Social investment was working

08/12/2021

Heather du Plessis Allan is excited about National leader Chris Luxon’s promotion of social investment:

. . .This was originally Bill English’s idea.

And his idea was to invest in kids and families who were clearly going to become problems later on.

You know the ones. I know the ones. The government knows the ones.

Kids who are sending a bunch of warning signs that things are going in the wrong direction.

Let’s say they’re growing up in a statehouse that’s had too many visits from the cops lately, their parents have been on the dole too long, they start showing up as truant on the school list too often,  maybe they get in a bit of trouble with the police themselves as a young one.

Bill English’s idea is that when you see that family is triggering alarms you know that child will end up probably committing crime later on and then in jail and costing the taxpayer a huge amount of money.

So, you break the cycle. You invest in them early, and you invest a lot. Whatever it takes to get their life in order

And it’s a win-win. They have a better more productive life with better opportunities and society aka taxpayers don’t end up with the huge bill for throwing them in jail for years on end. . . 

The policy was working but was shamefully dropped by Labour.

Because rather than spending lots of money on a huge group of people identified through something as genial as their ethnicity, wasting money on people who don’t need it and missing the ones who do, I would like the government to spend the same amount on one child helping them out and giving them a greater chance of it working.

It wasn’t only children who benefitted from this policy. It was also used for teen parents, teaching them to look after themselves and their babies, helping them get qualifications, become work ready and eventually get jobs. It could be used for anyone on a benefit to break the cycle of disfunction and poverty.

Social investment fosters independence. It’s the total opposite of Labour’s policy which encourages benefit dependency and all the high social costs which result from that.


Stats don’t tell full story

10/11/2021

The statistics on unemployment last week were good news but they don’t tell the full story:

There is a lot of falseness about the economy. 

The jobless rate was excellent. But it looks better because we are merely soaking up the people who wanted jobs based on the fact the choice has vanished. The labour market has shrunk, the population is no longer growing, we are paddling in a smaller pool, and the pool we are paddling in is filled with $50 billion worth of printed money.  . .

Lindsay Mitchell shows a fuller story:

Graphs are great tools for getting the big picture. Here I have plotted the unemployment rate against ‘unemployment’ benefits:

The heavy blue line is a combination of unemployment and sickness benefits. In 2013 the two benefits were combined into the single Jobseeker benefit (heavy brown line) but still with two categories – JS Work Ready and JS Health Condition and Disability.

The broken line is the official unemployment rate BUT expressed as a percentage of 18-64 year-olds, not 15+. Thats why in Sept 2021 it’s 4.4% – a point higher than the rate announced yesterday of 3.4%

The vertical lines mark the changes of government. . . 

The number of people unemployed is going down, but the number of people on benefits is increasing.

3/ Covid is largely responsible for the late steep upward trajectory of the heavy brown line BUT is was trending up before March 2020. My last post explained why the line has crossed the unemployment rate line and there is now a large gap between the two.

4/ The covid upturn is very similar to the GFC onset in magnitude. Lockdowns (policy within control of government) caused as much job loss as the global financial crisis (outside of government control).

5/ Another observation some would make is the gap between the unemployment rate and unemployment benefit lines during National’s term is now being corrected by Labour. Labour is more generous with benefits. The gap right now is a reversal of the period 2011-17.

There’s another line.

It’s the very fine line between being generous with benefits and entrenching dependency and all the misery that entails.

The post to which Lindsay refers gives some more statistics:

. . . Back to the Maori stats highlighted in the chart, in Northland, a region with a high Maori population the unemployment rate is 3.9% yet the Jobseeker rate is 10.5 percent.

In the general population the figures are:

Unemployment rate     3.4% 

Jobseeker rate     6.1%

 All benefit-dependent rate   11.3% . . .

The trouble is that life on a benefit isn’t necessarily miserable for everyone.

Friends in a small business employed someone for 20 hours a week. They offered her more work but she turned it down.

She has six children and is getting around $1,000 on a benefit and said she didn’t want or need to work longer hours.


Will beneficiaries be required to be vaccinated?

27/10/2021

The government is changing the law to enable employers in businesses where vaccine passports are mandatory to require staff to be vaccinated against Covid-19.

That will give them the ability to sack those who won’t – as opposed to can’t – be vaccinated.

This begs the question – will beneficiaries be required to be vaccinated too?

