Most newborns born onto welfare are Maori

Continuing with Sunday's theme of the gradual decline of the financially independent, working, two-parent, Maori family the chart below shows that 59 percent of newborns added to an existing benefit, usually the DPB, are Maori:

The data is sourced from a cabinet paper.

It represents 4,800 newborns - a five year average over 2006-2010.

The count includes newborns added from the date of their birth,  to a benefit that has been in place for 42 weeks or more, and where there are older children.

Interestingly the paper suggests reduced employment opportunities for men are lessening the likelihood they'll be a family breadwinner. But Pacific people have higher unemployment than Maori and are not particularly over-represented in either their share of the DPB (10 percent)  or the rate of adding children (12 percent).

So that's a crock.


Then over the course of the year in which they are born, many more babies will go onto a newly granted benefit resulting in 21 percent of all babies being dependent by year-end.

I seriously stuffed up

My apologies to the Herald. I misread their reporting on the latest welfare reforms. Too much haste. On returning from walking the dogs I re-read my post and realised MY mistake.  Hang head in shame.

On faith versus fact

Yesterday someone made an absurd (and irrelevant to the post) claim:

The fact that Maori birthrates are higher is not an indication that they are more promiscuous. But more an indication that non-maori have more abortions.
Teenage pregnancy rates are exactly the same.
Teenage birth rates are different because of NZ European Abortion rates... Who is worse - someone who has a baby as a teenager or someone who murders an unborn..?

What I wonder about is where this sort of thinking comes from? In this day and age it is very easy to check the veracity of your claim before making it. But I suspect this man, young man (?) has latched on to an idea that suits his ideology - anti-abortionism -  and never felt a desire to question or doubt it. Perhaps he'd gotten the idea from a source he trusted.

It recalled an ocassion which taught me to be more thorough. I was giving a presentation on the US welfare reforms and a catholic attendee stood up and claimed the reforms had pushed up the abortion rate. I thought she was wrong but wasn't 100 percent certain. She repeated it as absolute fact. As I was prepared to admit I didn't know and she was adamant she did, I came off the worse in terms of credibility.

I contacted her later to say she had in fact got it wrong. But the damage was done. She'd won support for her objection by being dishonest but resolute.

Anyway, for Ben, if he comes back, here's a scan from a paper amongst my files. It's 1997 but the relative teenage fertility  patterns have not changed substantially.

Tax avoiders bad: tax takers good?

Mark Hubbard drew my attention to a post about tax avoidance by Massey University tax lecturer Deborah Russell:

Despite everything you might hear, most New Zealanders mostly pay their taxes, on time and in full. We’ve got a very good compliance rate here. Somewhere between 80% and 90% of taxpayers pay their tax on time, and over 60% file their returns on time.

Like we have any option? The case for citizen buy-in is impossible to assess or prove when the law forbids choice.

People who won’t pay their taxes free ride on other New Zealanders.
Tax aoviders not only free ride on other New Zealanders, but they undermine the whole tax system. Tax compliance is a trust game: if people think that other people comply with tax law, then they are more inclined to do so themselves. But if they think that other people are rorting the system, and not paying taxes, and squirreling money away, then they lose confidence in the system, and start to avoid paying taxes themselves. The reasoning is straightforward: who wants to be the only schmuck left.

This interests me because it's exactly the same thought process I've heard blamed for benefit exploitation in Europe. The reason for the decades-long increase in people relying on state hand-outs is attributed to progressive capitulation from those thinking, "If you can't beat them, join them." The more normalised living off the state becomes, the greater the benefit uptake will be.

The one defense that these tax avoiders might try is that their activities are perfectly legal...But even if the procedures used are legal, it’s not clear that they are ethically acceptable. This is in fact the closest I can get to understanding exactly what a rort is: it’s something that is technically legal, but nevertheless pushes the law to such an extent that it is immoral.

Again the "perfectly legal" tax avoidance defence has its parallel with the 'perfectly entitled' tax take defence. Many have become far more concerned with legal entitlement to benefits than moral.

But look what follows:

We’ve heard a great deal of nasty rhetoric about people on benefits in recent years, but very little about the scungy behaviour of tax avoiders and tax evaders.

By Russell's logic, we should be hearing "nasty rhetoric about people on benefits" if the behaviour of tax avoiders and evaders is also "scungy". If people who don't pay tax are "free riding" so too are those who take it when they do not need to.

The problem is both groups are failing to accept her "common good" philosophy.

This isn't a defence of greed or laziness. But without the "common good" ends realised only via state force, those character traits would be visited upon their bearers - not you and I.

That portrait of Margaret

Back in my 'student' days, art student that is, back when I was reasonably apolitical, I wanted to paint a large scale portrait of someone famous. It was an exercise in capturing a likeness really. I can't recall why or where but I came accross this amazing photo of Margaret Thatcher back in the 'big hair' days.  It was the composition that drew me in; that and the expression in her eyes. Now I wouldn't even know where to find the original image though a google search might locate it.

It seems to me it could do with a few more coats and is far more detailed than anything I'd produce today. It lacks weight. Perhaps, typically, I lost interest when it came to the clothing. But I wasn't displeased with it at the time.

Of course it unleashed a few derisive sneers and raised eyebrows amongst some of my folk. Not for the attempted grandness but because I grew up in a 1960s Labour household where Harold Wilson had been loved, like Mickey Savage. Benevolent Harry and his lovely labradors I remember.

My parents hated Thatcher. Or that's what I recall. Though I never knew or cared why. They just gave me the overwhelming impression that she was callous and hard. As children, even young adults, do, I believed them without giving it very much thought.

Later though realised what an amazingly determined and steely character she was. And of course I came to understand and believe in the same political and philosophical values she espoused - free markets and individualism. "There is no such thing as society..." doesn't mean every man is an island. It means that in the final analysis any true right or responsibility lies with the individual. Assign them to groups and they cause conflict.

So I dragged out my portrait today and we'll have it sitting on the mantelpiece in her honour. RIP Maggie.

4 in 5 Maori children born outside marriage

The earliest statistics kept on Maori ex-nuptial births were in 1968. The percentage of Maori children born outside marriage would have been even lower pre-1968.

