Food grants 39% higher than at peak of GFC

In the financial year ending 2019, food grants exceeded the number granted during the GFC - when unemployment reached 6.7% - by 38.6 percent.

In the December 2019 quarter alone, over 3,300 grants were made daily.

But I notice (as remarked on recently) that the biggest increase is not identified as occurring in town and city service centres but in an 'other' region. According to MSD:

"The ‘other’ region includes the Ministry Contact Centres and Centralised Services that do not cover a part of New Zealand. Hardship assistance is reported by the Service Centre which granted the payment, so the increase in ‘other’ indicates more of these being granted in centralised offices."

So the majority of the increase isn't from grants made face-to-face at service centres but applied for on-line (using MyMSD) or over the phone. I gather money is loaded onto a payment card and the average grant is around $100.

Data source

It's a worry for the taxpayer but it's a bigger worry for the person becoming increasingly dependent on these grants.

Update: Jim Rose asked, "Have you asked for info on rates at which applications were declined?" Not me but someone else did. I've charted the data for the last four financial years.

Source

Nash goes on the offensive but gets it wrong

Minister Stuart Nash does a weekly session with National MP, Mark Mitchell, on the Mike Hosking NewstalkZB show.

This morning, before Hosking had even asked an opening question Nash waded in:

NASH: "Hey Mike I haven't heard you comment on the December figures last year when 19,000  handed in their benefit and got back to work. Was that in one of your commentaries?"

HOSKING: "It was actually Stuart. You shouldn't come on this programme and say 'I haven't heard you' because all that indicates is you're tuned into the wrong radio station. You need to be where the number one radio show is and the audience is Stuart especially now that it's election year and you need some votes.

NASH: "Well when you think there are 19,000 more people in work than were on the benefit in the last quarter that's pretty good news . That shows a great economy and good economic management I would say. Wouldn't you Mike?"

HOSKING: "Well no because my great concern is the massive increase in the people on the benefit. How do you explain that?"

NASH: "It's still a lower percentage than it was when we took over [wrong - see below]."

HOSKING: "But it's still increasing though. There are more an more people on the Jobseeker benefit - there's another 15,000 on the Jobseeker benefit and these are work-ready people. Why aren't they working?"

NASH: "But the economy's growing, we've got record low unemployment. This is the third lowest unemployment in the last ten years.Wages are rising and the economy is booming."

More at Jan 29, 8:00 from 7.36

18,818 benefit cancellations for work is not particularly spectacular when compared to the previous  December quarters and the trend-line is down.

source

More importantly there were 55,341 main benefit grants in the Dec 2019 quarter - the highest number since Dec 2015.

As well, in December 2017 - just after Labour took over - 9.8% of the working age population was on a benefit. By December 2019 it had grown to 10.5%. 

In respect of the Jobseeker benefit the number grew from 4.2% to 4.9%

An election campaign that is facts-based? Honest, robust, transparent?

P and poverty

Started the day by reading this headline:

Kids in poverty miss start of school year, as siblings share one uniform

This continuing poverty problem is baffling. OK. High rents is a undeniable issue. But then we have children apparently living in tents and garages. That's a terrible environment for kids but no rent problem. Still no money though? And state houses are affordable, but still no money? With all the extra emergency assistance WINZ is handing out? Food and clothing has never been more accessible. Food banks, markets, recycled clothing stores, charity shops. 

Then I spent 40 mins watching Fighting the Demon. If you can get past the overly dramatic treatment of the subject I recommend it.

Apparently meth is ravaging poor small towns. Police identified 600 P users in Kawerau (out of a population of 6,000). The kids are going without food. Debt is rife. Up to Whangarei, with the highest Jobseeker rate in NZ and an addiction counselor says the business man is using meth to be more 'productive' but the beneficiary is using it to escape his existence.

Therein lies a couple of clues.

But the media never puts the two issues together.

Case manager feeling "...just like an ATM machine"

Most of us have little choice but to rely on statistics to build a picture of what is happening at Work and Income. Accordingly, anecdotal evidence has some value, especially when it is from the normally gagged front line, and despite being secondhand. I can only trust that it is genuine. Transcribed from NewstalkZB's Week on Demand  (Jan 27, 8.30 am segment, starts at 7.15) it begins with Mike Yardley reading out a text or email from a listener and then refers to an Official Information Request of mine (I believe):

"Good morning Mike, My partner works for Work and Income and she says there has definitely been a culture change with respect to client obligations and the whole benefit system has ground to a halt hence why you are seeing the massive rises in the Jobseeker/Work-Ready benefit numbers. My partner says that if you are on a  benefit now you can basically stay there indefinitely because Work and Income case mangers are not tuning you up. My partner says that she feels her job is now just like an ATM paying out money willy-nilly. There is not the case management there used to be," says Dave.

