Amnesty needed on welfare debt

Green Party of Aotearoa New Zealand

The Green Party is calling for an amnesty on debt the Government is collecting from low income people and families.

“Christmas can be a stressful time for low income whānau. A debt amnesty would create some breathing space for people at the end of what has been a very tough year for everyone,” Green Party Social Development & Employment spokesperson Ricardo Menéndez March said.

“The Government can start by stopping charging penalties and interest on debts, which make up about a quarter of all debt MSD is chasing. This punitive approach ties people into a cycle of further debt.

“We know from the data that the Government’s debt burden falls most heavily on Māori, Pasifika, and women. Harsh debt repayments ultimately impact on children in many of these households.

“Rents are rising and the cost of groceries is rising, but on the other hand people who own homes are seeing their untaxed property values shooting up. An amnesty on Government debt, penalties, and interest would be a meaningful step to reduce household debt and support people out of poverty. It would also enable families to build up savings and be able to better support local businesses.

“The complicated welfare system in Aotearoa often leads to incorrect payments, which then get clawed back with penalties and interest. Base benefits are not enough to live on and the patchwork of top-ups changes depending on peoples’ individual situations. In the long term, the answer is to simplify our welfare system with a Guaranteed Minimum Income.”

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