The amount of money given out in advance benefit payments has soared over the past year to nearly $100 million.
Benefit advances are additional assistance to anyone already on a main benefit who still can't afford to pay for essential items or for help in an emergency. The cost is then recovered from subsequent payments of their usual benefit.
According to the latest Ministry of Social Development benefit report released on Thursday, $88.8 million was paid out in benefit advances in the September quarter. That compares to $64.6 million in the 2021 September quarter - a 37.5 percent increase.
The number of benefit advances has risen by 22.8 percent when compared to the same period last year, from 155,169 to 190,596.
Green Party social development spokesperson Ricardo Menéndez March said the jump in benefit advances shows more families are being forced into a cycle of debt to afford basics.
"As inflation continues to rise and benefits lag behind, more families are getting into debt with Work and Income just so they can get by," he said. "Unless we take urgent action, more families will be put further into debt with the agency that is supposed to support them."
Overall, the number of working-age people on a main benefit dropped in the September quarter to 345,762 from 359,762 in the 2021 September quarter.
However, that's still way above the 299,472 people on a main benefit in the 2019 September quarter - before COVID-19 caused economic disruption - and above the 277,218 on a main benefit when National left Government.
The proportion of the New Zealand working-age population receiving a main benefit was 11.1 percent, down from 11.5 percent, but above the 9.7 percent in 2019.
Social Development Minister Carmel Sepuloni pointed out it was below the 12.6 percent of people on the main benefit after the Global Financial Crisis.
"Traditionally the September quarter sees a slowdown in the number of people moving into work, however we saw 21,240 people move off a benefit into work during the September quarter. This is around 3900 more than the same quarter pre-pandemic, showing our investment in frontline case management is working."
The number of people on the Jobseeker support was 170,037 in the September quarter, down from 193,645, with 98,935 classed as "work ready". That's 11.7 percent fewer "work ready" recipients than there were a year ago and the first time it's been below 100,000 since COVID-19. But it's still above the 80,604 "work ready" Jobseeker recipients there were pre-pandemic.
Sepuloni said the numbers are on the "right path".
"Our strong response to COVID-19 and our economic plan continues to pay dividends, in what continues to be an extremely challenging global environment," she said.
"That hasn’t diminished our resolve or focus which is reflected by the fact benefit numbers have not met the high forecasts from Treasury who predicted 487,500 people would be receiving a main benefit by January 2021."
But National's not having it, saying with Kiwi businesses struggling to employ people, there should be fewer beneficiaries.
"Almost five years to the day after this incompetent Government came to power, there are almost 50,000 more people stuck on the Jobseeker benefit than in 2017," said social development spokesperson Louise Upston.
"With worker shortages in almost every sector of the economy, Jobseeker numbers should be at record lows."
Upston claimed Labour's approach to welfare "is doing serious harm".
"Instead of a safety net that supports people into their next job, Labour has created a dragnet that pulls vulnerable New Zealanders further away from independence and opportunity."
Overall hardship assistance was up from 572,220 in September 2021 to 588,238 with more than $236 million paid out. People don't need to receive a main benefit to be eligible for some hardship assistance.
The jump was driven by the increase in benefit advances. Special Needs Grants were down from 405,057 to 376,608, though the value had risen from $129.7 million to $136.1 million.
ACT social development spokesperson Karen Chhour said the jump in hardship assistance shows the cost of living crisis is hurting New Zealanders.
"Kiwi families are doing it tough. Labour has borrowed and spent which has fuelled the inflation fire. We’ve heard heartbreaking stories of people having to choose between paying the rent or feeding their kids."
The number of benefit sanctions for unfulfilled work obligations has jumped slightly from 5250 to 5655. But it's down from 10,470 in the 2019 September quarter.
The Green Party wants the Government to wipe Work and Income debt and lift benefits. It was frustrated when the cost of living payment wasn't extended to those receiving benefits.
"It is not fair for the Government to be excluding people on the benefit from the cost of living payment under the premise that because they already get the Winter Energy Payment, therefore they don't face the additional cost of living pressures," Menéndez March told Newshub in July.
The Government said it had already lifted benefits and the cost of living payment was intended for those who fall into a "gap" of not currently receiving any support.
The National Party released a welfare policy earlier this year that included paying a $1000 lump sum to anyone under 25 years old who stays in work for more than one year after having been on a benefit for at least 12 months. It also proposed giving under-25s who have been on the Jobseeker benefit for more than three months a job coach.
ACT wants the Government to take more responsibility for inflation. The Consumer Price Index this week showed annual inflation of 7.2 percent, down slightly from 7.3 percent last quarter, but above predictions.
"The Government has to take responsibility for its own policies, namely its spending, its Reserve Bank legislation and appointment of Adrian Orr, its long closure of the border and its expensive ideological experiment called the 'immigration reset'," said Chhour.
The Government, however, has said inflation is mostly the result of international factors like COVID-19 supply chain disruptions and the Ukraine war. Other countries are also facing sky-high inflation.