Does marriage matter? Of course it does. Married people tend to be wealthier, are more likely to stay together, and provide their children with greater security and opportunity. A great deal of Maori disadvantage is due to the picture below.

What's wrong with Radio Live?

The NZ Herald reports that latest Auckland audience polling shows Radio Live losing listeners in a big way. Marcus Lush, Michael Laws and Willie and JT all lost significant audience share. And it isn't just Aucklanders tuning out.

Laws may have lost audience because he was leaving. People anticipating his departure began looking for an alternative earlier than they needed to? I listened to Laws sporadically usually because he was running a subject that interested me and he didn't suffer fools.

Lush is an unknown but from the promos for his show I've never been tempted. Not enough gravitas in his presentation or content.

Willie and JT are entertaining at times but the (sometimes juvenile) slagging each other off wears thin. A lack of professionalism and repetition of race-related comment make Willie tiresome. JT has a wider field of knowledge and depth of insight but seems to mentally (and physically) disappear quite often. His solo shows make for more compelling listening. Their political panel show frequently degenerates into the verbal equivalent of a bar brawl. Again, I'm only a sporadic listener.

I tuned into Sean Plunket a couple of times during his first week. His style was unchanged since hosting NewstalkZB in Wellington 2011-12 during which time I started to gravitate over to Laws and RadioLive. Perhaps if he incorporates more interviews and news content - competing directly with his nemesis, Radio NZ - he could pull in people like me who refuse to listen to state radio but don't necessarily want music.

Duncan Garner is totally not my cup of tea. Three or four times I've persevered through the hour before Larry Williams starts on NewstalkZB. Garner gets an idea or takes a position (eg a nasty set against Susan Devoy) than asks people to text their support - repeatedly. He has a motor-mouth but not a motor-brain. Shallow and disappointing.

I've listened to RadioLive since the Radio Pacific days. Through many hosts like Jenny Anderson, a consummate professional, Paul Henry, very quirky and comical then, John Banks, cutting and polarising, Alan Dick, personable and forthright.

They just don't have any talent right now.  Perhaps they get what they pay for. In which case it's a downward spiral.

(Mea culpa to Mitch Harris who does run a good show when he gets behind the mike.)

Bulls**t detector

Here's a bit of fun. The NZ Initiative asks,

"How full of it are you? Run your writing (or indeed any writing at all) through this website to get a bulls**t reading. "


I've scored from .17 to .22 - apparently showing "only a few indications of bullshit language" to "some signs but within acceptable limits."

Truth column March 28 - April 3

My Truth column for March 28 - April 3

Labour was once proudly the party for the workers; the triers and the battlers.
That’s how our oldest living generation remembers them.  But, over the decades they’ve morphed into the party that espouses entitlements and rights before responsibilities.  They shut down free-thinkers with political correctness, but champion free-riders with their promotion of generous, unconditional social security. If you doubt me, consider this recent parliamentary exchange between social development minister Paula Bennett, and Labour’s Jacinda Ardern, complaining about sole-parent benefit reforms:

More

"I don't like the income tax"

Another great quote dug up by the Freedom Foundation:

I don't like the income tax. Every time we talk about these taxes we get around to the idea of "from each according to his capacity and to each according to his needs." That's socialism. It's written in the Communist Manifesto. Maybe we ought to see that every person who gets a tax return receives a copy of the Communist Manifesto with it so he can see what's happening to him.
 

- T. Coleman Andrews, Commissioner of Internal Revenue, U.S. News & World Report [May 25, 1956]

UK Chancellor defends welfare reform

The UK Chancellor is the equivalent of our Finance Minister. A report from today's Scotsman:

GEORGE Osborne yesterday attacked critics of the UK government’s welfare reform claiming they were talking “ill-informed rubbish” as he defended his controversial policies.
The Chancellor said the welfare system was “fundamentally broken” and he was “proud” of the stance being taken by the government, which has come in for severe criticism for introducing such measures as the “bedroom tax”.
Speaking at a Morrisons’ distribution depot in Kent, Mr Osborne also defended the decision to cut tax for higher earners by slashing the top rate.
“In a modern, global economy where people can move anywhere in the world, you cannot have a top rate of tax that discourages people from living here, from setting up businesses here, investing here, creating jobs here.”
His speech provoked a furious backlash in Scotland where the SNP claimed 105,000 households will be £600 a year worse off as a result of the changes.
But Mr Osborne said: “Those who campaign against a cap on benefits for families who aren’t working are completely out of touch with how the millions of working families, who pay the taxes to fund these benefits, feel about this.
“I’m proud of what we’re doing to restore some common sense and control on costs. In recent days we have heard a lot of, frankly, ill-informed rubbish about these welfare reforms.
“Some have said it’s the end of the welfare state. That is shrill, headline-seeking nonsense. I will tell you what is true. Taxpayers don’t think the welfare state works properly anymore.”
Mr Osborne said the system had not only become unaffordable, it was now so complicated people were better off on the dole rather than going to work.
“These vested interests always complain, with depressingly predictable outrage, about every change to a system which is failing. I want to take the argument to them,” he said.
“Because defending every line item of welfare spending isn’t credible in the current economic environment. Because defending benefits that trap people in poverty and penalise work is defending the indefensible.
“The benefit system is broken; it penalises those who try to do the right thing; and the British people badly want it fixed.”

Minister Bennett mistaken or misled

A 'welfare commentator' must be politically even-handed. If Jacinda Ardern gets it wrong I'm quick to criticise.

When it was reported  Paula Bennett said, "There were 659 subsequent children born to parents already claiming a benefit this January," I knew the number was either aberrant or wrong.

So I queried the number with MSD and received this response,

"to answer your question the number does not necessarily relate to children born in January - but rather children who were to be added, in January, to client benefits as subsequent children."

So then I asked,

What were the ages of the subsequent  children added to an existing benefit in January?

 but was told

unfortunately we are not able to provide an age breakdown for subsequent children

A subsequent child could be added to a foster carer's benefit; or moved into a 'safer' family at CYF instigation; moved from a mother to a father; adopted (particularly whangai) and so on.

Subsequent babies born directly onto a  benefit number annually around 4,800 or
400 monthly.

