Positivity beats petty and prevaricating


Summer holidays provide what many regard as a merciful break from day to day politics in the news.

That in turn provides an opportunity for an opposition leader who wants to get into the hearts and minds of voters to get noticed.

I came across a couple of news items in which Labour leader Andrew Little was quoted but neither was positive. In one he was petty and in the other he was prevaricating.

In the first he criticised Paula Rebstock’s New Year’s honour as political favouritism:

Ms Rebstock has been made a Dame Companion of the New Zealand Order of Merit for services to the state. . . 


He’s trying to make a political point and criticise the government and in doing so is making a slur on a woman who has years  of work in and for  the public service.

This was both petty and personal.

The second story repeated his assertion that Labour would defy the Trans pacific Partnership.

In the interview he is questioned about how he would do this and repeats what he’s said before about any government he leads picking and choosing which bits of the agreement it would keep.

That sounds definite but it is prevaricating because he knows that once an agreement is signed parties to it can’t decide which bits of it they will honour and which they won’t.

Kiwiblog’s poll of polls show National finished the year polling about 5% higher than it was three years ago and  Labour is about 5% lower.

One reason for this is that National’s leader John Key is usually positive which trumps  petty and prevaricating which is how Little often appears.





Quote of the day


. . . The nature of CYF is chaotic because it deals with chaotic people. The organisation is in crisis because it exists to respond to crisis. No law changes, or system revamps, or ‘best practice’ applications will change that.

I feel sorry for the people who work with deeply dysfunctional families. The best of them burn out, and the worst become desensitized.

This latest from the Commissioner, and then s panel to “transform” CYF are just part and parcel of the ongoing drama that is chasing the tail of  inter-generational social malaise driven by paying people to have babies. . .Lindsay Mitchell

She was responding to the release of The Children’s Commissioner Dr Russell Wills’s State of Care report.

ACC proposes across board cuts next year


ACC is proposing significant cuts to motor vehicle levies, including the ACC petrol levy, next year, as well as further reductions to work and earner levies.

The corporation is seeking feedback on these and other proposed changes as part of its annual levy consultation process, which starts today. . .

“On average, we’re proposing a forty per cent cut to motor vehicle levies, which are paid when relicensing a vehicle and through the petrol levy paid at the pump,” says ACC Chair Paula Rebstock.

“We’re also proposing an average twenty-one per cent cut to work levies, and a five per cent cut to the earners’ levy in 2015.”

This would have a similar effect to tax cuts, leaving more money in the pockets of workers and motorists.

This follows the significant reductions to work and earner levies which took effect in April this year.

Ms Rebstock says “This is a significant package of proposed levy cuts, made possible by the fact that the Scheme has achieved its goal of being fully funded.”

Full funding means ACC has sufficient financial assets to meet the lifetime costs of all existing claims.

That is the only way to ensure the scheme is sustainable.

As well as reducing motor vehicle and petrol levies, ACC is also proposing the introduction of ‘risk rating’ for cars in 2015.

Risk rating would see the levy paid by car owners reflect how their vehicle’s design affects injury outcomes in a crash.

Motor vehicle levies already reflect the different risk and cost of injury associated with different classes of vehicle. Risk rating would enable a more sophisticated classification of risk, based on real life crash data, within the ‘light passenger’ classes, which essentially comprise cars.

“Risk rating would mean owners of safer cars pay lower levies, to reflect the fact their vehicle is less likely to cause injury if involved in a crash.

This means the cost would reflect the risk.

The alternative is people with safer vehicles subsidising those whose vehicles are more dangerous.

Wait for the uproar from the usual suspects pointing out that poorer people are likely to have less safe cars and therefore will be paying more.

“While owners of the safest cars may receive the largest levy cut, I’d like to emphasise that all car owners will pay lower levies under our proposed changes.”

Ms Rebstock says ACC is not proposing levy reductions for motorcycles next year. This is because motorcycle-related injuries continue to generate disproportionately high costs for the scheme, and motorcycle levies are already heavily subsidised by owners of other types of motor vehicle.

Proposed changes to levies in 2015/16
• combined average motor vehicle levy reduced from $330.68 to $200 (40% reduction)
• petrol levy reduced from 9.9 cents to 5.9 cents per litre (40% reduction)
• average work levy reduced from $0.95 to $0.75 per $100 of liable earnings (21% reduction)
• earners’ levy reduced from $1.26 to $1.20 per $100 of liable earnings (5% reduction)

Other changes that ACC is proposing for 2015/16 include:
• increasing the minimum and maximum liable earnings limits for work and earners’ levies. . . 

There’s more on the proposed changes here.

