Beneficiaries must complete three job-search activities per week over a four-week period
The government has introduced two new non-financial benefit sanctions under the Ministry of Social Development’s (MSD) Traffic Light System, requiring job seekers to actively search for employment or participate in training programs to enhance workforce participation and reduce welfare dependency.
Social Development and Employment Minister Louise Upston stated that the initiative is part of a broader strategy to drive economic growth by encouraging more job seekers to enter the workforce. She emphasised the importance of ensuring that beneficiaries who are capable of working take reasonable steps to find employment or remain work-ready.
The first new sanction, called “Report Job Search,” will require beneficiaries to complete a minimum of three job-search activities per week over a four-week period and report back to MSD. Upston explained that this measure is intended to enhance accountability among those expected to seek employment. The second sanction, “Upskilling,” will mandate job seekers to participate in employment-related training courses or programs for at least five hours per week for four weeks. This requirement is designed to improve job seekers’ skills and increase their chances of securing work.
Upston stressed that these new sanctions will ensure greater accountability within the welfare system while recognising that financial penalties are not always the best solution. She noted that the government is focused on reducing welfare dependency by providing MSD with the necessary tools to support more people into employment.
The new measures follow the introduction of Money Management and Community Work Experience sanctions, which are scheduled to take effect later this year.
Recent data from MSD indicates that between July and December 2024, more than 33,000 individuals moved off the Jobseeker benefit and into employment, representing a 22 percent increase compared to the same period in 2023. Approximately 15,600 additional benefit sanctions were issued during that time, marking a 126% increase. Upston pointed to these figures as evidence that reinstating consequences for job seekers is contributing to greater workforce participation.
The legislative changes necessary to implement these new non-financial sanctions are included in the Social Security Amendment Bill, which is currently before parliament. Under the Traffic Light System, job seekers subject to these sanctions will be required to provide evidence of compliance before being returned to "green" status, allowing them to maintain access to benefits without financial penalties.