Couples split to get extra on benefit

A growing number of unemployed couples are living apart so one can claim the domestic purposes benefit to get more money, say beneficiary advocates.

A community leader in New Zealand's "DPB capital" of Kawerau says 70 per cent of those claiming the benefit in the town have partners "round the back door".

Kay Brereton of the Beneficiary Advocacy Federation said couples who might be getting $200 below their living costs on the $324 weekly couple unemployment benefit were being tempted to split.

One could then get $278 on the domestic purposes benefit (DPB) and the other could get $194 on the single dole - a total of $472, and almost $150 extra a week.

"In the current financial reality, more and more couples will be looking to maximise their income," Ms Brereton said.

Kawerau Youth Council co-ordinator Rob Matthews said 70 per cent of the town's DPB recipients had partners.

"You are starting to get people that are splitting up just to get that money. 'I'll take one child and you take the other two and we'll both go on the solo [benefit].' That's survival - still trying to be a family at the same time."

A Work and Income spokesman said the agency found 702 cases of relationship fraud in the year to June among the 111,689 people on the DPB.

The agency is trying to recover $16.6 million from the people who committed relationship fraud, and successfully prosecuted 205 of them in the year to June.

The trend is revealed in a three-part Herald investigation into New Zealand's high rate of sole-parenthood, which is the third highest in the developed world.

Our investigation has also found that many sole parents will have little hope of finding work under a new law requiring them to seek part-time employment once their youngest children turn 6.

Most are poorly qualified, many come from third-generation welfare families, and they are most likely to live in North Island provincial towns such as Kawerau where few jobs are available.

Ms Brereton said she had heard many stories about cheating on the DPB but Mr Matthews' 70 per cent figure was too high.

But many sole parents and community leaders in the high-DPB areas agreed that many beneficiaries did have partners.

"They'll have the husband on the dole and the wife on the DPB because the de facto [unemployment] benefit doesn't pay much for them to live," said Esther Thompson of Te Huinga Social Services in Kawerau. "It's rampant."

Debbie Wihongi, a whanau advocate at Papakura Marae in South Auckland, said many mothers went on the DPB because their partners were not supporting them.

"They are living off the women. They play the system - no more than three days on site; they know the rules," she said.

Economist Patrick Nolan calculated in 2008 that a couple who were both unemployed with two young children would be $54 a week better off living apart than staying together.

The benefit system is being reviewed by a working group, headed by economist Paula Rebstock, which will publish an issues paper on options for reform on Monday.

The Work and Income spokesman said there was no rule about how many nights a partner could spend with someone on the DPB.

DPB recipients had to be living apart and inadequately supported by a partner, and were counted as being in a relationship only if both had "a degree of companionship demonstrating an emotional commitment" and "financial interdependence".