Poverty stats government’s shame

April 3, 2019

The nine child poverty statistics that will be used as the baseline for improvement show released yesterday by Stats NZ show all but one have got worse under the current government:

David Farrar compares the stats under National and Labour:

  1. Percentage of children in households with income under 50% of median, before housing costs. 156,000 in June 2008 and 156,000 in June 2017 so no increase under National (rate dropped 0.3%). In June 2018 increased by 27,000 and rate increased 2.3% for Labour’s first year.
  2. Percentage of children in households with income under 50% of median, after housing costs. 329,000 in June 2009 (no data for 2008) and 247,000 in June 2017 so a drop of 82,000 under National (rate dropped 8.1%). In June 2018 increased by 7,000 and rate increased 0.4% for Labour’s first year.
  3. Percentage of children in households in material hardship. 196,000 in June 2013 (no data before that) and 140,000 in June 2017 so dropped 56,000 under National (rate dropped 5.4%). In June 2018 increased by 8,000 and rate increased 0.6% for Labour’s first year.
  4. Percentage of children in households with income under 60% of median, before housing costs. 252,000 in June 2008 and 243,000 in June 2017 so a drop of 9,000 under National (rate dropped 1.3%). In June 2018 increased by 38,000 and rate increased 3.2% for Labour’s first year.
  5. Percentage of children in households with income under 60% of median, after housing costs. 355,000 in June 2008 and 314,000 in June 2017 so a drop of 41,000 under National (rate dropped 4.6%). In June 2018 increased by 27,000 and rate increased 2.2% for Labour’s first year.
  6. Percentage of children in households with income under 50% housing costs for the base financial year. 258,000 in June 2008 and 236,000 in June 2017 so a drop of 22,000 under National (rate dropped 2.5%). In June 2018 increased by 18,000 and rate increased 1.4% for Labour’s first year.
  7. Percentage of children in households with income under 40% housing costs for the base financial year. 156,000 in June 2008 and 178,000 in June 2017 so an increase of 22,000 under National (rate increased 1.6%). In June 2018 dropped by 4,000 and rate dropped 0.4% for Labour’s first year.
  8. Percentage of children in households in severe material hardship. 84,000 in June 2013 (no data before that) and 74,000 in June 2017 so dropped 10,000 under National (rate dropped 1.0%). In June 2018 dropped by 9,000 and rate dropped 0.9% for Labour’s first year.
  9. Percentage of children in households in material hardship and under 60% median income after housing costs. 96,000 in June 2013 (no data before that) and 86,000 in June 2017 so dropped 10,000 under National (rate dropped 1.1%). In June 2018 increased by 12,000 and rate increased 1.0% for Labour’s first year. . .

Who would have thought it? Seven of the child poverty measures dropped under National, one was static and one went up.

And under the Labour/NZ First/Green government that purports to be compassionate and set reducing child poverty as a priority?

Seven of the child poverty measures worsened and only two improved.

What’s behind the difference?

Former Prime Minister and Finance Minister Bill English was determined to search out the risk factors which lead to poverty and the disastrous social outcomes that usually accompany it.

Having found them he used the social investment approach – spending more upfront on helping those most at risk. The higher short-term cost was justified by the expected reduction in the long-term human, social and financial costs should those at risk not be helped.

The compassionate and intelligent response of the Labour/NZ First/Green government would have been to continue and build on what was working.

The failure to do so is this government’s shame.

Instead it sabotaged business confidence, wasted money on policies including fee-free tertiary education and winter heating subsidies for people who don’t need them, and got soft on policies that used both carrot and stick for those who could be working but don’t.

Early days is no excuse, this government is almost half way through it’s first term.

It can’t blame National for what’s going wrong when under it, seven of the measures were improving, one was static and just one was going the wrong way.

The government has only itself and its ideological blindness to blame which will be no comfort at all to the families whose situation has worsened.

