Sobering stats

Finance Minister Bill English gave some very sobering statistics during question time yesterday:

Of course, the Government is focused not just on savings this year; we are focusing on intergenerational savings. If we resolve problems in complicated families and struggling communities, then we will be spending less in the long run. For example, 1 percent of the children born in 1990 had contact with Child, Youth and Family before the age of 5. They had parents who were in contact with the corrections system and had been in households supported by benefits for most of their lives. Thirty-six percent of people with these three factors will be on a benefit at age 35. So you know that pretty much from when they are born, compared with 9 percent of the general population. Almost 5 percent of this group will be in prison at the age of 35. Some of these individuals will cost around $1 million each, just in corrections, Child, Youth and Family, and income support costs , and that represents significant misery in families and communities. We will continue to change things in order to change their lives.

This is why the government has taken an investment approach to welfare – spending more in the short term to help people off benefits and into work which will improve their lives, those of their children and pay social and financial dividends in the medium and long term.

Unemployment is still too high at 5.8 %, but the employment rate has reached an all-time high of 69.6%.

. . . “This is the greatest share of New Zealanders we have ever seen in the labour force. The largest increase came from 20 to 34-year-olds, who accounted for nearly half this year’s increase,” labour market and households statistics manager Diane Ramsay said.

Over the year to the latest quarter, the number of people employed increased 74,000 (3.2 percent) while the number of people unemployed fell 1,000 (0.6 percent), as measured by the Household Labour Force Survey. . .

That’s the fourth highest in the OECD.
New Zealand National Party's photo.

28 Responses to Sobering stats

  1. Dave Kennedy says:

    We should also understand the following:
    -We have lost the most economic growth of any other country due to the inequality of our incomes:
    -We have the 6th worst levels of combined unemployment and under-employment in the OECD:
    -We are considered a low waged economy in the OECD and to meet basic needs, such as housing, our incomes amongst the most inadequate.

    Data without context is misleading.


  2. Andrei says:

    Rubbish Dave Kennedy – New Zealanders as a whole are among the richest people on the planet and best housed.

    There is a lot of room for improvement to be sure but paradise on Earth is an elusive dream that will realistically will never be acheived


  3. JC says:

    Bang goes your credibility again.

    First, this is a working paper and the OECD states it does not represent the official views of the OECD and/or member countries and that the opinions and arguments expressed are those of the author(s) only.

    Second the report finds no effects on the economy of investment and education,, in fact education has a slightly negative effect. The author realises this is an oopsie and says that despite this he thinks other studies show education does matter afterall.

    He finds no inequality effects of the 9th and tenth income deciles on those on the average wage but instead there is a whopping inequality between the average wage and the fourth income decile.. apparently those on the average wage should be taxed harder to compensate those earning just a few thousand less.

    The paper is crook.. the inequality in NZ has not increased but has remained relatively static over the long haul except for the brief period of 1987-92. Several of our economists have made these points.. Eric Crampton, Matt Nolan and Tim Hazeldene plus other commentators.



  4. Dave Kennedy says:

    Andrei, I would agree with you when you compare us to many African and Asian nations, but is this a fair comparison? Surely we should look at our progress over time and our potential. We have had stable government for over 100 years, a relatively small population with an abundance of resources and a temperate climate. We had a great head start economically and socially compared to most countries and once had the highest standard of living in the world. Especially since the 1980s we have seen a steady decline in our world rankings regarding social indicators (now one of the worst in the OECD for child welfare), economic indicators (fastest growing inequality and biggest loss of growth potential) and environmental indicators (We rank worst in the United Nations for the protection of endangered species).

    With good governance we could still be leading the world but even John Key states that we should be happy to be followers and not being the worst.


  5. Dave Kennedy says:

    JC, I guess interpretation is everything and data can be manipulated to suit different opinions. I believe the research behind The Spirit Level is robust and there is ample evidence to show that our very poorest have got poorer and our very wealthy have seen 10-30% growth in wealth every year over the past four years. Using taxable incomes to determine wealth can also be misleading as we have hidden wealth and hidden poverty in our statistics to a greater degree than before. Also note that the Government refuses to measure child poverty and bends over backwards to support capital gains of the very rich.


  6. TraceyS says:

    From Paranormal’s link above:

    “Part of The Spirit Level hypothesis is that teen births and homicide are somehow caused by inequality (chapters 9 and 10). However, Wilkinson and Pickett face a problem insofar as inequality has been rising in most countries for many years while rates of teenage births and murder have been falling.”

    From Dave’s link:

    “Conclusion: more than 50 studies of inequality and violence show that homicide rates increase in more unequal states.”

