Kemspeckle – conspicuous, easily recognised.
Quote of the day:
. . . But eating and drinking ourselves to death will always be our own fault. The development of a culture of blame, rather than of accepting personal responsibility, should be strenuously resisted. Herald on Sunday
Labour leader David Shearer gave a big speech in Nelson last week, which only three reporters from Wellington bothered going to.
His new big idea was that everyone should have a living wage.
It’s hard to argue against the idea that people should be paid enough to live on but it’s a policy which aims to treat the symptom not the cause, and use other people’s money to do it.
Rather than telling employers they should be paying their staff more, a party that wants to be taken seriously as a government-in-waiting need to be addressing the barriers to higher wages.
One of those is the burden of government and Labour is opposing National’s policies which will reduce that.
Another is high taxation and Labour wants to impose another one – a Capital Gains Tax which will take years to gain momentum and will add another cost to business, redirecting money which might instead be used to increase productivity and wages.
Opponents to the sale of the Crafar farms to Shanghai Pengxin, and other foreign investment, talk about the owners taking money out of New Zealand.
But whose money is it?
Anti-Dismal clearly explains it’s ours and it’s useless anywhere else:
. . . Let us assume for a moment that these evil foreigners make a NZ$1 profit which, in an effort to piss-off Michael Fay, they wish to take it back to China. How do they do it? Clearly a New Zealand dollar isn’t worth anything in China so the Chinese holder of NZ currency will have to sell their NZ$1 to buy Yuan. But why would anyone want to buy said NZ$1? The only use for a NZ$s is to buy something made in NZ. Thus the buyer of the NZ$s must want it to buy a NZ export of some kind. What is Michael Fay’s problem with this? The NZ$1 doesn’t go overseas in any meaningful way, it gets spent on New Zealand produced goods and services no matter who gets the profits from the ownership of the farms. If a New Zealander gets the profits they spend them on New Zealand made goods and services, if a foreigners gets the profits they sell the NZ$s to someone who wants to buy New Zealand made goods and services.
In short New Zealand will not lose “around $15 million in earnings every year” if the Crafar farms are sold to the Chinese. For New Zealand’s wealth and prosperity, it does not matter where the profits from New Zealand businesses end up. All that matters for the New Zealand economy is that New Zealand remains a place where business transactions take place – irrespective of who owns the business. New Zealand’s (real) wealth is the amount of goods and services produced each year, no matter who owns the business that do the producing. What we want is for firms to be owned by whoever will use those resources most efficiency, no matter what their nationality. Any investment that moves resources towards a more efficient use is a good investment for New Zealand, again no matter what the nationality of the investor . . .
The farms in question are already owned by foreigners – the banks which put the business into receivership.
If they were bought by New Zealanders, they’d be funded, at least in part by foreign debt, adding to our already heavily indebted state and paying interest to foreign-owned banks.
Why is paying interest to foreign lenders not regarded as a problem if letting a foreign owner take some of the profit from their investment is so bad?
Social Development Minister has a mission – to tame the welfare beast:
We used to have a benefit system that provided for a few.
We were a nation that saw welfare as a backstop, as something you went on if you hit dire straits.
Many were on Welfare because they were hit alright. Welfare was a way out of domestic violence.
It was also for those who were cruelly widowed and there was no such thing as being born into welfare.
When widow’s benefits were established there was nothing unusual in not expecting women to be able to look after themselves. That is an idea well past its use-by date.
But what about today?
In the context of welfare; who are we now?
Now we have 220,000 children living in welfare dependent households.
We have nearly 7,000 babies born to teen mums, most of who will be on a benefit for at least seven of the next 10 years and many for a lifetime.
One third of women currently on the DPB started on the benefit as teen mums. That is more than 30,000 people.
Is this the system we envisaged?
It is not who we were. It is who we are. But is it who we want to be?
I am the Minister of Social Development.
I head up this mammoth beast we call the welfare system and I will not sit back and accept that this is the best we can do by people.
I do not apportion blame.
I think no less of someone on a benefit than I do on any other New Zealander.
In fact I often think more of them because I acknowledge and respect how damned hard a life it can be.
So, I will believe in them, their ability and their contribution.
I will believe in their path out of welfare into a path with opportunity.
I will reform the system.
Our welfare system is failing many.
Our welfare system is failing sole parents.