 "As the second round of welfare reforms come back before Parliament, Social Development Minister Paula Bennett says the 650 children born to women already claiming a benefit in January are reason enough for her tough reforms"

250 would represent an increase of 62 percent.

There is no need to exaggerate  statistics to justify crucial reforms, especially when inaccurate claims could undermine support.

Pay your weight

What's the difference between carrying extra kilos in baggage and extra kilos on your person, except you get charged for the first? The economies of air travel are directly linked to weight carried and in an increasingly tight market I'd expect this policy to become more widespread. It will only take one major airline to adopt it, making them more attractive to most flyers, and the competition won't be able to afford not to. The NZ Herald is running a poll:

Is it fair to charge overweight passengers more to fly?

1500–1550 votes

Yes - it should be a policy on all airlines.

69%

Maybe - but only a small fee.

12%

No - it's discrimination.

19%

Reducing inequality among road injured

Data has been available for some time that shows Maori are statistically more likely to be involved in a road accident. Now the University of Auckland has measured the risk for Maori children in that region:

Maori children are 65 per cent more likely to be killed or hurt on our roads than children of other ethnicities.

This is synonymous with heightened risk of poverty, neglect, abuse, ill-health, educational under-achievement,  involvement with crime, etc. It is hardly surprising. What captured me was this sentence:

University of Auckland researcher Dr Jamie Hosking said the report highlighted what needed to be done to reduce inequality among those injured.

Another 'inequality obsessed' academic not thinking through the implications of his words.

A reduction in inequality amongst the injured could be achieved if more 'rich' people had accidents. Or more Asians, who are apparently the safest road users.

The goal is surely a reduction of injuries irrespective of ethnicity or economic status.

Does he come out with this sanitised-speak simply to avoid saying, we need to see an improvement in the safety practices around and on roads by Maori, and particularly Maori parents?


Of course describing road-risk  as an 'inequality' problem segues nicely into the logical next step which is, naturally enough, to spend more money righting it.

Calls for more spending/borrowing are astonishing

It is not my primary intention to argue against tax cuts but I couldn't accept the PSA Secretary Richard Wagstaff's rationale for extending Paid Parental Leave. My response in Monday's DomPost:

DomPost: Early work tests for adding children to a benefit fair

Yesterday's DomPost editorial was pleasantly forthright.

After the usual preamble about welfare being a social contract which most beneficiaries do not exploit, it continues,

"Sadly, however, some beneficiaries see it as their God-given right to remain on welfare for life and not only make no effort to improve their lot, but add to the burden on taxpayers.
They include women on the domestic purposes benefit who seem to believe they can have as many children as they want while remaining dependent on the state, and that workers will be happy to pay for them to have that privilege...."

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The falling teenage birth rate

A commentor yesterday was surprised that the teenage birth rate is dropping.

I've extracted the data from Statistics NZ and charted them. The first chart shows the birth rate per 15-19 year-olds has been dropping since 2008. The Maori rate is much higher which left me with the question, is the total rate falling only because the Maori rate is?

So I've charted births in absolute numbers. There's a slight quirk in that the Maori data is for births under twenty but there are very few under 15 so the line wouldn't change significantly.

Births for both Maori and non-Maori are dropping. I didn't chart the Pacific and Asian data but the trend is the same. So the reasons, whatever they are, are at least cross-cultural. That's a start. It'll be fascinating to see where the lines go in the next seven years.

Update. The birth rates are falling in every age group except 40 plus. Better half has just said to me it's the recession and that the same thing happened in the Depression. I imagine that the 40 plus females are going against the trend because they are running out of time and have better financial means. Also WFF introduced in 2005 seemed to produce a bit of a temporary baby boom, so a return to more 'normal' rates would be seen as a fall. But the teenage birth in 2012 was the lowest it's ever been (at least according to data going back to 1962 and you wouldn't expect it to be lower in times when people married and started families relatively young).

"You shouldn't leave a man alone with a baby"

Whaleoil has blogged a YouTube clip supposed to provoke outrage against male physical play with a baby.

By coincidence we had a visiting 15 month-old today.

My (almost) 19 year-old son looked after her from the outset. Her step Granddad was doing swing rides with secure hands, they encouragingly guided her up and down steps, they 'danced' to get her dancing. She loved every moment.

Any 'movement' against men looking after babies is tragic.

Reported progress with youth

The current government has been keen to increasingly involve the private sector  in a number of areas. MSD has just reported on the progress of their Social Sector trials which have been running in half a dozen locations - Taumarunui, Tokoroa, Te Kuiti, Kawerau, Levin and Gore - and will be extended and rolled out elsewhere. They involve smallish communities finding their own solutions to problem youth. Some of the trials are led by employed individuals, others by charitable trusts. They build on and co-ordinate  existing services and programmes which are highly practical. Apparently:

Momentum around the Social Sector Trials is strong. Anecdotal evidence suggests increased levels of cooperation, collaboration, transparency and accountability around programmes and services as well as progress towards impacts on outcomes.
Outcomes reported at the local level include:

• truancy levels trending downwards
• disengaged young people being identified and supported into engagement in education, training and employment (through new local programmes, advocacy, and exposure to opportunities)
• young people who would not normally access services being able to in their own environment (nurses, doctors, youth workers, and social workers being available in schools)
• individual plans being put in place for young people with high and complex needs
• young people having access to positive opportunities such as holiday programmes, youth hubs, intensive mentoring and community events
• more young people accessing help for drug and alcohol problems
• young people being supported to pay off justice sector fines and be supported through activities such as drivers licensing to reduce the possibility of fines occurring
• young people knowing how/where to access programmes and services

It's all very paternalistic but we are talking 12-18 year-olds. Someone has to step in when normal parenting is absent. Just a thought and mentioned before, I've been scratching my head over the dropping teenage birthrate. These programmes may be one factor.

Truth column March 21-27

My Truth column from March 21-27:

It is my fervent hope that National exercises its financial veto against extending paid parental leave from 14 to 26 weeks.
Apparently, many mums and dads and babies turned up at the select committee last week to support Sue Moroney’s member’s bill.
“Think of the children,” they said in one voice.
Well why don’t you, the parent, think about the children?

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DI rolls "heading for collapse" in US?

