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


MSD “Investment Approach” is not an investment approach

Council of Trade Unions Media release

The Ministry of Social Development’s “Investment Approach” is not an investment approach

Today the Minister of Finance, Bill English gave the first in a series of lectures at Treasury on the Government’s “Social Investment” approach. A flagship part of this is the so-called “Investment Approach” used by the Ministry of Social Development (MSD). It uses techniques from the insurance industry to calculate long term costs to the government of welfare benefits.

The CTU is today publishing a paper on the MSD’s “Investment Approach”, showing that it fails the test of being an investment approach. A true investment approach should take a long term view of both the costs and the benefits of public services in order to reduce costs while maintaining or improving effective services and benefits. It is the idea of spending now to reduce future costs.

Instead, the MSD’s “Investment Approach” is narrow and flawed. Far from being an investment approach to social welfare, it focuses on costs to the government, fails to incorporate either benefits or full costs, and makes invalid assumptions about outcomes for beneficiaries which are central to its logic. In its current form it is a recipe for reducing government expenditure. This narrow, uni-dimensional approach has implications for MSD clients and the impact of its services on wider society but it also has much wider significance because of plans to expand its use.

The Productivity Commission in its report on social services released on Tuesday, also finds that the Investment Approach looks only at costs and benefits to the government and not at the benefits to individuals and the community. It recommended (R9.1) that the Investment Approach “should be further refined to better reflect the wider costs and benefits of interventions” and called for independent evaluations (R9.3). It noted that “slavish application of an investment approach based purely on costs and benefits to government might lead to perverse outcomes. For example, some studies suggest that obesity might reduce future health costs as obese people die more quickly. A health system that sought only a reduction in future health costs might therefore do little, if anything, to discourage obesity.” (p.231)

The paper, The “Investment Approach” is not an investment approach, by CTU Policy Director/Economist is available here or http://union.org.nz/sites/union.org.nz/files/Investment%20Approach%20is%20not%20an%20investment%20approach%20-%20Rosenberg_0.pdf


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On National’s Less Than Stellar Choices

Amid all the jostling in the National caucus ranks, spare a thought for Andrew Bayly. Who? Well might you ask. Plucked from obscurity by Judith Collin, elevated from number 18 to number 3 in the caucus rankings and given the Finance portfolio - a role in which he has been invisible ever since – Bayly seems destined for a future as a trivia quiz question. That’s because as the National leadership contest comes down to a choice between Simon Bridges and Christopher Luxon, the only decisions to be made on Tuesday are over who gets to be leader, and who gets the Finance job... More>>


Government: Workplace Vaccination Requirements Extended To Cover Police And NZ Defence Force

Workplace Relations and Safety Minister Michael Wood announced today that workplace vaccination requirements will be extended to include the New Zealand Police and Defence Force in preparation for the transition to the new COVID-19 Protection Framework on 3 December 2021... More>>

RNZ: Judith Collins removed as National Party leader
Dr Shane Reti is interim leader of the National Party after Judith Collins lost a no-confidence vote. Simon Bridges was demoted and stripped of all portfolios over allegations of an inappropriate comment made five years ago at a party function. Judith Collins was voted out as National's leader today after the party was locked in a caucus for more than three hours... More>>

Government: Supporting New Zealanders To Recover From COVID-19 In The Community
The Government is increasing the support for New Zealanders who test positive for COVID-19 through the rollout of the COVID Care in the Community model and a $300 million funding boost to Pharmac to purchase new medicines to treat the virus, Health Minister Andrew Little announced today... More>>


National: Launches First Step To World-class Tech Sector

Leader of the Opposition Judith Collins says technology will create exciting careers and higher paying jobs and has the potential to transform the New Zealand economy... More>>

Council For Civil Liberties: Disgraceful Government Secrecy On Vaccination Certificates As Legislation Rushed Through
On the eve of legislation to enable vaccination passes being rushed through Parliament under urgency, the Minister has said it will not publish the relevant policy papers until ‘late January 2022... More>>

Government: Providing Business The Tools To Vaccinate Workforces

The Government is building on measures to protect businesses and workers from COVID-19 as the country gets ready to transition to the new COVID-19 Protection Framework on December 3, Workplace Relations and Safety Minister Michael Wood announced today... More>>




InfoPages News Channels