Sunday, March 10, 2024

What media bias looks like

When news media took a pummeling last week at both TVNZ and TV3, a number of critics said part of the reason ratings are poor is the public don't trust them. The public believe that the media is biased.

The print media is similarly suspect. An article in Stuff today (which may feature in the Sunday Star Times) provides a great example of indiscriminate reporting. The headline reads:

Mum: Ex ‘hiding income to avoid child support’

It features a single mother of three complaining about her self-employed ex hiding his income to avoid child support.

    'Full-time single mum-of-three Janet says she is left struggling to get by because one of her children’s fathers is able to conceal how much he is earning ... "I am unable to work as I also have a disability my legs are swollen and I’m still recovering from recent hernia surgery." '

As an unemployed single mum she must be receiving a benefit but nowhere in the article is this spelt out. Her desire for income privacy does not extend to her ex's.

    'She said he was meant to pay just over $1100 a month between January and April but had only paid $473 in February. From May his support will drop to $623 a month.'

This is where it gets interesting. It was only August last year that the new child support pass-on rules kicked in. Prior to that IRD kept child support payments to offset the benefit cost.

It seems the mother has now become concerned about how much the father is earning as she stands to pocket more of it.

If the liable father is artificially reducing his declared income, perhaps this development is a factor? The business editor omits mention of this possibility. 

The mother has a younger son to a subsequent partner who she is not complaining about because he doesn't earn an income. He is on a benefit (which he may be staying on to avoid paying more than the minimum child support ... another unexplored angle.) 

She says the first father hasn't given his sons birthday or Xmas presents for 14 years. So she has raised them alone for some years. Only now, when she stands to receive the child support directly, has life turned into a terrible "struggle" with her children needing support from charity - this despite a benefit-dependent single mother with two or more children receiving on average of around a $1,000 weekly net.

Without proof, the report creates an impression that self-employed fathers are hiding income to avoid paying child support. This  despite the income difference between self-employed fathers with liabilities versus all taxpayers being just two percent.

The only sensible comment in the entire piece is from a tax partner at Deloittes who points out that self-employed fathers with child support liabilities may have lower incomes because they often share care of their children and work fewer hours.

This is a biased piece of journalism. It's uncritically sympathetic to the mother and accusatory of the father. Note the reporter does not say he was approached for comment.

Ultimately the piece raises far more questions than it answers. An attempt to answer the questions might have provided some balance.



Thursday, March 07, 2024

Is real change on the cards?

Sometimes the gems are buried. My ears pricked up when the following statement was reported on a news programme playing in the background:

"MSD staff assessing anyone applying for emergency housing will increase their scrutiny of whether they have unreasonably contributed to their immediate emergency housing need ..."

I googled Minister for Social Development Louise Upston's press releases to confirm that's what she actually said. Indeed she had.

If the government means it, this is hugely significant.

It has been clear for decades that NZ's approach to welfare has gone awry. The late Roger Kerr, of the NZ Business Roundtable, once said to me, "The only way forward is to go back to the concept of 'deserving' and 'undeserving'."

To be honest, at the time I thought this was slightly draconian. But the passage of the years has only brought me further around to his view. By protecting people from the consequences of their own foolish actions NZ has only created more 'need'. In other words, the 'undeserving' have been rewarded.

This is a direct offshoot from the philosophy of 'non-judgementalism' which is absolutely rife through the social services and charity sectors, and even health and education. It is formally taught. Every needy individual is a 'victim' of circumstances, never their own poor decision-making.

I am personally a great believer in second chances and the right to redeem oneself, and have certainly had occasion to avail myself of these principles (or lived with the consequences of not being forgiven or excused.) But like many pendulums, the one called 'tolerance' has swung too far.

The welfare system is now the lifeblood of criminals. People who trash other people's property, who threaten and abuse neighbours, who keep aggressive dogs as status symbols, who have not a skerrick of regard for others, turn up at WINZ demanding to be placed in emergency housing. And they are.

(Not to mention the tens of thousands of other people who took no responsibility for their own education, go on to produce children recklessly and, in turn, take no responsibility for theirs.)

Between the passage of the Social Security Act in 1938 and the early 1970s the percentage of working-age people on a benefit never exceeded two. Today it stands at almost twelve, with the time people stay dependent growing every year.

As a society we have created this level of reliance by believing and acting on a bad idea. That we must not judge others. We must not mention their faults and shortcomings. We must bend over backwards to not blame the person responsible for their own troubles. That's the kindness and compassion we are taught to aspire to.

Until Louise Upston said something quite contrary but actually terribly sensible.

