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The Rise and Rise of Daddy State: MSD blackmails NGOs for private data
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Nanny State takes a Shower
What do showers have to do with this issue?
Wait and see.
Spying, Spooks, and Silly Journos
Nearly five years ago, the highly controversial Search and Surveillance Act 2012 was passed by National. As reported at the time;
The Search and Surveillance Act, which was passed through Parliament in March, extends production and examination orders to the police and legalises some forms of surveillance.
It will let more government agencies carry out surveillance operations, allows judges to determine whether journalists can protect their sources, and changes the right to silence.
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Police could complete some forms of surveillance and searches without warrants, but [Police Assistant Commissioner Malcolm] Burgess said the situations were pretty common sense.
Yes, indeed. Police surveillance and seizure powers were being massively extended. But according to the Police Commissioner, citizens could rely on the Police using “pretty common sense” to use them.
Then-Justice Minister, Judith Collins offered this excuse for the extension of police powers;
“ The new Search and Surveillance Act 2012 brings “order, certainty, clarity and consistency” to messy, unclear and outdated search and surveillance laws.”
(Interestingly, the fact that Collins felt the need to use irony-quotation-marks, in her Beehive statement, to enclose the phrase order, certainty, clarity and consistency is revealing.)
This is the same Judith Collins who, in 2009, passed personal phone numbers of a civil servant to far-right blogger, Cameron “Whaleoil” Slater.
A year later, the Government Communications Security Bureau and Related Legislation Amendment Bill was being hotly debated throughout the country.
Essentially, the Bill (since passed into law), would allow the GCSB to spy on New Zealand citizens which up to then had been the sole province of the NZ SIS.
National’s ‘spinned message’ – constantly parroted by Dear Leader Key – was;
“In addition, the Act governing the GCSB is not fit for purpose and probably never has been. It was not until this review was undertaken that the extent of this inadequacy was known…
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The advice we have recently received from the Solicitor-General is that there are difficulties interpreting the legislation and there is a risk some longstanding practices of providing assistance to other agencies would not be found to be lawful.
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It is absolutely critical the GCSB has a clear legal framework to operate within.”
In fact, the law was clear with it’s wording and intent and Section 14 of the Act (since altered to reflect the Amendment) stated with crystal clarity;
14Interceptions not to target domestic communications
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Neither the Director, nor an employee of the Bureau, nor a person acting on behalf of the Bureau may authorise or take any action for the purpose of intercepting the communications of a person (not being a foreign organisation or a foreign person) who is a New Zealand citizen or a permanent resident.
Some journalists were too lazy to fact-check Key’s lies;
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Journalists who failed to realise that Key was being disingenuous, and simply parroted the government’s official spin, did immense damage to public understanding of the issues involved.
Others, like Audrey Young and Tracy Watkins were sufficiently experienced and knowledgeable to recognise a government ‘stitch-up’ when they saw it;
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“ The GCSB Act 2003 expressly forbids it from spying on the communications of New Zealanders. But, by a series of snakes and ladders through the stated functions and objectives of the act, it convinced itself it was allowed to help the SIS and police spy on New Zealanders.” – Audrey Young, 26 June 2013
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“ The GCSB’s interpretation of the law was so loose it managed to spy on 88 New Zealanders even though the law specifically stated it was not allowed to do so.” – Tracy Watkins, 3 August 2013
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National ignored strong public opinion wary of extending the GCSB’s surveillance powers. The Bill became law on 26 August 2013.
The Government Communications Security Bureau and Related Legislation Amendment Act was followed by the Telecommunications (Interception Capability and Security) Act (TICS), made law on 11 November 2013.
The TICS law made it mandatory for all electronic communications companies (telcos) to comply with spy agencies demands to intercept and decrypt phone calls, txt-messages, and emails.
The excuse for this piece of intrusive legislation from Communications Minister, Amy Adams;
“ The fundamental reason that I have sought to introduce this bill is to safeguard New Zealand public safety and security. ”
The Telecommunications (Interception Capability and Security) Act was, in turn, followed by the Countering Terrorist Fighters Legislation Bill (split into several Bills after it’s Second Reading in Parliament on 9 December 2014).
This Bill, covering three existing laws, allowed the SIS to conduct surveillance on terrorist suspects without requiring a judicial a warrant for up to 24 hours; to conduct secret video surveillance on private property; gave SIS access to Customs Department data in relation to suspected terrorism, and allowed the Minister of Internal Affairs increased powers to arbitrarily suspend or cancel a passport.
The Labour Party were so opposed to this law change that they voted for it. (NZ First, the Maori Party, and the Greens, to their credit, voted against it.)
Then Dear Leader Key used the usual “defending Kiwis against terrorist” bogeyman to justify the State’s growing surveillance powers;
“ The threats faced by New Zealand have grown and it is important that we have the ability to respond to that. The Government has a responsibility to protect New Zealanders at home and abroad…”
Simultaneously in 2014, the IRD signed an agreement to share data with the Police;
Taxpayer information is required to administer New Zealand’s tax system effectively. This information can be supplied by taxpayers, or it can be collected by Inland Revenue during an audit.
Broadly, the government’s current legislative position is that this information is not shared with other government departments on the basis that it is ‘tax secret’.
However, there are instances where sharing taxpayer information relating to serious crime could bring offenders to justice, support the goals of other government departments, and offer the State broad efficiencies.
Up until that point, the IRD expected everyone who earned money – whether from legal or illegal mean – to pay tax. This meant that, for example, sex workers prior to 2003 would be expected to pay tax on their earnings regardless of the fact it was an illegal activity.
The tax department didn’t care where or how the money was earned – they just wanted their “fare share”.
After 2014, the IRD abandoned that policy, and data-sharing with Police was implemented. It means that taxing other illegal activities such as the production and sale of cannabis, is no longer feasible. This has unintentional consequences – such as the hoarding of cash; use of firearms to protect that cash; and violence.
This is part of an on-going wider process of government departments sharing private information with each other.
The Government Communications Security Bureau and Related Legislation Amendment Act, Telecommunications (Interception Capability and Security) Act, and Countering Terrorist Fighters Legislation Bill all follow on from previous extensions of State power, notably the Terrorism Suppression Act 2002.
This poorly thought-out law was Labour’s contribution to George Bush’s ill-conceived “War on Terror”.
Throughout National’s three terms in office, it has extended Police powers; widened the scope for the GCSB and SIS to spy on New Zealanders; and created a vast data-sharing network amongst it’s bureaucracy.
MSD, NGOs, and Demands for Data
To date, New Zealanders have been mostly apathetic as the government build up it’s ability to spy and store personal information on us. Most of the government’s “targets” have been so-called “terrorists”, immigrants, criminals, student-debt defaulters, and those on welfare benefits or living in state houses.
Most of Middle New Zealand find it difficult to identify with these elements of our society.
Recently, however, Radio NZ has been running a series of stories and interviews on a disturbing development regarding state aquisition of personal information.
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On 2 March, on Radio NZ’s Nine To Noon programme, Kathryn Ryan interviewed Brenda Pilott, the chairperson of ComVoices (an umbrella organisation for NGOs).
At issue was the disturbing revelation that the Ministry of Social Development (MSD), presumably under direction from National ministers, was forcing NGOs to collect and pass private information about their clients back to the Ministry, in return for on-going funding. This proviso was to be written into new contracts set to take effect in July this year after negotiations had concluded after Easter.
>Kathryn Ryan interviews Brenda Pilott – 2 March<
Accordingly to Comvoices, NGOs were expected to pass on;
- names of clients
- birth dates
- ethnicity
- other personal details such as dependent children’s names
NGOs that refused to share this information with MSD would forego funding. The result would be predictable;
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According to Brenda Pilot, the Ministry’s excuse to demand this data was;
“ They want to be able to find out what services are effective. And that this will provide information over time that will allow sensible decisions to be made about government funding and where to apply that funding.”
Ms Pilot voiced concerns that private, identifiable information would be used for tracking individuals who used NGO services. She said that vulnerable people needing to use services such as counselling, Women’s Refuge, Rape Crisis, etc, would be reluctant to engage those organisations and would “walk away”. Ms Pilot was concerned that passing personal, identifiable data to MSD would force NGOs to violate Privacy Laws.
Ms Pilot said that the Privacy Commissioner was also concerned at MSD’s intentions to obtain such data, and was investigating. She said the Commissioner would most likely report on the issue by the end of this month.
On 3 March, Radio NZ reported; grave concerns held by at least one NGO, Women’s Refuge;
Women’s Refuge chief executive Ang Jury said agencies would have to abide by the contract change if they wanted to keep their funding.
“If agencies choose not to share this information they won’t be contracting with the ministry. That’s pretty much where it sits.”
Dr Jury said it was not an ideal situation for the refuge but they were not in a position to say no.
“This is not something that we would happily go out and say, ‘yes, this is exactly what we want to do’.
“If it is going to happen, our job now is to make sure we get the sort of safeguards built around that information that we need to keep our women and children safe,” she said.
At least one privacy lawyer doubted the legality of MSD’s demands;
Privacy lawyer Kathryn Dalziel said the Ministry of Social Development (MSD) looked to be on shaky ground.
“This is a potential breach of privacy because they don’t appear to have identified, anywhere, the purposes for which they are collecting that information.
“There doesn’t seem to be any transparency around it … I also don’t think it’s fair,” she said.
“Principle 2 of the Privacy Act says that if you want to collect information from third party, you have to have a good reason.
“You also have to have … lawful and reasonable purposes for collecting that information in the first place. Now, none of that has been done.”
However, what really raised fears was Ministry of Social Development deputy chief executive, Murray Edridge’s responses to Kathryn Ryan’s questions. His answers not only failed to reassure, but raised serious concerns as to MSD’s intentions regarding the storage and end-use of personalised, identifiable data.
