of a welfare system that, by making support hard to get, is supposed to save taxpayers money but actually ends up costing them more.
In July last year, I had to move from a rental I was in, in Te Aro, because of noise, and because it wasn’t warm enough. By way of background I suffer from depression, osteoarthritis, and fibromyalgia. My main question was whether, if I had to move to a dearer place, my benefit payments would increase accordingly.
I tried to contact the WINZ call centre; I also emailed the Willis Street branch. Phoning, call-back, and email all failed. I even emailed Labour MPs Carmel Sepuloni, Grant Robertson, Ayesha Verrall and Chris Hipkins. Grant’s office got back to me pretty quickly, but even after three attempts, they couldn’t get answers. And he was the second-ranked politician in the country.
In the end, having no other options, I moved to Newtown, and my rent went from $380 to $550. I didn’t get any response from WINZ until the day I moved, and that was from the Newtown branch manager, who was pretty upset at how I had been treated. But not as upset as I was when she told me my benefit payments wouldn’t increase.
Apparently, with a rent of $380, I had already been receiving the maximum amount of accommodation supplement (a payment that helps with housing costs). Realistically, anywhere I moved would have put me over the maximum allowance, because there just aren’t decent places for a single person to rent in Wellington for under $380. What’s odd is that people paying similar rents in Auckland get an extra $60 in accommodation supplement – which is funny, since that’s about the extra amount I need to survive.
The failure to communicate
So one problem is just the amount of support available. Arguably a bigger problem was the way I was treated by WINZ. Not only has WINZ left me financially struggling, its communication has also been very poor. Yes, there are laws setting out the limits to accommodation supplement, but if I had been better informed, if they had communicated with me in time, I would have looked at other housing options.
Trying to fix the situation, and get redress, has involved countless emails, phone calls, and face-to-face conversations. My main effort involved what’s known as a benefits rights review meeting. It went OK, but after a three-week wait WINZ came back with the same conclusion: this was unfortunate but still fell within the rules of the proper legalisation.
I was then informed that if I wasn’t happy with that decision, I could put my complaint into Social Security Services. The Newtown branch manager, who was doing her best to help me, had already sent a further report to the Ministry for Social Development (MSD) legal team.
About a week later, I received an email from the chief executive of MSD’s services delivery team, apologising for the poor service and informing me that an investigation was still underway. (I’ve never heard the outcome of that investigation, which was one of at least three.) I was also given $2,000 compensation. This only delayed the inevitable step of my having to move a short time later, to somewhere with slightly lower rent.
A welfare system that keeps people waiting around
Is there any point in having a welfare service that really doesn’t care about your welfare? The amount of money spent to launch all these investigations, to fight me on their mistake, would be in the thousands of dollars, if you add up the staff time. And all to simply end up paying me compensation. If I had declined the compensation, the case would have gone to Social Security Services and possibly onto court. I might have got much more; the process would also have cost the system, and the taxpayer, much more.
I knew who to talk to and had support. But so many people don’t. Stress and exhaustion are continuous, massively affecting your mental and physical health. The welfare service is set up to give you as little help as possible.
Ironically, if the service worked as it should, and provided more timely and responsive support, more people would get back on their feet quicker and off the benefit. Most of us don’t want to be on there in the first place. A lot of the time, we are waiting for answers or, in my case, hospital appointments, which can be as frustrating as dealing with WINZ (that’s a conversation for another day). A system designed to keep costs down actually ends up costing (us all) more.
How flexible work helps tackle inequality
The following piece, written for IDEA by workforce strategist Gillian Brookes, looks at how a more flexible approach to our labour strategies can bring traditionally excluded groups into the workplace.
Research suggests that flexible work helps bring people into the labour market who would otherwise be excluded from it – and can allow them to stay in their jobs longer.
Flexible work gives more people more choices about their hours, days and/or place of work. This has been seen most obviously in the ‘working from home’ revolution that has swept the world post-covid.
And the benefits of flexibility, when done well, go far and wide. Businesses can enjoy improved productivity, stronger performance, lower levels of sickness-related absence and higher staff retention. Individuals enjoy better health and wellbeing because they can do the things they most value – whatever that might be – and fit them in more comfortably alongside their employment.
Removing barriers to paid work
And, crucially from an inequality point-of-view, flexibility allows more people to participate in paid employment. Many people can’t engage in the traditional model of 40 hours per week at a fixed workplace. That model creates barriers to entry that are too high – and often unnecessary.
Last year, Public First, a UK-based policy consultancy, reported that sectors with high levels of hybrid work had seen a significant rise in the number of women working full-time, compared to pre-pandemic levels.
In a recent interview, professor Nick Bloom, an economist at Stanford University, said his research showed working parents often take up the opportunity to work from home, as do people managing a health condition or a disability.
Detailed New Zealand data on this subject is lacking. But Maretha Smit, chief executive at Diversity Works, points to anecdotal evidence of the same trends. “Hybrid work is an exceptional inclusion practice, particularly for those with caring responsibilities,” she says.
Flexibility can’t stop with the hybrid workforce, however. A huge number of people have to work at a fixed location. But even they would benefit from being able to engage on terms that they can manage.
Keeping people in work
What’s more, a recent research report from Timewise, in partnership with the Institute for Employment Studies, showed that flexibility for frontline workers enables them to stay longer in their jobs. Their two-year study demonstrated that flexible work practices in healthcare, construction and retail generated multiple benefits, including better health and wellbeing and higher levels of retention. Which is hardly surprising: if people have some flexibility and choice over how they work, they are much more able to fit it in around the other demands in their lives.
If all work became more flexible, people would no longer need to self-select out of employment. Currently, even if they are not opting out altogether, many people’s paid employment is severely limited because so little is available to them on terms they can manage.
And it’s likely this limited work will sit below their level of capability and potential. With flexibility for every person in every role, the evidence suggests we would be more likely to see the right people in the right jobs, lifting each individual’s contributions. The aggregate of that effect would be a stronger, more inclusive economy for everyone.