Govt report card on BPS

July 7, 2015

The government has released a report card on its Better Public Service targets:

More young people are achieving higher qualifications, welfare dependency continues to fall and Kiwis are doing more of their government transactions digitally, Deputy Prime Minister Bill English and State Services Minister Paula Bennett say.

The Government today published the latest update of progress against the ten challenging targets set three years ago by the Prime Minister.

“There are now 42,000 fewer children living in a benefit dependent household than there were three years ago. That’s more than the combined populations of Masterton and Levin,” Mr English says.

“Today’s results confirm the Government is making continued improvements to some of the really difficult issues that affect our communities and families, however progress in other areas is slower.

“We are getting a better understanding of the most vulnerable New Zealanders, and we’re willing to pay a bit more upfront to change their lives, because what works for the community also works for the Government’s books.”

Mrs Bennett says the BPS results targets were designed to drive a positive change in the public service and signal a willingness to try new things and work across agencies to have more of an impact in people’s lives.

“Significant progress has been made since the Prime Minister first set the targets in 2012,” Mrs Bennett says.

Since the targets were introduced:

  • participation in Early Childhood Education has increased from 94.7 per cent to 96.1 per cent
  • the proportion of immunised 8-month olds has increased from 84 per cent to 92.9 per cent
  • there has been a 14 per cent decrease in people being hospitalised for the first time with rheumatic fever
  • the trend in the number of children and young people experiencing substantiated physical abuse has flattened, after previously being on an upward trajectory
  • the proportion of 18-year olds who achieve a NCEA Level 2 qualification has increased from 74.3 per cent to about 81.1 per cent
  • the proportion of 25 to 34 year olds with a qualification at Level 4 or above has increased from 51.4 per cent to 54.2 per cent
  • total crime, violent crime and youth crime have dropped 17.6 per cent, 9.1 per cent and 37.3 per cent respectively
  • the rate of reoffending has dropped 9.6 per cent
  • there has been a net reduction of 16 percent in business effort when dealing with government agencies
  • 45.8 per cent of government service transactions are now completed digitally, up from 30.4 per cent in 2012.

“We set these targets to stretch the public services to get better results from the more than $70 billion we spend each year,” Mrs Bennett says. “We have always said that some of them will be challenging.

“For example, reducing rheumatic fever remains difficult, but progress has been made. The previously increasing trend for assaults on children has been successfully flattened, but more needs to be done to achieve the target.

“We are making progress in many cases by working with individuals and families to develop services better suited to their needs,” she says.

The government deserves credit for setting targets against which progress can be measured, for working for the most vulnerable and being prepared to spend more upfront to solve long-standing problems.

But these targets aren’t just about the government, they’re about people served by public servants and those public servants who are working to meet the targets.

Education minister Hekia Parata gives credit where it’s due:

Today’s Better Public Service (BPS) update showing the Government is on track to achieve its goal of lifting the proportion of 18-year-olds with NCEA  Level 2 is a tribute to the hard work and professionalism of teachers and principals, says Education Minister Hekia Parata. . .

These targets aren’t necessarily destinations, many are staging posts in a journey towards better public services and better outcomes for the people who use them.

The  report is here.
John Key's photo.


Quote of the day

June 16, 2015

“The government currently invests $331 million each year in this sector, and we need a structured plan to ensure this funding is making a difference for our most vulnerable Kiwis, and that it is being invested in the right places,” says Mrs Tolley.

“At the moment there is little evidence of the effectiveness, or not, of funding in this sector, because up until now most contracts have focused on the numbers of clients receiving services, rather than the effect that the service has on improving the lives of vulnerable people.

“We need to address this so that future contracts are built around positive results and evidence of what is working.”  –  Anne Tolley

Hat tip: Lindsay Mitchell


Quote of the day

June 9, 2015

‘We don’t mind it being more expensive if we get results. The most expensive programmes we have are those where we churn out millions of dollars every year, thinking we’re having an impact when either we don’t or we don’t know.’ . .

‘We often spend money on a service where about 100% of it doesn’t work. So if we can get a return of 5% or something that is working, then we’re well ahead.’ Bill English


Addressing hardship better than measuring manufactured poverty

May 28, 2015

A few years ago a newspaper asked Oamaru clergy to comment on poverty.

One vicar said that he came from South Africa where hundreds of people shared a single cold water tap which made it difficult for him to comment on a town where people drove to the food bank.

The dictionary defines poverty as the state of being extremely poor.

