The government Welfare Working Group's 'Options Paper' was released this afternoon. While Paula Rebstock says nothing is decided yet, its overall direction confirms my earlier fears. It could make the 1991 benefit cuts look like a picnic

The Government’s Welfare Working Group (WWG), headed by former Commerce Commission Chair Paula Rebstock, has just issued its second major position paper.

Their latest effort follows the August Issues Paper which at the time was widely panned by many welfare reform and economic experts, including Anne Else in her excellent response.

This time around, the WWG goes deeply into options for reform, inviting further submissions from the public, with a short deadline of 24 December.

While Ms Rebstock repeatedly states that "the Working Group does not have preferred options at this stage", overall, the language and focus of this report only serve to confirm fears held by many of us about the direction in which the Government is heading.

Paula Rebstock and her team, with a budget of over $1 million, are clearly doing their best to meet an agenda that was basically laid down from day one of this exercise.

The focus on paid work as paramount; the desire to force as many people as possible into the work-tested category of benefit; the push to reduce numbers of people dependent on benefits; and the idea that the costs of the benefit system should be based on an insurance method of assessment are all maintained.

By using figures that assume people on the DPB and Invalid's Benefit, will stay on them for the rest of their lives, assumptions are made about welfare costs that are completely biased and unrealistic. The financial and moral panic engendered by threats of ‘welfare blowouts’ will just keep on rolling on.

While it is true that in each section of the report a number of possible options for reform are offered, they mostly tend to be within this overall framework.

And some of the choices presented are downright terrifying.

For example, in a section headed ‘strong signals to discourage semi permanent use of the benefit system’, the alternatives given are:

1. Limited work for the dole – requiring people to work a given number of hours per week in return for their benefit;
2. Income management of payments – similar, I presume, to the Northern Territory system, where the State retains control over how people spend at least some of their weekly income;
3. Withdrawing some parts of a person’s benefit if they stay on it for more than a year; and/or
4. Withdrawal of a benefit altogether if a person stays on it for more than 5 consecutive years.

While these are presented as choices, in fact all these options are undesirable if one believes in a fair and compassionate welfare system, as some of us still do.

There are many other little shockers littering the report, for example a suggestion that no person under 18 should be eligible for any benefit at all, and proposals that people on the DPB should be ready to enter the paid workforce from the time their youngest child is three years, or one year old.

A kite is even flown suggesting that sole parents go out to work from the time their oldest child reaches a certain age, regardless of the ages of subsequent children, in a bid to discourage those vexed beneficiaries from breeding – social engineering with bells on.

Another bright idea is that money now spent on supplementary third tier assistance should go to community groups to provide savings and insurance schemes for beneficiaries.

Notions like this reinforce my sense that the members of this Government appointed body have little notion of what life is really like for people on benefits.

They are truly away with the fairies if they think people on benefits – with access to even less discretionary help than they get now – would be in a position to comfortably start up savings accounts, much less pay for insurance, no matter how well intentioned the contracted NGO provider.

But I think the big, hard news in this report is that while there are a whole range of good, bad and indifferent suggestions for change within its substantial 125 pages, its ultimate direction is pretty much preordained.

I predict that the final report is likely to include recommendations that:

• Most working age beneficiaries – unemployed, sick, invalids, sole parent – will be placed in one work-tested benefit category.
• A small, residual number of people will be entitled to a form of ‘incapacity’ benefit, non work-tested, and paid at a higher rate than the rest.
• Further work testing requirements will be expected of sole parents; and a tighter series of sanctions and harassments will be applied to all work tested beneficiaries.
• Government will be encouraged to employ an insurance model of risk assessment in its calculation of costs/benefits, and use this to keep up the pressure to push people out of the system, even when they have nowhere else to go.

Yes, we do need major welfare reform in this country.

But if we head down the path I fear Paula Rebstock, Paula Bennett and John Key are taking us, the 1991 benefit cuts will look like a picnic in comparison.