When I became Minister, welfare resources were geared towards helping people on Unemployment Benefits find work while ignoring those on DPB.
This meant that a small proportion of the people on benefit received the majority of the support funding.
We have literally had people languishing on DPB for three plus decades without so much as a job interview.
While at the same time an unemployed university graduate, fresh from an O.E, can bounce into Work and Income and leave with several job leads, a place on a C.V writing course and a grant for work clothes.
I know of a graduate who had applied and been accepted for a well paid job who bounced into WINZ and bounced out again with a grant for work clothes.
When asked why she did it when she hadn’t been eligible for a student allowance, was unlikely to ever get anything else from the taxpayer and she was only getting something for which she was entitled.
That shows a big part of the problem – to some, assistance is no longer regarded as something you ask for when you really need it, it’s something you take when you’re entitled to it whether or not you need it.
There’s something wrong with this picture, isn’t there?
I’m not saying that support should be removed for unemployed graduates, far from it, and these services are available for all benefits including DPB.
But the fact is that we spend more on helping an unemployed graduate find a job than we do on someone who is sick, disabled or has a child.
We need to distribute these funds more fairly and we need to back people into more than a lifetime on welfare.
We also need to change expectations. . .
Welfare began as a safety net for people in need.
It has grown into a trap for people, some of whom are in need, some of whom are in want.
The speech continues to address benefit changes and then explains the expectations of organisations providing services for beneficiaries:
. . . Part of this working differently relates to the way we work with NGOs.
I suggest you watch the work going on alongside the first tranche of welfare reform, particularly with how we will be contracting with NGOs to provide services to young people.
These contracts will be outcome focused.
An administration fee will be provided upfront but other payments will follow as milestones are reached.
The contract will look very different. It will be about outcomes for young people but it will also be flexible in other areas.
We won’t tell providers how to accomplish these outcomes. They know what does and doesn’t work with young people better than anyone else.
I know I’m not going to tell them what to do. But I’m telling you now I will only pay for real results for young people.
Results matter and until recently there hasn’t been much monitoring of them.
You have probably already heard about some changes to Family Start.
Family Start is one of MSD’s flagship programmes.
It costs about $31 million a year and on average about $5,000 or $6,000 per baby.
I have heard it called the ‘Rolls Royce’ of programmes because it is ‘top of the line’ and worth so much more than any other program.
Family Start has been running for more than 14 years.
As Minister I had to question if it was getting the kind of results that it should be.
After two independent reviews it was ascertained that some Family Start providers were doing a great job, some were doing okay and some were doing a poor job.
But what was alarming was that some were considered to potentially be doing damage.
The next logical question is why?
And of course there were a number of complex reasons.
One of which though was the level of support from MSD.
These providers were more or less being left to it.
They were being asked to tick boxes and fill in a ream of nonsense paperwork.
So I spoke directly to providers and pulling no punches, I laid it out straight.
There had to be change and I would spend more time and money supporting that change.
A year later and some changes had been made but not enough.
Again I fronted and told them that although progress had been made, some had not made any changes and more needed to be done.
In fact in that speech I said, “…for some of you this is your second strike. Three strikes and you‘re out.”
A few weeks ago Family and Community Services announced that five providers would not have their contracts renewed this year.
This was not done lightly but the families these providers were supporting needed results.
I know that home based visiting can and does work and so I will back it. But results are absolutely paramount.
This process doesn’t end with Family Start and we will be working our way through all of our contracts.
There is over $550 million of contracting for services that MSD does and we are demanding that they all be up to a high standard.
You will see the outline of this programme of work over the upcoming months.
I know what you demand of me as your Minister.
You demand that I provide quality services to those families that need it most and that I do it in partnership with you.
The New Zealand public also demands that I don’t turn a blind eye to substandard practice and that I have the courage to stand up and make the hard calls.
I will make those calls.
I’m so very grateful for this second term as Minister of Social Development and I will not be wasting it. . . .
. . . So who do we want to be?
A society that stands next to each other, that supports those who need a space to learn.
A society that develops and brings out people’s potential.
A gutsy, smart little country that thrives and develops.
It’s who we were, who we should have always been and who we will become.
It’s time to make the hard calls.
Making hard calls doesn’t mean the Minister is hard-hearted. She is simply making sure that the money that is spent gets results for the people it is designed to help.
Welfare isn’t designed to support organisations, it’s there to help people in need and should also do what it can to help them be independent.