Saturday, December 20, 2008

It's not about more money for chrissakes

The Press reports, Parliamentarians will form a group to combat child abuse as a new report shows it costs the country about $2 billion a year.

Well whoopty do.

This is typical modus operandi of the left. A lobby group commissions a report to show how much some form of dysfunction is costing society. Then they use that cost to lobby for more money to be spent trying to reduce it.

Child abuse is apparently costing $2 billion. Infometrics is a credible outfit so I don't doubt the figure they have arrived at.

The report recommends a $1b trust be set up from which private and public groups can apply for money to do innovative child-abuse prevention work.

This assumes that we should simply continue to encourage the creation of at-risk children through unpartnered and, under critical analysis, unwanted childbirth. After which we should pour rescources into intensive monitoring and guidance of mothers who aren't ready to be mothers.

This is how it works. These girls - and older women who started on this pathway years earlier - have all these talking heads coming into their homes telling them 'how' and then going away. But nothing happens. Just as people had previously told them they had to go to school, they didn't and nothing could be done about it.

The best hope for change is that a volunteer goes in, rolls up their sleeves and works alongside them. You can't help get someone's life on track until their physical environment is liveable and healthy for the child. It takes a fair bit of nose-pegging and good humour to get through just that process. Paid social workers , community nurses, plunket nurses, etc don't fulfil this role and neither should they. Hence there is a limit to what paid workers can achieve. A very low limit.

Yet people like Deborah Morris Travers, the lobbyist who commissioned the report, cling to this belief that it's all about a lack of money. That saves them actually confronting the truth. That the only way to help people live better is to get in there and show them how. It's about finding time, having goodwill and hope. That's how to deal with the current crop.

Then we stop growing more. Take away the cash incentive. For goodness sake. The last thing we should do is up it, which is Ms Morris Travers other big idea.

I am so weary of this grand self-deception and grand gesture. Another cross party committee is going to make not a blind bit of difference. It could even make matters worse.

Friday, December 19, 2008

Happy Birthday to us

I have just realised today is the third birthday of my blog. I have never not wanted to keep blogging. But I do struggle with some bitches about blogging periodically. Surly and manic anonymous comments always irritate but are more than made up for by considered and clever anonymous comments. I wouldn't want to restrict commenters and touch wood, so far I haven't had to. Thank you all, self-identifying or otherwise, for keeping on reading and responding.

The impetus for this blog is conviction that a radical rethink of welfare is critical. I am even more committed to that idea than I was three years ago.

Minister must stick to her guns

Media Release

Friday, 19 December, 2008

The Minister of Social Development, Paula Bennett, has welcomed the Human Rights Tribunal finding against the Child Poverty Action Group (CPAG) claim that children of beneficiaries are discriminated against because their parents do not receive the In Work tax credit.

Welfare Commentator , Lindsay Mitchell, noted however that the Associate Minister of Social Development, Tariana Turia, may not join in celebrating the good sense the Human Rights Tribunal has shown. "The Maori Party strongly supported the action of the CPAG. Many children of beneficiaries are Maori and the DPB is an integral part of the Maori community, " she said today.

"Fortunately Ms Bennett is able to grasp the bigger picture and appreciate that preserving an incentive for parents to work, which is in the long term best interests of children, is vital. As the CPAG is now seeking a meeting with the government to plead its case directly, it is to be hoped that they do not aim to play one minister off against the other."

Thursday, December 18, 2008

Beneficiaries are not entitled to In Work payment

The title of this post seems to be a statement that goes without saying. Yet the Child Poverty Action Group has fought a protracted battle with the government to have this overturned because it 'discriminates against the children of beneficiaries'. They want people who do not work to receive an in-work tax credit.

I am very pleased and relieved that the ruling has gone against the CPAG. So is the Minister of Social Development. Her Associate Minister, Tariana Turia, will not be. The Maori Party publicly backed the CPAG action.

These are my earlier arguments against those of the CPAG;

If the CPAG win, essentially we will see an increase in benefit levels. An increase in benefit levels leads to an increase in the number of people going on or staying on benefits. CPAG want a short term gain and refuse to see the long term cost which cannot be in the best interests of children.

