The pool of resources being spent on the welfare for the most vulnerable in our communities is not getting any larger – yet the needs in our communities have expanded. At the post budget lunch last week, Alan Johnson from the Salvation Army reflected on the actual realities of the budget, providing the 70 attendees with a critical perspective different to the political spin hitting our mainstream news media.
The Minister of Finance has capped welfare spending at approximately 30% of the budget. Superannuation is funded out of this welfare spending. The Prime Minister has made it clear that the current government will be retaining all superannuation entitlements. As the population ages, more and more people will be claiming their superannuation entitlements and this will mean that there is less and less money available for other welfare recipients. There is a conversation that needs to be had about the distribution of welfare spending and some personal challenges for more privileged people claiming their superannuation benefits.
The government’s spending on income related rent subsidies and accommodation supplements has increased significantly over the last year and is expected to increase significantly over the following years if the current trajectory of government spending holds. There is a concerted push by central government to push people our of State Housing into the private rental market with assistance. This is effectively a transfer of wealth from tax payers to private landlords.
The government has not reviewed the regional cap on the accommodation supplement – this is concerning to us in the Waikato because over the past year, for example, the average rent in Hamilton increased 5%. Without increases in the accommodation supplement, people who rent are effectively required to find this additional money themselves. In a low wage economy, with restricted welfare spending, increased accommodation costs would simply be too much for some families, households and individuals.
This budget represents an extension of the neoliberal agenda – a push to market provision and the ongoing erosion of the Welfare State. Poverty Action Waikato is advocating for increased investment in State Housing and a social welfare system that recognises our shared vulnerabilities. We need a system that meets needs and that prioritises the common good. For more of our suggested actions, based on the stories of the social service sector in Hamilton, please read our latest report – Neglect and Nurture.