The measuring class—people with tertiary education who spend all their time telling us how much misery there is in our community  have manufactured a new definition – 60% of the median income.

By that measure poverty could only be solved by taking everyone’s money and redistributing it equally and ensuring it stayed redistributed equally for ever.

While gross inequality can be a problem, making the rich poorer will not address the causes of, nor provide a longterm solution to, the problems of the very poor.

This is why Finance Minister Bill English took a swing at critics of the government on ‘poverty’:

“The term ‘poverty’ has been captured by a particular idea of how you measure poverty and a particular solution to it. That is, you measure it relative to incomes, and the solution is mass redistribution.”

Those who use the term “poverty” and “child poverty” in this way have been “admirably open” about their objectives, Mr English told the meeting but it is not a view the government shares.

“We are not addressing that phenomenon. What we are addressing is absolute levels of hardship. That is someone not having enough to live, and we don’t think that is worse just because someone else has a bit more.”

Incomes are only one part of what keeps people at the bottom of the social heap, he says, and other factors matter more.

“What we are addressing is what I think is the kind of communal or moral dimension and the worst examples of it are not purely about poverty. They are about ways of behaving, and I don’t think poverty is an excuse for serial criminality or beating up your kids. But those are parts of the ways of behaving of parts of our community, in my view sometimes made worse by the way the government deals with some of these problems.” . . .

It is not often a politician talks about the moral dimension and that should not be taken to mean that moral problems are the preserve of the poor.

But when Northland GP Lance O’Sullivan says children will be better off away from their homes and the social dysfunction in them, the problem of hardship is not just a financial one.

When National came to government it took an actuarial look at welfare and uncovered the longterm costs of it.

Those costs were both financial and social which is why reducing dependency and addressing real hardship are so important.

It doesn’t matter what you call it, the problem is whether or not people have enough which in turn begs the question how much is enough?

Regardless of the answer, the solution lies in addressing real hardship, as this government is doing, not by manufacturing poverty by redefining it in a misguided attempt to solve it through redistribution.


Budget changes will benefit children – Dr Lance O’Sullivan

May 24, 2015

Northland GP and New Zealander of the Year says the Budget announcement of more money for beneficiary families and the requirement to seek work when the youngest child turns three is a good move:

Dr O’Sullivan says in the Northland communities he works in, the kids of beneficiaries are often better off out of the home because they’re less exposed to social dysfunction.

“Now that could be alcohol, drug abuse; that could be violence; that could be mental health problems; that could be problems with incarceration,” says Dr O’Sullivan.

He says putting those children into childcare during the day ensures they have some good role models early on.

“I think we should be able to expose them to positive environments, keep them warm, safe and dry and give them a learning opportunity that will prepare them for school. I don’t believe we should waiting until they’re five.” . . .

Home ought to be the safest place for children.

Parents ought to be the best teachers and role models but tragically for too many children they aren’t.

Dr O’Sullivan sees them and knows that these children will be better away from their homes, if only while their parents are at work.


Business as usual with surprises

May 22, 2015

The Budget which was expected to be boring was a business as usual one with surprises.

The business as usual bit is continuing focus on the careful management of public money and getting back to surplus without the slash and burn approach which past governments took.

The big surprise was an increase in benefits, above the normal adjustment for inflation, for the first time in more than 40 years.

Even the opposition was struggling to oppose that and balancing the increase is the requirement for sole parents to seek work once their youngest child is three and increased work obligations for those on job seeker benefits helps.

Dene Mackenzie says Bill English has pulled off a master stroke:

He pushed his political opponents off stride by announcing social spending better than anything Labour did during its most recent nine years in Government.

Mr English will continue to be criticised by opponents for not delivering his prized surplus this year, but spending $790 million on a package to help children in some of New Zealand’s poorest families was a touch of genius.

The package included more child-care support for low-income families, a $25-a-week increase in benefit rates for families with children, an increase in Working for Families payments to low-income families not on a benefit, and increased work obligations for sole parents on a benefit.

”This package strikes a balance that offers more support to low-income families with children while ensuring there remains a strong incentive for parents to move from welfare to work,” he said.

He also made it difficult for his political opponents to make any meaningful criticism by lifting benefit rates by more than inflation for the first time since 1972.

The Finance Minister has always been the social conscience of National, right from the days when he was a member of the party’s ”brat pack”.

At political conferences more than 20 years ago, he talked about ensuring a ”truck driver” from Balclutha could earn enough to feed and house his family. . .