In assessing applicants for emergency housing case managers must take into account whether they have "unreasonably contributed" to their need.

One assumes that if the answer is positive, there will be no emergency housing offered.

Quite right too.

My theory is that the emergency housing crisis - putting people into motels, lodges and motor camps - came about because the Labour government created an expectation that anyone who showed up at the newly-generous WINZ department asking for a house would get one (or something akin). If people had been turned away they would have found their own solutions. Living with friends or family usually. If friends and family wouldn't have them - presumably because they were undeserving - why should the taxpayer fork out to put them into place where they can wreak anti-social havoc on nearby neighbours?

It's the individual who should experience the consequences of their own unwise actions - not everybody else.

So let's support Upston and encourage her to take this new approach further. I would vouch that the majority of New Zealanders want to help people who, through no fault of their own, need a benefit and public housing. But that willingness does not extend to people who chronically cause their own misfortune.

Monday, February 26, 2024

Child poverty - complex or simple?

Question: Do you understand how the child poverty statistics are derived?

Clearly some people do not.

Last week the latest child poverty statistics were all over the media. But there are a number of misunderstandings that need addressing. Like this one from NewstalkZB’s John MacDonald who wrote:

"Living in households that get-by on less than half the median income, before basic living costs are taken into account. 

Now I’ve looked-up online to find out what the median income is in New Zealand and there seems to be all sorts of numbers available, but one figure I’ve seen is $91,400. So, let’s go with that one, for the purposes of today’s discussion. 

Half of that is $45,700. So, it’s kids living in households where less than $45k is coming in the door annually.  

With tax, that takes it down to about $38,000. Or about $730-a-week to live off."

But the median income Stats NZ produces isn’t actual – it’s equivalised. In the past I have attempted to explain how this process works, probably unsuccessfully. But now Stats NZ has helpfully produced a pictorial explaining the process:

 (Left click on image to enlarge.)

The first household becomes relatively rich compared to the third household. But in reality, their household incomes are identical.

Similarly RNZ demonstrated their misunderstanding reporting:

"One in six children (or 17.5 percent) lived in households with less than half of the median household disposable income after household costs - that was up 3 percentage points on last year."

In this case the median household income has been described as “disposable”. That’s wrong too.

The disposable income of a household is all income ‘earned’ by members aged 15 or older after taxes and transfers. Disposable income then undergoes equivalisation for the purposes of creating official child poverty statistics.

Teresa Tepenia-Ashton of Unicef said:

“It’s unacceptable for a single child to be in poverty in this country. With 1 in 8 children experiencing material hardship, we need Government to prioritise the interests of children in any decisions relating to welfare changes, so we can bring this number down to zero.”

A target of zero children in poverty is an impossibility because of the way poverty is measured. It is relative.  Zero poverty could only occur if every single household in NZ had the same equivalised income. It’s pure nonsense (similar to other ludicrous loony-tune ideas like Road to Zero 2030, Predator Free 2050 and Smoke Free Aotearoa 2025.)

There’s also been a great deal of handwringing over the higher poverty rates for Māori and Pasifika children.  But that is at least partly a facet of the equivalisation process. Pacific households in particular tend to be large, include children and are often inter-generational. It follows that their equivalised incomes will therefore be lower than households with fewer members.

The complexity inherent in the multiple measures of child poverty does nothing to instil confidence in their veracity. What the complexity does do is create a bias towards overstating poverty – a useful tool for proponents of greater wealth redistribution.

I tend towards a simple view. One which rarely rates a mention. The strongest correlate for child poverty is the rate of single parenthood. In New Zealand it is high. Among Māori it is very high.

Fixing that – an outcome largely in the hands of individuals – will go a long way towards reducing childhood hardship and deprivation.

 

 

 

 

 





Sunday, February 18, 2024

National needs to go further

In today's State of the Nation speech Christopher Luxon talked repeatedly about getting young people off welfare. It seems that National has devised a traffic light system which will use increasing levels of sanctions - welfare deductions - when beneficiaries fail to meet their obligations. He uses the word 'tough' a lot.

In his speech he made the following observation:

"Kids born this year will be turning 16 in 2040."

Well, because I can tell you something about them,  let's look at the children born in 2022 who will be turning 18 in 2040.

By the end of their birth year 12,639 of them were dependent on a benefit provided to their parent or parents. That's 21.5% of all babies born that year. Over one in five.

Then consider that the link between a child's early entry into the benefit system and later benefit dependence in their own right, is strong.