Edridge parroted the usual monetarist rhetoric of “the New Zealand public demands that government spend it’s money well”.
When Ms Ryan put it to Edridge that MSD was attempting to track NGO service-users, he denied it;
“ No we’re not tracking them. What we’re doing is we’re saying to providers, look, for us to understand the effectiveness of services, to understand where the resources are best invested, where we will decide between priorities in terms of investment we need to understand who the people are and what value they get from the services. For some time we’d had concern that investment’s been made in social services where they’re not the most effective mechanism for the people that require them, and this is part of the mechanism by which we understand the clientele better and we understand how we can serve them better and invest in services that are going to support them.”
When Ms Ryan put it to Edridge that anonymised data would work just as well, Edridge kept referring back to needing to know “who these people are“.
Moments later, Edridge contradicted himself by admitting “we know who the clients are, we know all about them“. If that wasn’t creepy enough, Ms Ryan then asked Edridge why MSD demanded further information about NGO service-users. She asked why MSD needed to know who was approaching (for example) Women’s Refuge for assistance..
Edridge’s response was further contradictory and throughout the twelve minute interview he could provide no satisfactory answer why MSD was requiring personalised data from NGOs. At one point he attempted to cloud the issue by stating that MSD required “demographic information”.
Ms Ryan dismissed that claim by remind Edridge that MSD was seeking names, addresses, ethnicities, children’s names and that was not simply “demographic information”.
When Ms Ryan suggested that NGO service-users might not want their details passed on to MSD or other ministeries, Edridge could only respond,
“ Well, we need to know where to get the money in the right place.”
Four days later, Rape Crisis draw a line in the sand and announced it would flat out decline to sign contracts with MSD in return for passing private information about service-users in exchange for on-going funding.
>Rape Crisis reject “data-for-funding” contracts – 7 March<
By 16 March, pressure on MSD and Minister Tolley was such that the ministry caved, and was forced to step back from demanding personalised data from some NGOs dealing with sexual violence.
>Temporary reprieve over ‘private data for funding’ contracts – 16 March<
The “reprieve”, however, was only temporary, and would last for only one year until MSD “works out how to securely collect and store their clients’ private data”. It also did not apply to all NGOs.
The Creep of Big Brother and the Daddy State
Up till this point, data-collection has centered on those who come in contact with the Justice system; WINZ beneficiaries; and Housing NZ tenants. These are generally New Zealanders who are usually the most deprived and vulnerable socially and financially, and rely on State assistance to survive.
A person seeking help from WINZ and Housing NZ is forced to supply both ministeries their private data. To refuse means no help. Next stop; the street;
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A citizen in contact with the Justice system has even less option to refuse to provide private data.
MSD’s demand for personalised data from NGO service-users marks a new stage in National’s slow advancement in building a data-base on every person in the country.
NGO service users may not necessarily be unemployed beneficiaries or live in state houses or have broken the law in some way – but their details will still be required to be collected and supplied to the Ministry of Social Development.
The ministry has assumed the de facto role of collecting and storing data on New Zealanders who – up till this point – may never have come into contact with any governmental organisation such as Housing NZ, WINZ, or Police.
The implications of this are staggering.
The net to scoop up data on as many citizens as possible, has just widened considerably.
If you think you – the reader – may never need the services of Women’s Refuge or Rape Crisis, consider for a moment that there are thousands of NGOs operating in this country and hundreds that are funded by the State.
Victim Support is just one state-funded NGO;
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So if you’ve just become a victim of a crime; Victim Support enters your life; the State now has your personal data on file;
- Client: Name, address, gender, date of birth, primary ethnicity, Iwi.
- Dependents: Name, date of birth, relationship to client.
- Service Level: Information Programme/service name, start date and end date.”
Middle-class New Zealanders who may never have had cause to have personal data collected on them may soon be on file with various ministeries. With data-sharing, personal information from MSD can end up throughout other ministeries. Or on the desks of ministers;
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Never mind “Nanny State” – this is the muscular arm of Daddy State flexing it’s strength to reach out to grab more and more of our private information.
And it won’t end with this.
Not until we say “Enough is enough. No more“.
Back to Showers
Remember this?
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In the lead-up to the 2008 general election, National attacked the then-Labour Government for “Nanny Statism”.
Following on from a disastrous drought in 2007 that cost the country’s economy over $2.8 billion (in 2008/09 dollars), the then-Labour government sought out ways and means to conserve water. The alternative was the possibility of further water-shortages or costly storage and irrigation systems. Labour opted for conservation. This included measures to save water in residential areas.
It could be suggested that water-saving shower heads and energy-efficient light-bulbs are the least of our concerns. National has surpassed anything that Labour envisaged, as this government reaches further and further into our private lives.
If there is one thing that history has taught us – governments that spy on their own people do not trust their people, and are fearful of them.
National must be very frightened of us.
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References
NZ Legislation: Search and Surveillance Act 2012
NZ Herald: New police search and surveillance law in force
Beehive: Search and Surveillance Bill becomes law
Radio NZ: Collins defends giving details to blogger
NZ Legislation: Government Communications Security Bureau and Related Legislation Amendment Bill
Beehive: John Key – PM releases report into GCSB compliance
Legislation.govt.nz: Government Communications Security Bureau Act 2003
NZ Herald: Spying on NZ: More power to watch us
Dominion Post: Spy bungles start to entangle PM
Fairfax media: Kiwis do care, prime minister
Parliament: Government Communications Security Bureau Amendment Bill
Parliament: Telecommunications (Interception Capability and Security) Bill
Fairfax: Spying bill passes into law
Parliament: Telecommunications (Interception Capability and Security) Bill — Third Reading
Parliament: Countering Terrorist Fighters Legislation Bill
NZ Herald: Foreign fighters bill passes 94 – 27
Fairfax media: Labour backs anti-terror laws, despite attacking it
IRD: Information sharing with New Zealand Police
IRD: Cross-government Information-sharing to Identify, Stop or Disrupt Serious Crime
MacNicol & Co: Tax News – IRD to share information with police
NZ Legislation: Terrorism Suppression Act 2002
Wikipedia: Terrorism Suppression Act 2002
Radio NZ: Government demands private data from NGOs
NZ Family Violence Clearinghouse: Relationships Aotearoa to close; funding models and issues in spotlight
Radio NZ: Govt on shaky ground over data-for-funding contracts, lawyers say
Radio NZ: Rape Crisis reject “data-for-funding” contracts
Radio NZ: Temporary reprieve over ‘private data for funding’ contracts
Comvoices: HomePage
Victim Support: Where does your funding come from?
NZ Family Violence Clearinghouse: MSD to require individual client level data from community agencies
NZ Herald: Bennett gets tough with outspoken solo mums
Dominion Post: Minister defends releasing private details
Fairfax media: Bennett won’t rule out releasing beneficiary details
Scoop: Showers latest target of Labour’s nanny state
NIWA: 2007 – much drier than average in many places
Beehive: Drought costs NZ $2.8 billion
Additional
Fairfax media: UN privacy expert slams government stance on privacy and ‘big data’
Other Blogs
The Standard: Social investment meets the surveillance state
Previous related blogposts
OIA Request points to beneficiary beat-up by Minister Chester Borrows
Audrey Young, Two Bains, old cars, and… cocoa?!?!
National Party president complains of covert filming – oh the rich irony!
An Open Message to the GCSB, SIS, NSA, and Uncle Tom Cobbly
Dear Leader, GCSB, and Kiwis in Wonderland
One Dunedinite’s response to the passing of the GCSB Bill
The GCSB Act – Tracy Watkins gets it right
The GCSB – when plain english simply won’t do
The GCSB law – vague or crystal clear?
The Mendacities of Mr Key #1: The GCSB Bill
Campbell Live on the GCSB – latest revelations – TV3 – 20 May 2014
The real reason for the GCSB Bill
Letter to the Editor: John Campbell expose on Key and GCSB
A letter to the Dominion Post on the GCSB
Dear Michael Cullen: the GCSB is not International Rescue!
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This blogpost was first published on The Daily Blog on 20 March 2017.
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WINZ, waste, and wonky numbers – *up-date*
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Radio NZ’s reporter, Ruth Hill, posted this story on Friday 10 July. Note Ms Hill’s comment;
“However, 4916 just dropped out of the system because they did not do the paperwork.”
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Even as National boasted about a drop in beneficiary numbers;
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– unemployment continued to rise;
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This discrepancy can be explained – in part – with RNZ reporter, Ruth Hill, revealing;
“Thousands of people are having their benefits cut off because they are not filling in the complicated paperwork required…
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… 4916 just dropped out of the system because they did not do the paperwork.”
This was a ticking time-bomb predicted by beneficiary advocates in 2013, when National implemented many of it’s punitive welfare “reforms”;
The changes sparked protests in front of three Auckland Work and Income offices by Auckland Action Against Poverty protesters yesterday who said the moves were about “cutting costs by pushing vulnerable people off the books” rather than getting them into decent jobs.
So how bad is the problem with WINZ forms?
On 8 February 2013, I blogged on precisely this problem (WINZ, waste, and wonky numbers);
Paula Bennett has directed WINZ to make life more difficult for the unemployed, when registering with WINZ. As if losing one’s job wasn’t stressful enough, Bennet has forced the implementation of some draconian rules and requirements for beneficiaries. (The implication being that it’s the fault of the unemployed for being unemployed?!)
One of the bureacratic bundles of red tape are the number of forms issued to WINZ applicants.
For those readers who have never had the “delight” of dealing with WINZ – these are the forms that are required to be filled out. Note: every single applicant is given these forms (in a little plastic carry-bag).
And if you have to reapply to WINZ for a benefit (if, say, you’ve lost your job again) you are required to fill out these forms all over again.
This is where taxpayer’s money is really going to waste in welfare.
