Through its association with New Zealand, Cook Islands has one of the most comprehensive social security/protection systems in the region. The system comprises a national provident fund (NPF) with approximately 2500-3000 members. All employed persons are required to be members of the NPF, contributions are paid by both employee and employer. Members’ contributions plus annual interest can be drawn at the official retirement age. There are also provisions for early access to member balances for specific approved purposes and circumstances. The 1989 Welfare Act provides for payments for all children aged up to 12 years and to old age pensioners 60 years and over. Special payments are made to people who are destitute or infirm and a caregiver payment can be made to those caring for infirm or elderly people. Other special assistance is given for improving the household residences of disabled and elderly people. Under the act, one-off grants equivalent to six month’s benefit are made to the families of deceased beneficiaries to help pay funeral costs. A new born allowance is also paid on the birth of a child.
The amount payable to each eligible person under the pension scheme has recently been increased from about $200 to about $330 per month. The disability benefit scheme supports approximately 230 disabled persons, with a monthly payment of around $100, this is supported by a care givers allowance with a similar monthly payment. In addition, there is a means-tested social assistance scheme, with the same rate of benefit as care-givers, which supports a small number (approximately 50) very poor households.
In 2010 it is estimated that more than a third of the population will receive some form of welfare payment, there were about 5600 or about 40 percent of the resident population (about 13,000) on a welfare benefit as of December 2009. In 2010, the government will spend $11.3 million on welfare payments which include the old age pension, child benefit, destitute/infirm payment, and care givers’ allowance. About one-tenth of the total government operating budget is spent on the welfare system.
The ministry of internal affairs recently announced that government had undertaken a preliminary review of the existing social welfare system and had identified a number of issues for broader public discussion. An issues paper identifies key questions to help inform the development of a policy paper for further government consideration.
According to the ministry, key questions include: What is the purpose of welfare payments? Who should receive welfare payments? What is an appropriate level of welfare payment? Are there other safety nets that should be considered such as the role of the community; extended family supports; superannuation; insurance? What system can government afford?
One of the considerations of the government review will be whether people should be means-tested for welfare benefits – now a common method employed by countries which have welfare systems.