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Working for Families falls behind wage rises: Child Poverty Action Group

Melanie Carroll06:00, May 05 2021
Working for Families has not increased in line with wages unlike main benefits and New Zealand Super, leaving some families up to $1900 worse off over two years, according to the Child Poverty Action Group.
Working for Families is a key tool to reduce New Zealand’s high child poverty rates, the group said, but it is failing to keep up with New Zealand Superannuation and main benefits, which automatically increase in line with wages each year.
Working for Families payments are not wage-indexed, and are only partially inflation-indexed, the group said. The group wanted the Government to automatically increase the payments every year to keep up with wage increases. ....

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Working for Families needs major changes, experts say

The multibillion-dollar Working For Families scheme, established in 2004, supports about 350,000 low- and middle-income families with payments and tax credits.
But it is often criticised, particularly because of the abatement rates that some say are a disincentive to people on lower incomes to take on more work. These “claw back” support payments as families start to earn more. But critics say the rate at which the money is taken away is too high, and starts too early.
Tax consultant Terry Baucher said the tax system and social welfare systems combined to create undesirable outcomes.
“That’s not a lot of money, as family income, that seems pretty low,” he said. ....

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