Monday, April 14, 2014

Is Mana advocating cuts to benefits and Super?

Mana candidate John Minto is advocating a universal basic income. To be expected after Gareth Morgan talked to the weekend conference about exactly that. But Morgan's proposal, detailed extensively in The Big Kahuna, sets the tax free income at $11,000 per annum to replace all benefits and Super. Minto also mentioned doing away with WINZ. But $11,000 is well under the rate of Super and vastly under what a sole parent receives.

Morgan acknowledges this:

He openly admits it would also slash the incomes of superannuitants and halve average payments of the Domestic Purposes Benefit. Many pensioners would gradually lose ownership of their homes to pay the capital tax, which could depress the value of all our houses (Morgan sees this as a good thing as it would help young people to buy). Many solo parents on benefits would have to either move into cheaper housing or share with other adults to make ends meet...Solo parents on the DPB, who currently get about $20,000 to $30,000 a year depending on allowances and the number of children, would lose out badly. Morgan argues the state cannot afford to support a single person as if he or she was a two-parent household...Morgan is forthright about cutting payments to superannuitants - "they get too bloody much anyway" - despite huge political backlashes against previous governments who have dared to tamper with the pension scheme.
There are attractive aspects of a UBI eg it incentivises work by getting rid of high effective marginal tax rates.
But it penalises the rich and the poor alike.

A number of classical liberal thinkers have proposed it in the past eg Milton Friedman and more recently Charles Murray, so I try to stay open-minded about it. I recall even (some members of the) Libertarianz Party had a crack at advocating it. But I struggle to see how it fits with their overall principles given forcible transfer of wealth continues.

It seems to me that the UBI is an attempt to improve the complicated, contradictory and corrosive system social security has become. But it continues the subjugation of the individual to the state.

In a way if Mana adopt Morgan's proposal I will respect them for it.  Because they will be telling the poor, their constituency, that in the immediate future they will be worse off, but their ability to improve their lot through their own efforts will be much improved.


This line wasn't reported in the audio I heard.
Mr Minto says it would need to be more than that, although the costings haven’t been worked out.
Thought so.

Just to give you a rough idea of costing if Mana pushed it up to $15,000 (x 3 million people assuming age 18 plus) that's twice MSD's budget.

1 comment:

Anonymous said...

Immediate cuts and raising the age of super are do manifestly sensible policies in surprised any party stands against it. Anyone aged under 50 planning on receiving any super deserves to starve in the gutter.

And no, Minto gives UBI to children (and probably to pregnant solo mothers too) but that doesn't mean 4 million people get it - there'd be marginal tax rates of around 60% above the average wage, 90% rich prick rate at $100k, estates taxed at the top marginal rate and a 5% wealth tax including the family home.