There is no guarantee the money reaches the children anyway.

And, most obviously, the incentive effect of the In-Work payment will be nullified if it is extended to non-working families.

The Greens and the Maori Party are supporting the CPAG.

Who is going to win? We have seen the Ministry of Social Development forced to settle out of court previously for discriminating against a single male parent who had full custody of a child (the mother had full custody of the other child/ren) by not allowing him to be on the DPB. But in this case, should the government lose, there would be a significant financial impact. Around $3-400 million more would be paid to parents on benefits. (From the beneficiaries point of view that's about a 14 percent pay rise.)

Beneficiaries already receive family support for each child. It varies according to age and ranges from $57 to $95 per week. Payments increased in April 2005 and April 2007. I wonder if I could take a case to the Human Rights Tribunal claiming discrimination because I do not receive these payments?

Or, more to the point, perhaps I should try discrimination on the grounds that I do not receive the In Work tax credit. The government has set arbitrary conditions on who receives them. The one that excludes me is an income test. The one that excludes beneficiaries is a work test. If the CPAG can get the work test removed perhaps I can get the income test removed.

UPDATE: A couple of months back I put out a media release about the CPAG being "at loggerheads with the OECD" on the matter of what strategy is most effective in reducing child poverty. I was pleased to read in the Dominion Post this morning that the government will be calling two representatives from the OECD as witnesses in its defence against the CPAG.

"Why men don't take messages"

(And I didn't know there was such a thing a pabst beer)

Survival of the fittest time

I bit the bullet yesterday and went Christmas shopping. Never before can I recall 8 shopping days THIS SIDE of Xmas Day, there being the sorts of offers currently available. I ended up spending what I had budgeted for but getting more than I planned.(I make this point because some figures show retail spending holding up against last year's. If buyers are getting more though, somewhere along the line someone is getting less. Profits must be down.) Two for one deals and 30% discounts are everywhere. And no, they are not offers on inflated prices.

But still the shops are not busy. We shopped till lunchtime and there were no queues, except at the Warehouse general counters, but they weren't long. And the CD, DVD counter, the one we usually use, had no queue at all. None of this augers well. I see Woolworths in the UK will close all its stores by January 5. There must be be a fair few NZ retailers sailing very close to the wind right now.

Wednesday, December 17, 2008

Kahui kidding himself

"It was a fully functioning household. We did the shopping, paid the bills and basically lived a normal life."

Chris Kahui about the home he and Macsyna King lived in.

This is true in his mind. It was a home like any other he had ever known and a home like many others in the neighbourhood. As a volunteer I go into homes that I couldn't live in as they are, but they are 'normal' within those communities of people. Being on welfare is normal, having Work and Income pay your bills is normal, living amongst clutter and grime is normal.

"Like it was said in court, only the primary caregiver could have noticed if something was wrong. My cousin April had changed the baby, she didn't notice anything and she's a grandmother to four kids."

Kahui is 23. His cousin is a grandmother four times over. Roll that around in your mind a while. That is a marker of prolific and very young breeding. But that's normal too.

Although Chris admits he didn't know Macsyna as well as he thought he did, what he saw was a good mother.

Good mothers do not abandon children. Perhaps she never talked about her older children to other men. Still. You don't need to know someone very well to shack up and sleep together. That's normal too.

For now, Chris is happy using his skills to help around the home, fixing broken cupboards or old ceilings.

That's nice. That gives him plenty of time to keep on 'normalising' his lifestyle and past in his head. Someone needs to give this guy a good shake. But that won't happen. The money will no doubt keep turning up in his bank account each week and he can go on playing at life.

Tuesday, December 16, 2008

ReStart could rev-up recession

The government's temporary, boosted assistance for workers made redundant, ReStart, may play a role in deepening the recession. That is because, as usual, with welfare paid out of general taxes there will be distortional incentives.

The package is going to encourage these responses.

From employers;

1/ They will feel more comfortable laying off workers. An employer who might otherwise have worked with staff to share in a decreased return from the business might now mentally justify making one or two redundant. Especially if he is inclined to keep his own returns to a status quo.