All up, seventythree pages of information and forms to read, understand, fill out, to collect information;
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(Blogger’s Note: for a comprehensive view of each WINZ form, please go to blogpost: Bill English: When numbers don’t fit, or just jump around)
This system becomes even more laughable when one considers that if an an applicant has been a WINZ “client” (ie, beneficiary) before, they remain on MSD’s computer files. Much of the information sought is already on-file.
The cost of this must be horrendous, and it is ironic that at a time when National is cutting “back room” support staff to save money, that they are permitting taxpayer funding for this ‘Monty Pythonesque ‘ exercise in out-of-control form-filling.
No wonder that this was reported in Fairfax media,
“Social Development Minister Paula Bennett this morning said latest figures showed 328,043 people were now on benefits, with 57,058 of those on an unemployment benefit.
Reforms passed by Parliament require people on an unemployment benefit to reapply for it after one year. Bennett said this change had led to 5000 people cancelling their benefit.
More than 1400 of those said they had found work, more than 2600 didn’t complete a reapplication and more than 1000 were no longer eligible. ”
How many people with minimal education or poor command of the English language could hope to fill out so many forms of such complexity?
National has a peculiar – but effective – way of dealing with unpleasant statistics.
It either does not engage in collecting data (eg; foreign house buyers, poverty levels, etc), or, it implements policies that will artificially impact on statistics without actually resolving under-lying problems. Whichever is the cheapest, easiest option. And whichever draws the least worst headlines.
If pushing New Zealanders off welfare – by making the system unnecessarily complex and frustrating – has the end result of an apparent drop in welfare numbers, then that is ‘Mission Accomplished’ for this government.
Pushing people into poverty; homelessness; the degradation of street living and begging; are not matters that greatly concerned successive Social Welfare ministers, whether Paula Bennett, nor her successor, Anne “Look-At-Me-Standing-On-A-Crushed-Car” Tolley, as she told Radio NZ;
“There is no reason for Work and Income to continue monitoring people who have chosen not to re-apply for a benefit.
If people require welfare support, it is their responsibility to get in touch and provide Work and Income with information that allows them to assess a beneficiary’s need. Once that is complete, Work and Income can provide the assistance people are eligible for.”
This is the same minister who told TVNZ’s Q+A, political reporter, Corin Dann, on 21 June;
DANN:
“Some would argue with the recent case, for example, with Emma-Lita Bourne who died in the state house, [a] damp house, why not just give those families more money to pay their power bill, rather than give the organisations money to come in and work and all the rest of it?”
TOLLEY:
“And, and, when you look at something like Whanua Ora, they are doing some of that. See, see, what we’ve got with the focus on individual programmes and agencies working in silos, families don’t work like that. They’re very complex issues so if I don’t know the details of that particular family…”
Tolley admitted not knowing the details of the family whose child died of cold/damp related illness.
Make no mistake, the end purpose of seventythree forms, and having to re-apply every twelve months, is to cause frustration and dissuade people from re-applying for welfare benefits.
Ministers then trumpet “success” at a drop in welfare numbers.
The next time you see beggars on the streets with signs saying “no money, please give what you can” – they are most likely telling the truth. They are this government’s dirty little secret.
Addendum1
“There is no official measure of poverty in New Zealand. The actual work to address poverty is perhaps what is most important.
Children move in and out of poverty on a daily basis.” – Paula Bennett, 16 August 2012
Addendum2
One of the more bizarre and ridiculous policies by the Ministry of Social Development is annual re-application forms sent to beneficiaries with permanent disabilities such as spina bifida.
For those who are not aware, spina bifida is a permanent, life-long condition. There is no cure.
MSD seems to believe that a miraculous recovery is possible, judging by the forms it sends every twelve months to people with spina bifida.
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References
Radio NZ: Thousands losing benefits due to paperwork
Fairfax media: Benefit numbers reach a six-year low
Radio NZ: Unemployment rises to 5.7 percent
Fairfax media: Number on benefits drops, reaction mixed
Fairfax media: 5000 beneficiaries quit dole rather than reapply
Fairfax media: Foreign house owner register downplayed
NZ Herald: Measuring poverty line not a priority – Bennett
TVNZ Q+A: Interview with Anne Tolley
Previous related blogposts
“I don’t know the details of that particular family” – Social Development Minister Anne Tolley
Bill English: When numbers don’t fit, or just jump around
WINZ, waste, and wonky numbers
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This blogpost was first published on The Daily Blog on 12 July 2015.
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Review: TV3’s The Nation – “Let them eat ice cream!”
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In the last three years I have been truly outraged and sickened only twice when watching a current affairs/documentary programme. The first was Bryan Bruce’s “Inside Child Poverty“, broadcast back on 22 November 2011.
Bryan presented the viewer with a country of increasing child poverty, disease, low-quality housing; and growing inequality that few of us (except hardcore ACT and National supporters) would have believed possible in a wealthy country like New Zealand. Especially a country which once prided itself on egalitarianism, fairness, and looking after those less fortunate than the privileged Middle Classes.
The second time was just recent – watching TV3’s current affairs programme, The Nation, on 24 May. The one word that came to mind as I watched the episode was: revulsion. Not revulsion at the fact that our once proud egalitarian nation is now one of the most unequal on the face of this planet – but revulsion at the injection of humour in interviews; panel discussion, and levity between the hosts, Lisa Owen and Patrick Gower.
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Hosts for TV3’s “The Nation”, Lisa Owen and Patrick Gower
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I am not even referring to Patrick Gower “interviewing” Ben Uffindell, editor of the satirical blogsite, The Citizen. Though one certainly has to question why this segment was deemed worthy of insertion? What was the point of suggesting that children living in poverty – many of whom go to school without food (or are given “food” that is of dubious nutritional value); no shoes; no rain coats; or lacking other items which Middle Class families take for granted – would find it funny to be given ice cream or a South American animal?
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I recall a legend of someone else trying to “make light” of the plight of the poor. That person suggested cake, in lieu of ice cream.
The highly talented Mr Uffindell has never been invited to comment on other pressing issues and problems confronting our country. So why start with inequality and associated problems with child poverty? A question I posed to The Nation, via Twitter;
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So why is levity suddenly the order-of-the-day when poverty and inequality is under the media microscope?
Because we are “just laughing at ourselves” some might say?
No. We are not “laughing at ourselves”. We are laughing at the thought of children, living in poverty, being given free ice cream and llamas.
We are not “laughing at ourselves”. We are laughing at children and families living in poverty – at their expense.
That is the difference.
Funnily enough, there was certainly no humour on The Nation (10 may) when ACT’s Jamie Whyte proposed a flat tax policy. Where was the mirth? The satirical hilarity? Where was the wink-wink-nudge-nudge repartee between The Nation’s hosts?
Any humour must have been lost amongst the rustling sound of $100 bills been eagerly counted…
On top of which, was Torben Akel’s piece on “fact checking” looking at whether or not inequality in New Zealand has increased;
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“But first, a bit of good old fashioned fact-checking“, said Patrick Gower, as he introduced Torben Akel’s piece. A pity, then, that no one at The Nation bothered to “fact check” Akel’s reporting.
Bill English stated in the above video,
“Income inequality has not got worse. In fact we’re one of two developed countries where the OECD has recently as yesterday have said it’s stable since 1994. And in fact in the last few years there’s some indications it’s fallen slightly.”
Torben Akel asked for evidence to back up English’s claims;
“What we got was a page lifted from a new OECD report with a graph showing income inequality here in 2010 was less than it was in the mid nineties.”
So the “new” OECD report was based on data, taken in the midst of the Global Financial Crisis and resulting Recession?! Data that was four years old?!
Akel continued with this – and here is the relevant bit;
“As for what had happened in the last few years, we were directed to the Ministry of Social Development’s household incomes report, released last July. And specifically, this graph, which shows why the Beehive [is] so sure our income gap isn’t growing.”
A cover of the Report flashed on our television screens;
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The document above is Bryan Perry’s Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011. It used data from Treasury to assess child poverty in this country;
“To calculate disposable income Statistics New Zealand uses the Treasury’s tax-benefit microsimulation model (Taxwell1) to estimate tax liabilities for individuals and benefit units. The resulting personal disposable incomes are summed to give disposable household income. Disposable household income is sometimes referred to as net income or after-tax cash income.”
– p25
“The Treasury has also developed a set of weights for use with its HES-based tax-benefit microsimulation model, Taxwell. The Taxwell weights include the number of beneficiaries as one of the key benchmarks, in accordance with Treasury’s primary use for the HES in the Taxwell model. Treasury’s Taxwell weights therefore provide a better estimate, for example, of the number of children in beneficiary families, although to achieve this there has been a trade-off with achieving other benchmarks…”
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“We know that the estimates using Statistics New Zealand’s weights consistently under-estimate the number of beneficiaries compared with the administrative data. Generally, the estimates using the Treasury’s Taxwell weights are closer to the administrative data, but the sampling error from the HES can still lead to either or both weighting regimes under- or over-estimating the population numbers. “
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The relevance of all this?
As reported back in February, Treasury had under-estimated the level of children living in poverty, as Bernard Hickey wrote on the 28th,
“Treasury and Statistics said in a joint statement they had double counted accommodation supplements in estimates of household disposable income between 2009 and 2012, which meant incomes were over-estimated by NZ$1.2 billion and the number of children in families earning less than 50% of the median income was under-estimated by 25,000.”
For those who want to read the actual Media Statement from Treasury, can be found here: Media Statement: Data error prompts process improvements. Refer to the table headed “Miscalculation – Scale – Key statistics affected”.
Bryan Perry’s revised report can be found here: Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2012 Revised Tables and Figures
27 February 2014. In it, he states,
“The revised trend-line figure is 32.9 compared with 32.7 [Gini Co-efficient] before the corrections. The trend line is still flat.”