The NCPA has a piece on the soaring disability insurance numbers in the US:

Since 1970, the number of individuals receiving DI has grown sixfold (from 1.4 million to 8.8 million), and the program expenses have grown tenfold, which is unsustainable.

How does NZ compare?

Using sickness and invalid benefit annual totals, the numbers have grown from 14,310 in 1970 to 147,029 in 2011 - more than ten-fold. Measured against the total population there are 28 claimants per 1,000 in the US compared to 33 per 1,000 here.

(That ignores long-term ACC claimants.)

Meanwhile both country's populations have grown by around 55 percent over the same period.

Still, neither country's problem is as big as some EU countries.

She believed the rhetoric

When was the last time you heard someone say "It takes a village to raise a child"? Not long ago I bet. Or "... children are a community responsibility". All the time. These are OUR children we are told.

And that's what the mother of a baby left in a Porirua Pack'n.Save carpark thought too. Baby all tucked up and sleeping peacefully, she left a note asking anyone who saw it wake ring her cellphone.

But wait now for the howls of outrage from the collectivists....

Rubbish from Russel Norman

Green co-leader Russel Norman says:

90 percent of Kiwis not interested in Key’s asset sales

He bases this on the 425,000 registered expressions of interest as a share of the total population. That includes the million or so children.

Roughly, there are around 1.5 million households in New Zealand with an average of 3 occupants. In general only one occupant, the main bread-winner, would make the expression of interest. So 425,000 expressions could easily represent interest from 1, 2, 3 or more others.

Being as loose as Russel Norman with statistics I could simply say the expression of interest represents 28 percent of households. And then claim that  72 percent of Kiwis aren't interested.

Of course that would still be untrue as many people would be interested but 1/ unable to afford the shares, or 2/ simply not registered their interest. For instance, I'm still thinking about it.

I haven't registered an interest in buying Mighty River shares but I support their sale and asset sales in general.

It's just desperate and dishonest stuff from Norman. It must be humiliating to have to chase after the votes of fools. Only an idiot would believe this claim.

Why some people can't get jobs

 According to Stuff:

"Some employers say they are dealing with dozens of applicants unpresentable and unfit for work and they fear it's only going to get worse as the next wave of benefit reforms starts to settle in and more beneficiaries are forced to actively look for work...despite the many jobless, employers say continual absenteeism, substance abuse and poor work ethic appear to be making a lot of them unemployable."

Employers occasionally speak out about their difficulty in getting good people. It's more often a lament heard on talkback radio than read in print but the stories aren't uncommon. I don't doubt their veracity and they make me angry, despairing and worried.

These 'inadequates' to put it politely will doubtless be passing on their own attitudes and impaired intelligences to their children. I fear that cutting off their benefit incomes won't motivate them positively. It'll just turn them into more resentful, more bitter and more desperate characters.

That is not to say it shouldn't happen.  A line has to be drawn. Society has to concede that some people have been helped as much as possible. Their education, their health, housing and income needs have all been met by the state to no avail. In fact, to their detriment.

The "next wave of benefit reforms" will begin to pull back the carpet under which we have swept this problem for too long.

One in five babies welfare dependent by year-end

Media Release

ONE IN FIVE BABIES BORN 2012 ON WELFARE BY YEAR-END

Thursday, March 21, 2013

Data released under the Official Information Act shows that 21.2 percent of babies born in 2012  were dependent on a caregiver receiving a welfare benefit by the end of the same year.

Welfare commentator Lindsay Mitchell said that, "Over one in five babies reliant on welfare by year-end is a sobering and sad statistic. But it's worse for Maori at over 1 in 3 or 35.9 percent."

"There is now an established pattern of childbearing involving birth onto an existing benefit or recourse to welfare soon after.  This occurs during good and bad economic periods. For instance, in 2007, when New Zealand briefly experienced the lowest unemployment rate in the OECD, the percentage only reduced to 19.1%"

"In general, the younger that children go on welfare, the longer they will stay in the benefit system. This leads to chronic child poverty and the many associated risks."

"Current and forthcoming welfare reforms are aimed at reducing this incidence but the answer remains largely with young females who need to be persuaded to gain educational qualifications, work skills and a committed partner before embarking on motherhood. "

(Talking to Larry Williams on NewstalkZB about this issue)

Paula outbats Jacinda again

An exchange in parliament today:

Jacinda Ardern: Should a sole parent be able to study to become a nurse or a social worker while on the DPB or in her new categories of sole parent support or job seeker; if not, why not?
Hon PAULA BENNETT: It will depend on how that fits with their work-test obligations, so that will depend on the age of the youngest child. If they are aged under 5 years old, there will be absolutely no trouble in the parent studying full time. If they are aged over 5, there may be some part-time work obligations alongside of them, and the parent can still study if they are doing those.
Jacinda Ardern: No, they can’t.
Hon PAULA BENNETT: Yes, they can. They can perfectly well study and work 15 hours a week. In fact, most of us over this side did that. I know that the member would not be able to associate with that, but that is actually true. Parents can study part-time or full-time and also meet their part-time work-test obligations, which I think are entirely fair.

Truth Column March 14 -20

 My Truth column March 14 - 20

It was embarrassing listening to a woman bleating about the status of New Zealand females, their lack of representation on boards and experience of pay discrimination.  On International Women’s Day, March 8, 2013, I could find far, far more to celebrate than bitch about.

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The starting out wage

The government wants to introduce (or re-introduce) a minimum youth rate and call it a Starting Out rate. It'll be $11 per hour.

Their professed aim is to get youth into employment.

My problem is this. Will more jobs be created because the price of labour is lowered, when job subsidies already exist and we still have high youth unemployment? An employer can already hire a young person at less than the minimum wage if he receives a Work and Income subsidy.

While NZ is still feeling the effects of the GFC will the difference between $13.75 and $11 create more jobs or simply represent a loss to the worker and a gain to the employer? In a growing economy I'm sure the optimum would be realised - more jobs. But currently, I don't know.

I support the move but with reservations about it being the silver bullet for reducing youth unemployment.

Council rate increases

Local government finance and policy analyst Larry Mitchell has a short piece in The Truth about council rate increases:

New Zealand Councils, particularly in this election year, make great PR play by citing their proposed current year’s percentage rate increases, more so if an increase is considered modest.
Public interest is drawn to such statements. The problem with council rate increase announcements is that they need not be correct. In fact many are downright misleading and here’s why.