    Click to access responses-to-all-critics.pdf

    And a day ago…

    “New Zealand’s low murder rate reflects a politically-stable country, with little corruption, and strict gun control, a leading criminologist says.

    A new study into all of the world’s homicides has shown New Zealand to be one of the most safest countries in the world.

    New Zealand’s homicide rate is 0.9 per 100,000 population…”

    So why aren’t New Zealand’s murder rate and teenage birth rate increasing if inequality is growing?

    If inequality in New Zealand is growing then maybe the ill effects of it are being compensated in other ways.

    However, in typical New Zealand style, we wouldn’t be able to see that let alone issue ourselves a pat on the back for the good stuff.


  7. JC says:

    Left parties throughout the West have found they have been getting no cut through from pimping the poor so they’ve come up with this inequality schtick and their flagship is the discredited Spirit Level.

    Regardless of what people think about the SL and the likes of DKs dodgy OECD working paper you only have to look at elections around the West to see the blowback from such pimping.. NZ elections, Israel, UK, the US midterms, Aussie, Canada, Germany and other nations.. the voters aren’t buying it.



  8. Dave Kennedy says:

    Tracey, the Spirit Level was published in 2009 and looked across a period of time. New Zealand’s inequality journey has progressed across the last 30 years and it is clear across many areas New Zealand scores poorly and while some aspects have leveled off through some good initiatives we are still much worse in many areas than we should be:

    -We have one of the worst levels of child health and safety in the OECD and in recent years there have been higher levels of rheumatic fever and respiratory illness in children. Our poor children also have shocking dental health.
    -The suicide rate amongst our youth is still one of the highest in the world.
    -We still have one of the highest imprisonment rates in the world (8th worst in the OECD):
    -Domestic violence is growing still
    -Our murder rate has increased five fold since the 1950s, a slight drop in the murder rate doesn’t mean we are in a good place and violent crime is increasing.
    -Despite a leveling off of our teenage pregnancy rate we still have the third worst statistics in the OECD.

    The symptoms of inequality don’t generally follow a linear progression, they definitely exist but as fast as we try to address each one another pops up. Did you see the item on the news tonight about the concerns from the Salvation Army that more and more responsible families (who budget well) are struggling to survive financially?

    JC, and I wonder how many poor vote? Voting levels generally are as low as 60% in many countries and the Conservatives won outright in the UK with only 36% of the vote. Taking into account those who didn’t vote their actual level of support will be around 20% of all voters and potential voters.

    What has caused the development of a growing underclass who both struggle to survive and feel disconnected from the system? They make up about 25% of New Zealanders and over 30% in the UK. You could just say it is their fault and they just need to take responsibility for themselves and their families, but why is this demographic growing? At the same time we have a growth in super rich. We even had an increase of billionaires in the world during the global recession. Many of them benefited from Government bailouts then paid themselves bonuses.


  9. farmerbraun says:

    “What has caused the development of a growing underclass who both struggle to survive and feel disconnected from the system?”

    That’s easy :-).
    It is the insidious growing emphasis on schooling , at the expense of education.


  10. Dave Kennedy says:

    Interesting suggestion, Farmerbraun, then how do you explain the fact that those children who come from affluent backgrounds do very well in our education system and those at the other end still struggle? I agree that National Standards has narrowed our teaching and learning, but there is still a strong correlation between affluence and educational achievement. Although the quality of teachers are fairly evenly spread throughout school deciles you can pretty much predict achievement by the school decile as home background has a much greater influence on learning than teaching.

    Also despite your suggestion that schooling not education dominates, New Zealand’s education system is still praised for having an approach to teaching and learning that creates greater independence of students using an inquiry approach rather than a focus on tests and narrow outcomes. The focus is on a life long approach to learning and adapting to a changing world.

    We still have a growing underclass of families living in increasingly poor housing and low wages. The poorest areas are growing poorer, Invercargill now has a decile 1 school we never had before and the median income in the the Mangere-Otahuhu local board area has actually dropped between 2006-2013:

    I have trouble accepting that schools are causing the growth of our underclass. Even if you think that our education system is not producing enough people with useful skills, the experience of my son and others with highly practical skills, that should be in high demand, is that the jobs aren’t there. Our manufacturing sector is a fraction of what it once was.


  11. Paranormal says:

    Keep up with the dogma DK. more of the same that we’ve had over the past 30 years that will really help change things…

    When we stop making children a revenue stream for the underclass is when we’ll see a significant change in children’s outcomes.


  12. Dave Kennedy says:

    Paranormal, how do you explain the fact that beneficiary numbers are dropping but the number of families struggling are growing. I would love to see the data that supports your theory.