People on job seeker benefits are required to be work-ready.

People working in jobs which requires them to work in close contact with other people will need to be vaccinated.

The logical extension of that is that being vaccinated will be a prerequisite for many job seekers.

Yesterday’s announcement applies to work places where customers are required to be vaccinated but they aren’t the only places where people have to work in close contact with others.

One sector not mentioned in yesterday’s announcement is farming. It wouldn’t be hard for the unvaccinated to keep their distance from others outside, but it would be difficult, if not impossible, in milking and shearing sheds.

There is a shortage of workers in dairying and shearing, even in areas where there are a lot of unemployed people who could do the work.

If beneficiaries aren’t going to have to be vaccinated it will give some an excuse for not accepting  lots of jobs, including on dairy farms and in shearing gangs, when it’s available.

I understand why the government isn’t suggesting people who lose their jobs because they won’t be vaccinated can’t get a benefit, or that people already on a benefit won’t be required to get vaccinated so they are eligible for more jobs.

But it has already made it much easier for people to stay on benefits longer, in spite of the economic and social harm that comes from that, and this will make it even easier.


Why comply?

02/06/2021

No beneficiary has been sanctioned for not meeting social obligations:

No one has ever had their benefit cut for failing to have their children in school or early education, or enrolled with a doctor.

That is despite the requirement for parents who are on the benefit to meet a number of so-called social obligations to keep getting their payments.

Ministry of Social Development (MSD) said checking people’s compliance had become a “burdensome administrative process” – and it cannot offer people any meaningful help if they cannot comply. 

How hard is it to have children in school or preschool and to enrol with a doctor?

These aren’t requirements for the sake of requirements, they’re there for the welfare of the children for whom beneficiaries are being paid to care.

This isn’t the only failure to ensure compliance from MSD.

No checks are made on people claiming relocation grants to work in horticulture:

It’s touted as a way to get beneficiaries into jobs, but 1 NEWS can reveal no checks are made to see if those who move for a job, stay in the role.

This has led to accusations of workers moving just to get paid $5,000 and quitting only weeks after.

Tasman apple grower, Simon Easton, told 1 NEWS he had a few workers leave after they got paid the relocation subsidy.

“[It was] pretty catastrophic because they left and we could not employ anyone else,” he said. . .

What would happen if we didn’t comply with obligations to pay tax, get building and resource consents or obey road rules?

Would IRD, councils and police do nothing?

No, but when there’s no attempt to check beneficiaries meet the very basic requirements asked of them, why would they bother to comply?


How much do they want to pay?

23/02/2021

More than two thirds of New Zealanders want the government to increase income support for beneficiaries:

Polling out today shows seven out of ten (69%) of New Zealanders agree “the Government should increase income support for those on low incomes and not in paid work”.

The UMR poll was commissioned by a super-group of NGOs who are urging the government to include increases to income support in this year’s budget, in order to release families from the severe constraints of poverty.

The group includes unions, social service NGOs, kaupapa Māori groups, churches, child poverty experts and other organisations across Aotearoa. . . 

No doubt the polling company didn’t ask those polled how the government would pay for this and how much more they would be prepared to pay to enable it to happen.

The pollsters almost certainly didn’t remind those polled how much the government is borrowing to counter the impact of Covid-19 and that every dollar borrowed has to be repaid with interest.

They wouldn’t have asked those surveyed about the root cause of poverty and what they thought the government should do about that either.

There is no doubt that poverty is worsening with the subsequent increase in poorer health and social outcomes but solving the problem isn’t as simple as increasing benefits.

Reducing the burden of government on businesses would help, and it could start with replacing an existing statutory holiday with Matariki instead of adding a new one that could cost up $448 million.


Ulterior motive to min.wage increase?

04/12/2020

The government isn’t heeding repeated calls to increase benefits – yet.

One reason for that is to maintain a big enough gap between benefits and wages so that people in full time work earn more than beneficiaries.

But one of the government’s priorities is a steeper increase in the minimum wage. Could there be an ulterior motive in that – to enable anincrease in benefits?

That would be another reason to slow the increases. Even if there is no ulterior motive, the New Zealand Initiative warns against them:

Calls to lift the minimum wage will not fix inequality and could end up hurting the most vulnerable – particularly during a recession, according to a new report by the New Zealand Initiative.