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(The Gini Co-efficient measures inequality, with the higher the value, the lower the equality in income.)
The”trend line” may still be “flat”, but I submit to the reader that for a family on low income; paying exorbitant rent; in a cold, damp house, with very little food in the pantry and fridge – it matters very little.
What does matter is that since 1984, before the Neo-Liberal “revolution”, the Gini Coefficient was only 28.
It is now 37.7.
We are going in the wrong direction.
So not only are National’s claims not backed up by evidence; not only has data been found to be incorrect; but also Torben Akel and The Nation’s research team missed the obvious; inequality has worsened since 1984.
Falling home ownership rates are another indicator which confirm increasing inequality in this country (and throughout the rest of the world).
The Nation’s comedic episode continued with this exchange between hosts Lisa Owen and Patrick Gower, and panellists, author Max Rashbrooke, and right-wing commentator and National Party cadre, Matthew Hooton;
Lisa Owen: “Let’s change to a lighter note. The Civilian Party. Let’s be clear. That was a bit of fun. It was tongue in cheek, if anyone’s confused about that out there. Do we need this in an election year. Do we need some humour?”
Max Rashbrooke: “Oh I think, absolutely. I mean it’s great to see Ben do his thing with the Civilian [Party].
If there’s a problem though, it’s that some of his policies which he puts out as satire, are actually quite close to reality. I mean he talks about we should tax the poor, more. Well actually, if you add up income tax and gst, people on low incomes are paying pretty much the same proportion of their income in tax as people at the top half. If you added capital gains into that story, the poor are probably paying a bigger chunk of their income than the rich are.”
Patrick Gower: “And, and, I, I agree with you there. Because llamas, in my opinion have been dodging tax for years and years, and until someone moves on that loophole, um…”
[general hilarity ensues]
Then Matthew Hooton had to go spoil it all by getting All Serious again, and witter on about Paradise in Scandinavia with more of his skewed ‘spin’ on those country’s taxation system.
Yup. Poverty and rising inequality. A laugh a minute.
What next on The Nation – point and laugh at people with disabilities?
“Jolly good fun”!
Postscript
TVNZ’s Q+A on 25 May also had Ben Uffindell as a guest. As usual, his wit was on form. The big, big difference between Q+A and The Nation? On the former, he satirised and poked fun at politicians. On the latter, the targets for laughter were children in poverty.
Draw your own conclusions.
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References
TV3: Inside Child Poverty
TV3: Child poverty doco ‘apolitical’ – filmmaker
TV3: Party calls for free ice-cream and llamas
Twitter: Frank Macskasy/The Nation
TV3: ACT leader steals thunder in minor party debate
TV3: New Zealand’s record on inequality
Ministry of Social Development: Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011
Hive News: Inequality data error revealed
NZ Treasury: Media Statement: Data error prompts process improvements
Ministry of Social Development: Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2012 Revised Tables and Figures
27 February 2014
Wikipedia: Gini Coefficient
Statistics NZ: 2013 Census – Trend of lower home ownership continues
TV3: Panel – Patrick Gower, Max Rashbrooke and Matthew Hooton
Other blogs
The Standard: Snapshot of a nation: inequality
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Above image acknowledgment: Francis Owen/Lurch Left Memes
This blogpost was first published on The Daily Blog on 25 May 2014.
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OIA Request points to beneficiary beat-up by Minister Chester Borrows
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In National’s on-going war against the poor; the unemployed; solo-mums; widows; etc, Associate Social Development Minister, Chester Borrows, recently trumpeted “new” developments in the campaign against “welfare abuse”.
He proclaimed “new” measures by this government to detect and deal to (alleged) fraudsters,
“The information sharing, which compares MSD records with Inland Revenue data to identify working age beneficiaries who have not accurately reported their income to Work and Income, started in March this year.”
Source: Information sharing continues to stop fraudsters
However, as I pointed out in July of this year, Borrows appears to be somewhat “loose with the truth”. The MSD has had the ability to share information with other government departments going back to 2001 – if not earlier (see: Benefit fraud? Is Chester Borrows being totally upfront with us) .
The initial evidence for this fact lay with two letters from an acquaintance, who luckily keeps every piece of correspondence from government departments.
The other evidence was a startling admission from Borrows – detailed later in this blogpost – in an OIA request lodged with the Minister’s office in July.
The first of two letters was from 2009,
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[Published with permission.]
The letter clearly states,
“We regularly compare our records with other government agencies…”
and,
“The Inland Revenue records indicate that you commenced employment: 16 March 2009…”
(Note; the over-lap that so concerned the MSD was a matter of two weeks, and centered more around confusion as to when the WINZ “client” was deemed to start work.)
Obviously, the MSD had data-matching with the IRD going back to at least mid-2009.
The second letter is from 2001,
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[Published with permission.]
Even in 2001 – twelve years ago – WINZ and the NZ Customs Service (not Immigration Dept as I mistakenly wrote) were comparing information.
So for Borrows to claim that “information sharing, which compares MSD records with Inland Revenue data to identify working age beneficiaries who have not accurately reported their income to Work and Income, started in March this year ” – shows either that he has poor knowledge of departmental policy, or is wilfully misrepresenting the truth.
If Borrows is lying, it would be part and parcel of National’s disturbing agenda to demonise welfare recipients and make them the scapegoats of this Tory government’s failure to create jobs.
On 19 July, I lodged an OIA request with Borrows’ office. I asked ten questions from the Minister through the course of two emails. Here are the questions and responses I received on 12 September;
1. Over what period of time were these 3,139 cases detected?
Borrows replied; “From 18 March to 14 July 2013 the information sharing agreement detected 3,139 cases of benefit fraud which resulted in the cancellation of a benefit.”
2. When did IRD and WINZ begin sharing information?
Borrows; “In May 2012 an Order in Council was passed that allows for Inland Revenue to share information with the Ministry of Social Development. To support this a memorandum of Understanding was signed by the Chief Executive of the Ministry of Social Development and the Commissioner of Inland Revenue.
This has led to a new programme of work in which Inland Revenue provides the Ministry of Social Development with income and employer information for all working age people in receipt of a benefit. In September 2012 a test of the information sharing agreement was undertaken to ensure data integrity and system compatibility. Full information sharing for the detection of undeclared earnings commenced in March 2013.”
However, further on in Borrow’s letter, he presents this chart of two government departments and the dates they commenced data-sharing with the MSD,
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Note the years given for the IRD (1992) and NZ Customs Service (1996). This ties in perfectly with the letters from WINZ and MSD above.
3. Does WINZ and the Dept of Immigration also share information on WINZ beneficiaries who travel overseas whilst in receipt of a benefit?
According to Borrows; Yes. Though with NZ Customs, not the Immigration Service. My bad.
4. When did that WINZ/Immigration Dept arrangement, in respect to Q3, begin?
According to Borrows; from 1996 onward.
5. What other government ministeries, departments, SOEs, and other bodies does WINZ share information with? 6. When did those arrangements, in respect in Q5, begin?
Borrows listed the following as data sharing with the MSD; ACC (2005), Corrections Dept (1995), Department of Internal Affairs (2004 onward), Housing NZ (2006), Inland Revenue (1992 onward), NZ Customs Service (1996 onward), and Ministry of Justice (2013)
7. Of the 3,139 illegitimate benefits found, what was the time period involved with people receiving a benefit and earning income from another source?
How many were within the following periods;
– 1 week
– 2 weeks
– 3 weeks
– 4 weeks
– 2 months
– 3 months
– 6 months
– Over 6 months – under one year
– Over one year
This was probably the most pertinent question, and Borrows point blank refused to answer it, stating;
“Your request for information about the amount of time a client was in receipt of a benefit whilst earning income from another source is refused under section 18(f) of the Official Information Act.This would require the Ministry to undertake a manual search of each of the individual client’s files to collate the information. As such I am refusing this part of your request as responding to it would require substantial collation or research.”
This is an unbelievable response!
For one thing, it indicates that the Minister has no information as to how long a welfare recipient was earning both a benefit and other income.
Was it one week? Or one year? Two weeks? Or two decades?
There are many cases of a brief overlap, as the 7 July 2009 letter above shows (where the over-lap was a fortnight before the recipient advised WINZ). There was a gap of just over a week between the job interview and job offer, and the person’s first induction course.
Borrows simply has no knowledge of how long these over-laps were. If the majority were one or two weeks, this can be put down to human error or a mis-understanding of employment start-dates – not planned fraud.
Worse was to come.
8. How many prosecutions have been undertaken of all nine cohorts listed above?
Borrows replied,
“Information about the number of prosecutions undertaken is refused under section 9(2)(f)(iv) of the Official Information Act. This part of the Act allows me to refuse your request as the Ministry is still in the process of deciding whether to prosecute these individuals, therefore this matter is still under active consideration. While I understand that there is a significant public interestin the functions of the Ministry, I believe that in this case the public interest does not outweigh the necessity to protect the Ministry’s investigation and prosecution process.”
I take it from his response that “as the Ministry is still in the process of deciding whether to prosecute these individuals, therefore this matter is still under active consideration” – that no prosecutions have taken place up until the time of the letter being written.
Not one single person out of the 3,139 cases was prosecuted.
Not. A. One.
So the alleged fraud was either of an insignificant nature (one or two weeks) – or the cases were so flimsy and ill-defined that a Court would have thrown out the charges.
Or they weren’t “fraud” at all.
9. How many have been convicted?
Borrows’ response,
“Prosecutions stemming from these cases are still in progress, and I am advised that none have yet been resolved. As such there have been no convictions to date.”
No convictions?
So much media hype surrounding 3,139 cases – and not a single prosecution or conviction.