Lindsay Mitchell blogs on the causes of poverty:

The Canadian think-tank, the Fraser Institute has just released a paper which suggests an elegantly simple framework in finding three causes of poverty: bad luck, bad choices and enablement. The first two need no explanation. The third is described thus:

We can say that poverty is “enabled” when systems and structures are in place to discourage the kinds of efforts that people would normally make to avoid poverty, i.e., find employment, find a partner (especially if children are present), improve one’s education and skill set, have a positive outlook, and take personal responsibility for your own actions. Ironically, it is government programs (welfare, in particular) that are intended to help the poor but end up actually enabling poverty.

In NZ, many of our current influencers (MPs and media) pooh,pooh the idea that bad choices are responsible for poverty despite this being self-evident. They base their disdain for the idea on a belief that greater systems, for example institutional racism, drive bad choices. Of course when they do this they excuse bad choices and even compensate the person making them. Undoubtedly, most of those sitting on the Welfare Expert Advisory Group would hold views of his nature. . . 

The soft bigotry of low expectations is not a cliche, it’s a fact.

This government’s low expectations are enabling poverty and turning around the improvements that National’s policy of social investment were making.


Does not compute

January 18, 2019

A business offering $400 a day to people willing to plant trees can’t get staff.

Aged care workers are concerned about under-staffing.

But one in 10 people are on a benefit.

That does not compute.

A Taxpayers’ Union report found that benefit sanctions, the help-but hassle approach to welfare reduces poverty.

. . . If the Government wants to reduce child poverty, it should encourage the unemployed and single parents back into work and off welfare.

Our report advocates a help-but-hassle approach that nudges beneficiaries back into work, leaving more to spare for those in genuine need.

If the Government took this approach, it could afford to be more generous, within existing budgets. The difference is that the money would be more targeted to those who most need it. . . 

Is it that simple?

That benefit numbers reduced when National took that approach suggests it is.


More than $1b/year + human cost

October 9, 2018

The Green policy to remove benefit sanctions would cost more than $1 billion a year.

A new report from the New Zealand Taxpayers’ Union shows the success of benefit sanctions, explains why efforts to make life on a benefit easier simply encourage a culture of welfare dependency and fraud, and exposes that more than one third of unemployment and single parent beneficiaries admit to failing on their obligation to seek employment.

The release of the report, Benefit Sanctions, coincides with a Green Party campaign to remove sanctions for beneficiaries who don’t comply with associated obligations. The report also works as a submission to the Government’s working group tasked with providing recommendations to overhaul the welfare system.

Taxpayers’ Union Executive Director Jordan Williams says, “Beneficiary advocates have good intentions, but their prescriptions – removing requirements to seek work and removing sanctions – are a social and moral failure. The Green Party’s policy to make life on a benefit will simply encourage a culture of welfare dependency and fraud.”

These good intentions lead to bad policy and high costs in both financial and human terms.

Removing obligations and sanctions might look like kindness but it’s not.

It’s giving up on beneficiaries, entrenching welfare dependency with the poor outcomes which accompany it and adding to the costs imposed on the rest of us.

“Rates of welfare fraud are many times higher than most New Zealanders would expect or find acceptable under the current system. The report canvasses the evidence that easing up on sanctions and obligations for beneficiaries would dramatically increase fraud and dependency. That means driving up the cost of the welfare system for taxpayers and leaving less room in the Budget for other forms of social spending.”

Every dollar spent on benefits for people who could be working is a dollar not available for people who can’t work and other priority areas including health and education.

“If the Government wants to reduce child poverty, it should encourage the unemployed and single parents back into work and off welfare.

The report’s author, economist Jim Rose, says, “Our report advocates a help-but-hassle approach that nudges beneficiaries back into work, leaving more to spare for those in genuine need.”

Help but hassle is a far better approach than getting rid of sanctions.

Beneficiaries need to be given the help they need to get and keep work and encouragement should be firm enough to ensure they’re not more comfortable on a benefit than being independent.

“If the Government took this approach, it could afford to be more generous, within existing budgets. The difference is that the money would be more targeted to those who most need it.”

And while the billion dollar plus cost of dropping expectations and sanctions is bad enough. The human costs of long term benefit dependency for beneficiaries and their children are worse.

Benefits must never be more generous than full-time work and the longer the time on a benefit the greater the gap between earnings from work and welfare.

On top of that, long term beneficiaries are more likely to have no or low education qualifications, poor health and a greater chance of committing and/or being a victim of crime.

