Wednesday, January 23, 2019

The best of times and the worst of times...

In recent history, the NZ unemployment rate saw the best of times in the latest quarter - December 2018.  It saw the worst of times when the Great Recession of 2008/09 took hold.

(Click on image to enlarge)

From a welfare viewpoint - the % of working-age dependent on a benefit - this is what the two extremes look like:

There is a 2 percentage-point variation between the two polar points.

Is 10 percent of the working age population dependent on a benefit now as good as it gets?

Here is some context for you to digest.

There was a decades-long period post 1938 (when Social Security was created) when the norm was consistently around 2 percent of the working age population dependent on taxpayers.

Now we are expected to celebrate 10 percent.

Tuesday, January 22, 2019

Sanction reduction extraordinarily inconsistent across country

Nationally, since December 2017, the number of benefit sanctions has reduced by 42 percent. But the reduction is extraordinarily inconsistent across the regions.

For instance, the East Coast region has seen a 70% reduction in sanction application whereas Northland beneficiaries have experienced only a 17% reduction.

These two regions represent the highest and lowest reductions. Yet they are reasonably similar in profile. Which leads to the conclusion that there is a degree of arbitrariness occurring in the decision-making.

There is also speculation that the increased sanctions are leading to an increase in the number of people receiving a Jobseeker benefit.

Is any correlation showing by comparing the regions? No.

Canterbury had the highest growth in Jobseeker numbers but one of the lower reductions in sanctions. Northland and EastCoast have virtually the same increase in JS benefits but the highest and lowest sanction reduction.

This doesn't conclusively disprove that fewer sanctions lead to more Jobseeker dependence simply that other weightier factors are in play.

I come back to the glaring inconsistency between Northland and East Coast. Why has the East Coast taken a much softer line than Northland? 

Whatever your feelings are about welfare, beneficiaries should be entitled to a consistent application of rules.