The increase to Working for Families at the lower end of income ensures the truck driver and any other parents in paid work will be better off than those on benefits.

I don’t support WFF for families earning well above the average income but can’t think of a better way to ensure there’s a decent gap between income from benefits and low paid jobs.

The Budget at a glance is here.

I was listening to talkback on my way home from Christchurch last night. The cut in the $1000 kickstart for Kiwisaver wasn’t popular but it was less likely to go to those who’d need it most and tax credits and employer contributions remain.

Border security and the risk of biosecurity breeches is of increasing concern with more travellers. Requiring $6 from departing travellers and $16 from incoming ones is a little bit of user-pays.

The Finance Minister’s speech is here.

. . . New Zealand remains one of the faster-growing developed economies, with conditions supporting sustained solid growth, forecast at 2.8 per cent on average over the next four years.

Growth matters. It means more jobs, higher incomes and opportunities for families to get ahead.

By mid-2019, the number of people in work is expected to rise by another 150,000 and the unemployment rate to drop to 4.5 per cent. The average wage is also expected to rise by $7,000 to $63,000 a year.

New Zealand’s positive economic performance, relative to others, is demonstrated by the strength of the New Zealand dollar and the very low number of people leaving for Australia – the lowest, in net terms, since 1992.

Lower dairy prices are a headwind for growth, however, and global uncertainties remain. Monetary policy easing in other countries is helping to keep upward pressure on the exchange rate.

Unusually, given our current growth, New Zealand is experiencing very low inflation.

Annual CPI inflation is only 0.1 per cent, compared to the Budget 2014 forecast of 1.8 per cent.

This is good news for consumers and workers because their income goes a bit further and they get good value for any pay rises.

Low inflation is also keeping down interest rates. The concerns I expressed in last year’s Budget about rising interest rates have largely disappeared.

But lower-than-expected prices also mean that nominal GDP – the size of the economy in dollar terms – is not rising as quickly as previously expected, despite solid growth in the real economy.

This means tax revenue is not rising as quickly either.

Compared to what was forecast in last year’s Budget, nominal GDP is expected to be $15 billion lower in total over this year and the next three years, and tax revenue to be $4.5 billion lower in total over the same period. . .

Government’s fiscal priorities are:

Returning to surplus this year and maintaining surpluses in the future

Reducing net debt to 20 per cent of GDP by 2020, including repaying debt in dollar terms in 2017/18

Further reducing ACC levies

Beginning to reduce income taxes from 2017, and

Using any further fiscal headroom to reduce debt faster.

The Government is making good progress on all these fiscal priorities.

While expenditure is firmly under control, tax revenue – as I mentioned – is not rising as quickly as expected.

This is lowering operating balances across the forecast period, compared to Budget 2014 predictions.

But the overall trajectory has not changed. We have come from an $18.4 billion deficit four years ago to seeing steadily rising surpluses into the future.

A deficit of $684 million is now forecast for 2014/15, which is $2.2 billion better than last year’s deficit.

A surplus of $176 million is expected in 2015/16, followed by $1.5 billion in 2016/17 and rising to $3.6 billion in 2018/19.

As I’ve said previously, the Government has no intention of making spending cuts simply to chase a surplus in a particular year.

The surplus target has been successful in applying greater discipline to government spending.

That discipline has turned the Government’s books around, and the fiscal outlook remains very positive. . .

The government can, and should, control its spending and the disciplined approach to it that has been taken since National came to power in 2008 is the major reason New Zealand is doing as well as it is.

The government can influence the environment which helps the income side, but sustainable growth comes from the private sector.


Quote of the day

May 22, 2015

. . . An enormous gulf has opened up between what used to be the core Labour voter, particularly in provincial regions, and the metropolitan elites, with their state-funded salaries and public sector pensions. The consequence is the current generation of Labour politicians are stumped when it comes to enunciating policies for the delivery of a better life for working people.

There is now a fundamental unease in the NZ population the collectivism inherent in the original concept of the welfare state doesn’t necessarily deliver the results originally envisaged. It is based on evidence the safety net the welfare state was intended to provide has been turned almost into a lifestyle for many who spend years on benefits. Now when the Govt says testing for spending effectiveness (in welfare programmes) will be core to the new processes it is introducing, and funding will be re-prioritised to providers to get results, Labour doesn’t seem to have an answer, or an alternative. . . Trans Tasman


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