What is Labour's Super policy?

One of the neglected aspects of raising minimum and public service wages is the effect that will have on average wages, and as a consequence, the level of Super payments.

Super is indexed to the average wage as well as the CPI. And as everyone knows, the proportion of the population aged 65+ is set to grow rapidly.

Labour could argue that they will offset the icreased resulting financial costs through lifting the Super qualifying age. Which gave me pause for thought.

They have gone very quiet on that front.

Here are the senior policies so far announced:

Senior Citizens

• Aged Care Commissioner
• KiwiAssure - an insurer for New Zealanders
• NZ Power: Bringing down power prices
• Support for Veterans

Here's a Radio NZ report from late 2013:

Labour Party delegates have rejected a proposal that the party drop its plan to raise the age of eligibility for New Zealand Superannuation at its annual conference in Christchurch.
At the last election, Labour campaigned on a transition to raising the age to 67 over time.

David Cunliffe.

Photo: RNZ

Electorate committees Northland and Coromandel both put up amendments at the party's annual conference in Christchurch on Friday to axe any move to raise the age of eligibility. But after a feisty debate, that was rejected by a substantial vote.
Instead, it was agreed that Labour would consider all options to make New Zealand Superannuation sustainable, including raising the age of eligibility.
Labour's finance spokesperson David Parker says he is happy with the amended policy.
"We've got to a really good outcome. We're given freedom to make the decisions that are necessary to ensure the sustainability of superannuation. That's what we wanted, so we've reached an agreement through our policy process that's consistent with that."
Labour leader David Cunliffe says the change is not a watering down of the policy.
"I think there is some confusion. Our policy platform is a high level in general document and it leaves room for us to fix an age. It indicates the age will rise, but it's not at a level of detail of saying how much, by when."
The policy will be debated by the whole conference on Saturday morning, but David Parker is confident it will be supported.

Clear on that?

Susan Devoy lambasts Jamie Whyte

From Scoop:

In the run up to the general election Race Relations Commissioner Dame Susan Devoy is urging politicians to “do the right thing and stick to those major issues that will help make New Zealand a better place for all our children to grow up in.”
“Equating Maori New Zealanders to French aristocrats who were murdered because of their privilege is a grotesque and inflammatory statement. Accusations of Maori privilege are not borne out by Maori socio economic statistics.”
“Whether we like it or not the reality is that ethnicity and disadvantage are connected and found in damning statistics that on average sees Maori New Zealanders life expectancy, education and health outcomes lagging behind non Maori New Zealanders,” said Dame Susan.
“The connection between ethnicity and disadvantage did not appear overnight and breaking it won’t happen overnight either. Treating everyone exactly the same will not necessarily make everyone exactly the same and anyone who thinks so is incredibly naïve.”

What Whyte said:
 

Maori are legally privileged in New Zealand today, just as the Aristocracy were legally privileged in pre-revolutionary France.
But, of course, in our ordinary use of the word, it is absurd to say that Maori are privileged. The average life expectancy of Maori is significantly lower than Pakeha and Asian. Average incomes are lower.  Average educational achievement is lower.
Legal privilege offends people less when the beneficiaries are not materially privileged, when they are generally poorer than those at a legal disadvantage... the principle of legal equality is far more important than any redistributive or compensatory impulses that people may have.  It is not some philosophical nicety to be discarded because you feel guilty about what people with the same skin pigment as you did 150 or 200 years ago.

 I can't figure out whether Devoy  is OK with affirmative action but doesn't think it's a major issue, or doesn't  think equality before the law is a major issue? Either way, as race relations commissioner they should both be major issues for her.

Update: Whyte responds by calling for Devoy to resign.

Ombudsman - public sector could do better

OIA requests to the Ministry of Social Development are now never met within the required maximum  20 working day time limit. A notification of an extension is received. And then sometimes a second extension. Complaining to the Ombudsman is a waste of time.

Or is it....

