Saturday, June 08, 2013

In poverty but not hardship

Thanks to the reader who drew my attention to a recently released Ministerial Committee on Poverty report. It contains information familiar to me but presented in new and revealing ways. For instance the chart below shows that of the 270,000 children 'in poverty' around half are not experiencing hardship. That's because income is arguably less important than outgoings, or budgetary prioritising:



This report is very encouraging in that it identifies children of beneficiaries and particularly sole parent beneficiaries as forming the major share of children at risk of deprivation, but it resists leftist solutions. It finds for more targeting (eg of services), not universalising payments (no child benefit as proposed by the Children's Commissioner), and is clear that getting sole parents into work, or increasing their hours, is the best strategy. It notes that in Nordic economies parents are expected to return to work when their child is 13 months old. It also makes mention of the need not to disincentivise work (or encourage fertility patterns that are not in the nest interests of children) with higher benefit payments.  I will blog more of the graphs later.

4 comments:

Anonymous said...

The "Nordic model" is just as much a failure as the rest of the "Welfare West" - actually moreso with cripplingly high personal, corporate, and value added tax rates. It only appears sustainable in Norway, which is not a member of the EU and is a massive nett oil exporter. Sweden's largest free school company has just gone bankrupt. Returning to work at 6 months is based on massive taxpayer subsidies for childcare, public transport, etc etc.
None of this is acceptable in NZ!

On the other hand, eliminating benefits would eliminate all moral hazard, removing all the perverse incentives, and reduces the numbers of "benefit dependent children in poverty" to zero.

Judge Holden said...

"On the other hand, eliminating benefits would eliminate all moral hazard, removing all the perverse incentives, and reduces the numbers of "benefit dependent children in poverty" to zero."

While increasing the number of actual children in poverty exponentially. And people call libertarians callous. How dare they?

Lindsay Mitchell said...

Judge, How do you know 'anonymous' is a libertarian? I asked you recently whether you were able to appreciate or acknowledge individual thought but you didn't respond.

Judge Holden said...

It's true that she could be a free-market conservative, granted.

Are you saying libertarians don't advocate the elimination of all benefits? Or perhaps there is no such thing as libertarian, only individuals all thinking about how great it would be to eliminate all benefits?