    Also benefits have also dropped in value over the last 20 years and we have a high percentage of people (11%) who are underemployed and are actively seeking more hours.

    Our real problem is a low wage economy and a high level of job insecurity.


  13. TraceyS says:

    The problem is generationally entrenched low expectations.

    Many things contribute to that; educational failings, low wages, unemployment, solo parenting, poor housing, socioeconomic discrimination, poor work ethic, etc.

    I am a product of it myself. It can be overcome but in most cases it is going to take generations. Why does anyone think it can be addressed in three years, six, or even nine years?


  14. farmerbraun says:

    “I have trouble accepting that schools are causing the growth of our underclass. ”

    Ah , but I did not say that.
    You must surely be aware of the influence of parenting in the early years. Education begins there.
    But could the schools be part of the solution ; I think we might agree that in theory they could be , and often are.

    ” how do you explain the fact that those children who come from affluent backgrounds do very well in our education system and those at the other end still struggle? ”

    Not all from the less affluent backgrounds will experience that struggle .

    Parental attitudes and education in many , possibly the majority of, cases can account for the difference.
    Parenting skills are not a function of degree of affluence, but education is a reasonable predictor of degree of affluence.


  15. farmerbraun says:

    Dave Kennedy says:
    “Our real problem is a low wage economy and a high level of job insecurity.”
    That doesn’t ring true.
    Farming is traditionally low wage, especially for the likes of young sharemilking families.
    Job security ? A one or three year contract?

    And how would you describe the condition of the lowest levels in Chinese society?

    Expectation is a factor , but who expects to drag themselves out of their birth conditions these days. Self-betterment is not something that is talked about these days ; rather there is a culture of entitlement at the expense of others.


  16. farmerbraun says:

    ” a culture of entitlement at the expense of others.”

    The culture of social welfare that has developed in NZ is accepting that ” Thirty-six percent of people with these three factors (who) will be on a benefit at age 35.” should be given every taxpayer assistance to avoid that fate , for the simple reason that they are the most costly members of society if the problem is not nipped in the bud.

    ” Almost 5 percent of this group will be in prison at the age of 35. Some of these individuals will cost around $1 million each, just in corrections, Child, Youth and Family, and income support costs ,”

    Enlightened self-interest on the part of the taxpayer means that these people must be targeted from birth, so that they are no longer a drain on the system.


  17. TraceyS says:

    “You must surely be aware of the influence of parenting in the early years. Education begins there.”

    I’d like to add that, in addition to this truth, we would be foolish to think that formal education within the institutional setting is limited to curriculum-based learning. Teachers bring to the role not only their skills as educators but their attitudes as well. These can affect their students profoundly and permanently.

    How many teachers originate from the same side of the tracks as their most disadvantaged students? Not nearly enough. So there is likely to be a fair bit of misunderstanding, ignorance, pity, despair and other unhelpful, albeit human, responses. I think this is where low expectations, often promulgated initially at home, can become reinforced for life.

    Here’s an example. When I was nine years old the sole teacher/principal our tiny country school waged a $10 bet with me that I would be a mummy before the age of 21. Would he have had the cheek to say that to a little girl from a “good” family? I seriously doubt it. He owes me ten bucks by the way – with interest. What a joke it later turned out to be when I saw all the “good” girls who became pregnant while aged 15 or 16 and having abortions. Great way to start womanhood – not! We underestimate the hidden damage done by keeping things tidy from good-family-background point of view.

    Avoiding teenage pregnancy was easy because I’d not been raised a pampered little princess who expected Mum or Dad to fix my mistakes. I knew my failures would be mine and only mine – and the same for my successes if I managed any. Yet right through High School nobody ever so much as mentioned University to me. So I consequently left without even knowing what it really was let alone considering going! It was never a topic discussed at home either. I’m not sure my parents knew anything much about it. However, I am grateful that they weren’t negative about it so I was able to make up my own mind eventually. I learned what University was by talking to the sales reps who came into work who had done marketing degrees when I asked them how they got their job (because I thought their job looked better than mine).

    I won’t say what I achieved there or how I did it in case Andrei feels I’m blowing my trumpet again.


  18. TraceyS says:


    “Expectation is a factor , but who expects to drag themselves out of their birth conditions these days. Self-betterment is not something that is talked about these days; rather there is a culture of entitlement at the expense of others.”

    Correct. And there lies the answer.


  19. TraceyS says:

    Some people are talking about self- betterment…Fortunately!


  20. JC says:

    It wouldn’t hurt to improve the attitudes of plenty of teachers either..

    At least in some schools and with some teachers there’s some pretty low expectations of Maori.

