Welfare System in New Zealand - Overview:
In 1937 the Government of the day established the first truly universal welfare system which offered support to the disadvantaged and created a safety net for those out of work, in need or without homes or income. This "cradle to grave" concept as it was known helped to eliminate almost all poverty and certainly the worst of what one sees overseas.
During the prosperous post WWII years and into the late 1960's New Zealand continued to fund this enormous system with relative ease. By the early 1970's however with a changing world New Zealand failed to respond and the system became less and less affordable - so successive Governments borrowed to sustain a standard of living and welfare that was no longer affordable. Only in the mid 1990's did the country attempt to restructure the welfare system so that it is better targeted and those seeking an alternative to gainful employment increasingly have to think again.
However New Zealanders pride themselves on having an absence of beggars on the streets, squatter settlements and shanty towns - most New Zealanders would have it no other way.
Welfare for migrants can be limited within the first two years. For most migrants who have English as a first language will never experience the Welfare Department. For those from non-English backgrounds who can find employment more difficult welfare assistance is available in various forms.
For 24 months after arrival migrants are not entitled to unemployment benefits but can get weekly allowances for accommodation (max $90.00), children (approximately $40.00 per child) and emergency grants of around $150.00 per week.
While your new country will not let you starve or become homeless you are expected to take responsibility for yourself and your family and state assistance should be viewed as a temporary measure and not a way of life.
Pensions in New Zealand:
New Zealanders do not yet have to pay any compulsory retirement contribution during their working life and the universal pension is funded out of income taxes. The retirement age is 65 at which time married couples receive $330.40 per week and single people slightly over half that. Most pensioners do not rely on the state for pension but have made provision through private Retirement funds or by realising assets to see them through. The rate of pension at 65% of the average wage is far higher than in other developed countries.
All migrants of working age are encouraged to establish some form of savings plan as so as you begin working. Life on the pension can be very difficult especially if you have a mortgage over your property or other debt.
With an aging population - reminiscent of most developed countries - the state’s ability to continue funding a universal pension must be questioned as we look towards the years 2020 and beyond when the “baby boomers” reach retirement age.
Welfare and the hand out mentality is still without doubt the single greatest impediment to the nations prosperity. Whilst few living in NZ would seek to have the system dismantled an increasing number question the sustainability of spending $250 million every week of the year on welfare. There is no doubt that part of NZ’s problem has been caused by a generation of people who believe that they have a right to not work.
The upside of it is that the Government still runs budget surpluses and the dependency culture is being chipped away at.
This is the last area of the country where reforms have been slow. This reflects the power of the welfare vote to the politicians we suspect.
Public Health System in New Zealand:
New Zealand has a highly developed and excellent public health system. As a consequence most people rely on the state system to satisfy their health needs. Also funded from taxes a visit to a hospital will be "free". With hospitals in all the major cities the availability to the general population is generally very good.
Increasingly with Government expecting every last tax dollar to be used most wisely health reforms have caused major political upheaval between those that wish to see the Government increase expenditure and those who believe that we can be getting better value for our tax dollar. Thus in 2000 no single issue more dominates political debate.
The Government currently commits around 7% of GDP to health and in return the standard is very high compared to most countries.
The facts however remain - the system is by and large well funded and an individual entering a public hospital here will receive a standard of care many countries only dream of. The Government of the day is now spending more of its income on health on a per capita basis than at any time in our history.
However with the restructuring that is taking place many hospitals are experiencing increasing waiting lists for non life threatening surgery and as a consequence people are being attracted to private medical insurance to cover themselves in the event the local hospital has a waiting list. While private medical insurance is voluntary - and there is no compulsory public medical insurance scheme - close to 50% of New Zealanders now have private medical insurance.
If an individual seeks to insure for Doctors visits, prescriptions and hospitalisation a family of 5 could expect to pay premiums of around $2000 per year for the family. This would return them 90% of all medical costs incurred in that year including (depending on the company) dental and optometry costs. A family of three could expect a yearly premium of around $1400.00.
Visits to the Doctor would cost an adult between $25 and $35. Children under six visit for free and remaining children are still heavily subsidised by the state and will pay anything from $5 to $9 for a visit to the Doctor depending on the area and region.
Drugs and prescriptions are also heavily subsidised and no family will pay more than $150 per year which means drugs are available to all at reasonable cost.
A visit to the Dentist to have your teeth checked will likely cost in the order of $60 and an eye test slightly less than that.
All maternity care (from the point of positive pregnancy test) to the birth of the child is 100% paid for by the state. Specialists if required or preferred are paid for by the patient.
In summary then, New Zealanders will tend to visit their own General Practitioner or Specialist who is in Private Practice. In the event of an emergency they will be taken care of in the public hospitals often under the care of a private sector specialist.
For new arrivals as soon as a residence permit is granted you will be afforded the same care and access to these health services as are New Zealand citizens and residents.
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