The Future of Welfare in an Ethnically Changing Population

 Asians will make-up a third of New Zealand's population by 2048.

(View interactive image here)

For those worried about one in eight working-age New Zealanders currently relying on a benefit, this is good news.

That's because Asians are heavily under-represented amongst beneficiaries.

While making up around 20 percent of the population they only account for 5 percent of people dependent on benefits.

The news gets even better. Of that 5 percent, two thirds are receiving an unemployment benefit. This is the benefit people rely on for the shortest period and current numbers will abate quickly  when (if) unemployment falls. There are only 2,817 Asian single parents (June 2025) compared to 38,556 Maori.

Of course, 2048 is a generation away and Asian behaviours will undoubtedly change over the next couple of decades. How much is anyone's guess. I am not sufficiently familiar with various Asian cultures to make predictions.

But Asians - Indians in particular - are going to immerse themselves in the political life of New Zealand. In Lower Hutt we have an Indian female running for mayor and the evidence of Indian cultural and commercial activity is everywhere. I like the cut of her jib and she has my vote.

Can we expect that as Asian values become more prevalent we will see less tolerance for people who make benefit dependency a lifelong habit?

I hope so.

Data sources:

https://www.stats.govt.nz/news/asian-ethnic-population-projected-to-increase/

https://www.msd.govt.nz/about-msd-and-our-work/publications-resources/statistics/benefit/index.html

The other side of the story

 The Latu family first appeared at RNZ pleading poverty. Their household consists of mum, dad, eight children and two relatives.

They have now reappeared in the NZ Herald. You can read the details at those two links.

What frustrates is that the two reporters who have written up the Latu family's plight have seemingly asked no questions about how much income the family actually receives and how they budget it.

Mr Latu cannot work due to a knee injury and neither does his wife.

A couple on welfare with two or more children receives on average $1,244 net per week. Here is a chart from the 2024 Total Incomes Report issued by MSD:

The green portion - tax credits - refers to what is paid for the children. In the chart above, the average for two or more children is $397. But because there are eight Latu children that sum would rise to $967 weekly. According to MSD the first child receives $144.30 weekly and each subsequent child $117.56. You can do the maths.

So the Latu family's weekly income is now in the territory of $1814. The children each receive a further $50 monthly from the charity Variety through sponsorship, effectively adding another $100 onto the family's weekly income.

The chart above does not include the Winter Energy Payment which is $31.82 a week.

If you are following the calculation, the sum has reached $1,946 weekly during the winter months. Or $101,192 annually. After tax.

Additionally there are two relatives living with the family who will also bring in income but one can only speculate about what that is. 

What can be safely stated is this. In New Zealand in 2025 the 'poverty' threshold is very high.

Now obviously I do not know what the family's outgoings are; whether they live in a state house and pay income-related rent, in a subsidised private rental or pay a subsidised mortgage. They may have high-interest debts; they might tithe to their church.

All we get with these types of mainstream media reports is emoting over unfair hardship and helplessness. One might wonder how much of the story was written by the charity and how much the journalist contributed.

In fact the redistribution of wealth into these families is substantial, by some people's standards, possibly eye-watering.

After nearly ninety years of social security it would be reasonable to conclude that the state cannot solve 'poverty'. Indeed, the more the state does, the more the state is expected to do.

Judge undermines government intent

The National coalition government banned the wearing of gang patches in public places in November 2024.

The legislation states:

If a person pleads guilty to, or is convicted of, an offence against subsection (1), the gang insignia concerned—
(a) is forfeited to the Crown; and
(b) may be destroyed or otherwise disposed of as the court, either at the time of the conviction for the offence or on a subsequent application, directs.

In what appears to be a first, District court judge Lance Rowe has decided to return a patch to its convicted wearer.

He came to the decision using the concept of tikanga or kinship. The court reporter detailing this decision says it "may yet be appealed by the police." 

I don't want to argue either way for the ban on gang patches in public places. But yet again, we are seeing a court thwart the government's position.

Police Minister Mark Mitchell is emphatic: “Our message to the gangs is clear - the days of behaving like you are above the law are over.”

Are they?

About submissions from the gang member in question, the judge wrote they "could be recognisable in tikanga terms as consistent with expressions of mana and whanaungatanga."

