The Training Incentive Allowance was introduced in 1983, and aimed to encourage sole parent beneficiaries receiving the Domestic Purposes Benefit to develop work skills and skill-confidence.[1] Those groups eligible for the TIA were identified as needing further education and training incentives ,as they faced additional barriers to entering paid employment, such as lack of educational qualifications, lack of job experience and childcare responsibility. [2] The allowance provided up to $3862 a year for costs such as course fees, materials, transport and childcare.[3] Since the late 1980s, the TIA has been successful in allowing sole parent beneficiaries to overcome various financial barriers and develop skills, and attain qualifications to enter into sustainable employment.[4] Furthermore, individuals accomplished a number of positive outcomes other than employment, such as improved self-confidence, increased sense of well-being and increased interactions with others.[5] A Ministry evaluation of the allowance in 2003 showed beneficiaries who received it spent less time on the Domestic Purposes Benefit.[6] Overseas research has also found that undertaking high-quality education will lead to improved economic prospects for sole parents and their children.[7] However, the success of the TIA in allowing sole parent beneficiaries to attain qualifications and enter employment has not been taken into account by the government, as it recently made the decision to cut eligibility for the TIA for those intending to do degrees or diplomas. It is now available only for school-level or lower level courses.[8] This policy change is expected to save $2 million by 2012, however at least 4500 beneficiaries a year are likely to be affected. [9]This policy decision has been made at a time when barriers to participation in employment for sole parent beneficiaries still exist, and lack of educational qualifications, along with other barriers identified hinder sole parents mobility into higher-wage jobs.[10] Furthermore, sole mothers are much less likely than other women to have any educational qualifications. [11] Consequently, the type of occupations usually held by solo mothers tend to be low-skilled and low- paid, with no parental leave, with unpredictable and limited hours, low status, and be insecure, temporary and casual.[12]
The government’s decision to restrict eligibility to the TIA is further problematic, as the recession has increased the incidence of poverty for sole parents and their children. Recent research has found that the recession is impacting on families unevenly, this is evident in a Social Development Ministry study, which found that 49 % of sole-parent families were in poverty last year, earning less than 60 % of the median income per person after housing costs, whereas only 12 % of two-parent families with children were in poverty.[13] A recent report also found that poverty rates for children in sole parent households is 52 % compared to 13 % for those in two parent households.[14] The recent cut to the TIA conflicts with the governments own research findings, for example, reports produced by the Ministry show that the economic position of solo parents has declined drastically, and it is stressed that additional support is essential for solo parents: ‘With the economy softening, there is a risk that sole parents will fall back on to benefits, and we should give special attention to helping to reconnect these sole parents to the labour market where possible. If there are no jobs, a period of education and retraining will need to be the short-term focus.’ [15] These reports have also consistently recognized the children of sole-parent beneficiaries as among the most vulnerable, and consistently stated that well-paid, sustainable employment for sole parents is their route out of poverty.[16]
There is a significant lack of policy research and literature on training incentives for sole parent beneficiaries in New Zealand. There are a small number of research reports on the Training Incentive Allowance, however there is a gap in the analysis of the problem as they do not focus greatly on the importance of higher education for sole parent beneficiaries.[17] The works on solo parents and the TIA are out of date, and furthermore, research has not been conducted in response to the cuts made to the TIA in the 2009 budget .This report will address this problem, and my work will provide a contribution to fill that important gap by focussing on the potential impacts of the cuts to the TIA on sole parent beneficiaries, and the possible solutions to this problem.
[1] Gill Aimer, Barriers and policy interventions: The Training Incentive Allowance and the participation of sole parents and Invalids’ Benefit recipients in education, training and employment (Wellington: Ministry of Social Development, 2003), 2.
[2] Ibid., 2.
[3] http://www.nzherald.co.nz/claire-trevett/news/article.cfm?a_id=74&objectid=10579431 June 19 2009.
(accessed September 14,2009).
[4] http://www.msd.govt.nz/about-msd-and-our-work/publications-resources/literature-reviews/index.html
[5] Coreen Adamson, Phase 2 Evaluation of The Training Incentive Allowance ((Wellington: Ministry of Social Development, 2004), 24.
[6] Coreen Adamson and others, Phase 1 Evaluation of The Training Incentive Allowance (Wellington: Ministry of Social Development, 2003), 2.
[7] Aimer, 21.
[8] http://www.nzherald.co.nz/claire-trevett/news/article.cfm?a_id=74&objectid=10579431 June 19 2009.
(accessed September 14, 2009).
[9] http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10585365 July 19 2009.
(accessed September 14,2009).
[10] Aimer,5.
[11] http://www.guardian.co.uk/education/2001/jan/30/highereducation.theguardian3 January 30 2001. (accessed September 16,2009).
[12] Sue Richardson and Lauren Miller-Lewis, Low Wage Jobs and Pathways to Better Outcomes (Wellington: New Zealand Treasury, 2002), 43.
[13] Simon Collins, ‘‘Recession hits New Zealand families unevenly-economist,’’ The New Zealand Herald, September 17 2009.National section.
[14]Bryan Perry , Household Incomes in New Zealand: Trends in Indicators of Inequality and Hardship 1982 to 2008(Wellington: Ministry of Social Development, 2009), 9.
[15] http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10588235 August 3 2009. (accessed August 5, 2009).
[16] http://www.nzherald.co.nz/privacy/news/article.cfm?c_id=546&objectid=10588235&pnum=2 August 3 2009.(accessed August 5,2009).
[17] See Susan Harland and others, The Effectiveness of the Training Incentive Allowance (Wellington: Evaluation Unit, Department of Social Welfare, 1989).
Marlene Levine and others, Lone Parents and Paid Work: A Study of Employment Patterns and Barriers, and Options for Change (Wellington: Social Policy Agency, Department of Social Welfare, 1993).
Cathy R. Wylie, Factors Affecting the Participation in the Workforce of Female Heads of One Parent Families, (Wellington: Department of Social Welfare,1980).