Right on cue here comes my council, Hutt City:

Hutt City Council is proposing an average annual rate rise of less than one per cent in its annual plan for 2013-2014, says Lower Hutt Mayor Ray Wallace.
Mayor Wallace says councillors have proposed increasing rates revenue by an average of 0.9 per cent reflecting the strong financial management of the Hutt City Council’s finances.

Strong financial management? With operating expenditure of around $126 million and debt of $67 million and a deficit for the past two years?

Larry also produces a League Table for the 67 local authorities in NZ. It measures economic sustainability and affordability. Hutt City rates 43rd. For financial performance it rates 'fair'. A few councils achieve a 'good' or even 'very good'.

He writes about the reasons for council indebtedness:

The “it’s not our money” coupled to “castle-building” attitudes of elected members. We have elected many Councillors over the last ten or so years whose debt-fuelled adventures with our money have lead to Council debt levels and gold plated community infrastructure without consideration of their basic affordability to ratepayers and their effect upon ongoing financial sustainability. Large stadia (Dunedin) expensive Council organisations with expensive tastes (with Auckland Council leading the way) and bloated payrolls have unfortunately become the norm. Audit meantime has stood idly by without exercising their wider mandate powers to ensure that public monies are not wasted. Elected members have failed to adequately set and supervise affordable policies that match the incomes and demographics of their ratepayer-electors....

And finally, the role played by the beauracrats. There are some very good people out their working for Councils. But far too many, starting at the top and with CEO leadership missing in action who have paid little heed to matters such as cost containment . They continue to project expenditure/rates increases that pay little heed to the realities of a persistent recession. Enough has been written already of inflated senior staff salaries. I would just add this. Within the relatively stable, secure, mostly risk free circumstances of their employment Council employee terms of engagement do not justify the present private sector competitive rates of payment.

And the following (included in the League Table report) referring to any effect of the GFC, is an article published in Local Government Magazine Feb 2011:

Mr Mitchell says longer term recovery strategies will be needed by 2012 or earlier. Financial plans must now

confront the budget realities of affordability and ‘cut the cloth’.

“These steps should be followed by meaningful and ongoing audit and performance assurance, coupled with

independent advice on the matters. Elected members must avoid ‘staff capture’ by insisting upon provision 

of independent advice covering a range of well understood and fully cost/benefited options.”

Mr Mitchell says he doesn’t accept that councils’ financial problems are principally due to the recession 

which has gripped New Zealand since the international banking crisis hit.“No, I don’t think so. This situation, 

let’s call it a crisis, for that it may well be, has been a long time in the making.

“A major reason that springs immediately to mind is a perverse and unforeseen consequence of the 2002 Act.

This legislation that promised so much has put councils into something of an inflexible and unresponsive

medium term (three to ten-year) straitjacket. It is called the Long Term Council Community Plan. While this

plan is regularly reviewed, it tends to build a model that has in its effect constrained councils’ ability to

readily react to the external financial-economic environment. And this is particularly so of course, when a

recession hits as quickly as this one has.“If you go back to the 2006 and earlier plans, all o

f their projections were for steady increases, as if there was no tomorrow, including − and this is the killer −

the failure to control maximum prudent-affordable-sustainable debt levels. The interest only content of an average residential rates bill for highly indebted councils is alreadyover 25 per cent of its total; a bit like some heavily mortgaged homeowners really to put this into some context."

He believes that current financial difficulties have been exacerbated by the effects of the

short term changesbrought about by a three-year election cycle, coupled with the hands-

off compliance and procedural nature of audits of the LTCCPs.

The LTCCP unfortunately has become a more prescriptive document than is desirable, he says.

“It tends not to stress the importance of affordability and sustainability issues; it pays only passing regard for

the need to adopt accountable economic and financial performance measurement and to cap that lot off its

legislative structure limits the flexibility of councils to make changes even when they see the tsunami coming.

“I believe councils tend to get locked into their plans. If it was a private-sector company, it could react within

a month or at most within a quarter. Given council inertia linked to their legislative and operational

environment it’s like turning around the Titanic.

“Councils are going to have to get pretty active in the next 12 to 24 months because they won’t have many

easy options left. And now they just have! to take the correct actions.”

Sudden Unexpected Death in Infancy Syndrome - ethnicity

The really good news is the general SUDI rate is trending down - significantly. But:

"We were especially concerned to see that the rate of death in Maori and Pacific infants is significantly higher than for European infants,'' Dr Baker said.
"We're not sure exactly why this is, although differences in the rate of smoking during pregnancy may be a factor. We know that infants exposed to cigarette smoke in pregnancy tend to be smaller and are more prone to suffocation.''

A summary of the first results from Growing Up In NZ, a birth cohort study, found:

* More than one in 10 mothers continued to smoke through their pregnancies (with an over-representation of those identifying as Maori and living in the most deprived areas.)

Again (and I could write a paper on this subject) conflating Maori and Pacific isn't helpful.

Over 2003 to 2007 there were 202 SUDI deaths for Maori babies; 42 for Pacific; 4 for Asian and 80 for 'other'. The rate (per relevant population) for Pacific is well under Maori although higher than 'other'.

Any report that differentiates between 'Maori and Pacific' and 'other'  should  go  further and highlight the difference between Maori and Pacific. That story also holds important clues.

Cyprus

“Any government big enough to give you everything you want is big enough to take away everything you have."

(source disputed)

Some more up-to-date quotes about the situation via Robert Tracinski:

Thomas Pascoe explains why this is such an alarming precedent.

"The principle that there is no division between your private property and communal property which may be appropriated by the government whenever it sees fit is an outrageous one in any system other than Communism. The idea that a government which has chronically misspent may order the banks to close and deduct a sum of its choosing from a person's balance before allowing it to re-open is beyond parody. "In the name of saving the state, central banks throughout the West have been conducting inflationary policies which act as a tax on savings. At least that is subtle. Now, in order to mitigate the excesses of the rash, both private borrowers and the government, savers are being taxed directly.
"The establishment of the principle that a government can, and at times of economic strain must, help itself to your savings, and that this is a legitimate tool of statecraft, ought to provoke riots."