As we know, these concepts can be quite elastic. Whatever they mean - or are purported to mean - in this case they put the rights of the offender first. In this case they have been used as devices to allow an offender to thumb his nose and avoid the consequences. His patch is very precious to him apparently  but on at least two occasions (another caught on CCTV camera) he transgressed the legal ban and risked losing it. He thought he'd get away with it. And he has.

In this judge's application of the law, the very clear message the ban is meant to send, has been muddied and weakened.

The gang patch ban aside, there are two big issues here:  the increasing admittance of Maori concepts in New Zealand's system of law, and secondly, their utilisation to counter government intent. 

The message that sends is to expect more ambiguity and confusion, and less transparency and certainty for anyone involved in the justice system. And if you don't like it,  don't expect your vote to make any difference.

Why I disagree with Helen Clark

According to the NZ Herald this morning:

"Former Prime Minister Helen Clark has described the departure of former Prime Minister Jacinda Ardern from politics as “devastating for women around the world”."

Not this one.

But then very little devastates me beyond the loss of a loved person or pet. Or dwelling on the suffering of some New Zealand babies born into dysfunctional dumps.

Clark's comments relate to the abuse that women politicians have to endure and how they must stick together and build networks to protect themselves.

When I had a brief fling with political advocacy, and later campaigning for ACT in 2005 and 2008, not many women wanted to stick together with me. In fact I was labelled as a misogynist for attacking the DPB. I'd get interrupted by hostile female audience members and derided over factual research. Marilyn Waring heckled me for citing the work of Australian professor Bob Gregory showing how long single mothers would spend reliant on welfare over the course of their lives. "You're including women on Super!" she yelled out causing much laughter and snickering. She was wrong.

When I asked to be included as a speaker at a feminist-organised meeting to counter my activity, I was barred. 

My mail box would constantly fill up with letters using language intended to shut me up. Not all, but most, were from women.

Now I am not complaining about this. You take it on the chin. But don't tell me that woman can't be just as threatening as men. They just use different methods.

The problem is feminine tribalism precludes dispassionate discourse. I believe that on balance the DPB has been - and continues to be - bad for children. Feminists believe the DPB is a non-negotiable right for women. Period.

I took a petition out to gather signatures calling for reform, and women would say that they actually agreed with me BUT  felt guilty signing my petition because they had  a friend or female relative dependent on the DPB.  That's what tribalism does. Induces emotional guilt in anyone with a non-tribal impulse. Emotional guilt overrides a rational response.

By saying, "women in politics need to develop strong networks to withstand abusive sexism," and not including male politicians in her concerns, Clark strongly implies men are the problem.

I'm sure some of them are. Just as I am sure some women can also be highly effective bullies. 

Whether tribalism is along gender or ethnic lines it discourages, if not extinguishes, freedom of thought and speech. 

Threats and coercion are what we actually need to combat. Together. As like-minded individuals.

Unemployment - Digging beneath the headline rate

The unemployment rate rose in the June quarter to 5.2 percent. For those who are interested, here's some finer detail behind the headline statistic.

While the media has latched on to the idea that the elderly are discriminated against in the workforce the stats don't support it. The highest unemployment rates are amongst the young: 15-19 year-olds at 23% and 20-24 year-olds at 9.8% . Thereafter, as the age-bands increase, the unemployment rates fall significantly with most numbers starting with a 3 and the lowest - 2.9% - belonging to the 55-59 year-olds. It'd be fair to state that the older you are, the less likely you are to be unemployed. It is only after age 60 that an increase in those 'not in the labour force' is marked, indicating around 30,000 individuals choosing early retirement. Whether that is voluntary or involuntary is unknown. But the unemployment rate for 60-64 year-olds is just 3.2%. Past the age of sixty five, 217,500 individuals continued to work, an increase on June 2024 of 7,800. Because most people leave the labour force after 65, that age group's unemployment rate is the lowest at just 1.6 percent.

So it is the very young who are bearing the brunt of unemployment.

In terms of ethnicity, Pacific people have the highest unemployment rate at 12.1 percent followed by Maori (10%); Middle Eastern and Latin American and African (6.5%); Asian (5.2%) and European (3.8%). This pattern has held over decades. The lower skilled and educated feature more heavily among the unemployed.