Some people need permanent help.

Others require temporary assistance and it is best for them, and the rest of us who pay for it, if they get the help when they need it as long as they need it but no longer.
The report is here.


Social sabotage

October 2, 2018
AM show host Duncan Garner called Green co-leader Marama Davidson incompetent for good reason yesterday morning:

The Green Party co-leader appeared on the show on Monday morning to discuss her party’s commitment to raising benefits by 20 percent, but was unable to say how much it would cost. . .

I am staggered by the lack of facts and detailed knowledge that she showed in her interview with me this morning,” Garner said after the interview.

“No detail at all. She’s exposed herself as being underdone at best, and completely incompetent at worst. It’s called flaky. . .

Flaky is a charitable description of the policy she couldn’t give costings for too:

Increasing the baseline amounts for benefits is pretty clear. That increase hasn’t followed wage increases or inflation for far too long. And removing sanctions which we’ve been very, very vocal about, which is about trying going away from that punitive or punishing approach.

Not only doesn’t she know the cost, she doesn’t know the current policy. Benefits do increase with inflation. When it’s low as it has been for some time, the increases aren’t big but they do increase with the cost of living. No sanctions? That means people who, for no good reason, don’t turn up for interviews, don’t try to find work, don’t pass drug and alcohol tests will face  no consequences. People in work are expected to turn up in a fit state to work when and where required, what’s wrong with similar expectations for beneficiaries? No sanctions will also allow non-custodial parents to get away with making no contribution to the support of their children.

Changing the threshold for benefit reductions. There are so many people who want to work, even part time, while raising young children in particular. But those incentives are just really clumsy, confusing , messy, and they don’t make it worth it,” Davidson said.

It’s sad that people regard getting paid for work which gives them a measure of independence as not worth the effort. There might not be much difference financially but even a small increase on what comes from a benefit should be regarded as a bonus, especially when it could be a stepping stone to more work and eventual freedom from benefit dependence. Davidson is right that benefit abatement for people in part-time work are less than ideal, but the alternative is worse.  If the benefit isn’t abated when people start earning, beneficiaries in part-time work would earn more than some people in full time work.

The Greens would also look at combining the in-work tax credit and family tax credit and making them less discriminatory.

They also wanted Work and Income to stay out of people’s personal lives by “moving towards entitlements based on individual needs rather than a blanket policies around starting new relationships and losing entitlements”, Davidson said.

This would mean a beneficiary could be living with someone more than capable of supporting them both and any children, and still be able to keep claiming a benefit. National put a lot of effort into social investment based on the indisputable  financial and human costs of benefit dependency. The Green policy would be social sabotage, creating an underclass of benefit dependents with neither the expectation nor hope that they might become self-supporting. They would turn the welfare safety net into a noose that would entrap people on benefits and saddle the rest of us with the financial and social costs that would result.  

e-mob for Roxburgh children’s village

May 29, 2018

Southern mayors are asking people to join an e-mob today to save Roxburgh children’s village.

Message from Central Otago Mayor Tim Cadogan: the people of the South are being asked to join in an e-mob protest (possibly the first of its kind) to get the message that failing to increase funding so the Roxburgh Children’s Village can remain operating is unacceptable to the people of the South.

Those who care about the Village and the children and families of the South that have used its services since 1949 are asked to join an “e-mob” protest, sending the very poignant Garrick Tremain cartoon (with his permission) to Jacinda Ardern this Tuesday 29 May.

The cartoon attached (is available and instructions for where to email it by emailing cartoon@codc.govt.nz

May 29 has been chosen as it is one month until the doors close on the Village. It is very important that you know that the residential therapeutic service that the Village offers will no longer be available to the children of the South, while it does remain in place for other parts of New Zealand. This is service by geography at its worst.

May 29 is also the anniversary of Mabel Howard being made our first female Cabinet Minister in 1949. Ironically, she was made Minister of Health and Children’s Welfare.

The cartoon (is available and instructions for where to email it by emailing cartoon@codc.govt.nz

No automatic alt text available.

Everyone who sends the cartoon is asked to email: roxburroxburghletsnotdothis@gmail.com so an accurate count of support can be made.

