The Green Party wants to give in-work tax credits to people who aren’t working and fund it with an envy tax.
The motivation to end child poverty is noble.
But in taking away the incentive to work they are going to increase benefit dependency, which as Lindsay Mitchell, says is one of the major determinants of poverty:
Let’s remember is was Labour that introduced the IWTC, the rationale being to attract more parents, mainly single, into employment. Clark and Cullen believed that the best way to get children out of poverty was to get their parents into paid work. From Cullen’s 2006 budget speech:
The Government believes that ultimately work is the best way out of poverty, and provides the best social and economic outcomes for families in the long run. Making work pay through the In-Work Payment component of the Working for Families package improves people’s opportunities to make a better life for themselves and their families.
In Social Developments author Tim Garlick wrote
The decision to strengthen work incentives by not increasing the income of non-working families was strongly criticised by some academics and community groups…
But they stood by their conviction.
And the courts have upheld the policy’s legitimacy against multiple challenges from the Child Poverty Action Group.
Yet the Greens see no value in paid work. No value in children growing up with working role models.No value in actually earning an income; participating, contributing and producing.
All they see is a quick cash cure (with no gaurantee the money will be spent on the children) which comes with the almighty risk that more children will grow up welfare dependent as the financial rewards of working, as meagre as they are, disappear.
I must have said it hundreds of times. Welfare made families poor. More of it is not the answer.
Contrary to what the Greens believe, neither more welfare nor higher taxes are the answer to reducing poverty:
The Greens/Labour recipe of more and higher taxes would stall New Zealand’s economic recovery just when we are getting back on our feet after the Global Financial Crisis, National’s Associate Finance spokesman Steven Joyce says.
“The Greens have proposed a 40 per cent top tax rate that would affect many hard-working New Zealanders, including school principals, doctors, and many small business owners,” Mr Joyce says.
“We’ve been here before. A 40 per cent tax rate is damaging to the economy because it increases tax avoidance, penalises hard work, and sends some of our best and brightest offshore.
“And it is of course just another in a long list of new taxes Labour and the Greens want to introduce including a capital gains tax, a big carbon tax, taxes on water use, higher personal taxes, and regional fuel taxes.
“Just when the New Zealand economy is heading in the right direction and we are growing the largest number of new jobs in a decade, the Greens want to go back to the old tax and spend approach that clearly didn’t work in the lead up to the GFC.
“Back then, our best and brightest were flooding out the door for better opportunities in Australia. Now migration out to Australia has stopped.
“Back then, welfare rolls were already growing because of our domestic recession. Now 1600 people a week are moving off welfare and into work because of our growing economy.
“Back then, government spending had jumped by 50 per cent in just five years, pushing floating mortgage rates close to 11 per cent and leaving us with forecasts of budget deficits and soaring debt into the future.
Mr Joyce says the economic recipe that’s working includes lower, not higher, taxes and a government that is relentlessly focussed on growing jobs and getting people off welfare support and into meaningful work.
“National’s economic plan is working for New Zealand. We have just become one of the fastest growing economies in the OECD. Keeping with the plan is the best way of helping people the opportunity to get off welfare and into work. We should not go back to the failed recipes of the past,” Mr Joyce says.
And let’s not forget that the Greens are also promising a carbon tax which would impact directly on every individual and business adding costs not just to luxuries but to basic necessities including food and heating.
Anything they “give” to reduce poverty will be more than counteracted by what they take away in direct and indirect cost increases and the brake their policies would impose on the economy.
Green is supposed to be for go, but Green influence in government would be for slow and low when it comes to economic growth and the social progress and environmental protection and enhancement that depend on that.