Latest news with #hardship
RNZ News
6 days ago
- Business
- RNZ News
iwiSaver hardship withdrawals boom
Photo: RNZ More than 50,000 people made withdrawals from their KiwiSaver accounts on the basis of hardship in the year to June - compared to about 18,000 five years ago. KiwiSaver provider Simplicity chief economist Shamubeel Eaqub said the increase started in 2023 and the reasons were easy to understand - the recession and cost-of-living crisis were putting ongoing pressure on people's budgets. "But some context - the number of hardship withdrawals were 1.6 percent members, and 0.3 percent of savings. The hardship, as is true for the wider society, is concentrated pain among a few," Eaqub said. Sorted's personal finance lead Tom Hartmann told Nine to Noon, it was likely the ability to withdraw from KiwiSaver was giving people "peace of mind" that if their situation worsened they could draw on their savings. Kiwisaver hardship withdrawals data from Simplicity. Photo: SIMPLICITY / SUPPLIED He said the average withdrawal was $8800. For someone in their 30s, earning $75,000 a year, a withdrawal of that size in a year could reduce their not-inflation-adjusted final balance by about $40,000. Hartmann said there had not been an increase in savings suspensions, which indicated that the withdrawal was a temporary stop gap for people who would get back to making contributions. Sorted's personal finance lead Tom Hartmann. Photo: Supplied People can opt to stop contributing to KiwiSaver for a year at a time, and can renew the suspension at the end of the 12 months. The number of people on a savings suspension had dropped from 89,000 a year ago to 85,000. Hartmann said the key thing for people considering a withdrawal was to make it a last resort. "Typically there are other sources of support that need to be explored first." Financial helpline MoneyTalks was one option, he said. "The team there have reporting seeing an increase in even middle-income people exploring their options." Eaqub said for people making a withdrawal, it was often a choice between "certain hardship today versus more savings later in life". "Many low-income people do not contribute to KiwiSaver, because the employee contribution lowers their take home pay. But they also miss out on the employer contribution and government subsidies. It means when non-contributors face hardship, they do not have this fallback." But Rupert Carlyon, founder of Koura KiwiSaver, said people on lower incomes could build up good balances. "Someone earning $60,000 contributing 3 percent will end be putting in [about] $3500 per year, so over 10 years plus returns that really adds up. "You can easily see a $60,000 salary becoming a $45,000 balance over 10 years. That is the power of KiwiSaver, we are often encouraging people to save that would not otherwise do it." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
6 days ago
- Business
- RNZ News
KiwiSaver hardship withdrawals boom
Photo: RNZ More than 50,000 people made withdrawals from their KiwiSaver accounts on the basis of hardship in the year to June - compared to about 18,000 five years ago. KiwiSaver provider Simplicity chief economist Shamubeel Eaqub said the increase started in 2023 and the reasons were easy to understand - the recession and cost-of-living crisis were putting ongoing pressure on people's budgets. "But some context - the number of hardship withdrawals were 1.6 percent members, and 0.3 percent of savings. The hardship, as is true for the wider society, is concentrated pain among a few," Eaqub said. Sorted's personal finance lead Tom Hartmann told Nine to Noon, it was likely the ability to withdraw from KiwiSaver was giving people "peace of mind" that if their situation worsened they could draw on their savings. Kiwisaver hardship withdrawals data from Simplicity. Photo: SIMPLICITY / SUPPLIED He said the average withdrawal was $8800. For someone in their 30s, earning $75,000 a year, a withdrawal of that size in a year could reduce their not-inflation-adjusted final balance by about $40,000. Hartmann said there had not been an increase in savings suspensions, which indicated that the withdrawal was a temporary stop gap for people who would get back to making contributions. Sorted's personal finance lead Tom Hartmann. Photo: Supplied People can opt to stop contributing to KiwiSaver for a year at a time, and can renew the suspension at the end of the 12 months. The number of people on a savings suspension had dropped from 89,000 a year ago to 85,000. Hartmann said the key thing for people considering a withdrawal was to make it a last resort. "Typically there are other sources of support that need to be explored first." Financial helpline MoneyTalks was one option, he said. "The team there have reporting seeing an increase in even middle-income people exploring their options." Eaqub said for people making a withdrawal, it was often a choice between "certain hardship today versus more savings later in life". But he said the situation was worse for those without KiwiSaver. "Many low-income people do not contribute to KiwiSaver, because the employee contribution lowers their take home pay. But they also miss out on the employer contribution and government subsidies. It means when non-contributors face hardship, they do not have this fallback." But Rupert Carlyon, founder of Koura KiwiSaver, said people on lower incomes could build up good balances. "Someone earning $60,000 contributing 3 percent will end be putting in [about] $3500 per year, so over 10 years plus returns that really adds up. "You can easily see a $60,000 salary becoming a $45,000 balance over 10 years. That is the power of KiwiSaver, we are often encouraging people to save that would not otherwise do it." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
ABC News
13-07-2025
- Business
- ABC News
Cancer sufferer's quest for hardship payment plan highlights issues with ACT's strata management system
Amalia Vatavalis was undergoing chemotherapy for cancer when her mother died from a brain tumour in April. In the weeks leading up to her mother's death, the small Canberra business owner struggled to balance everything on her plate, including keeping on top of her bills. "I was trying to balance the chemo, my treatment out with her care, as well having to run a business and work just to pay the bills — it was a lot," she said. She tried to organise a payment plan to keep up with the fees but unlike over the border in New South Wales, the ACT strata system does not allow for hardship provisions for people struggling to pay their strata fees. Her experience highlights issues with the ACT's strata system, issues that are likely to impact more people in the future, with about one in five Canberrans now living in apartments or units. Earlier this month, a Legislative Assembly inquiry into the management of strata properties heard half of all forced bankruptcies in the ACT last financial year were a result of strata companies seeking money from unit owners. After surviving seizures