It seems apparent that this was little more than a propaganda exercise and useful only to beef up National’s ‘tough-on-welfare-abuse” image. Any serious fraud is never countenanced by any government and prosecutions are relentlessly pursued,
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And lastly, I asked,
10. How many were in actual employment whilst receiving a welfare benefit, as opposed to some other source of income?
Borrows replied,
“In every instance of the 3,139 alleged benefit frauds, those in receipt of these were also employed.“
Note the Minister’s use of “alleged”. Without a single court case leading to a single conviction, nothing has been proven. There was no fraud, as such, because no one has been convicted of any such offence.
We have only a politician’s word that this has happened.
And thus far, Mr Borrows seems to be lacking in any credibility whatsoever.
It is also interesting to note that whilst Borrows knew the answer to Q10 – he had no data on Q7.
If the mainstream media had the time or inclination to delve further behind the press releases, they might uncover the same situation I have; that this has been part of a propaganda exercise by government ministers to boost National’s reputation as being “tough on welfare cheats”.
New Zealand has a dark side to it’s much vaunted “fair go”. We can be quick to judge; easy led to indulge in prejudice; and punitive to a nasty level.
National’s strategists and spin-doctors are well aware of this nasty side to our collective psyche and play it like a maestro.
We may not force jews to wear the yellow star of David and ship them off to death camps – but when a Tory government re-victimises the poorest and most vulnerable in our society, simply to gain a few polling points, and seemingly gets away with it – then you know that this is a country that is willing to be led into darkness.
And all the while with a complicit media, only too eager to be the government’s unquestioning, obedient, mouthpiece,
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Whatever happened to journalists looking behind government utterances?
Or is the new policy Don’t Question Authority?
At the very least, journalists like Susan Wood should have expected payment for her blatant towing of the National Party-line. She has shown herself to be a Good Citizen. Obedient. Unquestioning. Loyal.
So when do we start shipping welfare beneficiaries off to work camps?
Would that satisfy that subconscious, punitive urge for New Zealanders?
Or would that finally – finally – be a step too far?
And in the meantime, how many more times will gullible New Zealanders fall for National’s get-tough-on-welfare-fraud propagandising?
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This blogpost was first published on The Daily Blog on 6 December 2013.
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References
OIA letter from Chester Borrows
Scoop media: Information sharing continues to stop fraudsters
Radio NZ: Thousands stopped from getting benefits not entitled to
Dominion Post: House call plan to nab benefit fraudsters
NewstalkZB: Susan’s Editorial: Benefit fraudsters stealing from you and me
NZ Herald: Alleged identity theft for pension
Additional
Gordon Campbell: Ten Myths About Welfare – The politics behind the government’s welfare reform process
TV3: Courts tougher on benefit fraud than tax dodging – study
Previous related blogposts
Benefit fraud? Is Chester Borrows being totally upfront with us?!
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WINZ, waste, and wonky numbers
From previous blogpost, Bill English: When numbers don’t fit, or just jump around…
… Paula Bennett has directed WINZ to make life more difficult for the unemployed, when registering with WINZ. As if losing one’s job wasn’t stressful enough, Bennet has forced the implementation of some draconian rules and requirements for beneficiaries. (The implication being that it’s the fault of the unemployed for being unemployed?!)
One of the bureacratic bundles of red tape are the number of forms issued to WINZ applicants.
For those readers who have never had the “delight” of dealing with WINZ – these are the forms that are required to be filled out. Note: every single applicant is given these forms (in a little plastic carry-bag).
And if you have to reapply to WINZ for a benefit (if, say, you’ve lost your job again) you are required to fill out these forms all over again.
This is where taxpayer’s money is really going to waste in welfare.
All up, seventythree pages of information and forms to read, understand, fill out, to collect information,
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(Blogger’s Note: for a comprehensive view of each page, please go to previous blogpost: Bill English: When numbers don’t fit, or just jump around)
This system becomes even more laughable when one considers that if an an applicant has been a WINZ “client” (ie, beneficiary) before, they remain on MSD’s computer files. Much of the information sought is already on-file.
The cost of this must be horrendous, and it is ironic that at a time when National is cutting “back room” support staff to save money, that they are permitting taxpayer funding for this ‘Monty Pythonesque ‘ exercise in out-of-control form-filling. (More on that below.)
No wonder that this was reported in Fairfax media,
“Social Development Minister Paula Bennett this morning said latest figures showed 328,043 people were now on benefits, with 57,058 of those on an unemployment benefit.
Reforms passed by Parliament require people on an unemployment benefit to reapply for it after one year. Bennett said this change had led to 5000 people cancelling their benefit.
More than 1400 of those said they had found work, more than 2600 didn’t complete a reapplication and more than 1000 were no longer eligible. ”
See: 5000 beneficiaries quit dole rather than reapply
How many people with minimal education or poor command of the English language could hope to fill out so many forms of such complexity?
By contrast, applying for a bank mortage is vastly simpler – an irony considering the vastly greater sums of money involved.
In fact, an application for an ANZ Mortgage comprises of eight pages (four, double-sided),
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Eight pages for a mortgage to borrow anywhere from $250,000 to $1 million and upward.
And 72 pages for an unemployment benefit of $204.96 per week, net, for a single person over 25. (See: Unemployment Benefit – current)
So how much does all this cost us?
Last year, this blogger emailed the Ministry of Social Development (MSD) with an Official Information Act (OIA) request, asking what the cost of all these pamphlets cost,
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Date: Tue, Wednesday, 14 November 2012 1:38 PM
From: Frank Macskasy
Subject: Information Request
To: Paula Bennett “Paula.bennett@parliament.govt.nz”Kia Ora Ms Bennett,
I would like to make an official Freedom of Information Request.
Please provide information as to the costings of the following forms and information leaflets produced by MSD/WINZ;
“Work and Income Employment-Earnings Verification” (VO6-mar 2011)
“Work and Income Find a job build a future Tools to help you find work” (JOBSW0007-nov 2010)
“Jobz4u Manual Jobseeker Enrolment” (-)
“Work and Income Unemployment Benefit Application” (M18-JUL 2011)
“Work and Income Unemployment Benefit Application – What to bring” (M18-JUL 2011)
“Work and Income How can we help you” (CM0001 – OCT 2010)
“Work and Income Online Services” (-)
“Work and Income” plastic carrybag for above items.
Please provide total costings for EACH item printed, on an annual basis for the last four years, and a break-down of costings for usage per year and per WINZ client.
Thank you for your assistance in this matter.
Regards,
-Frank Macskasy
Blogger
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After seeking an extension, on 4 February this year, the MSD replied with these costings,
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Firstly, it’s disappointing to note that of the eight items that I requested costings for, MSD could provide figures for only five. They admitted not have costings for two documents (“Jobz4u Manual Jobseeker Enrolment” and “Work and Income Online Services” ) and made no mention of another (“Work and Income Unemployment Benefit Application – What to bring” ).
However, based on figures provided for other documents, we can certainly make some rough guesses. If MSD’s figures are correct, over four years, the cost of printing these 72 pages is around $1 million. Not a hell of a lot, when considering that WINZ benefit’s will be approximate $4.9 billion for just this financial year alone (see: Budget 2012 – Vote Social Development).
But if a Bank can offer mortgages from $1 to millions of dollars, using an eight page application form – then why would a government department be wasting hundreds of thousands of dollars – millions over decades – for a measely $204.96 (per week, net, for a single person over 25)?
The reason is fairly obvious.
A Bank welcomes a new client in the hope of offering a financial service – eg, a mortgage. Banks view clients as assets.
Under the current government, WINZ is actively discouraging people from signing up for welfare assistance,
Reforms passed by Parliament require people on an unemployment benefit to reapply for it after one year. Bennett said this change had led to 5000 people cancelling their benefit.
More than 1400 of those said they had found work, more than 2600 didn’t complete a reapplication and more than 1000 were no longer eligible. ”
See: 5000 beneficiaries quit dole rather than reapply
Yet, at a time when we have a critical shortage of skilled workers in this country – especially tradespeople for the Christchurch re-build – National views those seeking welfare assistance as a liability.
This is about as short-sighted as a conservative, market-oriented government can get. It shows a lot about the narrow-sightedness of National’s ministers when, like a bank, they don’t see that 170,000 unemployed is an asset waiting to be upskilled; trained and supported into new careers.
Just imagine; 170,000 new builders, computer technicians, doctors, electricians, nurses, quantity-surveyors, scientists, teachers, vets, etc. Imagine the economic growth this country would have if National viewed an army of 170,000 unemployed as an asset waiting to be tapped – rather than discouraged.
I can imagine it.
National evidently can’t. Not when they prefer to spend millions on 72 pages of bureacratic rubbish, which would put of a lot of people.
I wonder how much business a bank would get if they demanded that new clients fill out 72 pages of forms?
Not much, I’d wager.
So why does the government do it?
Addendum
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This is the predictable consequence when a hands-off government does nothing to grow the economy and generate new jobs.
This is the predictable consequence when a government treats unemployed workers as a liability to be discouraged and labelled as ‘bludgers’ – rather than recognising the asset that they really are.
This is the predictable consequence of a National government.
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Johnny’s Report Card – National Standards Assessment y/e 2012 – inequality & poverty
To Whom It May Concern; the following Report Card detail’s Johnny’s achievements over the last four years.
The following contrasts compare four years, ranging from the end of 2008 to the end of this year, 2012.
Whilst it is acknowledged that the Global Financial Crisis impacted harshly on our society and economy, it is also fair to say that National has had the benefits of starting out with a sound economy (surpluses, low unemployment, etc) in 2008 and four years in office to make good on it’s election promises..
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Inequality & Poverty
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The rhetoric:
“You can measure a society by how it looks after its most vunerable, once I was one of them. I will never turn my back on that.