Collins questions ACC funding of CTU


ACC Minister Judith Collins is questioning ACC funding the CTU to provide injury prevention training:

“The Council of Trade Unions’ (CTU) published annual accounts show the CTU has been paid up to $1.3 million (highest year was 2009) each year by ACC. In 2012 the total paid to CTU under three contracts was $669,000,” Ms Collins says.

“In the biggest contract shown in CTU accounts, ACC pays the CTU to provide training to health and safety representatives that large employers (over 30 staff) are legally obliged to have.

“Currently this is free-of-charge to these large businesses – it remains to be seen why ACC and levy payers should have to pay for this.

“It is not clear to me whether the provision of free training services for big business to carry out their legal obligation, is a good or fair use of levy payers’ money.”

The CTU and two other entities have similarly arranged contracts getting paid by ACC per person trained. The current fee is around $360 per person trained but the CTU has a higher maximum earning potential.

“ACC is investing up to $40 million a year on injury prevention. I’m advised all injury prevention investment is being reviewed to ensure it is evidence based and achieves results,” Ms Collins says.

It is perfectly reasonable to ask why businesses are funded for something they are legally obliged to have and a review to ensure that money spent on injury prevention is evidence based and achieves results is sensible.

ACC is back on a sound financial footing and its annual report annual report, released yesterday, shows a net surplus of $4.9 billion, which was $3.6 billion ahead of budget.

Chair Paula Rebstock said:

. . . the surplus would allow ACC to reduce the deficit between its assets and the lifetime cost of every claim on the books by $4.9 billion to $2.3 billion.

“The scheme is well on track to meet its objective of being financially sustainable – the point at which assets match forward costs – by 2019.

“More importantly, ACC’s strong performance has given the Government the confidence to signal that it believes decreases in ACC levies in 2014-15, and again in 2015-16, are sustainable. That is great news for all New Zealanders, particularly as it follows a $630 million reduction in levies for households and businesses in 2012-13.” . . .

“To ensure we maintain sustainability we will continue to evolve the Corporation. We will greatly increase our spending on injury prevention, and we will embark on a programme designed to improve outcomes for our clients through better case management and rehabilitation services. . .

Increasing spending on injury prevention is commendable but it provides an even stronger argument for a review which ensures that money currently being spent is well spent.

New chair, board members for ACC


ACC Minister Judith Collins has announced the appointment of a new chair and board members for ACC:

“My appointments today underline the Government’s commitment to genuine culture change, and will lead to a more balanced and comprehensive approach to the governance and operation of ACC.

“I am pleased to announce the interim Chair Paula Rebstock has been appointed to the position of Chair. Paula has served the Board well in an acting capacity throughout a challenging time for the corporation. She has demonstrated a commitment to culture change at ACC and will bring important continuity to the role on top of her broad experience in corporate governance and regulation,” Ms Collins says.

The new Board members are Deputy Chair Trevor Janes, Professor Des Gorman and Kristy McDonald QC – all appointed for three year terms. A fourth new Board member has been identified, to commence in early 2013, bringing the Board up to its full membership of eight. The appointment will be announced later this year, giving the person time to fulfil prior business commitments. The new appointees join existing Board members Jill Spooner, John Meehan and Jane Huria.

“The Government’s priorities for ACC also include maintaining a focus on levy stability and financial sustainability, providing high quality services for claimants and clients, and ensuring the early resolution of disputes.

“Building on the strength of the existing Board members, the wide-ranging skills and experience of these appointees reflect our priorities. We now have a strong Board to lead ACC as it embarks on a new era of service for all New Zealanders,” Ms Collins says.

The old board turned around a dire financial position but solving other problems which have dogged the corporation require a culture change which is best achieved with some new people at governance level.

Resetting expectations – updated


A minority of people requiring state assistance will be on a benefit for the medium to long term or permanently. Most should be on it for the short term.

Responsible people accept help when they need it and do the best to become independent as soon as they are able to.

As Social Development Minister Paula Bennett said in announcing proposed changes to benefits:

“It’s not socially or financially sustainable to continue to spend eight billion dollars a year to pay benefits to 12 per cent of working age New Zealanders.”

There are clear links between welfare, poverty and poor health. Evidence shows children are better off when their parents are in work, not on welfare.

“We have greater aspirations for New Zealanders and their children, which are achieved through work, not welfare,” says Ms Bennett.

The proposal includes replacing unemployment, sickness, widows and women alone benefits with a new Jobseeker Support benefit. People on the DPB with children aged 14 or older will also be on the new benefit.

The name change is not just cosmetic, it signals a change in expectation, that those who can work should work.