Megan McArdle explains why European finance ministers thought they could get away with raiding accounts in Cyprus: it has become a haven for tax-dodging Russian oligarchs. The problem is the question everyone is asking themselves right now: where will this be tried next?

"If Cyprus had done this on its own, the country would be in trouble, but the rest of the world would just emit a bemused sigh and move on. Now, however, this plan has the imprimatur of the EU stamped on it—and so people are going to be looking hard at other European banking systems. Which other nations' depositors might have to take a similar haircut in the future? "Hopefully, savers will view Cyprus as an extreme one-off: a tiny nation whose banking system was unsustainably oversized for its economy, and whose substantial depositor base of kleptocratic foreigners made it uniquely difficult to deliver government support.
"The problem is, Europe seems to be chock full of unique, one time problems with its banking system. There's a real risk that investors will decide that they'd rather not stick around to see what one-of-a-kind, custom-crafted solution the European ministers come up with next."

Truth column March 7-13

A local bus-stop shelter was recently spray-painted with "Aoteoroa is not for sale." The tagging was a response to the Crafar Farm deal. In a similar vein last week, there were calls from NZ First and The Greens (unlikely bedmates) for the government to 'do something' about house sales to foreigners, in particular, Asians. Foreign investors, they say, are locking New Zealanders out of the housing market with their preparedness to pay good money for property. It's not fair, they say. It's not looking after our own first.

For every buyer of a house, there's a seller. Before asking politicians to regulate against freedom to purchase property, owners should think about what that means for them.

More

A good news story about getting off the dole

Home from work and having a happy hour glass of bubbly, feeling a bit more benign towards mankind as Michael Laws would put it, I came across this and thought I'd just cut and paste it. I can theorise till the cows come home about why government shouldn't be involved in wage subsidies, skills training, job placement etc but they are and this is at least one good, heart-warming even, result.

"I’ve learnt a lot and my knowledge is growing all the time."

Late one night last year, an elderly man found himself harassed by a group outside a Wellington bar. Afraid and unable to escape the situation, he sought refuge inside the bar. Henry Lemalu was working security when the man came up and asked him for help.
A quiet-spoken, steadfast individual, Henry was relatively new to security but he knew what to do.
“I went out there and told them to mind their own business. The following week the man came back and gave me a present to thank me for helping him out. That was a great feeling – knowing you can make a difference.”
For employer Darryl Stonnell of First Contact Security, it would have come as no surprise to see his trainee handle the situation so well.
Intelligent, committed and worthy are the words Darryl used when he nominated Henry for the Security Trainee of the Year 2012.
And yet, 18 months before he won the industry-wide award, Henry Lomalu was so afraid he wouldn’t measure up, especially with writing and theory, that it took all his courage not to walk away from the opportunity.
Struggling to find work on the Unemployment Benefit back in 2011, Henry was offered a place on an eight-week training course with a security company, First Contact. The company partners with Work and Income, training unemployed clients with the aim of moving them into work or further training.
It was the first time Henry had studied or trained since leaving school.
“I was so afraid that I almost had second thoughts. I wasn’t sure if I was capable or what I was getting myself into. But I’m pleased I convinced myself that this was something I could do and that I needed to do”, says Henry.
He shouldn’t have worried. Not only did he pass and gain a job, but First Contact saw the potential in Henry and encouraged him to go for the National Certificate in Security.
“It was a nice feeling to know that Darryl and the team supported me and wanted me to gain more qualifications. Otherwise I don’t think I would have attempted it. I was worried about the theory aspect; I’ve never had to write reports before or learn the specific alphabet used in the industry.”
Henry is now a team leader and studying towards the Level 3 certificate. He says he’s proud of what he’s done so far.
“I’ve learnt a lot and my knowledge is growing all the time.”
For Darryl, the reward is not only gaining a valuable employee but seeing Henry grow in confidence and skill.
He says he is impressed by Henry’s determination and hopes that winning the award will prove to Henry that he is capable of achieving even more.
“He is a prime example of someone who hasn’t found the training easy, has struggled at times, but has persevered and is now reaping the rewards of his efforts.”

Parental leave - pay for it yourself

The private members bill legislating for an increase of taxpayer-funded Paid Parental Leave (PPL) from 14 to 26 weeks is back in parliament today. Bear in mind, if lobbyists get 6 months it'll only be a matter of time before they want 1 year.

The main argument goes that bonding and breastfeeding are so important they should be encouraged as much as possible.

If you look at how mothers are behaving after a birth most already appreciate that.

NZ statistics analysed data from 2002 -2005 when the provision was for 12 weeks PPL.

Did most mothers return to work when their leave entitlement ran out?

No.

4 months after starting PPL only 12.5 percent were back working - at 5 months, only 33 percent.

30 percent had not returned to work after 18 months.

So, outside of 12 weeks, the majority of mothers were already funding motherhood themselves. They don't need the taxpayer to make it possible for them to stay home.

60.4 percent were aged 30 or older,  probably well-established in work and earnings. The average monthly earnings before PPL were $3,450. Mothers in the 99th percentile had monthly earnings of $10,490 but under the proposed  legislation would still be getting 6 months tax-payer funded PPL.

Finally, "Employment and return to work rates were higher for those who had earned the most before starting parental leave. "

The people who least need taxpayer support return to work faster anyway.

Begrudging farmers and attitudes to welfare

Those people commenting here and elsewhere about their lack of sympathy for farmers and opposition to any assistance will be pleased to know that Work and Income has not made any payments to farmers since the official drought declaration.

A spokesman for Work and Income said no rural assistance payments had been made since drought had been declared.

As I pointed out yesterday on an earlier thread these payments will be very hard to access and are only for people in extreme hardship.

Personally I don't begrudge it.

Here's something relevant written by an economist:

Attitudes towards welfare may differ substantially even across otherwise similar countries, but the basic determinants of solidarity and willingness to help are understood well enough. An interesting summary of the quantitative and qualitative research is provided by Horton and Gregory (2009: 110–30). It shows, first of all, that most people are not indifferent to the distress of others. 