The fact that Auckland's unemployment rate was high at last got some attention. I have written previously about Wellington doing a lot of whinging when their numbers aren't the worst. Auckland's unemployment rate is 6.1% - up from 4.6% a year ago. Wellington's rate is 4.1% - down from 4.3% a year ago. As usual, the further south the region is, the lower the unemployment rate. Otago has the lowest rate at 3%.

Which sectors are faring the best? With respect to numbers of people employed, the following sectors gained over the year: electricity,  gas, water and waste; wholesale trade; financial and insurance services; rental, hiring and real estate services; and education and training. Many of us won't be surprised to see electricity, gas, and insurance featuring among the 'healthier' sectors.

There's been a bit of media-murmuring over the NEET rate (Not in Employment, Education or Training) but it's actually fairly steady for 15–24-year-olds moving from 12 to 12.2% June on June. There was a very big jump in 15-19 year-olds in education between March and June this year rising by 23,400 (which helps explain why the education and training sector is adding jobs.) Hopefully this will play out as a good news story in time.

Internationally New Zealand now sits 18th out of 38 OECD countries - just above the average unemployment rate of 4.9%. The English-speaking countries we often compare ourselves to have the following rates: Australia and the United States (4.2%); the United Kingdom (4.5%) and Canada (6.9%).

Finally, females are slightly more likely to be unemployed with a rate of 5.5% versus males at 5%.

All in all, the usual patterns are evident with respect to age, ethnicity and gender. The numbers don't necessarily support the narratives pushed by the likes of RNZ and Stuff who appear intent on winding up anger against the current government.

All of the above data comes from the HLFS (Household Labour Force Survey) for June 2025.

In a diversion I will make a final comment about how closely related those numbers are to benefit stats. Not very.

The HLFS has 158,000 people unemployed whereas 216,000 are on the Jobseeker benefit. Some of the difference occurs because some on Jobseeker are partially employed. Some of the difference occurs because not all Jobseeker beneficiaries are necessarily in the labour force (available for work). They might be temporarily too ill to work.

The total number of working age people on benefits though is 406,128 or 12.5 percent of the 18-64 year-old population.  The balance is mainly on  Sole Parent Support, or on what's now called a Supported Living Payment due to permanent incapacitation.

If the usual trends occur, in time the unemployment rate will abate and those who have been on welfare short-term will return to the workforce. But the ongoing underlying dependency will persist as the headline numbers drop and politicians think the job is done.

Study results baffle researchers

Fascinating news out of the US this week. The prevailing ideology - mirrored in NZ - is that poverty in and of itself harms children's development. That's the thesis behind welfare for poor mothers and more specifically, Ardern's impetus for her Best Start payments.

The US is a far more sensible country than NZ. It actually tests theories. Try to do this kind of research in NZ and academic ethics committees would be all over it like a rash. It'd never happen.

The National Bureau of Economic Research published the combined efforts of private and public institutes which conducted the following study:

"Between May 2018 and June 2019, 1,000 mothers were recruited shortly after giving birth in 12 postpartum wards across 4 U.S. metropolitan areas: New York, the greater Omaha Metropolitan area, New Orleans, and Minneapolis/St. Paul."

400 of the mothers were given $333 monthly unconditional cash; the other 600, just $20. The mothers needed to be below the federal poverty line to qualify. The cash was initially promised for 40 months and has been extended to 76. 

" Forty-one percent of mothers self-identified as Hispanic, and 40% self-identified as non-Hispanic Black. Approximately 9% of the sample self-identified as White. On average, mothers were about 27 years old, had completed close to 12 years of schooling, and had between 1 and 2 older children at the time of the birth. Thirty-eight percent reported living with the biological father of the baby at the time of the birth."

The results reported are at 48 months - when the child turned four.

"The Baby’s First Years study tests whether monthly unconditional cash transfers to low income mothers beginning shortly after birth affect children’s development. This paper reports results after the first 4 years of the planned 6-year RCT [Randomized Controlled Trial], at a point when mothers in the high-cash gift group had received about $16,000 in cash gifts and mothers in the low-cash gift group had received less than $1,000. We found no evidence of group differences on preregistered primary (language, executive function, social-emotional development, composite of high-frequency brain activity) or secondary (visual processing/spatial perception, pre-literacy skills, diagnosis of developmental conditions) outcomes."