Mike continues,

"Which is an interesting point because I know there was an Official Information request on this very matter in the last few weeks and apparently, according to Work and Income they are now only spending - these are case managers - about 20% of their time helping people on a benefit into work or ensuring they are work-ready or doing some training, looking at other options...just generally trying to get them onto a more independent and productive footing. And apparently this collapse in how much time they are spending with that sort of work-focused case management is because they are doling out so many hardship assistance grants and having to wade through so many applications. I think the figures out on Thursday from MSD say there were 537,000 [573,000] hardship assistance grants given out in the last year."

Mike Yardley has also penned an opinion piece,  Benefit numbers betray Labour's posturing on well-being.

Why are 56,000 Maori claiming Jobseeker benefit when only 27,000 are unemployed?

Jacinda Ardern went to Ratana and told Maori she was working for their collective people and that the unemployment rate was dropping. Officially the latter is true.

But that's only half of the story.

Here is the Maori unemployment rate from Statistics NZ data:




However, in September 2017 Maori overtook NZ European on the Jobseeker numbers for the first time ever. Since they have been pulling away. Here are the Jobseeker numbers from MSD data:

It seems odd that the two trajectories are going in different directions.

According to the Stats NZ data at September 2019 there were 60,200 unemployed NZ Europeans and 27,500 unemployed Maori.

You would expect the number of  unemployed to be slightly higher than on Jobseeker - some people will be neither inclined to seek nor qualify for a Jobseeker benefit. This is the case for NZ Europeans.

But there is a large mismatch between 27,500 Maori unemployed and over 56,581 on Jobseeker benefit.

From Sep 17 to Sep 19 the Maori Labour Force Participation Rate (LFPR) fell from 70.4 to 67.8 percent - a drop of 2.6 points. NZ European LFPR fell from 71.7 to 70.7 - a drop of 0.3 points.

Looking at the 'not in the labour force' numbers, for NZ European they have climbed 9,000 - a 1.1% increase. The Maori increase is 17,800 - a massive 12 percent increase.

If an individual drops out of the labour force that means they are not looking or available for work. In which case they shouldn't be receiving a Jobseeker benefit. If they have dropped out due to health/disability reasons that preclude them from work permanently, they would go on the Supported Living Payment but there is no particular increase for Maori there.

On the other hand the Maori working age population has grown much more than the NZ European population probably due to the ageing NZ European pop versus the young Maori pop. (The stats are muddied by Stats NZ classifying the working age population as 15-64. Ridiculous when you can't even leave school till 16.)

But the same demographic characteristics apply to the Pacific population and their unemployment/ Jobseeker ratio is more like the NZ European with 13,400 unemployed and 11,552 on the Jobseeker benefit.

If Jacinda thinks this is a success for Maori she is probably in a very small minority.

And as she has pledged to run an election campaign free from fake news perhaps she could start by answering the question in the title of my post.

(There is one other remote possible explanation. Around 62,000 Jobseekers have a health condition or disability and are not 'work ready'. Could they all be Maori? I am going to rule it out on the basis that when the sickness benefit was rolled into the Jobseeker benefit in 2013 Maori only made up 28 percent or around 16,600 individuals. But I will OIA it.)

Update: A commentor points to part-time employment as a reason for many more Maori than just the 'unemployed' being on a Jobseeker benefit. But the 'underutilisation' (which includes underemployment) percentage for Maori is not much higher than for Pacific - 17.6 versus 14.1 percent. So I am skeptical about that answer.

Update 2: Further reflection - it is possible that the ranks of part-time Maori workers have been swollen by ex DPB ageing single parents. But that brings us back to arguing over whether these ladies are genuinely single. If they were partnered (as they very well may have been when claiming the DPB) they shouldn't qualify for the Jobseeker benefit (unless both partners are claiming the single rate - exactly half of the married/de facto rate). So many complications.

Bottom-line is the Maori unemployment/Jobseeker ratio is utterly different from the NZ European and Pacific. And I'd like to understand why.