MSD's own commissioned research showed:

 - Nearly three quarters (74%) of all beneficiaries up to age 25 had a parent on benefit while they were a child, and just over a third (35%) had a parent on benefit throughout their teenage years.

 - The greater the family benefit history the longer the client tended to stay on a benefit, particularly for the Jobseeker benefit.1

It's laudable to talk about getting 18 year-olds off welfare. Better still though to discourage their entry into the welfare system in the first place.

The focus of reforms must be two-fold. Dealing with 40,000 young people on Jobseeker right now is critical. But so is looking to the future and turning off the tap that feeds inter-generational dependence.

Labour's soft-on-sole-parents approach has to go. That means ending the nonsense of not naming fathers and reintroducing work obligations for parents who add children to an existing benefit.

But more broadly, the cash-for-kids scheme has to stop. The assistance provided to unemployed parents who refuse jobs  should be through 'money management' - a system used for youth beneficiaries. The rules are:

    -your rent or board and things like your power bill and any debts will be paid straight from your payment. You won't get this money yourself.

    -you will get paid a weekly allowance of up to $50 into your personal bank account.

    -any money left over will be put onto your personal payment card. This is like a debit card that you can use to buy your food and groceries at approved stores.2

Until cash incentives that equal incomes from work are removed, the inter-generational problem will continue to plague New Zealand. Yes, there will be downsides to money management. But will they be any worse than the devastating social outcomes that come from unconditional welfare?


1/ https://www.msd.govt.nz/documents/about-msd-and-our-work/newsroom/media-releases/2015/taylor-fry-key-findings.pdf

2/ https://www.workandincome.govt.nz/on-a-benefit/payments/money-management-youth.html

Thursday, February 08, 2024

Labour hid developing welfare crisis

When National became government in 2008, Finance Minister Bill English's determination to understand the extent of benefit-dependency led them to commission Taylor Fry to produce annual actuarial reports. These were duly published at the MSD website every year but ceased when the government changed in 2017. Now however, an Official Information request by the NZ Herald has revealed that the reports actually continued - only their publication ceased.

In my columns I have referred repeatedly to the worsening depth of dependency using the sole measure available - one solitary statistic published in MSD's annual reports not typically subject to public scrutiny.

So while I am not shocked by the content of the latest Taylor Fry report, the detail is staggering.

According to The Herald:

    "... recipients of the main Jobseeker payment [are] now expected to spend an average of 13 years on a benefit."

    "Sole Parent Support clients are projected to spend an average of 17 working-age years on a benefit (up from 12.5 years in 2019), but the upper quartile of this group – about 18,700 people – are expected to spend more than 25 years in the system."

    "...about 2000 teens on the Youth Payment or Young Parent Payment [are] now expected to spend an average of 24 working-age years on a benefit – a 46 per cent increase from the 2019 estimate. About 500 of them are expected to be on income support for more than 38.5 years, almost the rest of their working lives."

Against a scenario of "record low unemployment" - which Labour leader Chris Hipkins campaigned vigorously on - these increases are unfathomable. Unless one weighs up the amount that benefit incomes have increased by over the same period. Unsurprisingly paying people more not to work means they stay on welfare longer. A child could figure that out.

That was compounded by a raft of actions which included diverting case managers away from an employment focus to checking beneficiaries were receiving their full and correct entitlements;  abolishing early work requirements for sole mothers who added a subsequent child to an existing benefit; temporarily suspending medical certificate requirements and the annual jobseeker reapplications; significantly reducing the use of sanctions to enforce work obligations; and generally fostering a sense of entitlement due to gender and race victimhood. 

In response to the discovery of the reports, former MSD minister Carmel Sepuloni says she did not recall being briefed on the research by officials.

She then had the utter gall to state:

    “What these trends show are an absolute need to create and maintain sustainable pathways to employment … National have talked a big game in opposition and now they need to show us their plan to get people into work.”

"These trends" are the direct result of bad policies implemented by Sepuloni who then kept their devastating impact hidden.

Though it shouldn't be Sepuloni primarily carrying the can. It was the Prime Minister, Jacinda Ardern who appointed Cindy Kiro to lead a bunch of leftist academics and activists to produce the most ill-advised welfare policy recommendations imaginable, many of which were implemented.

Ardern's unique brand of 'kindness' morphed quickly into cruel incompetence.

As Taylor Fry's analysis apparently suggests, people on benefits tend to have more precarious family, living and financial situations with worse life satisfaction and more contact with police and mental health services than they otherwise would.

Crucially, the longer people stay on welfare, the harder it is to get off.

