National | Benefit

Two-tier benefit system in force

A Māori economist says changes to benefit rules are creating a class system amongst beneficiaries and pensioners.

From April 1 some benefits have become fixed to inflation rather than median wage growth.

That means the amount paid for jobseeker support, sole parent support, youth benefits and long term hospital patient support will be more volatile year to year.

Peter Fraser says it effectively downgrades non-superannuitants.

“I want to be really, really clear about this because they’ve only done it to some benefits. For example, national superannuation, they have totally left untouched.

" So what we’ve actually set up here is a situation that if you are on what the government calls the main benefit, you are a second class beneficiary because you get indexed in a different way,” he says.