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Punitive welfare a blight on the poor

New Zealand’s once-humanitarian welfare system genuinely supported those in need, says Professor Darrin Hodgetts

The stresses and struggles of the poor are being intensified by a punitive welfare system, say authors of a hard-hitting new book on the causes of poverty and associated health inequalities.

Lead author Professor Darrin Hodgetts says statistics out this week that show wealth distribution is worse than ever reinforce key themes of his book. Statistics New Zealand’s figures reveal the top 10 per cent of the population owns 60 per cent of wealth while the poorest 40 per cent held just three per cent.

Evidence of growing poverty documented in the book includes more people unable to survive on welfare benefits opting for loan sharks, despite the horrendous debts they incur. They choose this rather than demeaning treatment when asking for help from Work and Income New Zealand (WINZ) – a symptom of an increasingly dysfunctional welfare system, says Professor Hodgetts, a societal psychologist at Massey University’s School of Psychology.

Due out later this year, the book provides insights and analysis on structural causes of the current levels of deprivation, evidenced in growing numbers of homeless people, families living in cars, unaffordable housing, increased dependence on food banks and charities, low paid casual jobs – and the myriad of health problems and the exclusions these issues cause.

Titled Urban poverty, penal welfare and health inequalities, by Professor Hodgetts and Dr Ottilie Stolte from the University of Waikato, the book traverses 200 years of research on urban poverty in New Zealand, Australia, Canada, the United States and Britain to highlight concurrent developments and the similarities across these countries. The book includes comments from those living in poverty as well as media depictions of welfare and poverty to provide a deeper understanding behind what the authors term “the resurrection of penal welfare”.

“There is little disagreement that low incomes, inadequate housing and health and disability issues are the main causes of poverty, yet enthusiasm continues for punitive behavioural responses, which are largely counterproductive and deeply offensive to people facing hardship,” the authors say.

“It’s depressing,” says Dr Hodgetts, who has researched the effects of poverty in New Zealand and England over the past 20 years in previous research. He says New Zealand’s once-humanitarian welfare system genuinely supported those in need but has evolved into an often cruel, punitive entity. The way it treats its ‘clients’ reflects an ideological switch to judgemental attitudes towards the poor as morally inept failures who have made the wrong choices, he says.

Structural violence

The authors use the term “structural violence” to describe the behaviour that has come to characterise the relationship between welfare providers and recipients. “They often resemble violent relationships between intimate partners, involving coercion, detailed monitoring, denying resources, blaming, threats and intimidation, victimisation, and the minimising of legitimate concerns.”

Constant scrutiny and the routine denial of entitlements is reported as undermining welfare applicants’ sense of dignity and self-worth, and invokes emotional responses in the form of anxiety and dread in having to submit to such control.

One participant quoted in the book described WINZ as “very judgemental” and “traumatising”.

“The myth of an over-generous welfare state still features strongly in public imagination,” the authors say. “The levels of scrutiny and interrogation are therefore often surprising to people who end up engaging with welfare for the first time due to redundancy, failed businesses, serious illnesses or other misfortunes.”

‘Shadow welfare state’ and loan sharks

Debt is another of the burdens facing those living in poverty, with the use of payday loans from fringe lenders in the ‘shadow welfare state’ as a key survival strategy.

The authors say that although people are well aware that they are being financially exploited by fringe lenders, “they are at least treated with a degree of respect”.

Debt makes life even more precarious, “adding to their stress and undermining people’s ability to flourish and to participate in society, as well as forcing impossible choices between rent, heating and food”.

Neo-liberal agenda undermining welfare system

The authors assert that current problems are the result of “the continued dominance of neoliberalism”, creating a society “characterised by increased wealth concentration, the associated corruption of political processes, and increased urban poverty and health inequalities”.

“Neoliberal-inspired governments have employed the common strategy of deliberately underfunding government services, which eventually lose their efficacy due to resource restraints.”

This, they say, then provides ‘evidence’ of the perceived inefficiency of government services and a rationale for the need to privatise service delivery. Underfunding also cultivates a prevailing view of urban poverty as “a personal problem involving the moral failings of those affected, rather than as a socio-economic problem and a consequence of the actions of more affluent groups in society”.

The majority of people on welfare want to work, Professor Hodgetts says. But they are often presented with unviable options of low-paid casual work, which is not enough to live or support families on.

Introducing a living wage or Universal Basic Income are potential solutions. And those living in poverty should be involved in the design, planning and development of better services and solutions, he says.

“There is a strong need for engaged, advocacy social science, to give a voice to those who are not being heard,” says Professor Hodgetts, a former army officer.

He hopes the book will be of interest to policymakers and welfare providers. It will be published by Routledge, the world’s leading academic publisher in humanities and social science, as part of an international series on Critical Health Psychology.