I decided to write to the State Services Commission and ask about average response times to OIA requests and how MSD compared to other departments . This resulted in the SSC referring my letter to other departments eg Education and Health. But SSC also advised me to write to the Ombudsman who, while not subject to the OIA, might provide information on complaints received about MSD.

That is what I did.

The Ombudsman duly obliged and told me that 110 complaints had been received against MSD in the 2013 financial year. 62 were about delays.

On its own that doesn't mean very much. But then I received a letter from MSD (the one that had been passed on to them from SSC) refusing my request for information about average response times. However they did tell me that in the 2013 financial year they had received 482 requests.

Context then shows that the complaint rate against MSD is quite high. 482 requests and 110 complaints.And this happens even when many people consider complaining to the Ombudsman a waste of time.

Anyway, there is good news.

The Ombudsman finished:

You may also be interested to know that the Chief Ombudsman is intending to conduct a wider administrative investigation into concerns that the broader public sector is not managing requests for information under the OIA as well as it should.

Perhaps a better public service target is required.

Labour just not serious

There have been weaknesses in the welfare reform results.

The educational achievements of those on the Youth Payment are mixed.

Yet last week in Parliament the following patsy and response went unchallenged.

Youth Programmes—Reports 5. MELISSA LEE (National) to the Minister for Social Development: What recent reports has she received about the Government’s Youth Service initiative?
Hon PAULA BENNETT (Minister for Social Development): Youth Service, which is about reaching out early to young people on or at risk of going on a benefit and engaging them in education or training, is already producing great results. The latest evaluation report shows that four out of five young people enrolled in Youth Service are now in education or training, and 63 percent of 16 and 17-year-olds on the youth payment achieved National Certificate of Educational Achievement (NCEA) credits in their first year on the Youth Service, compared with just 24 percent of young people who were on the old independent youth benefit. Fourteen percent of those on the youth payment achieved NCEA level 2, compared with 5 percent before the Youth Service. Achieving NCEA level 2, of course, makes someone far more likely to be able to support themselves and be financially independent.
Melissa Lee: What evidence has she seen that the Youth Service is working to stop young people becoming dependent on the benefit in the long term?
Hon PAULA BENNETT: It is early days but I am pleased that we are already seeing a drop in the number of young people on the youth payment who go on to a main benefit when they turn 18. Seventy percent of young people on the youth payment did not go on to a main benefit when they turned 18 in the year to March 2014. These are young people who have often come from very difficult backgrounds. Wrapping support around them early and ensuring that they are not on a lifetime of welfare is what our Youth Service is all about.

Not a supplementary in sight.

Another example - Last week I provided data showing that the policy to discourage adding children to a benefit wasn't working.

It is the job of a good opposition to monitor government policies, especially if they oppose them. Yet Labour's Sue Moroney does little but push her paid parental leave bill.

Now, on balance, I think Paula Bennett has a better grasp on the welfare problem than previous Ministers and there have been good reforms with good results.

But there are vulnerabilities a credible government-in-waiting would be exposing.

70,000 pay $16.77 weekly in child support

The number of liable parents paying the minimum amount of child support - currently $16.77 weekly - has risen from 59,536 at April, 2009 to 69,968 at December, 2013. An 18 percent increase.

Minimum payers make up about 52 percent of all liable parents. In 2009 the percentage was forty six.

One of the Left's poverty solutions is to transfer the child support payment directly to the custodial parent rather than the IRD retaining it to partially offset the benefit bill. They want the taxpayer to shoulder more of the cost of raising financially-orphaned children. Assuming that most of the custodial parents with liable parents paying the minimum amount are on a benefit, their incomes wouldn't  rise very much.

And for those whose ex's are in prison, perhaps the most needy, they wouldn't get any extra. During 2013, 786 prisoners were exempted from paying child support.

The left writhes over collective responsibility for unacceptable child poverty, while 7 percent of all children have a biological parent paying less than the price of a packet of cigarettes for their weekly upkeep.

Millennial values

From a US survey of 2,000 American adults under 30.