Monday, February 05, 2024

A terrible trend in desperate need of turning

When did you last read a headline in MSM about more children being raised on welfare? Yet latest Ministry of Social Development benefit statistics (1) show at the end of 2023 the number reached a new high of 222,500.

I predicted this would happen when Jacinda Ardern became Prime Minister, making herself Minister for Child Poverty Reduction to boot. In a nutshell, I believed that her plan to increase benefit income would only draw more parents onto them. She began by introducing the Best Start Payment of $60 per week for newborns - her simplistic solution to income inequality being ever more state redistribution of wealth. This was followed by increases to basic benefit rates; removal of financial penalties for failure to name liable fathers; pass-on of child support and increased family tax credits.

In effect she decided to pay parents more not to work by further closing the gap between income from the state and income from employment. In fact, for a sole parent with a couple of children,  there is now no gap between income from a benefit (with all the add-ons like accommodation supplement and family tax credits) and an average paying job. By April last year the average benefit income for this family type was $1,057 weekly. (2)

So, even against a backdrop of low unemployment, it is no surprise that the number of children in benefit-dependent homes has risen. Why does it matter? If these children have been technically lifted out of poverty, isn't that a good thing?

For one, homes where no-one is employed lack routine and discipline. Who gets the kids up and ready for school?

Look at the stats (3&4) for Northland: lowest regular school attendance at just over a third (34.2%) and highest dependence on a single parent or jobseeker benefit (14.5% of working-age population). Christchurch has the highest regular attendance at almost a half (49.4%) and second lowest reliance on the same benefits (6.4%). Mere coincidence?

But the more insidious aspect of benefit-dependent homes is the lack of appreciation for education. Who needs to be literate and numerate when WINZ puts money in your bank every week       regardless? In the absence of teachers, this attitude is the main message being sent and received.

Yes, some people fall on hard times and need a period of financial help. But they are not seduced or sedated by benefits long-term. They pick themselves up and get back into the real world taking their children with them. New National MP James Meager (5) talks about watching his own solo Mum on a benefit, "...juggle three kids, part-time work, correspondence school..." She drove home the importance of education. She inspired her children. But the same MP also says, "Too many children in our country will grow up without that opportunity."

He is right. It is a statement of fact. Too many children will never experience living with a parent who works. The expected average future years on a benefit (6) measured from a point in time is now 13.6 - up from 10.7 when Ardern became Prime Minister. Another mere coincidence?



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

2/ https://www.msd.govt.nz/documents/about-msd-and-our-work/publications-resources/research/benefit-system/total-incomes-annual-report-2023.pdf

3/ https://www.educationcounts.govt.nz/__data/assets/pdf_file/0003/224715/Term-3-2023-Attendance-report.pdf

4/ https://www.msd.govt.nz/documents/about-msd-and-our-work/publications-resources/statistics/benefit/2023/benefit-fact-sheets-snapshot-december-2023.pdf

5/ https://www.parliament.nz/en/pb/hansard-debates/rhr/document/HansS_20231206_038580000/meager-james

6/ https://www.msd.govt.nz/documents/about-msd-and-our-work/publications-resources/corporate/annual-report/2023/msd-annual-report-2023.pdf

Wednesday, January 31, 2024

Nobody's Child

On the face of it I have some sympathy for Mr Singh who claims to have worked hard in prison to turn his life around and has passed drug tests since leaving there in September. But, due to violent neighbours, he has rejected a lodge where Work and Income placed him and is currently living in his car. His case manager has run out of patience and delivered some harsh words to Mr Singh, now seeking new accommodation, in a phone call Mr Singh recorded and gave to RNZ.

As I said, I have some sympathy for this character. But, if I can find it, why can't his immediate family?  If not a brother or father, he must be somebody's son. Why isn't a family member offering Mr Singh a bed? Mr Singh says he has family with whom he is "ready to reconnect". But to all intent's and purposes he is presently Nobody's Child, along with many thousands of other New Zealanders relying on complete strangers to provide them a liveable income and home.

This is the crux of New Zealand's heavy dependence on welfare. This is primarily why almost 12 percent of working age people rely on benefits.

What started from the reasonable idea that the elderly needed an income once unable to provide for themselves, has evolved into catch-all for familial indifference.

What do I mean?

Way back in the day families were ordered by the courts to take responsibility for members unable to take responsibility for themselves. The law was known as the Destitute Person's Act. Some  orders could involve quite distant connections. I doubt today many would be comfortable with being  ordered to take financial responsibility for a wayward nephew or alcoholic aunt. But on the flip side of the coin, why should complete strangers be expected to assume responsibility?

