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New Ally In Welfare Reform Battle?

New Ally In Welfare Reform Battle?

Weekly Column by Dr Muriel Newman

Last week Associate Minister John Tamihere distributed a controversial speech at Auckland's Knowledge Wave Conference.

The move turned out to be a significant embarrassment for the Government - not only because the speech criticised Labour policy and breached collective Cabinet responsibility, but because of the outspoken comments Mr Tamihere made to the media.

He accused Social Services Minister Steve Maharey, of "bullshitting" about welfare and of practicing - not "third-wayism" but - "old-left" socialism. Not content with that, he also described the Government's housing policy as "dumb, dumb, dumb".

The ensuing furore forced a high-speed U-turn by the Prime Minster - who had earlier stated that she was "relaxed" about the speech, but soon became outraged and critical, demanding an apology from her junior Minister.

It has now transpired that, while the Minister bucked the system to publicly raise his criticisms of Government policy and Ministerial performance, he failed to put forward his ideas for change to either the responsible Minister or to Cabinet. As a result, he has undermined his credibility and risks that his actions will be seen as a cheap publicity stunt, rather than a serious attempt to reform the welfare system.

It is, however, worthwhile looking at the merits of the issues raised in his speech.

Labelling the Social Services Minister "old left" is not far off the mark. As an academic committed to Labour's socialist agenda, Mr Maharey's goal to expand the welfare state is working. In spite of the best economic conditions in decades, there are still 400,000 working-age New Zealanders - and 300,000 - children living on benefits.

The real worry for the country is that these numbers will swell dramatically when, as it inevitably will, the economy turns down. Further, once the effects of Labour and United's relaxing of the Domestic Purposes Benefit requirements take effect, thousands more women and children will enter the welfare system. As a result, not only will those mothers be disadvantaged, and their children damaged, but the cost to taxpayers will amount to millions and millions more dollars each and every year.

In his speech, John Tamihere said that welfare is destroying Maori. He's right.

Although Maori make up only 14 percent of the total population, more than a third of all adults, and 36 percent of all children living on welfare, are Maori. By the year 2010, it is estimated that three quarters of all Maori children under one year old will be living in welfare dependent fatherless families. Since fatherlessness is a key indicator of crime, the problem of Maori over-representation in crime - as highlighted in Mr Tamihere's speech - is set to get dramatically worse, unless welfare reform becomes a Government priority.

John Tamihere challenged the Government's housing policy, saying that state housing should not be a lifetime entitlement but a respite facility. Yet it is the Labour Government's new income-related rent policy that causes families to no longer move on. Official figures I have just obtained show that 4,214 families in desperate housing need will have to wait more than nine months for a state house if they live in Auckland. Meanwhile the 7,453 families currently in dire financial straights have virtually no chance of getting a state house at all.

This growing waiting list is the reason income related rents - which provide financial assistance based on whether the state is the landlord, rather than the family's need - is misguided. Instead, state support should be needs based, irrespective of who owns the house, with state house tenants being encouraged into home ownership. Given the present policy, however, time limits for state houses surely makes sense.

A major thrust of John Tamihere's speech was the call for Government welfare services to be devolved to the private sector. He was referring, in particular, to Maori agencies. The difficulty that most New Zealanders have in embracing his proposition is the plethora of failures involving Maori providers.

Recently, two Northland organisations contracting services to Child, Youth and Family - Te Hauora o Te Tai Tokerau and the Kaikohe Disabilities Information and Resource Centre - collapsed, costing millions of dollars of taxpayers' money. Serious concerns have also been raised over Maori housing trusts and, of course, the Pipi Trust. In the past, questions have even been asked about the Waipareira Trust.

The underlying problem of state devolution is that the lines of accountability for taxpayers' money are not robust once the funding passes into private hands. If Mr Tamihere were serious about progressing his ideas, he would do well to work with the Auditor General's Office, which is reviewing this whole area in order to find some better ways of ensuring more effective accountability. In his speech, Mr Tamihere stated that it is now time for welfare reform. ACT New Zealand has been calling for welfare reform since it was formed. We see the effects of long-term welfare dependency - in blighting communities, limiting families and damaging children - as the biggest problem this country faces. From having 28 full-time workers supporting each beneficiary only 30 years ago, we now have four. The trend is unsustainable.

While we have been pleased to see National recently coming out in support of ACT's call for welfare reform, it is now reassuring to see that at least one Labour MP agrees. I hope that this is just the beginning of a growing movement for change.

If you agree with the need for welfare reform, why not attend the strategy workshop that I am holding at our annual conference in Wellington on 14-16 here to register...

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