Millennials distrust political parties and are largely socially liberal but fiscally centrist, according to the latest Reason-Rupe survey. The survey gathered responses from 2,000 adults ages 18 to 29 between late February and mid-March 2014, finding that today's young Americans are largely unaligned with traditional political parties:

• While young adults have supported Democrat political candidates since 2004, one-third of millennials identify themselves as independents -- three times the number of Americans over the age of 30 who do so.
• Twenty-eight percent of millennials trust neither major party to handle the nation's issues. Fifty percent do not trust either party to handle privacy.

The survey also indicated that young American adults believe in personal responsibility and other free-market values. When asked to explain success, respondents listed hard work, ambition and self-discipline as the top three explanations for wealth. The most common explanations for poverty were poor life choices, lack of job opportunities and lack of work ethic.

Would love to see how a NZ survey compared.

Poverty 100 years ago

The Otago Daily Times has a piece written 100 years ago.

Note the difference in tenor:

It is well that cases of pitiable poverty and want, such as one which came under the notice of a Christchurch Star representative on Wednesday morning, are rare, extremely rare.
In a small cottage in Milne Street, Spreydon, live a woman and her three children, whose ages range from two to six years. The house has four rooms, but the family occupy only two of them. Three old chairs, a tiny table, and a few pictures on the wall comprise the furniture of the kitchen, while two small stretchers are the sole contents of the bedroom. The woman and the three children were neatly but poorly dressed, and it was evident that they were having a hard struggle to make ends meet.
In the course of a conversation, the woman said that her husband was at present in a mental hospital at Porirua, Wellington, and that there was very little chance that he would ever be discharged. During the late strike, when her husband was out of work, she went out washing, and had kept herself, her husband, and five children, the two oldest of whom were now in the charge of her sister in Wellington. It was now 11 weeks since her husband had been sent to Porirua, and ever since then she had been the sole support of herself and the three children.
She earned 12s a week, and 7s went in rent, so that the family had practically been living on 5s a week for two months. Two days in the week the woman goes out washing, two days she takes in washing, and for the rest of the week she is unemployed. She has now applied for charitable aid, and is also making application for a widow's pension. The neighbours have been very kind, and but for their help she would not have been able to live.

Two of the children have been moved where they can be supported by family, and her neighbours are making it possible for her to get by.

Imagine today's coverage of the same situation. The Greens would be hopping mad that the woman wasn't getting state support. They would be laying victim hood all over the unfortunate mother and bemoaning that neighbours had to put a hand in their own pocket to help her get by. The woman is being stigmatised through no fault of her own, they would say.

When in fact her plight had appealed to people's compassionate instincts.

Poll puzzle

The NZ Herald headline says, "Labour slumps to 15 year low".

Labour's support has slumped to its worst rating for 15 years in the latest DigiPoll survey, putting critical pressure on leader David Cunliffe.

But over on Whale Oil Richard McGrath has pointed out Labour won the 1999 election.

The historical polls are available at DigiPoll

This is the 1999 pre-election poll.

Does that mean 2 months out from the 1999 election, Labour was polling in the mid 20s and managed to turn that into 40% by polling day?

Adding to the puzzle I found this

Labour Surge, Alliance Slump in Latest Poll

Monday, 6 September 1999, 10:57 am
Article: Jonathan Hill Today’s Herald DigiPoll shows Labour surging further ahead to 43.8 per cent, up seven points from National on 35.7 per cent.

Just over two months out, Labour was on 43.8 percent.

So if it had been polling much lower earlier in the year, it didn't turn it around within two months of the election - where we are now.

Ah I see the problem now. I am interpreting the headline wrongly.

If instead of "Labour slumps to 15 year low" it was "Employment slumps to 15 year low," I would expect to go back to 1999 and see employment at the same rate as when the headline was written. Employment statistics of course go back much further. The Herald DigiPoll does not.

Surprising position on privilege for the elderly

Susn St John and Claire Dale, generally known as advocates for the Child Poverty Action Group,  had a piece in yesterday's NZ Herald arguing for more elderly privilege; more taxpayer dollars for certain retirees.

Yes. That's right.

