Muriel Newman’s The Column
Lowering Unemployment Figures By Devious Means
A growing number of doctors are being pressured by unemployed patients to sign the assessment forms that entitle them to
a Sickness Benefit. According to one such doctor: “In recent years the Department of Work and Income has been
increasingly sending their clients to GPs with a suggestion that they transfer from the unemployment benefit to a
sickness benefit. Often these referrals are not appropriate but it is more difficult to decline such benefits to these
people when they have been sent by Work and Income. As a result of these changes, many of the people who were previously
unemployed are now on a Sickness Benefit”.
The dilemma faced by doctors is if they refuse, the patient, and indeed the whole family, is likely to switch to another
doctor who will sign the forms. The new Primary Health Organisation scheme exacerbates the problem since doctors are now
paid per patient on the books – with greater subsidies for patients in lower socio-economic groups, and even greater
ones for patients who are Maori.
The actions of DWI case managers, who encourage long-term beneficiary clients to transfer to the Sickness Benefit for no
good reason, is tantamount to fraud. I would be interested in finding out how widespread the practice is.
One of the criteria used to judge the performance of a government is unemployment. While changes to short-term
unemployment are driven by the state of the economy – when an economy is buoyant, short-term unemployment will be low –
the level of long-term unemployment is indicative of the success or failure of a government’s welfare policies. For a
government to adopt a strategy of reducing long-term unemployment by encouraging beneficiaries to transfer to another
benefit rather than helping them into jobs is dishonest.
The reality is Labour has enjoyed a dream run with the economy since it came into power, not through good management but
essentially by accident: as a result of Labour’s 1999 election, overseas investment fled the country causing the
currency to plummet. The resulting low dollar created huge windfall gains for exporters in general and the rural sector
in particular, generating significant growth especially in provincial areas.
Then, September 11 meant that fewer New Zealanders left the country and more came home, increasing net migration from an
expected 5,000 or so to more than 30,000. The huge consumer and housing demand that has been created by this unexpected
influx of migrants has helped to drive that growth.
As a result of these economic “accidents” there is now a critical shortage of skilled and unskilled labour. There is
therefore no excuse for the government not to reduce long-term unemployment down to minimal levels by honest rather than
devious means. BUT…that means tackling the hard end of the unemployment problem and requiring long-term beneficiaries to
take jobs or lose the benefit.
If time limits and full time work for the dole requirements were introduced in this climate long-term unemployment could
be eliminated.
The Labour government is driven to a large extent by the demands of the beneficiary unions. And it clearly prefers to
lower unemployment numbers “cosmetically” by encouraging people to switch to the Sickness Benefit. As a result taxpayers
are forced to pay for beneficiaries who are quite capable of working to sit on a non work-tested benefit.
A letter from a constituent, who has been on the benefit for the last seven months while languishing on an operation
waiting list, epitomises the government’s double failure: “I get the idea that this government isn’t interested in
getting people like myself back into the workforce which would be more beneficial for everyone all around. All my
friends reckon that leaving me for month after month on a sickness benefit instead of fixing me up so I can work again
is plain stupid”.
In 1940 there were 2,565 people on Sickness Benefits, and by 1970, 5,876. By the year 2000 when Labour came into power,
the numbers had grown to 32,294. Today these have increased by 23 percent to 39,902 and are predicted to rise
relentlessly. Of that number, 2,209 suffer from alcohol and drug dependency, 2,732 from depression, 2,877 back pain, and
4,477 from stress - up 55 percent over the last three years.
According to Social Services Minister, Steve Maharey, most people come off the Sickness Benefit “because they die”.
Maharey’s far-fetched answer in parliament did not bear any similarity to his department’s official answer to my written
question: Last year there were only 334 benefits cancelled as a result of death.
Meanwhile in the year to June 2003, 13,191 people have been transferred from the unemployment benefit to the sickness
benefit.