There must be a middle ground. And there was. For decades New Zealander's reliance on welfare benefits created by Micky Savage in 1938 never exceeded 2 percent of the working age population. But that middle ground relies heavily on a shared value of personal responsibility, a requisite we have strayed well away from. Personal responsibility means taking care of oneself and one's family, "...in sickness and in health." Granted, there are situations where this is simply not possible but they are exceptional.

Today many thousands are on welfare because they had a relationship break up. (Mr Singh's own problems began, he says, with that very occurrence.)

This immediately brings to mind benefit-dependent single mothers, yet many of the liable fathers are also unemployed and willing to stay that way as income from working only gets sucked up by child support. There are armies of young people who could be living in the family home but prefer to live 'independently' on Jobseeker and accommodation support. Even if a parent discourages this, the system does the opposite.

Some might argue that only the rich can afford personal responsibility. But the current obscenely-loose definition of 'need', and consequent array of unchecked benefits only keeps the poor poor. I would argue that any parent can earn enough through work to house and raise their child. In recent decades thousands have done, and continue to do so, proving my point.

If the country does not soon recapture a widespread commitment to personal responsibility, the collective financial burden - along with the many unwanted social consequences - will continue.

In the absence of any reason why a sense of personal responsibility would re-emerge, it will fall to government to make it happen. The only way to achieve this is to begin removing the crutches. No more sole parent benefit; time limits on the unemployment benefit and raising super eligibility to a realistic age would make for good starters.

Wednesday, January 24, 2024

The danger of the Treaty debate wearing us down

Screeds have been written about the Treaty of Waitangi. And there's more to come as division over race and rights ramps up.

Its content and meaning are getting lost in the crossfire and the danger of 'contestants' talking past each other looms, if not already happening.

When matters get murky, and misunderstandings abound, there is also a danger of observers getting worn down and disengaging. To avoid this happening personally, I made a mental list of what really aggravates me. In no particular order:

    1/ Maori spiritual and religious belief being embraced and promoted by a formerly secular public service.

    2/ A separate health system 'by Maori for Maori' that's a duplication and indulgence. Every individual that interacts with the health system now faces nurses and doctors etc of various ethnicity and birthplaces.

    3/ A child who cannot be cared for by its natural parents having a substitute picked primarily by race.

    4/ Cultural reports that use colonisation to excuse criminal behaviour and result in sentence discounts.

    5/ The cultural practice of 'rahui' which block public access to public property.

That's not a long list. But each of these concrete bones of contention has arisen from Treaty 'creep', one way or the other. For instance, regarding item 1, the practice of reciting karakia (Maori prayers) is defended by the public service as "cultural acknowledgement" adding:

    "The Public Service is committed to building and maintaining capability within organisations to engage with Māori and understand Māori perspectives. The Public Service Act 2020 (the Act) section 14 recognises the role of the Public Service to support the Crown in its relationships with Māori under Te Tiriti o Waitangi | the Treaty of Waitangi. To this end, the new Act includes provisions that put explicit responsibilities on the Public Service Commissioner, when developing and implementing the public service leadership strategy, to recognise the aims, aspirations and employment requirements of Māori, and the need for greater involvement of Māori in the Public Service."1

Obligations under the Treaty must flow one way. No other prayers are required or permitted at the commencement of public service meetings. 

Back to my list. Wanting an end to each of the above can, in no way, be described as racist, or hysterically, 'white supremacist'. An end to these practices would be consistent with an end to racism. Not the reverse.

Individually we each have our own objections to what has developed. Not just over the past six years, but decades. There can be no doubt that over the coming months and years the debate will intensify. It may be far more effective to list and talk about practical concerns than argue the original- versus- evolved meaning and intent of the Treaty. The latter course is rapidly descending into the realms of how many angels can dance on the head of a pin. By all means a redefinition of the articles or replacement with a constitution should be an option. But if that relies initially on a referendum then the arguments that persuade will be much closer to home - through letters-to-the-editor, talkback, social media, around the dinner table and at the pub.

I noticed a neighbour is flying the national Maori flag. I am assuming as a show of support for Maori. But what does that mean? They agree with TV1's John Campbell? They are virtue-signalling their 'non-racist' credentials?

I support Maori. I support them to look forward instead of back - which most do. I support them to get a decent crack at the cherry like everyone else. To get equal opportunity but understand that doesn't guarantee equal outcomes.

But above all I support a set of rules we can all live with free from fear or favour. None of the items on my short list would pass the test.


1. https://www.publicservice.govt.nz/assets/DirectoryFile/Information-request-regarding-secular-organisations.pdf