caused by her brain tumour, Ms Vatavalis's mother, Connie, was in "great spirits". So, it came as a shock to Ms Vatavalis when her mum suddenly took a turn and died. "All I could do was cry. I've got one of her pillows, I just wanted to hug it." Feeling overwhelmed, Ms Vatavalis spoke to her home and car loan providers about hardship payment plans, and she said they were accommodating and understood her situation. "I rang my bank. I said, 'I just can't do it, my mum has just passed, I'm overwhelmed', and they were so understanding, they put my mortgage payments on break for a couple of months, which was so lovely," she said. But when it came to trying to set up a payment plan for her body corporate fees for her apartment, she couldn't reach an agreement with her strata manager. "I contacted the strata manager so many times by phone, left messages, they were never available to talk, never got back to me. I emailed them asking [them] to get back to me," she said. "They tell you to do something and it's their way or the highway, there's just no negotiation and that's what I found absolutely abhorrent. Ms Vatavalis eventually had to appear before the ACT Civil and Administrative Tribunal over her unpaid strata fees and was ordered to pay them back. She said the ACT government needed to change legislation to ensure people struggling to pay their strata fees could access payment plans, similar to those for home loans, insurance and energy bills. The ACT Strata Community Association (SCA) said it was "not opposed" to a framework which would allow for hardship provisions, however it stressed the importance of paying strata levies. "This money goes towards things that are absolutely essential like insurance of the building," SCA CEO Chris Miller said. "There's a statutory obligation to insure the building that's not something they can opt out of, and critical systems supporting life and property, fire systems, CO2 extraction from basements. Mr Miller also defended a strata manager's role in the process when unit owners who have struggled to pay fees have had their requests for payment plans knocked back. "The strata manger is simply an agent for the owners corporation and these matters are determined and decided by the corporation," Mr Miller said. The SCA did however recognise a need for higher standards and mandatory qualifications for strata managers in the ACT, and called for changes to the current set-up. "Strata managers, and potentially assistant strata managers, engaging with customers, doing work on behalf of owners corporations, there should be a requirement for minimum qualifications and ongoing professional development in those roles," Mr Miller said. "Presently in the ACT the only requirement is for the principal of the strata business to have a minimum qualification and an ongoing licence and professional development, we think that should extend to a broader collection of operators in strata management."
The Guardian
08-07-2025
- Politics
- The Guardian
Children in England ‘living in almost Dickensian levels of poverty'
Children in England are living in 'almost Dickensian levels of poverty' where deprivation has become normalised, the children's commissioner has said, as she insisted the two-child benefit limit must be scrapped. Young people said they had experienced not having enough water to shower, rats biting through their walls, and mouldy bedrooms, among a number of examples in a report on the 'crisis of hardship' gripping the country. Dame Rachel de Souza said she had noticed a significant shift in how young people talked about their lives since she became children's commissioner four years ago, and that 'issues that were traditionally seen as 'adult' concerns are now keenly felt by children'. 'Children shared harrowing accounts of hardship, with some in almost Dickensian levels of poverty,' she said. 'They don't talk about 'poverty' as an abstract concept but about not having the things that most people would consider basic: a safe home that isn't mouldy or full or rats, with a bed big enough to stretch out in, 'luxury' food like bacon, a place to do homework, heating, privacy in the bathroom and being able to wash, having their friends over, and not having to travel hours to school.' The report said it was 'deeply concerning how often children seemed to accept these inadequate situations as normal, or to have worryingly low expectations for what they should be entitled to'. She said that, in 'one of the richest societies in the world', people in power 'should be ashamed that children are growing up knowing their futures are being determined by their financial circumstances'. A record 4.5 million children were living in poverty in the UK in the year to April 2024, according to the latest figures. Labour's flagship child poverty strategy has been delayed until at least the autumn, as it faces growing pressure to end the two-child limit on universal credit. On Sunday, the education minister said the government's recent U-turn on changes to welfare would make it harder to implement the policy, adding to concerns it may not be added to the strategy. 'The decisions that have been taken in the last week do make decisions, future decisions harder,' Bridget Phillipson told BBC's Sunday with Laura Kuenssberg. The limit, which came into effect under the Conservatives in April 2017, restricts child tax credit and universal credit to the first two children in most households. The Child Poverty Action Group estimates 109 children are pulled into poverty every day by the limit. The Institute for Fiscal Studies has estimated that axing the policy would cost the government about £3.4bn a year and would lift 500,000 children out of relative poverty. De Souza said there was 'no quick fix to ending child poverty', but it was 'very clear that any child poverty strategy must be built on the foundation of scrapping the two-child limit'. Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion The commissioner's report, based on the experiences of 128 children aged between six and 18 across the country between January and March this year, noted a range of concerns including lack of access to quality, healthy food, and living in cramped and poor conditions. De Souza also called for a 'triple-lock' on child-related benefits to ensure they kept up with rising prices, reforms to ensure families are not housed in temporary bed and breakfast accommodation for longer than the legal six-week limit and free bus travel for all school-age children in England. Responding to the report, Paul Whiteman, the general secretary of the school leaders' union NAHT, said teachers were 'increasingly running food banks and warm hubs, providing food vouchers and even offering use of laundry facilities, but this shouldn't be necessary, and schools cannot tackle all the underlying causes of child poverty'. He said he supported the commissioner's call for cross-departmental action and auto-enrolment for free meals. The Department for Work and Pensions has been contacted for comment.