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Yet, also, you can measure a society by how many vulnerable people it creates – people who are able to work, and able to take responsibility for their own lives and their children’s lives, yet end up depending long-term on the State.” – John Key, 28 November 2006
See: Speech to North Shore National Party luncheon
“My father died when I was young. My mother was, for a time, on the Widow’s Benefit, and also worked as a cleaner. But the State ensured that I had a roof over my head and money for my mother to put food on the table. It also gave me the opportunity to have a good education. My mother made sure I took that opportunity, and the rest was up to me.” – John Key, 30 Jan 2007
See: The Kiwi Way: A Fair Go For All
“I have said before that I believe in the welfare state and that I will never turn my back on it. We should be proud to be a country that looks after its most vulnerable citizens. We should be proud to be a country that supports people when they can’t find work, are ill, or aren’t able to work. ”- John Key, 30 Jan 2007
See: IBID
“When Sir Ed climbed Mt Everest back in 1953, he wasn’t the only New Zealander on top of the world. We all were. We were among the five wealthiest countries on earth. Not any more.
Fifty-five years on, we are no longer an Everest nation. We are among the foothill nations at the base of the OECD wealth mountain. Number 22 for income per person, and falling.
But what does a wealth ranking matter, you might ask? Why does it matter if we’re number 22 or number four?
It matters because at number 22 your income is lower, you have to work harder, and you can save less. You face more uncertainty when things go wrong, when you or your family get sick or lose a job. No New Zealand sports team would be happy to be number 22. Why is the Government?
This is a great country. But it could be so much greater. It has been so much greater.
So the question I’m asking Kiwi voters is this: Do you really believe this is as good as it gets for New Zealand? Or are you prepared to back yourselves and this country to be greater still? National certainly is.
[…]
So, make no mistake: this election won’t be fought only on Labour’s economic legacy. National will be asking Labour to front up on their social legacy, too. Many of the social problems the Government said it would solve have only got worse.
This time a year ago, I talked about the underclass that has been allowed to develop in New Zealand. Labour said the problem didn’t exist. They said there was no underclass in New Zealand.
But who now could deny it? 2007 showed us its bitter fruits. The dramatic drive-by shooting of two-year-old Jhia Te Tua, caught in a battle between two gangs in Wanganui. The incidence of typhoid, a Third World disease, reaching a 20-year high. The horrific torture and eventual death of three-year-old Nia Glassie. The staggering discovery of a lost tribe of 6,000 children who are not enrolled at any school.
The list goes on and on. The fact is, that under Labour, there has been no let-up in the drift to social and economic separatism.
We don’t need more of their hand-wringing, their strategies, and their interdepartmental working groups. What’s needed is the courage to make the tough calls to fix these problems.” – John Key, 29 January 2008
See: A Fresh Start for New Zealand
“I’m a product of the welfare state – there hasn’t been any great secret about that.” – John Key, 27 Aug 2011
See: ‘Socialist streak’ just means we have a heart, says Key
The results:
Interestingly, whilst Key’s 2008 speech (A Fresh Start for New Zealand) started off describing New Zealand’s growing underclass, National’s Dear Leader went on to describe a series of punitive actions that his Administration would undertake, if elected to power.
The following sub-headings in Key’s speech are illuminating,
- Youth Plan (education, youth crime)
- Youth Guarantee (education, training, universal educational entitlement, threat of benefit sanctions)
- Youth Justice (extending Youth Court; tougher sentences for youth offenders; new Youth Court orders)
- New powers for the Youth Court
- First, the power to issue parenting orders.
- Secondly, the power to refer young offenders to mentoring programmes.
- Thirdly, the power to refer young offenders to compulsory drug or alcohol rehabilitation programmes.
- Tougher sentences
- The first is longer residential sentences.
- In addition, National will fund a new type of programme for teenagers who aren’t bad enough to be put in a youth justice facility but who need a serious dose of intervention.
- National will fund a new range of revolutionary ‘Fresh Start Programmes’. (boot camps)
- Finally, we think the Youth Court needs better teeth for following up serious youth offenders when they are released back into the community.
This was John Key’s “vision” of a “Fresh Start for New Zealand”; more punitive action against youth offenders – but precious little to address the root causes of youth crime; poverty, lack of jobs, poor housing, worsening health, lack of training and apprenticeships, etc, etc, etc.
Key’s “solution” was to treat the symptoms of this country’s growing underclass.
So it should be hardly any surprise that those symptoms worsened, and the underclass; prison population; domestic violence; hungry children; poor housing – all grew.
The truly unbelievable aspect to Key’s shonkey speech in 2008 was how comprehensively New Zealand voters sucked it up, en masse. (We seriously need to introduce comprehensive Civics courses in our schools, to teach young New Zealanders how to recognise and deconstruct political BS.)
Tax cuts:
Whichever way we look at it, New Zealand in the last four years has become a more unequal society, and with growing poverty.
The first causal factor was the 2009 and 2010 tax cuts, which gave the most to the highest income earners and most wealthy New Zealanders,
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When, on 1 April 2009, then-Maori Party MP, Rahui Katene asked John Key in Parliament,
“How do low-income New Zealanders benefit from the tax changes introduced today?”
Dear Leader replied,
“They benefit because 630,000 New Zealanders—the New Zealanders who do not have children and who have been relatively low-income New Zealanders, and who got absolutely nothing under the previous Labour Government for 9 years—get $10 a week, or $500 a year. It is a small start, and it will be welcomed.”
See: TheyWorkForYou Blog – Tax Cuts—Implementation
At least Key wasn’t bullshitting us this time; for those on minimum wage up to it was indeed small. Someone on $100,000 would receive two and a half times more than someone on minimum wage.
The following year’s October tax cuts were hardly better – but this time the rate of GST was increased from 12.5% to 15%,
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The impact on low-income families – along with increased costs for medicines (see: Prescription charges to increase), and other user-pays government fees – would be harsh.
Contrary to the NZ Herald’s claim above, the average earner would not be “better off”. The $15 a week “extra” would be quickly swallowed up in rising government charges; medicine prescriptions; increased petrol taxes; and the flow-on inflationary effects throughout the economy.
This was not a “tax switch” – it was a tax-swindle – with the richest making the biggest gains.
Interestingly, ACT’s Roger Douglas – commenting on the 2009 tax cuts – realised that National was having to borrow heavily to finance said tax-cuts,
“Does the Prime Minister agree with Professor Eric Leeper’s statement in the latest Reserve Bank Bulletin that counter-cyclical fiscal policy could actually be counter-productive; if not, why not; if yes, why, then, is he borrowing $1 billion plus interest a year in order to give tax relief of $1 billion?” – Roger Douglas, 1 April 2009
So much for National’s promises in 2008,
“National’s rebalancing of the tax system is self-funding and requires no cuts to public services or additional borrowing.
[…]
This makes it absolutely clear that to fund National’s tax package there is no requirement for additional borrowing and there is no requirement to cut public services.”
Salvation Army Report: The Growing Divide – A state of the Nation Report 2012
This document by the Salvation Army is one of the most insightful and far-reaching analyses of current economic stagnation; political factors; and related social problems. It pulls no punches.
This blogger encourages people to read the Report (it’s written in plain english; very little jargon; and contains excellent data, with references). It should be put into the letterboxes of every home in this country. Click here to link to the report.
[NB: The report was written at a time when unemployment was at 6.3%. Since then it has increased three consecutive Quarters to the current 7.3% (see: Unemployment January 2012 to November 2012.]
Amongst the Report’s findings,
1. Inflation, higher prices, increased GST, raised indirect taxes (eg, fuel taxes), and government charges, have off-set the tax cuts of October 2010.
2. If New Zealand is to return to the historically low rate of unemployment of 3.8% in December 2006, (from the then-figure of 6.3%), we would require 90,000 jobs, in on top of 25,000 to 30,000 jobs required each and every year just to keep up with the growth of the labour force. The figure of 90,000 will have increased as unemployment now stands at 7.3%.
3. The rapid growth in the labour force participation rate of people aged 65+ (from 14.1% in December 2006, to 19.5% in December 2011) has been at the expense of falling employment participation of young people in the 15 – 19 year old age group.
Those in the 15 – 19 year old age group, the Report states, have “borne the brunt of the recession and tightening of the job market”. Unemployment for this group rose from 14.3% in December 2006, to 24.2% in December 2011.
It is also this group targetted by National’s harsh “welfare reforms”, which attempts to blame young people as “work shy” – a ‘double whammy’ from the Global Financial Crisis and a right wing government keen to shift blame for rising unemployment onto powerless victims of the Recession.
4. The numbers of welfare recipients receiving the Domestic Purposes Benefit has also been affected by the Global Financial Crisis and resultant Great Recession. DPB recipients dropped from a peak of approximately 111,000 in late 2003, to 96,000 in mid 2008. Since 2008, and as redundancies increased; unemployment rose; and jobs disappeared, the number reversed. DPB recipients skyrocketed to an all time record of 114,230 benefits by December 2011.
Far from being “bene bludgers” opting for the DPB as a “lifestyle choice” (which is constantly parrotted by ill-informed conservatives and low information voters), solo-parents are as vulnerable to recessionary forces as other workers.
5. In the year to December 2011, average weekly earnings rose a only 2.6% from $991.05 to $1016.95. Taking annual inflation of 1.8% into account, weekly earnings rose by a fractional 0.8%. With increases in rent, fuel tax, and other government charges, that increase will have vanished altogether.
6. The Report gave as an example of unequal wage increases the difference between hourly earnings in the finance sector increasing by $1.01 per hour, from $36.63 per hour in June 2011 to $37.64 in December 2011.
By contrast, the average wage in the traditionally poorly paid accommodation sector increased by only 3 cents an hour from $16.40 to $16.43 per hour.This was a clear illustration of the average hourly earnings of the highest paid sector increasing 2.3 times more than those for lower paid workers.
7. Most of the increase in State benefit payments over the past five years was made as higher spending on New Zealand Superannuation (43% of the increase) and Working for Families (37% of the increase). Approximately 568,000 people were receiving superannuation by June 2011.