 

Most people, however, have strong views on what they expect from those receiving help. The single biggest deterrent to generosity is fear of being taken advantage of. Free-riding is so destructive that it need not even be especially widespread in order to undermine people’s willingness to help. At the same time, nothing boosts the willingness to be generous as much as the confidence that most recipients of aid will collaborate, and do their best to improve their own situation.

 

The bottom line of the research is that people empathise with those who try – even if they try unsuccessfully. This is such a strong determinant of people’s willingness to help others that it trumps all other considerations.

 

An interesting illustration is an experimental study in which participants are presented with a set of fictional characters, and are asked to evaluate the degree to which they are deserving (ibid.:123–30). One of the characters has entered hard times through no fault of his own, receives benefits now, has the opportunity to change his situation, but does not do so. Another character has only himself to blame for having come on hard times, but is now doing his best to get his life back on track again. Participants empathised more strongly with the latter character. People are not primarily interested in who is to blame for a situation, but in who is doing their best to remedy the situation.

Who's 'beneficiary bashing'?

It seems to me the phrase 'beneficiary bashing' was coined in the 1990s and originally used to describe Ruth Richardson's benefit cuts. For some time I've been reflecting that the Left are now very quick to cry beneficiary bashing whenever  government attempts to reform welfare IN ANY WAY.

But this National government has never cut benefit payments. In fact they've introduced more protection for benefit levels through indexing.  National hasn't reduced the incomes of beneficiaries.

Policies of (usually) the political Left though, like tobacco and alcohol taxes, supposed environmentally-friendly fuel and energy taxes, a proposed fat tax, or Labour's capital gains tax, actually do or will hurt the lowest income people the most. Does anybody cry 'beneficiary basher' when Tariana Turia ratchets up the price of a cigarette yet again? Despite Maori women being the most prolific users of welfare and the biggest users of tobacco?

I was just reading a paper that shows  spending on alcohol and tobacco accounts for 10.7 percent of the incomes of those in the lowest quintile in the UK. The same paper shows how government interference in the housing market - and the UK has the same affordability problem as NZ - leads to high rents, again disproportionately hurting the working poor and beneficiaries. Do environmentalists seeking to prevent urban sprawl get called beneficiary bashers? Do climate change activists who campaigned for the ETS get called beneficiary bashers?

But offer free long-acting contraception to a beneficiary sole parent and her teenage daughter and you are not only a basher but a eugenicist! Everything aimed at trying to better the material and social lot of people on welfare and their children - work obligations for those able, short-term retention of benefit while transitioning into work, requirement to partake in child health and educational facilities, income management to ensure essentials get paid for - are all labelled punitive and beneficiary bashing.

Perhaps we should turn the term on the Left at every occasion they suggest making life financially tougher for those on low incomes, be they beneficiaries or workers (or both). Even BUY NZ could be construed as a beneficiary bashing campaign on the premise most cannot afford such indulgent nationalism. It'd be drawing a longish bow but isn't that what the Greens, Mana and Labour do every time they invoke the mantra?

A survey that tells us stuff all

Reported at Stuff:

Employers have slammed the government's scorecard on creating jobs and developing a viable growth agenda, a survey of business owners has found.
The Ernst & Young/Sunday Star-Times Job Creation Survey also indicated how widespread employers' concerns over unemployment and job creation are, with an overwhelming majority expecting it to be a major issue at the next General Election.
The survey participants were owners or managers, mainly mid-market, in a variety of industries nationwide.
It found that just over half of those businesses (54 per cent) had hired someone in the last year, but slightly less than that (51 per cent) intended hiring anyone in the year ahead.
When asked if they thought job creation was the responsibility of the government, the private sector or a combination of both, an overwhelming majority (79 per cent) said both.
However most were unimpressed with the government's contribution to that process.

What's missing is any in indication of whether the employer wants the government to be more active in loosening up employment legislation, wage controls, tax legislation, monetary policy etc. or they want the government to spend more on job creation schemes, wage subsidies, training, start-up subsidies etc.

It's depressing that 79 percent think job creation is both the responsibility of government and the private sector. But if I was answering the question precisely, at this point I'd have to agree. The government and only the government can extract itself from activities that contribute to unemployment and business failure. National has done a few things, for example the 90 day work law, but they need to do far more. Especially big stuff like lowering corporate tax. Not tweeking stuff.

So they can't really win when it comes to a survey like this. Labour supporters and National  supporters alike will find fault. But Labour's employment spokesperson, Grant Robertson says:

 "We need a hands-on government, not a hands-off one and I think the message from the business people who have been surveyed here is that they think this is a hands-off government that is not playing its part."

That's not the message I get. I don't get any clear message because the questions (those reported) weren't specific enough. And he shouldn't take it as a sign employers are so unhappy with the government they will vote to change it.

Talking up child poverty

Talking up child poverty is not an unusual practice. But it normally comes from the mouths of any number of people who make their living  documenting or advocating as part of the ' child poverty industry'.

An opinion piece in the NZ Herald earlier this week by the former head of Telstra Clear, exhorted business to get more involved in solving the social problems of NZ children:

Let's look at the facts. Today, a quarter of children live in poverty in New Zealand. That means going without a doctor, good food, shoes, raincoats and decent housing. If you look at Pasifika children, that statistic rises to 51 per cent; and more than half of Maori families are dependent on benefit incomes.

Facts?

Firstly, Mr Freeth has defined living in poverty by the 'reduced living standards measure' which is where his 51 percent of Pasifika children comes from - MSD's  2008 Living Standards Survey. So, 51 percent of Pasifika children experienced (or didn't as the case may be) 4 or more of the following

Ownership/Participation

• A good bed
• Ability to keep main rooms adequately warm
• Suitable clothes for important or special occasions
• Home contents insurance
• Presents for family and friends on special occasions

Economising ‘a lot’ (to keep down costs to help pay for other basics)

• Continued wearing worn out clothing
• Continued wearing worn out shoes
• Went without or cut back on fresh fruit and vegetables
• Bought cheaper or less meat than wanted
• Postponed visits to the doctor
• Did not pick up a prescription
• Put up with feeling cold to save on heating costs
• Went without or cut back on visits to family or friends
• Did not go to a funeral (tangi) you wanted to

And there are other measures mentioned like not being able to have friends to a party of your own bedroom when aged 10 plus. It's all very subjective stuff. BUT experiencing reduced living standards does not condemn a child.