    I think what we’re learning from the now 90% charter school based system in New Orleans is that even close to the worst of students in the US can be dramatically improved by a change in the bureaucratic structure of education and pushing accountability way down the ladder.



  21. Andrei says:

    Tracey @May 10, 2015 at 3:47 pm

    I just threw up – what load sanctimonious twaddle – what’s the National Party, the Oprah Winfrey Show, or fricken Dr Phil.

    Clearly a party with lots of zombified followers


  22. Dave Kennedy says:

    Farmerbraun, the Greens idea of having school hubs where nurses, community social workers and budgeting support etc must then must have merit. The idea that struggling kids and families could be identified and supported in a way that they can eventually help themselves. The hubs would be managed by the community and shaped to provide the best support for needs within it. Breaking the cycle of dysfunction as early as possible is important and we currently waste money because different agencies don’t coordinate their support or communicate well, if they all worked from the same base it must help.

    I remember having IEP meetings for one kid I was teaching and five different agencies were supporting him and his family in a rather ad hoc way that must have wasted time and resources.

    JC, I think some teachers just reflect widely held views of Maori as they also suffer in the justice and health systems as well. I remember parents in one community I taught in wanted their children removed from the class any time I used te reo and objected when I included Maori place names from the local area in spelling lists. Research has shown that all children achieve better when their culture is recognised in their learning.

    I remember in one of Nigel Latta’s recent programmes on domestic violence and he used an example of a community that had lost key industries and employers. There was a direct correlation between an increase in gambling, drug and alcohol abuse and domestic violence with the loss of employment. It is commonly agreed that we have 20-25% of our children living in challenging home situations and we only have 5% unemployment, but 11% under-employment.

    Surely all schools should do well. I think you will find that successful Charter Schools will be doing the same thing that good public schools do. Tomorrows schools were actually a form of charter school and there is an ability in any school to shape the schools curriculum in a way that best meets the needs of the children.

    Over ten years ago the Ministry put together a series of documents called Best Evidence Synthesis. This was a determined effort to collect together evidence of what has produced the best results in teaching and learning in different curricula and in school management.

    The new curriculum used aspect of these and teachers and schools were starting to engage with them for their teaching and management. Rather than schools competing and keeping good ideas to themselves we should be sharing them and using evidence to guide changes.

    Charter schools will never be a silver bullet they are just as dependent on good practice as public schools but they just don’t have the same safe guards and there is much more potential for things to go badly wrong as we have seen.


  23. TraceyS says:

    Rather than schools competing and keeping good ideas to themselves we should be sharing them and using evidence to guide changes.”

    “Communities of Schools are groups of schools and kura that will come together to raise achievement for children and young people by:
    – sharing expertise in teaching and learning
    – supporting each other
    – forming around students’ usual pathway from primary to secondary.

    So what happens when a school trustee puts it forward? Answer: “…the Union has told us…[you know the rest]”. Majority of trustees don’t want to upset union – for good reasons. School trustees don’t take on the role to engage in national politics.


  24. Dave Kennedy says:

    The communities of schools idea is not a new one, Tracey, it is already occurring to various degrees and has been promoted by the profession. What teachers objected to, believe it or not, was where the money was being spent and the model put forward. Much of it was on the salaries of Lead teachers and the Executive Principals. It was a business model where much higher salaries would be paid to those at the top and even principals thought this was not the right use of the money. We need similar amounts to be spent on special needs support, Maori and Pasifika children, smaller classes and more trained teachers in ECE. That would make a much bigger difference to kids.

    NZEI in partnership with the Ministry have launched the Better Plan and I think there is much more merit in spending the money directly to where it is needed the most. For most Principals and teachers they would say that they would rather have more time and more support to help kids than super high salaries:


  25. TraceyS says:

    “NZEI in partnership with the Ministry have launched the Better Plan…”

    Then why can’t I find “Better Plan” on the Minedu website?


  26. Dave Kennedy says:

    The Better Plan initiative was part of a strategy launched by NZEI to counter the IES scheme of the Government’s where the spending was focussed on the new structure (and higher pay for those managing it), not on things that would directly help kids. This was our title and the Ministry has just called it a joint initiative within the IES. I guess this is face saving because it wasn’t in the IES originally.
    The Ministry has a link to the NZEI site.

    Remember that when the PM announced the IES it had come out of the blue and had involved little or no consultation with the profession. Teaching is an evidence base profession, like medicine, and NZEI grew increasingly frustrated with the fact that the Minister would not provide the supporting evidence or research behind IES. Eventually the Government did produce what they claimed was the supporting research but when Massey University actually researched the research they found the Government’s claims did not stack up.


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