This compared to 319,000 of other welfare recipents as at December 2011 – up from 264,500 from December 2006. Welfare numbers were dependent on the economy and increased only because of the impact by the GFC-caused Recession.
8. Food parcels issued to families and people in need doubled from 24,250 in 2006, to 53,360 in 2011. Again, this was in accordance with the advent of the GFC in 2007/08; skyrocketting unemployment; and a lack of job-creation policies by National, once it won the election in late 2008. (John Key admitted to this on 18 October 2011. See: Key admits underclass still growing)
9. Inflation of living costs for 2011 was fractionally higher for Low-Income Household CPI at 2.1% than it was for the All Groups CPIs, at 1.8%. Low-Income Households were more vulnerable to increasing costs such as rent, government charges, and gst increases.
10. The Report correctly predicted that levels of unemployment would rise during 2012, and would negatively impact on growth in wages and salaries of poorest paid workers.
For a full understanding the the Report, it is recommended that people read the document in it’s entirety, as I have abridged and condensed much of the information contained therein.
The Report reinforces anecdotal evidence, facts, and stats, that are already in wide circulation and confirms that jobs, incomes, and those receiving social welfare assistance are all affected by the global downturn over the last four to five years.
After all, John Key uses that very excuse to explain away National’s poor economic performance,
“We did inherit a pretty bad situation with the global financial crisis... ” – John Key, 11 Sept 2011
See: View from the top
Ministry of Social Development: The widening gap: perceptions of poverty and income inequalities and implications for health and social outcomes
In New Zealand, income inequalities have increased since the neo-liberal reforms and benefit cuts of the late 1980s and 1990s, although the rate has slowed this decade (Blakely et al. 2007, Ministry of Social Development 2006, Ministry of Social Development 2007). The New Zealand Living Standards 2004 report showed a million New Zealanders living in some degree of hardship, with a quarter of these in severe hardship. Despite the buoyant economy and falls in unemployment levels, not only was there a slight increase in the overall percentage of those living in poverty between 2000 and 2004, but those with the most restricted living standards had slipped deeper into poverty (poverty defined as exclusion from the minimum acceptable way of life in one’s own society because of inadequate resources) (Ministry of Social Development 2006, 2007).
[…]
This greater income inequality has seen New Zealand move into 18th place out of 25 in the OECD in terms of income inequality from 1982 to 2004 (Ministry of Social Development 2007). Over the preceding two decades New Zealand experienced the largest growth in inequalities in the OECD (2000 figures), moving from two Gini coefficient points below the OECD average to three Gini points above (Ministry of Social Development 2007:45-46). One indication of the impact of these inequalities has been that relative poverty rates, including child poverty rates, have increased.
OECD: Growing Income Inequality in OECD Countries: What Drives it and How Can Policy Tackle it ?
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Over the two decades to the onset of the global economic crisis, real disposable household incomes increased in all OECD countries, by 1.7% a year, on average. In a large majority of OECD countries, household incomes of the top 10% grew faster than those of the poorest 10%, leading to widening income inequality. Differences in the pace of income growth across household groups were particularly pronounced in some of the English-speaking countries, some of the Nordic countries and Israel. In Israel and Japan, real incomes of people at the bottom of the income ladder actually have fallen since the mid-1980s.
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At present, across OECD countries, the average income of the richest 10% of the population is about nine times that of the poorest 10%. While this ratio is much lower in the Nordic countries and in many continental European countries, it rises to around 14 to 1 in Israel, Turkey and the United States, to a high of 27 to 1 in Chile and Mexico. The Gini coefficient, a standard measure of income inequality that ranges from zero (when everybody has identical incomes) to 1 (when all income goes to only one person), stood at 0.28 in the mid-1980s on average in OECD countries; by the late 2000s, it had increased by some 10%, to 0.31. On this measure, income inequality increased in 17 out of the 22 OECD countries for which data are available (Figure 1, left-hand panel). In Finland, Germany, Israel, New Zealand, Sweden and the United States, the Gini coefficient increased by more than 4 percentage points: and only five countries recorded drops, albeit small ones .
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[See also Addendum 2 below.]
So it’s official – the Great Experiment in free market reforms from the mid 1980s to the late 2000s, has produced growing inequality here in New Zealand. Indeed, the trend has been global,
Income inequality followed different patterns across OECD countries and there are signs that levels may be converging at a common and higher average. Inequality first began to rise in the late 1970s and early 1980s in some Anglophone countries, notably in the United Kingdom and the United States, followed by a more widespread increase from the late 1980s on. The most recent trends show a widening gap between poor and rich in some of the already high-inequality countries, such as Israel and the United States. But countries such as Denmark, Germany and Sweden, which have traditionally had low inequality, are no longer spared from the rising inequality trend: in fact, inequality grew more in these three countries than anywhere else during the past decade. However, some countries recorded declining income inequality recently, often from high levels (Chile, Mexico and Turkey).
It is no coincidence that the trends “first began to rise in the late 1970s and early 1980s in some Anglophone countries, notably in the United Kingdom and the United States” – that is the precise period when Margaret Thatcher won office in May 1979 and Ronald Reagan became US president in January 1981.
Our turn came three years later with the Lange/Douglas government that ushered in “Rogernomnics“.
The OECD report above is simply being ‘coy’ by not connecting-the-dots.
What is more telling? Any person reading this would not be surprised. We have become innured to an unfair economic system which produces unequal outcomes and great disparities in incomes and wealth. As the OECD report states with alarmingly candour,
Increases in household income inequality have been largely driven by changes in the distribution of wages and salaries which account for 75% of household incomes of working-age adults. With very few exceptions (France, Japan and Spain), wages of the 10% best-paid workers have risen relative to those of the 10% least-paid workers. This was due both to growing earnings’ shares at the top and declining shares at the bottom, but top earners saw their incomes rising particularly sharply (Atkinson, 2009). The highest 10% of earners have been leaving the middle earners behind more rapidly than the lowest earners have been drifting away from the middle.
Furthermore, as the OECD report points out, “…more working hours were lost among low-wage than among high-wage earners, again contributing to increasing earnings inequality“.
The OECD report is backed up by Statistics New Zealand,
As with total employment, the drop in full-time employment mainly reflected a decrease in male
full-time employment, which was down 12,000 (down 1.2 percent).
Usual hours worked decreased 0.4 percent – down to 79.6 million hours over the quarter. The
changes in full and part-time employment reflect the fall in the number of hours people usually
work during a week. Over the quarter, the number of hours people actually worked decreased
0.8 percent, down to 73.2 million hours.
See: Household Labour Force Survey: September 2012 quarter
Ministry of Social Development – Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011
Whilst New Zealand has no formal or official measure of poverty or material hardship/deprivation, there are studies and conclusions leading to reports that offer a disquieting insight into the state of income inequality, poverty, and child poverty in our country.
One such report was conducted by Bryan Perry for the Ministry of Social Development in August 2012, entitled the “Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011” – a 195 page study.
The full report is available here: MSD – Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011
A much-condensed precis of the Report;
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2012 MSD Household Incomes Report – ‘Summary’
- Household incomes BHC (before deducting housing costs) rose in real terms for all income groups from 2007 to 2009, continuing the steady growth that began in 1994,
- Income inequality increased significantly between 1988 to 2004, then fell from 2004 to 2007 as a result of the WFF package, and was still around the same level in 2009 as in 2007,
- Income inequality grew very rapidly from 1988 to 1992, followed by a slower but steady rise through to 2004,
- From 2004 to 2007 inequality fell mainly as a result of the WFF package,
- Median Household incomes fell 3% in real terms after little change (+1%) from HES 2009 to HES 2010,
- This fall followed a long and strong rise in the median from the mid 1990s to 2008-09 averaging 3% pa in real terms. GDP per capita increased at 2.5% pa over this period on averagwe,
- Incomes fell for deciles 3-6, but rose for the top decile especially,
- At the very bottom (P15 down), incomes were flat from HES 2010 to HES 2011 (protected by benefit rates being CPI adjusted and NZS being wage related),
- Inequality decreased significantly from HES 2009 to HES 2010 then rose from HES 2010 to HES 2011 to its highest level ever. This volatility reflects the impact of the GFC,
- On the AHC (HouseHold income after deducting housing costs) moving line measure, the child poverty rate increased from 2007 (22%) to 2009 (25%), reflecting the rise in the proportion of households with children with high ‘outgoings-to-income’ (OTIs),
- The 2009 child poverty rate is almost double the rate that prevailed in the early 1980s,
- In 2009, on the Social Report measure (AHC ‘fixed line’ 60%), there were 230,000 children (22%) below the low-income threshold (ie ‘in poverty’), down from 380,000 (37%) in 2001,
- Hardship rates for children rose from 15% in the 2007 HES to 21% in HES 2011 using the ELSI measure. In part, this reflects the falling incomes of those in deciles 3-6, some of whom may already have been in a precarious financial position – the loss of income has been enough to tip them into hardship even though their incomes are still above the poverty threshold,
- Chronic poverty (as defined in the Incomes Report) is about having an average household income over seven years that is below the poverty threshold over those years. Looking at children in poverty in a HES survey (cross-sectional), 60% of them are in chronic poverty in any survey and 40% in temporary poverty. In addition there are others who are in chronic poverty but not in current poverty in that one year – this group is about 20% of the number in current poverty.