The report is a response to a joint paper released last week by the Helen Clark Foundation and the New Zealand Institute of Economic Research which suggested lifting the minimum wage (presently set at $18.90) to a “living wage” of $22.10, among other proposals.

The minimum wage received a boost earlier this year and the Government may lift it even higher during 2021.

But New Zealand Initiative senior fellow Dr David Law says while international evidence on minimum wage increases is complex, it is wishful thinking that it might fix inequality or enhance productivity.

“This country already has one of the highest rates in the OECD. If this rises to a ‘living wage’ of $22.10, that would take it to 82% of the median wage. Only Colombia would have a higher rate than us.

“Such a high minimum wage would put jobs at risk,” Dr Law says.

The joint paper also justified its ideas by downplaying the negative effects on employment.

But Dr Law says international studies do not nest well with New Zealand’s economic realities and where they do, the positive effect on employment or productivity is vanishingly small.

“Even MBIE’s predictions suggest at least 33,500 jobs would go if the minimum wage rate rose to the proposed ‘living wage.’

“While the authors of the joint paper say such a rate would help the most vulnerable, the evidence actually shows the work prospects of the young and low-skilled are hit the hardest by rate increases,” Dr Law says.

The New Zealand Initiative report advises scrapping any plans to further lift the minimum wage and suggests winding back the 2020 increase as well.

You can read the full paper at: MINIMUM WAGES TO THE MAXIMUM: THE RISKS OF LIFTING THE MINIMUM WAGE


Paying more to pay more

10/11/2020

A large group of social agencies and welfare advocates is calling for the government to increase benefits before Christmas.

There is no doubting the difficulties facing beneficiary families.

But that doesn’t change the fact that every dollar the government is spending is borrowed money that has to be repaid.

The signatories of the open letter to the government don’t seem to understand they are asking us all to pay more in repayments and interest to pay more in benefits.

They also ignore the growing disincentive to work when income from a benefit gets closer to income from wages.

And they are seeking a band aid without offering any treatment for the underlying causes of the multiple problems which face many who depend on benefits.

The last National government made a good start in addressing these with its social investment programme, but much of that good work was abandoned or  undone in the last three years.

If these groups really want to help the people for whom they’re advocating, they need to understand the solution to their problems is not as simple as more money.


For the sake of the children

21/07/2020

Lindsay Mitchell points out two contrasting approaches to welfare:

Perhaps the single-most underrated and under-reported issue in New Zealand is the practice of adding children to existing benefits. Oodles is spoken and written about child poverty, particularly by the Prime Minister who appointed herself Minister of Child Poverty Reduction in 2017. But the fact that 6,000 children are added to an existing benefit and a further 3-4,000 are reliant on welfare by their first birthday never rates a mention. The numbers have varied only slightly over the past 30 years and persist at very high levels. One in ten babies goes home from hospital to a benefit- dependent family.

Most of those one in ten babies will be behind most babies who go home to a family where at least one adult is in work from the start.

The links between welfare dependence from birth and poor, if not disastrous outcomes, have now been well-explored by institutions like AUT and Treasury. The latter identified 4 indicators:

1)    a finding of abuse or neglect;
2)    spending most of their lifetime supported by benefits;
3)    having a parent who’d received a community or custodial sentence; and
4)    a mother with no formal qualifications. . . 

The outcomes for those children are much poorer than for children in families not dependent on benefits.

They are more likely to have contact with Youth Justice services, leave school without qualifications, follow their parents onto a benefit, and be jailed. They are also more likely to be Maori.

Is it kind to perpetuate this intergenerational failure?

Is it kind to contribute to these bad outcomes?

Is it kind to foster the causes rather than address them?

Act doesn’t think so.

 They point out that it isn’t acceptable for these families to keep having children when other families wait and sacrifice, and sometimes never have their own or additional children. More to the point, it is entirely unacceptable for children to be carelessly thrown into environments that harm them and rob them of their potential.

ACT’s policy says that if someone already on a benefit adds another child their benefit income will thereafter be managed. Rent and utilities will be paid direct, with the large part of the remainder of their benefit loaded onto an electronic card to be used in specified retail outlets. Work and Income already has the technology to do this. They operate income management for Youth and Young Parent beneficiaries in this fashion.