CPAG's usual complaint is that NZ looks after the elderly far better than it does children.

"We could reduce child poverty dramatically if we choose to, just as we have done for elderly people."

And, Susan St John quoting Jonathan Boston:

As Professor Jonathon Boston, co-chair of the NZ Children’s Commissioner’s Expert Advisory Group on Child Poverty says, ‘Why are so few older people materially deprived?  The answer, very simply, is that governments have implemented policies to minimise deprivation among the elderly.’

From the health spokeswoman for CPAG:

We do so much better for the elderly in New Zealand, because - thankfully - we do not discriminate against the elderly with universal superannuation. It is not targeted and is non- judgmental. 

Contrast that to today's complaint against the state's apparently discriminatory position that, "... the Government expects married people to share resources and support each other."

Back to the article:

 Tom has been a good citizen and lived here all his life and expects to get the married rate of New Zealand Superannuation at age 65.

What if Tom had been a bad citizen? Why bring his deserving status into it when usually CPAG rail against that principle:

  "We've got the deserving and the undeserving poor in New Zealand, and that's just not good enough."

I suppose they are at least being consistent in calling for more tax-payer funding to address their latest chosen cause.

A justified use of the word 'misogyny'

Generally I find accusations of 'misogynism'  paranoid, over-reactions.

So when I read this recent  release I went looking:

Keep misogynist messages off our roads

Friday, 18 July 2014, 3:32 pm
Press Release: Human Rights Commission Human Rights Commission urges Kiwis to help keep misogynist messages off our roads

EEO Commissioner Dr Jackie Blue hopes Kiwis will ensure an international rental van company keeps its offensive messages off New Zealand roads.
Wicked Campers Australia was recently forced to remove misogynist, offensive slogans off its vehicles after thousands of complaints.

Here are two of their slogans:

  "In every princess, there's a little slut who wants to try it just once"

 "A wife: an attachment you screw on the bed to get the housework done"


Bad taste, not funny.

Adding children to an existing benefit - numbers rise

Not such good news for National.

In October 2012 a policy to discourage beneficiaries from adding children to an existing benefit was introduced. When a new child turns one, the parent may have work expectations based on the next oldest child's age. The policy was specifically aimed at discouraging the addition of children to an existing benefit to avoid employment.

Data released to me  under the Official Information Act shows that the policy has made no difference.

In fact the number of children under 1 year-old added to an existing benefit has actually increased.

In the six months ending March 31, 2006, 5854 children aged under one were added to a benefit. In the same period prior to March 2014 the number increased to 6634 - a 13% rise.

Half of the caregivers adding children under the age of one were Maori: 26 percent NZ European and 12 percent Pacific Island.

Seventy two percent of the caregivers were 29 years or younger.

Over a quarter of those receiving the Youth Payment/Young Parent Payment added a baby. The majority of newborns were added to Sole Parent Support.

While the policy was well-intentioned it will not work in communities where there are no jobs or where a parent has significant barriers to work eg a criminal history. In these cases children continue to present an opportunity to increase income by an additional $3,328 annually.

This is a really thorny issue.

On one side there's those crying, what will happen to the children if we stop paying?

On the other is the grim reality that meal-ticket children are at-risk children.

When the policy was implemented it was accompanied by free access to long-acting reversible contraception, especially to women on a benefit and their "adult female dependent children".  MSD estimated just under 15,000  in the first group (according to Cabinet papers) and  1,000 in the second "may choose to utilise a long-acting reversible contraceptive."

In 2013 only 215  Special Needs Grants were paid for LARC.

So while the number of teen births is dropping significantly, there is a group of beneficiaries who either don't know about the new policy or are ignoring it.

Ironically these are the very parents hands are wrung over because their children are 'living in poverty'.

I don't have to come up with solutions because I'm not a politician. But capping the benefit (before the reforms) has been tried in the US and it didn't work.

Stopping welfare isn't acceptable with the electorate.

So my best alternative is time-limits. People need to know they have X amount of entitlement and when it's gone, it's gone. They have to make the right choices for their circumstances, and if they don't, they have to live with the consequences.