The Independent
07-07-2025
- Business
- The Independent
‘Mouldy or full of rats': Children in England face almost-Dickensian levels of poverty
The Children's Commissioner has warned some young people in England are living in an 'almost- Dickensian level of poverty ' as a new report reveals the 'real hardship' facing some families. Black mould in a bedroom and rats in a kitchen were among some of the examples given by young people for the commissioner's review, as the government prepares to publish a child poverty strategy in autumn. The latest official estimates, for the year to March 2024, suggest there were a record 4.45 million children living in poverty in the UK. While some feel a sense of shame over their situation, Dame Rachel de Souza said it is 'society at large and decision-makers that should be ashamed of the fact that children don't have enough money'. A multitude of campaign groups have said the government's new strategy must contain a commitment to do away with the two-child benefit limit. The limit, which came into effect under the Conservatives in April 2017, restricts child tax credit and universal credit (UC) to the first two children in most households. Organisations working in the sector argue that 109 children across the UK are pulled into poverty by the policy every day and that an estimated 350,000 children would be lifted out of poverty immediately if it was scrapped. But comments by Education Secretary Bridget Phillipson at the weekend have raised concerns the policy might not be done away with, amid financial pressures following the U-turn on welfare reforms. Ms Phillipson said spending decisions have been made 'harder' after the watering down of the welfare reforms. Pressed on whether the chances of the benefit cap going are now slimmer, Ms Phillipson told BBC's Sunday With Laura Kuenssberg: 'The decisions that have been taken in the last week do make decisions, future decisions harder. 'But all of that said, we will look at this collectively in terms of all of the ways that we can lift children out of poverty.' Estimates for the cost of scrapping the policy vary, from around £2.6 billion to £3.5 billion by the end of this Parliament (2029/30). Dame Rachel – whose office was commissioned to carry out its report to feed into the Government's work in the area – said while there is 'no quick fix to ending child poverty', she feels it is 'very clear that any child poverty strategy must be built on the foundation of scrapping the two-child limit'. She added that a new approach is needed which 'stops sidelining children's voices', saying that 'only by listening to children, and acting in response, will we get close to solving those problems'. The commissioner said in recent years she has seen a change in children's comments, noting that issues traditionally seen as 'adult' concerns 'are now keenly felt by children, who see their parents' worries and the struggles they face: the hours they work, the homes they live in and the ability to put food on the table'. She added: 'Children shared harrowing accounts of hardship, with some in almost-Dickensian levels of poverty. 'They don't talk about 'poverty' as an abstract concept but about not having the things that most people would consider basic: a safe home that isn't mouldy or full of rats, with a bed big enough to stretch out in, 'luxury' food like bacon, a place to do homework, heating, privacy in the bathroom and being able to wash, having their friends over, and not having to travel hours to school.' While commending 'some positive steps by the Government to get more money into families' pockets', she urged 'bold, practical measures that break the link between a child's background and their opportunities'. The commissioner's report, based on the experiences of 128 children across the country between January and March this year, noted a range of concerns including lack of access to quality, healthy food and living in cramped and poor conditions. As well as calling for the two-child benefit limit to be scrapped, Dame Rachel urged a commitment to a so-called 'triple-lock' for uprating all child-related benefits, reforms to ensure families are not being housed in temporary bed and breakfast accommodation for longer than the legal six-week limit, free bus travel for all school-aged children in England and better safety measures in areas with children in low-income families including increased street lighting, and more neighbourhood watch-style initiatives. A government spokesperson said: 'We are determined to bring down child poverty. We've just announced a new £1 billion package to reform crisis support, including funding to ensure the poorest children do not go hungry outside of term time. 'This comes alongside the expansion to free breakfast clubs, investing £39 billion in social and affordable housing, increasing the national minimum wage and supporting 700,000 of the poorest families by introducing a Fair Repayment Rate on Universal Credit deductions. 'As part of our plan for change, the Child Poverty Taskforce will publish an ambitious strategy later this year to ensure we deliver fully-funded measures that tackle the structural and root causes of child poverty across the country.'