The ODT answers questions about the village and the service it provides for children in desperate need here.


Teenage fertility rate drops to lowest ever

February 23, 2018

New Zealand’s fertility rate has dropped well below replacement level:

In the December 2017 year:

  • 59,610 live births and 33,339 deaths were registered in New Zealand, resulting in a natural increase (live births minus deaths) of 26,268.
  • There were 180 more births and 2,160 more deaths compared with 2016.
  • The total fertility rate dropped to a low of 1.81 births per woman, compared with an annual average of about 2.01 from 1980–2017.
  • The infant mortality rate was 3.9 deaths per 1,000 live births.
  • All regions had more births than deaths.

If it wasn’t for a lower death rate and more immigration our population would be in decline.

The replacement rate for fertility is around 2.1% in the developed world. New Zealand has joined other OECD countries in falling below that.

Part of the reason for that is more couples are choosing to have no children or just one child.

Another reason is that more are leaving it too late and fertility drops for both men and women as they age.

The birth rate has dropped for all ages and among the statistics is one very positive one,  the teenage fertility rate has dropped to its lowest ever:

The teenage fertility rate has dropped to its lowest ever, with 15 live births per 1,000 women aged 15–19 in 2017 – just under half the 2008 rate of 33.

In 1962, when fertility rates were highest for women in their twenties, the teenage fertility rate was 54 births per 1,000 women aged 15–19. While rates dropped for women in their twenties throughout the 1960s and 1970s, the teenage rate increased to a peak of 69 births per 1,000 women in 1972. The teenage rate then decreased to 30 births per 1,000 women in 1984. 

No automatic alt text available.

 

The media release doesn’t say how many of the teenage mothers are single but the drop in the number of teens giving birth is reflected in a drop in benefit numbers for teen parents.

In 2017, the median age (half are younger and half older than this age) of New Zealand women giving birth was 30 years.  It has remained at 30 years since 1999. In comparison, the median age of women giving birth in the 1970s was 25 years.

If, we want a return to replacement fertility rates or higher the aim should be to encourage more couples to have children sooner but not too soon – in their 20s rather than their 30s or teens.

 


Poverty policy lacks ambition

February 2, 2018

The government talks a lot about reducing child poverty but its policy lacks ambition:

The Prime Minister’s ‘good intentions’ have once again fallen short, with the Government’s child poverty targets aiming to lift fewer children out of poverty than National actually lifted out in the last five years, National’s Children spokesperson Paula Bennett says.

“The Prime Minister committed her Government to reducing the number of children in material hardship over the next ten years by 70,000. Yet, over the last five years of the National government, the number of children in material hardship fell by 85,000.

“So this Government is promising to do less over a longer period of time than National did – in spite of its bold claims it would do better.

It’s making a lot of noise but aims to do less than National already did.

“National also remains more ambitious – that’s why we had committed to reducing the number of children in low-income households by 100,000 over three years, while Labour is committing to reducing the number by 100,000 in 10 years.

“National’s Family Incomes Package was also projected to lift 50,000 children out of poverty on 1 April 2018. It would have given 1.2 million working Kiwis an extra $1060 per year in the hand – and, we had committed to a further package in 2020 that would have had a similar impact.

“Labour, on the other hand, have no money for another Family Incomes Package – they’ve spent it all on a year’s free tertiary education. That is why they are giving themselves such a long timeframe to achieve what National would have done in the next three years.

What’s more important – fees-free tertiary study for people, most of whom don’t need it, or lifting children out of poverty; money and expertise for children who don’t have the pre-learning skills they need when they start school and those failing at school or adults who’ve already got through school?

“If the Government was truly serious about reducing child poverty it would reconsider abolishing the Better Public Services targets, which directly focused the public service on reducing the number of children living in poverty and tackling the causes of long-term deprivation.

Poverty isn’t just about income. It’s causes are complex and include lack of education, poor physical and mental health, and drug and alcohol dependency.

“As is becoming the Government’s modus operandi, it is all intentions and no substance. Its ambition falls way short of the action needed to actually deal seriously with child poverty in New Zealand.”

Poverty is a serious issue. Reducing it requires serious and substantial action not just good intentions.


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