Coming Apart: Charles Murray

A surprising and positive response to my Listener article came from a local man who is probably politically on the other side of the fence (except for welfare).

He started talking to me about Charles Murray's Coming Apart, published in 2012. I have The Bell Curve and Losing Ground on my bookshelf, but not his latest book.

So I went looking for a review or video...whatever.

What I found was a presentation by Murray, who incidentally moved 'downmarket' so his family would experience real America and real Americans. Now, I'm not a great YouTube watcher and this thing goes for an hour (including questions from the audience at the end).

But I started watching (got past the lame intros) and couldn't stop. He just talks. About why the classes are coming apart.

If there's nothing on the telly I can't recommend this highly enough.

US welfare numbers stayed down

Here's an update on US welfare numbers (as separate from unemployment or disability benefits). Since the welfare reforms, which largely affected single mothers and their children, the numbers have dropped drastically and, despite the GFC, stayed down. Those receiving cash assistance (Temporary Assistance for Needy Families) are described below. In 2012 only 28.6% of all the funding went on cash assistance. The rest was spent on supporting people into work, childcare and child protection services.

Cash Assistance Caseload.

A total of 1.8 million families, composed of 4.1 million recipients,

received TANF- or MOE-funded cash in March 2013. The bulk of the “recipients” were children—3.1 million in that month. The cash assistance caseload is very heterogeneous. The type of family historically thought of as the “typical” cash assistance family—one with an unemployed adult recipient—accounted for less than half of all families on the rolls in FY2010. Additionally,

15% of cash assistance families had an employed adult, while almost half of all families had no adult recipient. Child-only families include those with disabled adults receiving Supplemental Security Income (SSI), adults who are nonparents (e.g., grandparents, aunts, uncles) caring for children, and families consisting of citizen children and ineligible noncitizen parents.

'P' babies and meal ticket children

Last week Sean Plunket was discussing the case of the student with overlong hair and what it had cost his school in court.

A principal rang in to make the point that insurance indemnity would have covered the court costs. Whether that holds across schools , I don't know. Frankly the issue bored me.

But the skillful Plunket moved his valuable coal-face witness on to other matters. What are the day-to-day problems his school faces?

Here's what the principal chose to highlight. He said that his school is starting to see the 'P' babies coming through. He said they are like fetal-alcohol syndrome babies but worse.

Which brings me to another article that appeared in this week's Listener. Dame Lesley Max, CE of the Great Potentials Foundation, is interviewed about the state of New Zealand children.

The writer lists the many reports (and book) recently published about child poverty and its effects.

Max is familiar with all of the above and more; she looks around her Penrose office and sighs: "I am submerged in paper." But she argues that much of the bureaucratic hustle around our kids is missing the crucial point. "In all the talk about inequality, I wish people would consider rather more the inequality that results from the huge disparity  of experience in parenting."

What does she mean? "Some children are very much wanted from before their birth. And nurtured and loved and cared for  and watched. And responded to. And they blossom and flourish. "But I hear some stories that you just...". Her voice falters. "It's hard to express how upsetting they are - of children who are not wanted. And they feel that every day of their life. They don't experience loving care, loving touch, they don't experience concern [for their needs]. It's a hot day, do they need some water? Are they too cold are they too hot? That attentiveness that a loving parent demonstrates is something foreign to them. And they lack in every domain."

Max is frustrated that public discussion about this sort of inequality is so often conducted in "fairly abstract language".

"Abstractions don't tell the whole story. They don't tell the story of underweight children sharing a dirty mattress with no food in the house, but a lot of alcohol and drugs. They don't tell the story of chronic neglect."

And it concerns her that the courts and agencies such as CYF, don't always step in when parents are neglectful. She believes that in practice, the threshold for intervention is too low in neglect cases, often due simply to an overloaded system.

"So children who are dirty, whose clothes haven't been washed for Gods knows how long, who smell bad, whose nits are untreated, whose hair is a stranger to shampoo - those situations persist. And there is no mechanism that exists to make parents do anything much about it."