Holy heck.

Ensuing discussions in the paper include questions like: Was the payment high enough to affect child outcomes?  Is it too early to expect to see a positive result? Did the pandemic interfere with the results?

The authors add, "...the lack of impacts on age-4 child outcomes raises the possibility that income alone may not affect children’s early development."

The "possibility"??

A report about the study from the New York Times states:

"It has long been clear that children from affluent families exhibit stronger cognitive development and fewer behavioral problems, on average, than their low-income counterparts. The question is whether their advantage comes from money itself or from related forces like parental health and education, neighborhood influences or the likelihood of having two parents in the home." (my emphasis)

As someone who takes a particular interest in welfare, the paper frustrates in providing no data about the mother's dependency status (preventing any within-group analysis on my part). However, according to the aforementioned NY Times report:

"While opponents say income guarantees could erode the work ethic, mothers in the two groups showed no differences across four years in hours worked, wages earned or the likelihood of having jobs."

The NY Times writer must be privy to further undisclosed data because employment status does not feature in the primary paper. The test participants were not qualified by source of household income so it can only be assumed that they were a mix of employed and unemployed mothers.

Typically, proponents of welfare from the Left are raising objections to the results (aided by the paper's authors.) Even one of the lead researchers said, “I was very surprised — we were all very surprised [that] the money did not make a difference.”

Disappointed perhaps?

But this is science, and while scientific evidence inevitably develops and may change over time, right now the theory that unconditional cash improves child development amongst the poor has been dealt a significant blow.

Proof that National is Labour-lite

National governments are better economic managers BUT avoid the entrenched age-old problems that hold NZ back.

Welfare for sole mothers is one such problem.

In the six years between 2017 and 2023 there were five things Labour changed under PM Ardern and MSD Minister Sepuloni:

1/ Child support payments previously kept by Treasury to offset sole parent benefits were passed directly on to the custodial parent

2/ The penalty for not naming a liable parent (usually the father) was abolished

3/ The requirement to face work-testing one year after a subsequent child was added to an existing benefit was abolished

4/ Best Start - a substantial additional weekly payment for 0-2 year-olds - was introduced 

5/ After adjusting for inflation increased incomes for sole parents with two or more children by 48 percent

Not one of these policies has been reversed.

They all encourage single parenthood as a lifestyle. And National appears to be on board.

On the back of these changes the number of children dependent on a sole parent benefit has risen 37 percent from 117,471 to 160,653 (June 2017 and 2025 quarters). These numbers do not include those children older than 13 whose sole parent has been moved to a Jobseeker benefit.

The facts are that children of benefit-dependent sole mothers are far more likely to suffer abuse and neglect; educational under-achievement; ill health; poverty; transience and become known to Oranga Tamariki and Corrections. And perhaps most worryingly, to become state-dependent single parents themselves perpetuating the sorry cycle.

Armed with this knowledge, politicians should be designing policy that discourages females from becoming sole parents in the first place and, especially, from further adding to their families.

The last Labour government did the very opposite and National, it turns out, is no better.

PM's new line

The Prime Minister is back from his holiday and insists the economy has turned a corner.

But it's not showing in the unemployment data. June 2025 benefit data is just out (scroll down).

All benefits are up 6.6 percent on June 2024. Jobseeker is up 10 percent year on year.

Significantly, the rise in those people on a Jobseeker benefit due to a health or disability condition has increased by 15.4 percent. That points to a health system that is continuing to under-perform.

Talking to Heather du Plessis-Allan on NewstalkZB this morning Christopher Luxon said that his party is trying to pull NZ out of a recession worse than any since 1991 - he reiterated this minutes later saying the recession is the worst since the early 1990s and is worse than the GFC.

This is his new line. Watch out for it.

This is an adjustment - a new explanation - because the economy is not improving anywhere near as fast as he had hoped or it needs to.

At half-time National is struggling to make a real difference to voter's lives.

That's what the polls are saying.

New Zealand needs him to do better. Because another innings for Labour, with the Greens and Te Pati Maori, would be a disaster.

Source: https://www.msd.govt.nz/about-msd-and-our-work/publications-resources/statistics/monthly-reporting/