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Don Brash Writes... No. 10, 11 June 2003


An update from National's Finance spokesman

No. 10, 11 June 2003

Welfare dependency

The National Party has just released a paper by Katherine Rich, our welfare spokeswoman, called "Saving the next generation from welfare dependency". It's on National's website ( and is thoroughly worth reading. Katherine tackles the tough welfare questions... should benefits have time limits; should able-bodied people be able to receive a benefit indefinitely without doing some kind of work in return?

The paper is NOT a beneficiary bashing exercise.

I was reminded recently about just how painful being unemployed can be. I received a letter from a 57 year-old, who's been unemployed for 18 months having been made redundant after 41 years. During that 18 months he'd applied for over 150 jobs, had about seven interviews, and been short-listed twice. And the result? Nothing. He knew of my concern about the very large number of those on benefits and wrote:

"Your comment was extremely hurtful. What you do not realise is that being unemployed is a day-by-day roller coaster of emotions. Some days your hopes are high; others you can hardly drag yourself out of bed. Believe me suicide is never far from your mind. What is there to live for? Your friends no longer ring you as you cannot afford to go out with them. You cannot follow sport as it is now all on pay TV."

The pain in this letter was palpable, and I seemed to be callous and indifferent.... which is certainly not the case.

As I've said before, getting people into satisfying employment involves getting four things right. It means: 1) ensuring sufficient demand in the economy so there are lots of jobs available - and in most parts of the country there is plenty of demand at present;

2) ensuring people have the basic skills of literacy and numeracy, without which their employment prospects will remain bleak;

3) reducing or eliminating disincentives to hiring people; and

4) ensuring people have an incentive to take the jobs offered, which may mean measures such as scrapping the dole and arranging for local governments to be the employers of last resort, or introducing a time limit on the benefit.

Why can't a 57 year old with a long history of presumably satisfactory work get a job, when he so clearly wants one? I don't know the answer to that question but I suspect part of the answer lies in the disincentives that now exist to hiring people who seem even slightly risky to the prospective employer.

Thanks to the ever greater difficulties which the law and the courts create around firing staff, employers are understandably reluctant to hire people they feel might possibly not work out. And the result? People who are a bit older than the average, people at the start of their careers with no work experience, people who have been unemployed for some time, people whose language skills are not too good, people with brown skins, people with a criminal conviction... they all find it hard to get a job.

I believe that one important way of getting everyone into a job is to remove the obstacles now facing employers in firing staff.

Finance and economics boring?

Industry New Zealand's recent survey revealed that only 6% of the 1500 people surveyed regarded business and the economy as factors likely to ensure their "ideal" place of living.

The same survey found that 47% of women find economic issues "boring" - a truly depressing result for me, as a male economist!

Peter Ellis petition

And now, something totally unrelated to economics, or my role as National's Finance spokesman. For the past few weeks, I have been gathering signatures for a petition urging the Government to appoint a Royal Commission of Inquiry, presided over by a judge or judges from outside New Zealand, to look into all aspects of Peter Ellis's conviction in the early nineties. Why? Because I have read enough of Lynley Hood's book "A City Possessed: the Christchurch Civic Creche Case" to be seriously concerned that Peter Ellis's conviction may have been entirely wrong. Katherine Rich and I have been helping Lynley Hood assemble the petition.

We haven't tried to get thousands of signatures - we don't have the time or the resources to do that - so instead we have tried to gain support from those whom the Government is most likely to take seriously. To date, Members of Parliament from five of the parties in Parliament have signed, together with a number of Queens Counsel, several professors of law, prominent former politicians (including David Lange, Mike Moore, Michael Bassett and David Caygill), writers and members of the media.

It's a serious matter when a guilty person goes free. It's at least as serious when an innocent person is convicted of a crime. Peter Ellis may be guilty or innocent, but there are too many questions unanswered to let the matter rest.

Don Brash

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