Why do wealthy need benefits?

It’s not difficult to justify welfare for people in need.

But what is the rationale behind welfare for people who already have more than enough?

There might be a case for Paid Parental Leave for people on very low incomes. But what is the justification for giving it to high income earners?

If people on well above average incomes can’t arrange their own finances without the need of top-ups from the taxpayers it ought to be their problem not ours.

If the state wasn’t paying them it’s probable their employers would to ensure valued workers returned to their jobs. Many already do supplement and extend PPL for that reason.

That raises several questions: Is PPL a benefit for parents or a subsidy for employers?

Does it help people have children, or help them fund more expensive choices about how they live?

What would happen if it wasn’t there at all?

Would employers give it? Would prospective parents budget for an income drop before the birth? Would they buy less expensive houses and pay less for what they put in them, the cars they drive and other discretionary spending?

Would it make a difference to when they had children or whether they had children at all?


14 Responses to Why do wealthy need benefits?

  1. robertguyton says:

    “There might be a case for Paid Parental Leave for people on very low incomes.”

    There might be, Ele?
    How generous your soul.
    Bill’s pulled off his ‘caring’ mask to reveal his ‘couldn’t-care-less’ face.
    Have you also?

  2. Denny says:

    About thirty years ago Singapore introduced an interesting piece of social engineering. Increasingly, well educated women taking up management roles had fewer or no children. The government, concerned that this trend would ultimately lead to a population that was less educated and less intelligent, introduced financial incentives for high achieving women to have children.
    I’ve no idea what actually happened, and I’m not expressing an opinion on the ethics of modifying behaviour in this way. It’s an interesting theory tho ….

  3. JC says:

    “There might be a case for Paid Parental Leave for people on very low incomes.”

    We call it Working For Families.


  4. pdm says:

    Having `Paid Parental/Maternity Leave for the well off is Labours way of snaring them into the Welfare trap.

  5. Gravedodger says:

    Of course our well trained questioning Media repeaters just gave the moronic freekshow full licence to propose another OPM scheme to target a group of people with zero regard as to need, another nice little earner.
    In the meantime those who did it with bugger all government support and mostly on one income will just have to pay more tax to fund the latest socialist election campaign idea.

    Of course a 26 week scheme will not have a negative influence on employers considering a woman in her fertile years for a job, “yeah right”.

  6. homepaddock says:

    Robert – what’s caring about giving money to one woman with a high family income and none to one with a low family income?

    That’s what happens with PPL if the first woman happens to have been in paid work and the second wasn’t.

    JC – WFF is income-tested, PPL isn’t.

  7. JC says:

    “JC – WFF is income-tested, PPL isn’t.”

    My point is the lower paid already receive significant child benefits through WFF, so additional PPL is a double up.


  8. homepaddock says:

    Ah, thanks for the clarification JC.

    Apropos of that – WFF goes to families whether one or both partners are working if their income is low enough; PPL doesn’t go to low income families where the mother wasn’t working and does go to high income ones where she was.

  9. From the Cowshed says:

    Who says income testing works anyway? We’ve all known rich kids at university on full benefits because mummy and daddy had a clever accountant…

    It seems to me that PPL is an incentive for the working mother (or should I say the mother in ‘paid employment’ because we all know mothers work hard but don’t get paid for it!).

    If we can increase our GDP per capita by fully utilising women to keep working (part-time or whatever) then isn’t that a good thing for our country (quite aside from our own personal beliefs/biases concerning working mothers and whether they could/should/can work)?

    Together with free childcare hours it should become more of an investment rather than a handout.

    As with any investment the question is always cost and return on investment.

    If in my own farming business I had staff doing the monkey work when I knew they were capable of management then I would encourage/support them to step up. To have a resource sitting there doing nothing doesn’t make good business sense.

  10. homepaddock says:

    FTCS – You’re right that income testing can be manipulated, but so can PPL.

    How big an incentive is PPL? Are there enough women who wouldn’t otherwise have had children having them because of it to justify the cost?

    How much difference does it make to them returning to work?

    I agree the question is cost and return, it’s easy enough to work out the cost of PPL but more difficult to determine the return.

    Are you suggesting looking after children is monkey work? Not everything can be measured in dollars and staying at home to look after children, with or without taxpayer encouragement, is a valid and valuable option.

  11. From the Cowshed says:

    I think if you look at the Scandanavian example you’ll see the benefits of PPL. Young families don’t have to ‘choose’ between having a career and having children and the women (and the businesses they work for) have the benefit of continuity of their employment – no need to retrain etc to re-enter the workforce later on. And the health benefits to the child can’t be understated either.

    No, I am definetely not suggesting looking after children is ‘monkey work’ which is why I think you should be paid to do the very demanding job of looking after children. If it is, as you say, ‘a valid and valuable option’ then why is this not recognised as such with payment? Or is that because it has traditionally been ‘women’s work’??

  12. homepaddock says:

    Are the Scandanavian countries running surplus? How high are their taxes?

    I’m not questioning the benefits to mother and child of taking leave, I’m just not convinced it’s necessary to publicly fund it.

    Why isn’t parenting paid? There are other priorities for public money, especially when most families which choose to have a stay at home parent manage to do so with their own resources.

  13. From the Cowshed says:

    So following that train of thought…maybe we should take another look at things like superannuation then? Can people who choose to retire ‘do so on their own resources’ as you say parents who choose to stay at home with the child can? Tax cuts? Investors in SCF? Asset sales? Where does it all end…??

    Yes, you are right. It all comes down to priorities. But I believe in an egalitarian society.

    And I’m afraid we will have to agree to disagree on this 🙂

  14. homepaddock says:

    Where does it all end? That is the nub of the problem. Once you start giving one group “entitlements” rather than assistance based on need another group thinks they’re entitled to something too.

    How does giving money to high earning working women but not to low income families where the mother hasn’t had paid work make society egalitarian?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: