New Zealand Reaches Consensus on Social Policy

Article excerpt

New Zealand's October 14, 1996, elections are the first to be held under a new, proportional electoral system. In advance of the outcome, agreement has been reached on continuing changes in the country's social welfare programs. The outgoing National Party government has been active in adjusting these changes in the face of future economic constraints. Among the more important changes in the social security program formulated by the government since 1991 were:

Tightening an income test for old-age benefits and gradually raising the pensionable age, beginning April 1992, from 60 to 65 by the year 2001. The retirement age is currently 62 years and 9 months.

Cutting unemployment benefits to make them less attractive, relative to low-paying work. The unemployed now also have to wait, in some cases for up to 26 weeks, before becoming eligible for benefits.

Reducing costs of the national health program by charging most patients deductibles for partial costs of drugs, visits to doctors, and private hospitalization (the chronically ill exempted), with middle and upper income earners paying higher fees. At the same time, the government introduced a "kiwi card" to provide low-income people with reduced fees.

Protecting children via the New Zealand Family Support Tax Credit (FSTC) and the Independent Family Tax Credit (IFTC), both implemented on July 1, 1996. …


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