"I can see letters to the editor saying, 'How judgemental!' Max says. "But we cannot continue to ignore what our social workers see. Which is too often, parents whose own need for drugs. for alcohol, for gambling take precedence over their children's needs. Not wants, but needs. It happens . And it's not insignificant,"

On paying parents a higher but tapering  child payment, as suggested by Boston and Chapple, Max believes

... for very many parents, the petering out payment would act as a nudge to get into paid employment. But to others it would act as a prompt to have another child, " to generate income on behalf of the parents."

"I ran that past so many people who work in the field, and they are kinder than  I am, to say, 'Am I right about this?' And they said, 'Absolutely'.

NZ poverty line much higher than US

The Feminist News carried an article about poverty in the US.

The 77 million Americans who live in poverty areas - defined as an area where over one-fifth of the residents earn incomes below the current poverty line of $23,600 for a family of four - is a significant increase from the 18 percent recorded by the Census Bureau in 2000.

I checked this with a government resource which has a slightly different poverty line of $23,850.

I am interested how their poverty line compares to ours.

Currently US $23,600 equates to NZ $27,066.

NZ uses an equivalisation (see P43 for explanation) method to make various household types comparable.

Table A4 (reproduced below) shows that a family of 2 adults and two children would need $28,100 to have the same purchasing power as a family of 1 adult and one child on $18,300. 


The HES finds:

 "The overall median BHC household disposable income in the 2013 HES was $67,700 (ordinary dollars). In equivalised terms this is 33,500 dollars per equivalent adult."

We commonly use 60 percent as the poverty threshold. Apply it to the equivalent adult sum above to get $20,100.

We can then go back to table A4 and work out how much that would equate to for a family of 4.

At $20,000 the amount required to have the same purchasing power is $43,400.

Below that and you are in poverty.

So our commonly used poverty line for a family of four is $43,400 compared to America's $27,066.

Our poverty line is 60 percent higher.

Table A.4

Conversion of equivalised dollars to ordinary dollars for households with low-to-middle unequivalised incomes

Equiv income	Income for families and households of various types in ‘ordinary dollars’
	(1,0)	(1,1)	(1,2)	(1,3)	(2,0)	(2,1)	(2,2)	(2,3)	(2,4)	(3,0)
	1.00	1.40	1.75	2.06	1.54	1.86	2.17	2.43	2.69	1.98
$10,000	10,000	14,000	17,500	20,600	15,400	18,600	21,700	24,300	26,900	19,800
$11,000	11,000	15,400	19,300	22,700	16,900	20,500	23,900	26,730	29,600	21,800
$12,000	12,000	16,900	21,000	24,700	18,500	22,300	26,000	29,160	32,300	23,800
$13,000	13,000	18,300	22,800	26,800	20,000	24,200	28,100	31,600	35,000	25,800
$14,000	14,000	19,700	24,500	28,800	21,600	26,000	30,400	34,000	37,700	27,700
$15,000	15,000	21,100	26,300	30,900	23,100	27,900	32,600	36,500	40,400	29,700
$20,000	20,000	28,100	35,000	41,200	30,800	37,200	43,400	48,600	53,800	39,600
$25,000	25,000	35,100	43,800	51,500	38,500	46,500	54,000	60,800	67,100	49,400
$30,000	30,000	42,100	52,400	61,600	46,100	55,900	64,800	72,900	80,600	59,300
$35,000	35,000	49,200	61,200	71,800	53,800	65,200	75,600	85,100	94,000	69,200
$40,000	40,000	56,200	69,900	82,100	61,500	103,700	74,600	86,400	97,200	79,000
$45,000	45,000	63,200	78,600	92,400	69,200	83,900	97,100	109,400	120,800	88,900
$50,000	50,000	70,236	87,367	102,641	76,844	93,200	107,900	121,500	134,300	98,800

·      This table uses the 1988 Revised Jensen equivalence scale, as does the rest of the report, except where it is stated otherwise.