Just for some balance, if the OECD measure of child poverty was used the percentage would immediately drop to around 12% of NZ children.

Then he says that, "More than half of Maori families are dependent on benefit incomes." Say what?

I'd be the first to agree that Maori are disproportionately dependent on welfare and it's not good for their children. But the percentage is not that high.

At December 2012 around 112,000 Maori received a main benefit. There were around 375,000 18-64 year-old Maori in 2012. So just on 30 percent of the Maori working age population receives a benefit.

The proportion for Maori single parents on a benefit is higher but even the highest age group - 20-29 - doesn't exceed half.


I have no idea where he got his statistic from.

Ironically later in the piece he writes:

Our statistics are not simply unacceptable, they are truly outrageous. They are beyond comprehension. And where, as business leaders, have we been, I wonder, as more and more reports are released showing more issues with children and youth health and welfare?

Probably getting on with their first priority - running a business - and feeling suspicious about media reports exaggerating child poverty.

Truth column Feb 28 - March 6

The Truth site is now up-to-date and I should be able to post my column weekly again.

The 'living wage'  idea poses more questions than it answers. Apparently the proposed non-compulsory hourly wage of $18.40 is based on the needs of a family with two children, with one full-time and one part-time worker.

But someone with dependent children who is currently earning less than the living wage will almost certainly be receiving  Working For Families assistance. As well, someone without children might be receiving accommodation supplement which helps with rent, board or a mortgage.

More

Farmers likened to "solo mums" - Helen Kelly

Regarding the government assistance available to farmers in officially drought-ridden areas, in a column titled  "We are all beneficiaries now" Helen Kelly writes,

Solo mums are a bit like these farmers. They are working but not earning and need community support to do that....  The drought shows how important social protection systems are.  When the unexpected happens – your farm dries up, you get sick, you lose your job, you find yourself alone raising your kids – the community steps in by way of tax funded Social Protection. 

I wonder how farmers feel about being compared to people who default to a welfare lifestyle in their thousands every year?

Tax-paying farmers are subject to the whim of the weather; many DPB mums are subject to their own (or their partner's) personal whims and wants. But Kelly can't differentiate between people who are  products of a habitual hand-out regime and people who need temporary help.

Shoring up support for a debased benefit system on the back of drought-stricken farmers sucks.

(Should farmers get government assistance? A tax break to buy income protection insurance against such advents would be better).

Truth Column Feb 21-27

My Truth column for February 21-27. The political poll referred to in this column has since been superseded by others.

Here's a scary headline: LABOUR, GREENS WITH MINOR PARTIES WOULD WIN ELECTION.  So said the latest Roy Morgan poll. Emboldened Green co-leader Metiria Turei shoved aside her education spokesperson to lead the charge against charter schools and pave the way to becoming Education Minister in 2014. Any charter school would be turned into a state school under her direction, she threatened. In other words she'd remove the "greater flexibility in exchange for greater accountability of educational outcomes" promised to partnership schools. Before the initiative has chance to prove itself, the Greens (and Labour) would trample it dead.
What else could we expect from such a government?

More.

And a few words from the Minister...

Regarding Jacinda Ardern's claims and what the Herald on Sunday published, Paula Bennett has responded;

"Ms Ardern and the Herald on Sunday need to get their facts right. The Herald on Sunday reported today that changes to youth are progressing through Parliament and will be introduced shortly. Wake up - they passed through the House last year and were implemented in August 2012."
“This is shoddy journalism and scaremongering by Labour. They might not like the truth and prefer to talk down people's chances of finding work, but I believe in people and their abilities, and want to support and encourage them in their hunt for work,” says Mrs Bennett.

Note the Herald headline has now changed. From memory it was something like Benefit numbers swell. If I google that term said article comes up with a new title.

The print media turns over a lot of young journalists. Or moves them around different portfolios. It's a good thing the blogosphere is now around to hold them to account.

(Bennett should also be careful when talking about DPB numbers to explicitly refer to sole parents. As is stands her release has the potential to confuse when matched against MSD's benefit factsheets.)

Median time on welfare 7.4 years

I was reviewing some of the papers presented to the WWG back in 2010 and noted some important statistics relating to the degree of dependence on welfare in New Zealand. 

Of people aged 28-64 receiving benefit at June 2009 (for whom there is a full ten years since they turned 18), half had spent at least three-quarters of the preceding decade on benefit. Just under a quarter had received benefit for all of the decade.

- the median proportion of time spent on benefit in the preceding decade was 74%

- 23% had spent all of the preceding decade on benefit. 

- Māori were much more likely than non-Maori to be in receipt of benefit and had spent larger shares of time in receipt of benefit, on average, than non-Maori.

- Pacific people and people from “Other” ethnic groups in receipt of benefit had, on

average, spent smaller shares of time in receipt of benefit than both Māori and European benefit recipients.

 

(That last statistic is important because too often Pacific people get put together with Maori in a 'Polynesian' category. That does a disservice to Pacific people who aren't over-represented in the benefit system in either numbers or duration of dependence.)

A lot of left-leaning commentators and politicians play down welfare dependence by using statistics pertaining to  the total population use of benefits over time. Naturally many people do use welfare at some point and that skews the overall picture towards shorter periods in receipt. Here's an example from Jacinda Ardern:

"There are 112,000 sole parents on the Domestic Purposes Benefit. Most come off it within four years"

What she omits to mention is many go back on it quite quickly. The report linked to shows that at June 2009 73 percent of DPB sole parents had spent 50 percent or more of the preceding decade on a benefit. These are the numbers that describe long-term dependence - the problem welfare reforms are trying to reduce - and it is wilfully misleading  to use any others.

Children's Day dying a death

Today was Children's Day. News to me. This media release was the first I knew about it:

The future of New Zealand depends on the well being of every child. Child Poverty Action Group says Children’s Day this Sunday is a chance for New Zealanders to reflect on our collective responsibility for the well-being of all our children.

Hopefully people are tiring of annual, designated 'concern' days for everything and anything. The over-subscription to 'days' has cast a pall over their efficacy. Usually a socialist construct designed to put political heat on governments to 'do something', I look forward to their demise.