The Minister has been explicit in urging employers to ring the 0800 number to find out what support can be provided if employers 'need' to make staff redundant. Some individuals take their 'morality' from the state. They will be assured they are doing the 'right' thing.

2/ Employers will be incentivised to minimise redundancy payments in order that employee qualifies for greater assistance.

From employees;

1/ As the extra assistance is means-tested the redundant worker may be tempted to take a lower redundancy payment, or dispose of any cash assets or investments within 20 days. He will find ways to maximise the assistance on offer even if conditions have been put on eligibility for reasons of 'fairness'.

2/ Employees will be encouraged to take voluntary redundancy where they might otherwise not have. For instance, low paid women who have left DPB to work 20 hours may find a return to benefit will see them in a better financial position (for up to 16 weeks at least).

These incentives then, could drive unemployment higher than it would otherwise have gone, thereby reducing desperately needed productivity. The rise could be compounding.

What will it cost?

The costing of ReStart is based on a 'worst case scenario' of 70,000 job losses over two years. As I have previously pointed out however, if Treasury predictions are right (and they are lower than other economists) and unemployment rises to 5.7 percent by 2010 then the total unemployed is likely to be over 135,000.

The costings of $50 million are far too modest. Even if they are based on 70,000 redundancies the figure assumes an average payout of $714. Using the Ministry's own examples of typical payouts, this assumes each person becomes re-employed within 8 weeks.

There are also difficulties with the concept of self-employed people effectively making themselves redundant. A self-employed person just scraping by, who was considering a move back to being an employee anyway, could be tempted to declare himself redundant in the interim.

Additionally there will be people who miss out on the help because of technicalities. For instance a worker with a long and stable employment history who just happened to have a break during the last 6 months will be ineligible.

In countries which operate dedicated unemployment insurance schemes it is normal to pay one claimant more than another based on the difference in the premiums that have been contributed. But that is not what is going to happen here. The extra assistance qualified for is based upon need, not contribution. Sounds fair but why is one family needier than the next? Perhaps one family has been living frugally in order to pay down their mortgage while the next has been living beyond their means. The family that will be eligible is the second because they have high mortgage repayments and no savings. (A cynical bureaucrat may point out that the first family, which is used to living frugally will manage better on just the basic dole whereas the second is accustomed to chomping through more money.) This is more of the socialist imperative of punishing responsibility and rewarding irresponsibility.

The good aspect of this development is the government employing the principle of temporary assistance. That is something we need to see more of. But not on top of indefinite entitlement benefits.

Monday, December 15, 2008

Crisis? What crisis?

There can be no doubt there is a strongly conservative mood afoot in the early 21st century. The prohibitionists of many flavours are more prevalent than they were during the last part of the 20th. Although certainly not exclusively females they do predominate. Strangely their political colours are varied. Often Green but just as often blueish. Fortunately the blueish ones have failed to secure an effective parliamentary presence with the failure of the Family and Kiwi Party's most recently.

My comments are provoked by the Dominion Post's headlines of the last two editions. Saturdays front page proclaimed, 'We are killing ourselves' and today's 'Weekend of drunken mayhem'. Both are strident rallying cries to clamp down on alcohol.

The voices come from people who work in A & E and alcohol watchdogs. On Saturday the solution pushed was a massive increase in the price of alcohol through higher taxes. Bugger the people who drink responsibly and the people who make their livings from producing and selling alcohol.

But when you look at the facts reported there is room for optimism. A booze bus operating in Levin and Otaki (potentially areas where a high result might be anticipated) only 9 out of 1,000 people tested were over the limit. Not even 1 percent. The Wellington police said the number of calls due to alcohol-related incidents was nothing out of the ordinary. And let's not forget that the number of calls is up due to the 'It's not OK' campaign - apparently. The police had processed all of 22 intoxicated people yesterday.

The front page of the Dominion Post is being used to promote the crusades of those who chose to work in areas where they know they will see the extremes of alcohol abuse but would nonetheless punish the rest of civilised society with their prohibitive solutions.