Welfare reform and the intra-regional migration of beneficiaries in New Zealand |
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| Authors: | Philip S Morrison |
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| Institution: | a Institute of Geography, School of Earth Sciences, Victoria University of Wellington, PO Box 600, Wellington, New Zealand
b Social Policy Research Unit, The Family Centre, PO Box 31050 (Wellington), Lower Hutt, New Zealand |
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| Abstract: | This paper investigates the net effect of major cuts in welfare benefits and associated changes in the delivery of housing assistance on the relocation behavior of beneficiaries. It does so against an international literature which has documented the tendency of welfare recipients to adjust their costs of living by moving from urban to rural settlements. The paper reviews the literature on welfare and migration, introduces a theoretical framework based on a metropolitan labour market and then tests several hypotheses about the possible effects of benefits cuts on spatial adjustment. The research design uses quinquennial census data to compare core beneficiary relocation patterns with those of non-beneficiaries before and after the cuts to welfare benefits in the Wellington region of New Zealand in 1991. The period following the benefit cuts in New Zealand was characterised by increasing job opportunities which helped to mitigate their adverse effect and made it difficult to identify a more general down-market residential adjustment. While a downward adjustment in housing consumption by core beneficiaries was identified, residential movement from urban to the cheaper settlements in adjacent rural areas was only observed from former State house areas where the income effects of benefit cuts were compounded by increases in rents on former State houses. Thus, while this paper supports the findings of independent sample survey work, our census based analysis underscores the highly contingent nature of that response. Evidence of urban-rural migration is placed in the context of the government's `remote area policy' which attempts to dissuade beneficiaries (who are receiving a social security benefit related to their employment status) from moving without good reason to `remote' locations where job prospects are weak. The paper raises the more general policy issue where benefit cuts, designed to stimulate more active job searching among the unemployed, actually prompt some beneficiaries to relocate to the urban fringe and in some cases to remote parts of the country where job prospects are weak. The theoretical and policy implication of this paper is that there are geographical correlates to the reservation wage which need to be integrated into thinking about the participation consequences of setting benefit levels. |
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| Keywords: | Welfare Migration Unemployment Beneficiaries Residential mobility Wellington New Zealand |
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