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Govt Releases Assistance Package For Those Hit By Redundancy

Fuseworks Media
Fuseworks Media

Wellington, Dec 15 NZPA - A package to assist those made redundant in the current economic turmoil will cost $50 million over two years if 70,000 people lose their jobs.

The Government's announcement of the economic assistance package today was almost identical to that outlined by National during the election campaign.

The "ReStart" package offers short-term help for up to 16 weeks to low and moderate income families with children, and to people with high housing costs.

Those made redundant will be offered:

* A payment for families with children and who lose the In Work tax credit of $60 a week for families of up to three children and $15 a week for each extra child;

* A top up of the accommodation supplement for those who qualify for the maximum payment of $100 more a week;

* Assistance with getting a new job.

This would be on top of any benefits that people were eligible for.

There are two main differences from the policy that National campaigned on.

Under the original proposal those made redundant would have to be working in the same job for six months, now it is just working for six months.

Also those who received more than $25,000 in redundancy payments would not be eligible for the In Work tax credit.

Prime Minister John Key said it was estimated 92 percent of those made redundant would get less than $25,000 in payout.

Officials said 800 people had been made redundant in November, though usually up to 40 percent of these would find a job quickly.

Those made redundant from November 8 will be eligible, but the first payments will not be made until January 1.

Officials said the $50 million cost over two years -- which is how long the package will exist for -- was based on 70,000 people being made redundant.

They said this was not a forecast, but a worst case scenario.

Figures provided by officials showed 9900 people were made redundant in the four months ending September 2008, compared to 7600 in the same period in 2007.

Officials said the job market remained buoyant.

The scheme would cost $1 million to administer and is being introduced by ministerial direction, which means it does not need legislation.

Social Development Minister Paula Bennett said the package was designed to give some breathing space to those hit by redundancy.

Ms Bennett said she hoped employers would work hard to keep staff on and despite the gloom there were many jobs still out there.

She did not envisage 70,000 people losing their jobs over the coming years, but many of those who did would face tough decisions over dealing with the sudden drop in income.

Labour's Social Development spokeswoman Annette King said the policy was a welcome start, but more needed to be done to keep people in jobs.

Ms King said the Government's package provided for assistance for single income families, but left working couples without support. "The major failing of the National government package is that it had not been done in conjunction with a plan to stimulate the economy," Ms King said.

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