Thursday, October 15, 2009

Where or what would you cut?

Thinking about the previous post, this government needs some ideas about how to cut spending. Can we assist? Substantial amounts are needed so bear that in mind, and make sure you can cost it (roughly). Don't go all radical libertarian on me. Be realistic (yes, I know radical libertarian is realistic, but we live in an unreal world) and let's see how big a total we can build.

I'll kick it off with;

1/ Raise the Super qualifying age to 67 (66,000 pensions x $15,000 = $990 million)


Oswald Bastable said...

For starters- dump MMP and all the tag-along MP's that come with it!

libertyscott said...

No additional welfare for children born after going on welfare.

Time limit all NEW recipients of welfare benefits (except invalids and national superannuation) to 1 year. Review all others after another year.

No government funded broadband.

Abolish NZ On Air.

Freeze public sector wages. No inflation adjustment for any welfare benefits.

Berend de Boer said...

Abandon the Ministry of Consumer Affairs, Women Affairs, and whatever other affairs there are.

Abolish WWF.

Anonymous said...

Time limit on DPB and other welfare benefits.

homepaddock said...

Replace the word entitlement with benefit.

reform the benefit system so benefits go only to those in genuine need.

Close the Families Commission.

pdm said...

Wind back Working For Families - over say 5 years.

Repeal all of the `nanny state' laws off the previous 9 years.

Get rid of red tape hindering productivity.

Russell W said...

Sorry to intrude on this discussion.
Lindsay: Have you my new email?
Drop me a line as I've lost yours
Russell W

libertyscott said...

Berend, what does the World Wildlife Fund have to do with saving taxpayers money? :)

Sally said...

Reduce the number of politicians.

Stop putting funds into the United Nations.

brian_smaller said...

Instruct WINZ to stop calling people they give money to "clients" and replace with "Welfare recipient". Wouldn't save any money but may start to make a cultural change.

Anonymous said...

Stop journalists from talking about beneficaries "earning" x amount of money.

Get rid of apartied politics
Get rid of MMP.
Open ACC up to private insurance.
Abolish minimum wage.

Shane Pleasance said...

Where or what would I cut. Incumbent MP testicles. Seem to have no use for them.

brian_smaller said...

I would also drop the fiction that is "income tax" on benefits. All it does is cost money and was only put their to make welfare recipients feel like they are contributing.

brian_smaller said...

Sorry for my misuse of 'their', when I meant 'there'. Typing too quickly for my own good.

Lucy said...

All those on a sickness or invalids benefit because of drugs or alcohol should have the time on a benefit limited to the time it takes to complete a drug and alcohol program.

Anonymous said...

No more free 20 hours early childhood education.

KG said...

All of the above.

Anonymous said...

Lucy some people are on drug and alcohol programs for life. I have been dishing out methadone to the same faces for 22 years. There is no time limit on the program and no evidence of improvement either. It just keeps failed nurses, and doctors in a job.

Anonymous said...

Food parcels or card technology that restricts to healthy food only instead of benefits. No chips, booze or smokes. I bet we'd see benefits as not such a popular lifestyle choice and quicker attrition.

Legalise dak and free all weed related prisoners. Apparently around 700 so you could close two prisons and save one billion dollars.
That's a lot of hip replacements.

Lucy said...

Exactly Anon and that is why if those with drug & alcohol problems should get three strikes and you are out.

In other words you have three chances to clean up you act before you are cut off for good.

Lindsay said...

"I have been dishing out methadone to the same faces for 22 years. There is no time limit on the program and no evidence of improvement either. It just keeps failed nurses, and doctors in a job."

Without stopping the methadone programme we cannot know what crime-reducing effect it has. I think that's the crunch. I recently asked a lot of OIA questions about the programme. Must do a blog post when I get around to it. In the final analysis, I am pro but there are some conditions I would like to see put on it.

sean14 said...

Goodbye Working for Families and Families Commission for a start.

Anonymous said...

Lindsay your quest has a life of its own and may be out of control!


Anonymous said...

So - this all all very interesting - absolutely no solution that would save anywhere near enough

In fact the only substantial suggestion in this thread of comments - cut WFF is effectively tax rise on the middle class Kiwi battlers with kids.
I can't think of a better way to ensure a Labour government for the next 10 years.

If you want to rise taxes, by far the most sensible option is to take GST up to 20%, have a flat income tax rate at say 30%, capped at 30,000. (i.e. income earned over 100,000 is tax free). So I suggest that, it would bring in a few more billions but more importantly reward the productive. That's a start.

NZ's budget goes basically 1/3 on health, 1/3 on education, 1/3 on welfare. If say you want to get government spending down from 65 Billion to say 40 Billion - that's only from 36% to 30% of the economy, a far cry from the 15% to 20% demanded by most commentators - they you're going to have to cut about 1/3rd of all government spending.

In otherwords: health, welfare, or education - either eliminate one entirely, or eliminate one third of each. For example: you could simply stop public education - allow schools, polys, unis etc to charge whatever fees they liked, but given them no public money. Because we're trying to reduce the defecit we cannot reduce any taxes at all: but now people have to pay our of their own pockets.

That is the scale of change that is required. Or, for example, you could stop all funding for tertiary education as above, but keep primary and secondary (and yes, 20 hours childcare, that doesn't cost very much at all - perhaps around 500 Mil). But then you'd have to fund similar cuts in health and welfare: say stopping the DPB, and stopping all healthcare to the over 65s. That would also do it.

Cutting salaries? Well yes salaries are a big expense - perhaps half to 2/3rds of all expenses in health and education. So another option would be cut all benefits by 1/3rd and simultaneous cut all state sector pay rates by 1/4 - everyone, all from doctors, teachers, government contractors, etc etc etc.

Be realistic (yes, I know radical libertarian is realistic, but we live in an unreal world) and let's see how big a total we can build.

Well the answer, which Key knows very well, is that without "radical libertarian" solutions you simply cannot build a big total. You just can't. (Or you can, as commentators here have suggested, by jacking up more "middle class" taxes).

Which leaves you with what he's doing: zero pay raises in the public sector for 5-10 years. Pay increases for benefits less than inflation. Winding back ACC etc. Capping places in tertiary education.
Double bunking the prisons. And hoping that compound affect of inflation will make quite big (10-15%) cuts over 5 years, so 20% over 10 years, which is significant - and that the economy recovers, that private sector wages and company profits increase, so that he'll have tax revenue to fill the gap.

But if you want to get government as a percentage of GBP down significantly, the only way you can do it is to push large amounts of health and education into the private sector, permanently.