Under this regime children should be guaranteed a secure roof over their heads instead of the insecure transience resulting from unpaid rents, evictions and homelessness. Their schooling would be less interrupted with increased geographical stability. They should have adequate food in their tummies in and out of term time (not assured under school lunch programmes).  Their  mother may be encouraged to take advantage of the fully- subsidised, highly effective,  long-acting contraceptives now available, ameliorating the overcrowding which is a significant factor in New Zealand’s horribly high rate of rheumatic fever. Perhaps most importantly their parent(s) will actually decide working is a better option if they want agency over their income. There is a risk caregivers will try to supplement their incomes in other undesirable, illegal  ways but no policy is risk free, and this almost certainly already happens to some degree.

Increasingly throwing money at dysfunctional families provides no assurance parents will suddenly become better budgeters, or not simply spend more on harmful behaviours. Gambling and substance abuse don’t just hurt the parent. They hurt the child directly (damage in the womb, physical abuse or neglect under the influence) not to mention indirectly through parental role-modelling that normalizes bad behaviours, especially violence, to their children.

The last National government took an actuarial approach to benefit dependence, worked out the long term cost and began putting more money into preventing benefit dependency. It was working but the current government has undone that good work.

There is a need for a welfare safety net and with the Covid-19 induced recession numbers needing benefits are already increasing but welfare should not be a life sentence.

There are sound financial and social benefits to stopping people going on benefits and getting those on benefits off them as soon as possible.

The current government’s approach could be seen as being kind. It stopped sanctions against people who could work but don’t and women who don’t name the fathers of their babies.

That isn’t kind to the adults and it’s even worse for the children.

The two approaches to child benefit dependence are a world apart. One continues the ‘freedom’ of the adult to use taxpayer’s money as they wish; the other prioritizes the best interests of the child -their right to security, stability and safety – or, as ACT puts it, what the taxpayer thinks they are paying for.

The country cannot go on merely paying lip-service to the idea of ‘breaking the cycle’. Now is not the time for more of the same. More than ever New Zealand cannot afford the social cost and lost potential that occurs monotonously in an easily identifiable portion of every generation.

The choice at the election is stark – a vote for any of the parties currently in government that are perpetuating the cycle of benefit dependency and the poor financial and social outcomes that result  or a vote for a National-Act government that will address the causes and break the cycle.

The truly kind way is to vote for change for the sake of the children.


False kindness is cruel

26/02/2020

Benefits have been indexed to inflation rather than wages for good reason – to ensure there is a big enough gap between the two to make work more attractive than a benefit.

Lindsay Mitchell points out that the previous government understood the danger of this:

 “…it is desirable to create a margin between being dependent on a benefit and being in employment….
The Labour Party isn’t the party that says living on a benefit is a preferred lifestyle. Its position has always been that the benefit system is a safety net for those who are unavoidably unable to participate in employment. From its history, the Labour Party has always been about people in employment.”
Michael Cullen, 2008

This is supposed to be a government of kindness but linking benefit increases to wage rises is false kindness, cruelly disincentivising work and trapping more people in poverty.

The Taxpayers’ Union points out that beneficiaries are getting something denied to the people who pay the taxes that fund the benefits:

The indexation of benefits to wages means that taxpayers are treated less fairly than ever, says the New Zealand Taxpayers’ Union.
 
Taxpayers’ Union spokesman Louis Houlbrooke says, “The Government says it’s fair to index benefits to wages because we already do this with superannuation. So about tax brackets? These aren’t indexed to inflation, let alone wages. The result is that each year, taxpayers keep less, while beneficiaries get more.”
 
“Politicians often say we cover the costs of super and benefits by increasing productivity. But under this Government’s policies, increases in productivity will automatically trigger hikes to benefits and super, meaning we can never dig ourselves out of this spending hole.”

 

Mike Hosking also raises the issue of productivity:

Most who got a three per cent wage rise did so because they did something productive. They made more, produced more, worked more – that’s the productive side of the economy. That’s how you incentivise people: there is reward for work

Beneficiaries got the same rise, that’s the non-productive side of the economy. Nothing more was produced, but more was put into it. And that is why the money is gone and we are borrowing.

Economies grow because of productivity, not because of non-productive spending. You need one to fund the other, and one must be stronger than the other. That’s how you move forward, run surpluses, and afford to cover difficult days.

