Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Investment Approach for welfare loses sight of social goals

20 May 2012

Business focused “Investment Approach” for welfare loses sight of social goals

Child Poverty Action Group is concerned that the government is adopting the USA’s harsh approach to welfare reform, which focuses on reducing the cost of welfare without regard for the wellbeing of those affected. Under the USA’s reforms, welfare rolls were reduced, but poverty and hardship increased and many people simply disappeared from both welfare and employment statistics.

Ms Bennett announced yesterday that a newly appointed board at Work and Income NZ would oversee an "investment approach to welfare." The overseeing board will adopt a private insurance approach “to reduce future liability”.

The Social Development Minister asserts that: "The cost of today's total number of beneficiaries is estimated at $45 billion.” This terrifying figure, based on the lifetime cost of all the people currently on Domestic Purposes, Unemployment, Sickness and Invalids Benefits, leads her to draw the conclusion: “it makes good economic and social sense to provide targeted support up front to get more people into work sooner".

However, if this thinking is applied to New Zealand superannuation, the Retirement Policy and Research Centre has estimated the actuarial value of New Zealand Superannuation for those currently over 65 is over $80 billion. Most people currently aged under 65 will also reach retirement, so the total expected liability for the old age pension could be about $150 billion. These figures however are somewhat meaningless, like the Minister’s $45 billion, and not a good guide to policy.

CPAG believes the mis-named “investment approach” is a fundamental shift away from the social goals which underpin the provision of social welfare in New Zealand.

CPAG spokesperson Mike O’Brien said, “The funds available for “investment” will be spent largely on restructuring administration, IT, contracts with private providers, and remunerating board members. And the American experience has shown far too much money will be spent harassing beneficiaries, and funding private providers whose incentives are misaligned with the interests of their clients.”

None of this spending will provide extra employment and training opportunities, or address child poverty, which is a major welfare issue for New Zealand. Instead the government is reducing meaningful employment in the public sector and in schools.

Mike O’Brien said: “In its search for efficiency and cost savings, the government cannot afford to lose sight of the long-term wellbeing of our children. The UK Guardian recently warned that “The aim of cuts is to "incentivise" people out of "dependency". Presumably kicking away crutches incentivises the lame to walk.”

References
PensionCommentary 2009-1: Why does the Accident Compensation Corporation have a fund?
http://www.guardian.co.uk/commentisfree/2012/feb/02/welfare-reform-bill-cameron-frightening

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Patience: Drive Safe

Be patient before passing is the AA's message for drivers this Labour weekend.

"People taking crazy risks to get past other vehicles is one of the most dangerous things on the road,” says AA spokesperson Dylan Thomsen.

“The weather is looking good for the long weekend so the roads will be busy. Unfortunately, that also increases the chances of people getting frustrated and trying a risky passing manoeuvre. When they get past, there will probably be more traffic up ahead anyway so it won’t get people there faster.” More>>

 
 

Parliament Today:

Employment Relations Bill: Govt Strains To Get Tea Break Law Through

The Government has been left with egg on its face - failing to get its much-vaunted, but hugely unpopular, meal break law passed in the first week of its new term, Labour spokesperson on Labour Issues Andrew Little says. More>>

ALSO:

Guns: Police Association Call To Arm Police Full Time

"The new minister gave his view, that Police do not need to be armed, while standing on the forecourt of parliament. The dark irony was that the interview followed immediately after breaking news of a gunman running amok in the Canadian parliament in Ottawa..." More>>

ALSO:

Gordon Campbell: On The Tokenism Of New Zealand's Role Against Islamic State

Our contribution against IS will be to send SAS forces to train the Iraqis? That’s like offering trainers to General Custer just as the 7th cavalry reached the Little Big Horn. More>>

ALSO:

Scoop Business: Shell And Todd Caught Drilling Without Approval

Multi-national oil company Shell’s New Zealand arm and local energy giant Todd Energy have breached the new law governing New Zealand’s Exclusive Economic Zone, the Environmental Protection Authority says in an Oct. 10 document released by the Green Party. More>>

ALSO:

Gordon Campbell: On Pharmac, Gough Whitlam And Sleater-Kinney

We’re not at the outset of these negotiations. The outset was six years ago, and negotiators were hoping to have some sort of ‘framework’ deal finished in time for the APEC meeting in a few weeks’ time. These ‘extreme’ positions are what we’ve reached near the intended end of the negotiations… More>>

ALSO:

PM Of Many Hats: Questions, No Answers On Whale Oil

Dr RUSSEL NORMAN (Co-Leader – Green) to the Prime Minister: How many times since November 2008 has he spoken with blogger Cameron Slater on the phone and how many times, if any, has he texted him?
Rt Hon JOHN KEY (Prime Minister): None in my capacity as Prime Minister. More>>

ALSO:

Aussie Investigation Dropped: Call On Minister McCully To Pursue The Case Of Balibo Five

West Papua Action is deeply concerned at the lack of any clear outcome from the Australian Federal Police inquiry into the 1975 deaths of the ‘Balibo Five’ including NZ journalist Gary Cunningham. More>>

ALSO:

'Feed The Kids' Bill: Metiria Turei To Lead Fight On Feeding Hungry Children

Green Party Co-leader Metiria Turei is urging all political parties to support the Feed the Kids Bill which she inherited today from Mana leader Hone Harawira. More>>

ALSO:

Parliament Today: State Opening Of Parliament

The House sat at 10.30am on Tuesday before MPs were summoned to hear the Speech from the Throne in the Legislative Council Chamber. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news