- In 2009, between 460,000 and 780,000 people were in households with incomes below the low-income thresholds (ie ‘in poverty’),
- In 2009, on the Social Report measure (AHC ‘fixed line’ 60%), there were 650,000 (15%) below the low-income threshold (ie ‘in poverty’, down from 930,000 (25%) in 2001,
- In 2009, just over one in three poor children were from households where at least one adult was in full-time employment, down from around one in two before Working for Families (2004),
- Income poverty rates for single person working-age households trebled from the 1980s to 2007 (10% to 30%) and were 35% in 2011. One in 9 poor people and 1 in 4 poor households are from this group. The rates are higher for the older group living on their own (45-64 years) than for the younger group,
- In 2001, 42% of households in the lowest income quintile had high ‘outgoings-to-income’, but this fell to 34% by 2004 reflecting the introduction of income-related rents, and has remained steady since then (33% in 2009),
- In 2009, 37% of children lived in households with high ‘outgoings-to-income’, a rise from 32% in 2007, and 26% in 2004 – the 2004 figure was the lowest proportion for some time, following the introduction of income-related rents in 2001 (when the proportion with high ‘outgoings-to-income’ was 32%),
- In 2009, on the Social Report measure (AHC ‘fixed line’ 60%), there were 650,000 (15%) below the low-income threshold (ie ‘in poverty’, down from 930,000 (25%) in 2001,
- The child poverty rate increased from 2007 (22%) to 2009 (25%), reflecting the rise in the proportion of households with children with high ‘outgoings-to-income’,
- The 2009 child poverty rate is almost double the rate that prevailed in the early 1980s,
- Just over two of every three two parent families were dual earner families in 2009, up from one in two in the early 1980s, but down from nearly three in four in 2004,
- Children in sole parent families have a higher risk of hardship (46%) than those in two parent families (14%). This reflects the relatively low full-time employment rate for sole parents (35% in 2009) – 73% of sole parents were in receipt of a main benefit in 2009,
- The value of New Zealand Superannuation (NZS) fell further below the median household income from 2007 to 2009,
- People living in sole parent households are a relatively small subgroup, making up only 8% of the population. Only 3% of those in sole parent households are found in the top income quintile. On the other hand, a high proportion have incomes in the lower end of the income distribution.
- High housing costs relative to income are often associated with financial stress for low to middle income households. Low-income households especially can be left with insufficient income to meet other basic needs such as food, clothing, transport, medical care and education,
- For the bottom quintile, the proportion with high ‘outgoings-to-income’ reduced from 2001 to 2004 with the introduction of income related rents, then remained steady in 2007 and 2009 at the 2004 level.1 For all but the bottom quintile, the proportion with high housing costs rose strongly from 2004 to 2007. From 2007 to 2009, the situation for the second quintile continued to worsen, such that by 2009, each of the two lower quintiles had one in three households with high ‘outgoings-to-income’,
- From 2007 to 2009, median household incomes (BHC – HH income before deducting housing costs) rose by 4.3% pa in real terms (8.6% in total). This continues the steady growth in the median from the low point in 1994. The AHC (HH income after deducting housing costs) median rose less rapidly (3.2% pa), reflecting the relatively rapid rise in average accommodationcosts,
- The increasing dispersion of household incomes from the 1980s through to 2009 is clear. For the period as a whole, incomes for households above the median increased proportionately much more than did the incomes of households in the lower three deciles,
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In 2009 the incomes of the bottom 30% of the population were on average only a little better in real terms than those of their counterparts two decades earlier in 1988. On the other hand there were more substantial gains in the period for the top half of the distribution. The income distribution is therefore much more dispersed in 2009 than in 1988,
. - The most significant structural change to the income distribution over the two decades from 1984 to 2004 is a significant hollowing out of the middle parts of the distribution from $12,000 to $30,000 (equivalised) and a corresponding increase in the proportion of the population in higher income households. There was also a small increase in the proportion of the population in low-income households in this period. From 2004 to 2007, the impact of the Working for Families package in that period is very clear for low to middle income households.The income distribution was more dispersed in 2004 than in 1984. From 2004 to 2007 income inequality decreased.
- The significant change in shape of the income distribution from 2004 to 2007 reflects two main factors: (A) the impact of the WFF package on low to middle income households and (B) the reduction in the number of people in households whose main source of income is an income-tested benefit (100,000 fewer in 2007 than in 2004)
- As recently as 1996, the government of the time in New Zealand was openly disapproving of any poverty discourse. However, in 2002, in the context of the Agenda for Children, the government made a commitment to eliminate child poverty, and in the Speech from the Throne in November 2005, the Governor-General described the Working for Families package as “the biggest offensive on child poverty New Zealand has seen for decades”. The current National-led government, like the previous Labour-led government, espouses the principle that ‘paid work is the best way to reduce child poverty’. New Zealand does not however have an official poverty measure.
- The rise in moving line child poverty rates from 1990 to 1992 was driven by two factors: the rise in unemployment, and the 1991 benefit rate cuts which decreased real incomes for beneficiaries by a greater amount than the median fell in the period,
- From 1992 to 1998 the 60% of median moving line poverty rate for children fell as unemployment rates fell and incomes for those around the poverty line rose more quickly than the median in the period,
- From 1998 the median continued to grow in real terms, but the incomes of many low-income households with children remained fairly static through to 2004. This meant that the moving line child poverty rate rose to 2004, indicating that low-income households with children were on average further from the median in 2004 than in 1998,
- On the After Housing Costs (AHC) moving line measure, the child poverty rate increased from 2007 (22%) to 2009 (25%), reflecting the rise in the proportion of HouseHolds with children with high OTIs (‘outgoings-to-income’ ratio),
- From 2004 to 2007, the poverty rate fell strongly … for the working poor than for the beneficiary poor. There were no further policy changes to housing assistance from 2007 to 2009 – the maximum rates of assistance remained fixed and did not move in line with movements in housing costs, and net housing expenditure rose for low-income households with children. This is reflected in the rise in child poverty rates from 2007 to 2009 using the moving line AHC approach.
.(Report Note: when a household spends more than 30% of its income on accommodation it is said to have a high “OTI” – ‘outgoings-to-income’ ratio)
The above is a heavily condensed version of Bryan Perry’s report. For a full report, please refer to: Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011
It is fairly clear that income inequality is not only still prevalent – but increasing. The ‘Gini’ does not lie – and the Inequality Factor has risen from 30.2 to 33.5 (the higher the figure, the more inequality).
Child poverty is still with us, and remains New Zealand’s most critical problem (I refuse to call it an “issue”).
Despite John Key’s fine words and stirring rhetoric, National has failed to change it’s core “values” and adheres to a dogmatic faith in the Market to deliver solutions to poverty in our country.
Yet, John Key should know precisely what needs to be done. As he told the nation five years ago,
“My father died when I was young. My mother was, for a time, on the Widow’s Benefit, and also worked as a cleaner. But the State ensured that I had a roof over my head and money for my mother to put food on the table. It also gave me the opportunity to have a good education. My mother made sure I took that opportunity, and the rest was up to me.” – John Key, 30 Jan 2007
See: The Kiwi Way: A Fair Go For All
The State invested heavily in Mr Key – as it did with many other people prior to the Rogernomics roll-backs of the late 1980s – and New Zealand benefitted accordingly from that social investment.
The social welfare system is designed as a safety net for citizens in time of need. Whether through job losses or injury or raising children single-handed, our society – through the State – demands that no one suffers. (Never mind the deranged ravings of the ill-informed on talkback radio.)
However, there is another role for our welfare society; to guarantee that the young from impoverished and vulnerable families are accorded the same opportunities that other, luckier parents can provide for their own children.
This is a country of plenty. There is no reason why we cannot eradicate poverty; poor housing; disease; lack of adequate, nourishing food for all children; and low schooling/training outcomes.
The only reasons that this blogger can see for the perpetuation of poverty is a double curse on our country, namely,
- An irrational prejudice against the poor
- A debilitating lack of will
Until we resolve both of these collective “disabilities” to our vision for a better society, we will continue to reap the rotten fruits of our inaction.
On 28 November 2006, John Key said,
“You can measure a society by how it looks after its most vunerable, once I was one of them. I will never turn my back on that.”
I see no evidence of that.
Indeed, six years later, Key admitted that the underclass he spoke of has not diminished,
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Addendum 1
It is interesting and worthwhile to compare the rhetoric of John Key’s speech, A Fresh Start for New Zealand, with the data contained in the Salvation Army report, “The Growing Divide“. Both are worth reading. It rapidly becomes clear how Key cynically mis-represented facts to suit his Party’s election agenda.
Addendum 2
It is worth noting that the GINI Coefficient – which is one method by which to measure income inequality – shows interesting figures for New Zealand,
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Source: OECD Income distribution – Inequality (GINI co-efficient)
A high GINI factor (close to 1 or 100, expressed as a percentage) indicates maximum inequality. A figure at zero indicates absolute income equality.
New Zealand’s GINI Coefficient rose (income became more unequal) from the mid-1980s to around 2000. At the mid-2000s, the GINI Coefficient began to reduce – indicating incomes are becoming less unequal. (Though has not addressed growing poverty in this country.)
What factor intervened in the mid-2000s to stem the rising inequality of incomes?
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The same policy introduced by the preceding Labour Government, which Dear Leader, John Key, once described as “communism by stealth” (see: National accuses Government of communism by stealth) – but by 2008 had decided that he liked “Working for Families” after all (see: National to keep Working for Families unchanged).
After 2010, the GINI coefficient begins to rise again, as effects from our stagnating economy and National’s policies begin to over-take the positive income-redistribution aspects of ‘Working for Families’.
Income inequality in New Zealand is once again on the rise,
Gini scores (x100) for market and disposable household income, 1986 to 2011 (18-64 yrs)
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HES year
Before taxes and transfers (market income)
After taxes and transfers (disposable income)
Reduction (%)
1986
36.4
26.4
27
1991
42.4
31.3
26
1996
43.1
32.9
24
2001
43.1
33.1
23
2004
41.7
32.9
21
2009
40.3
32.3
20
2010
38.3
30.2
21
2011
42.2
33.5
21
Source: MSD – Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2011
Additional
Dominion Post: Children need changes now – commissioner
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=fs =
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