A level of redistribution, the likes of which we are currently experiencing, leads nowhere sound fiscally. It makes us increasingly vulnerable to global shocks, and we are too small to be running that risk.

The spread of coronavirus (COVID-19) is bringing a global shock ever closer, threatening jobs and increasing the likelihood of more people on benefits.

It is neither kind nor sensible to be doing anything that will discourage work and add to the burden placed on taxpayers.

 


What are the parents doing?

21/02/2020

A scheme that will eventually provide lunches in 120 low decile schools has been launched.

School principal Robyn Isaacson said the programme, only recently introduced in Flaxmere, had helped the key aim of raising student achievement.

Isaacson said the programme meant children were able “to open a lunch box, to never actually complain about what’s in it, to know that it is nutritious and is able to fill their pukus so they can learn in the afternoon”. . . 

In his autobiography, *The Good Doctor, Lance O’Sullivan said if children were fed and had any health problems treated at school the chances of them learning and breaking the cycle of poverty were greatly increased.

I can’t argue with that but it begs the question: what are the children’s parents or caregivers doing?

Some will be doing all they can to provide for their children but finding that despite their best efforts the money coming into the household falls short of the costs of providing for their families.

Some will be trying to manage but lack the skills to do so.

And some won’t even be trying.

There is no easy answer to dealing with this but the National-led government was making headway with its social investment initiative. That took some of the money that would be spent on the long term costs for people on benefits and was spending it up front in equipping beneficiaries for life and work.

Not all the people who can’t, or won’t, feed their children will be beneficiaries but they are the ones who get public money to provide for their families. If they can’t, or won’t, look after their children, they ought to be getting whatever is needed to ensure they do.

And if they still don’t or won’t? There’s no easy answer to that question but we must find one, and it must be one that doesn’t put the children at risk.

*The Good Doctor by Lance O’Sullivan, published by Penguin.


Living better lives

07/11/2019

National’s welfare proposals have been condemned as beneficiary bashing by the usual suspects, but the party’s welfare spokeswoman Louise Upston says their aim is to help people live better lives:

. . .When people are in need, it’s important we support them to get back on their feet and give them a hand-up. We believe there should always be a safety net for Kiwis who need it. . . 

A safety net for those in need should not be confused with a hammock for those who could but don’t support themselves.

 At the heart of our policy proposal is the Social Investment approach. The previous National Government designed it, and it transformed lives – using data to identify the best ways we can solve the problems faced by Kiwis. Underpinning it all is the idea that the best interventions are the earliest ones.

This approach targeted spending, often at a greater initial cost but with a much lower long-term cost and it worked.

We know that families are the best form of welfare we have, so in helping families, we’re helping all Kiwis to live better lives.

That’s why National’s committed to investing in the first 1,000 days of a child’s life. We know that not all mums and dads feel prepared for what life as a parent will bring, so we’ve proposed a range of ways we can support young parents.

Whether that’s more home visits for all families in the first six months, or a focus on intensive home visits for vulnerable young mums who are at risk, we want to ensure we’re supporting families as they navigate their first moments with a new baby.

Plunket nurses used to visit all homes with new babies every week at first then gradually reducing the visits unless there was a need for more. There was no stigma attached as because visits were universal.

That’s why we’ve committed to giving all new mums a guaranteed three day stay in a hospital or postnatal facility just after giving birth, and why we want to change parental leave so parents can take it at the same time, for the whole family to help each other out and bond in those early days.

By getting Kiwi kids off to the best possible start, we’re giving New Zealanders the best chance to reach their full potential.

Better starts for babies improve their chances of better lives and provide a foundation for happier fmailies.

We’re looking for solutions that break cycles of poverty and tackle the root causes, not just the symptoms of disadvantage. We want to measure the success of those solutions using targets. Targets work, ensuring clear, focussed goals on positive outcomes for Kiwis.

When we introduced targets for immunisation, rates went up. We introduced targets for the number of people achieving NCEA level 2, and the numbers went up. We know targets are effective.

This Government scrapped targets – but we’ll reintroduce them so that we can help more and more New Zealanders to live better lives.

Targets are about spending taxpayers’ money responsibly – and we believe in spending taxpayers’ money responsibly. We wouldn’t have social welfare at all without the hard work of New Zealanders every single day, paying their taxes.