Changes announced include:

• A new work-focused benefit called Jobseeker Support
• A part-time work expectation for sole parents with children over 5 years
• A full-time work expectation for sole parents with children over 14 years
• The new Sole Parent Support to replace DPB
• The new Supported Living Payment to replace Invalid’s Benefit and DPB care of sick and infirm
• An investment-based approach to the benefit system.

The investment based approach will tailor support to beneficiaries based on their likelihood of becoming long-term welfare dependent.

Expectations will centre on each individual’s capacity to work rather than ‘entitlements,’ shifting the focus to what people can do, not what they can’t.

Individuals receiving Jobseeker Support will have work expectations set depending on their capacity – full time, part time or temporarily exempt.

“Jobseeker Support will include those capable of work and those who are temporarily exempt, but will soon be able to work,” says Ms Bennett.

“Sole parents will be expected to be available for part-time work when their youngest is school-age and available for full-time work when their youngest turns 14, and like most New Zealanders, I think that’s absolutely reasonable.”

. . .  Those currently on the Sickness Benefit will be included in Jobseeker Support and, according to work capability, will have a part-time or full-time work expectation or a temporary exemption until they are work-ready.

“The Sickness Benefit should be temporary but 40 per cent have been on it as long as four years, so these changes reset expectations of a return to work.”

A compassionate society looks after those who can’t look after themselves.

It doesn’t have a responsibility to support those who could and should be supporting themselves, although it may have to help them help themselves.

That help could include education and assistance with childcare.

The Supported Living Payment replaces the Invalid’s Benefit for those who are permanently and severely disabled, severely mentally ill or terminally ill.

“This benefit is for those who’re unable to work at all and the name change reflects the fact the term ‘invalid’ for many, is offensive and outdated.”

An investment approach guides how support is tailored to get the best results based on an individual’s likelihood of becoming long-term welfare dependent.

“For example, it makes sense to put more resources and support into helping a teen parent with no education, than to help a university graduate who is between jobs,” says Ms Bennett.

“Underpinning the investment based approach is a focus on the long-term social and financial cost of welfare dependency, not just on numbers.”

“170,000 New Zealanders spent the majority of the past decade on benefits, that’s bad for children, families, individuals and the economy,” says Ms Bennett.

Behind the numbers are people, many of whom have become trapped in welfare which isn’t good for them, the economy or society.

This policy aims to change that for the good of those on benefits, their dependents and the rest of us who support them.

A fact sheet Q & A on the policy is here.


Welfare Working Group chair Paula Rebstock says she’s encouraged by the scope of the policy:

Ms Rebstock says it’s encouraging the policy also commits $130 million a year towards reforms in areas including child care and training.

She says the National Party seems prepared to invest and look at the range of initiatives needed.

“There is no simple answer and there is no silver bullet”, she says.

Complex problems don’t have simple solutions. Resetting expectations so those on benefits who could work know they will be expected to and helping with training and child care so they can work will help.

ALCP gives reason to vote National


The Aotearoa Legalise Cannabis Party is telling drug using beneficiaries to vote for them or risk using their benefits:

Party Leader Michael Appleby said the only way for beneficiaries to continue using cannabis was to ensure the ALCP was elected on November 26 to fight for their rights.

The Government’s Welfare Working Group led by economist Paula Rebstock, aims to tackle drug addiction by introducing drug testing for those on the benefit.

Social Development Minister Paula Bennett said she supported the move.

“We expect it for people who are in work so why shouldn’t we expect it for people who are looking for work? Frankly, I don’t think that is too much to ask,” she said.

This plea might appeal to those beneficiaries who use cannabis.

But there will be a lot more people who work to pay the taxes that provide the benefits that support these people who will see it as a very good reason to vote National.

Sickness insurance better than benefit?


The Welfare Working Group’s pronouncement that the benefit system is unsustainable is not unexpected.

One of the reasons our economic growth is so slow is that the number of people getting some or all of their income from the public purse is so high.

The people hurt most by this are those on low wages who find themselves little if any better off than some on benefits.

Those who can work should do so and changing incentives sp people are less likely to go on them and move  off them more quickly is one way to reduce the welfare burden.


The report also echoes Ms Rebstock’s call for New Zealand to look at insurance-based welfare systems, like those in Canada, where workers pay insurance premiums.

“Unlike an insurance-based system, the [existing] benefit system has weak incentives for people to reduce the chance of adverse events occurring,” the report says.

This would make sickness more like accidents where workers and businesses pay premiums.

I am cautiously supportive of that.

Having more people in work and paying net tax would reduce the welfare burden which has benefits for the people concerned and society as a whole.

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