National believes work is the best route out of poverty, through the security of a regular pay cheque and the chance of career development. Children do better when their parents are in work, and parents do better too.

A relatively few people have health problems which mean they will never be able to work. But those who could work, should work and those who need it should be given help to be work ready and secure employment.

National is committed to having the right mix of obligations and sanctions, so that those who can work, do work, with all the opportunities that brings. We want to reduce the number of children in benefit-dependent households.

We want to hear your feedback on how we can best support New Zealanders, ensure taxpayers’ money is spent responsibly and give all New Zealanders the opportunity to live better lives. Please have your say at www.national.org.nz/social_services.

Sir Apirana Ngata’s prediction that welfare would destroy Maori has become true but not just for Maori.

The statistics are clear, people in work are much likelier to live better lives than those on benefits.

The government must look after the most vulnerable but it also has a responsibility to help those who could look after themselves to do so.


Delivering $132m more on dole

29/10/2019

The government’s year of delivery has delivered an extra $132m in jobseeker benefits.

An additional $132 million of dole payments have been dished out to people who are able to work in the past year, Leader of the Opposition Simon Bridges says.

“New Zealanders deserve a fair go but not a free ride. Since Labour came into Government an additional 22,000 people have gone on the Jobseeker Benefit.

That’s around the total population of the Waitaki District who could be working but aren’t and on a be fit because of that.

“Social Development Minister Carmel Sepuloni doesn’t seem to care how many people go on the dole and she doesn’t believe there should be sanctions if people show no willingness to get into employment.

“Being in work lifts people out of poverty and improves the lives of families. There’s no excuse for taxpayers having to pick up an additional $132 million, a figure that doesn’t include inflation. This figure is just for people on the Jobseeker Benefit – people who are fit to work and doesn’t include other benefits.

Employers are crying out for workers so there shouldn’t be people who are able to work lining up for the benefit.

These aren’t people who can’t work, they could be working and aren’t.

“This week National will release our Social Services Discussion Document. We’ll release our positive plans to get more people into work and improve the lives of individuals, families and communities.

“National is aspirational for New Zealanders, we want people to have a safety net when they need it but we recognise that this is paid for through taxes and there needs to be accountability and obligations with that.

“The Minister needs to explain to taxpayers why they’re funding an additional $132 million in welfare and what her plan is to get people back into work.”

There are lots of reasons why people who are able to work might not be able to find a job in the short term and benefits provide a temporary safety net for them.

But there’s something wrong with a system that allows the safety net to become a hammock that traps people in dependency when so many employers are desperate for staff.


Two years and what have we got?

28/10/2019

The Labour, NZ First, Green government has just passed its second anniversary in power and what have we got?

  • Fee-free tertiary education which hasn’t had a positive impact on participation, and a third of those who got the help failed or withdrew.
  • KiwiBuild turned into KiwiFlop.
  • Higher fuel taxes for all to pay for public transport in Auckland which includes the stalled project of rail to airport about which officials can’t get direction from the Minister.
  • Two Ministers resigned/sacked.
  • Thousands of hectares of productive land converted to forestry.
  • Subsidies that incentivise forestry over farming.
  • Foreign ownership of productive land encouraged by much less rigorous requirements than for purchase for farming, horticulture or viticulture.
  • Business confidence in the doldrums.
  • Interest rates heading towards zero and below.
  • DHB deficits growing.
  • Polytechs that are working well to be sacrificed for those that aren’t.
  • Virtue-signaling environmental policies that come at a high economic and social cost here and add to environmental cost elsewhere.
  • Policy at the mercy of the minor coalition partner’s leader’s whim.
  • The waka-jumping legislation.
  • The Provincial Growth Shane Jones Promotion/NZ First re-election Fund.
  • Policy announcement after policy announcement that is high on feel-good but low on planning.

It was easy to come up with those negatives, and it wouldn’t be hard to add more.

But what of the positives?

The only one that comes to mind is a Prime Minister who  gets a lot of focus and high praise internationally.

But how much is that worth when there are so many problems that aren’t being solved at home?

A new government needs some time to get up to speed, but more than two-thirds through its term is too long on training wheels.


Poverty stats government’s shame

03/04/2019

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

18/01/2019

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

09/10/2018

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

02/10/2018
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

29/05/2018

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

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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

23/02/2018

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. 

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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

02/02/2018

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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