Friday, May 16, 2014

Half a million children known to CYF?

This is an interesting statement contained in the budget announcement about extra funding for vulnerable children

“One per cent of children known to Child, Youth and Family – around 5,000 children –  go on to cost New Zealand $550,000 each by their early 30s in corrections and welfare services.

Half a million children are known to CYF?

Over what period I wonder.

According to an MSD research paper one in five born in 1993 became known to CYF over their childhood to the age of 17.

Thursday, May 15, 2014

Cost of marginalising Labour

The $172 million extension of Paid Parental Leave, said to be electorally popular,  is one of the big-ticket items in today's budget. Based on Treasury advice, there was no case for the government to extend Paid Parental Leave (beyond buying votes and sidelining Labour.)

Here's what I wrote about it in December 2013:

...last year Treasury analysed who was using paid parental leave, labour market outcomes, and child health outcomes. It found that, "...there is not a strong evidence-based argument to support extending the length of paid parent leave."

Treasury's report states, "...the majority of mothers return to work when the baby is six months old...". Marginal benefits to labour market participation and child health and well-being would therefore be small. Additionally, it notes, "...the most vulnerable children are likely born into families where parents are not eligible for paid parental leave...".

In a discussion about improving income adequacy it found that the arguments are "weak" as "the current access group are likely to be middle and high income women with stable employment." Of the 32,000 paid parental leave recipients in 2011/12, 58 percent were earning over $40,000; 27 percent were earning over $60,000.

Treasury also noted a possible negative impact for employers, particularly small to medium enterprises, as their costs are, "...likely to be more significant as the length of parental leave increases." This could give rise to greater discrimination against child-bearing age females in the labour market.

A fine example of the irrational policies thrown up by redistributive democracies.

Wednesday, May 14, 2014

Australian welfare spending

Australia needed to cut their welfare spending.

Although government spending overall is a smaller proportion of GDP than New Zealand's, 41 percent goes on  Social Security and Welfare

In contrast New Zealand's Social Security and welfare spend makes up 32 percent of the total.

One of the measures Australia is taking is pushing up pension eligibility age to 70:

"Over the past 100 years, there has been little change in the Age Pension eligibility age; however, over the same period the average life expectancy has increased by 25 years to around 85 years."
A point I have been making about NZ Super for a long time.

When the first Old Age Pension was instituted in 1898 the qualifying age was 65. Today it is unchanged. In his 1997 work Reforming New Zealand Welfare, Michael Jones wrote,

“If the age of eligibility for New Zealand Superannuation was adjusted to equal average periods on the aged pension in 1900, the eligibility would now be 75 for men and 80 for women.”

Winston denial about horse ownership is not adding up

Winston Peter's name is still listed in the ownership of Bellazeel.

It was winning only 5 months ago but Winston says:

"I only had an interest for a short time, but it's been out to pasture for years." 
Bellazeel, a 5 year-old Zabeel mare, would be extremely valuable as a brood mare, especially with her 3 win record. Even if Peters relinquished his share I doubt it would be without return.

Update: Peters says he had a short term leased share in the horse purchased at a charity auction in 2008, which is when the horse would have been born. Seems odd to me because a horse isn't going to return anything until it is at least a 2YO. You'd want to be in for the long haul, particularly as a propsective broodmare.

Update 2: Stuff reports, " New Zealand Thoroughbred confirmed this afternoon that according to its records, Peters continued to part-own a racing lease on the horse"

Media bias

Not aided by an interviewer determined to make ACT's budget look bad, Jamie Whyte was eventually able to make some valuable points.

He told Espiner that to argue that people should be allowed to consume things without paying for them is a ridiculous argument.

If Whyte needs some training in how to handle hostile media Guyon would be the perfect person to provide it. Seems to be the go according to Karl du Fresne.

David Cunliffe and his sappy comments

On-line over on The Standard yesterday David Cunliffe made this comment:
Our priority is to get kids out of poverty – that’s why our Best Start payment includes the children of beneficiaries; they shouldn’t bear the brunt of their parents’ misfortune.

Misfortune? What does that mean? Bad luck? An accident?

When one in five babies is either born onto a benefit or arrives there shortly after, how much of an accident is it?

Obviously some children will have a temporarily unemployed parent. Or a parent who has been abandoned. I accept some parents may have suffered a degree of misfortune.

But when nearly 11,700 of the babies born last year were welfare dependent by the end of December, I can only conclude something beyond bad luck is the cause.

I don't want to 'beat-up' on parents on benefits, but if we don't understand the nature of the problem, how will we ever address it?

CPAG making false claims again

According to the NZ Herald:

University of Auckland senior lecturer and Child Poverty Action Group spokeswoman Susan St John said tax credits should be extended to beneficiary families and indexed to inflation.
"A lot of newborns get nothing - they get nothing from paid parental leave or tax credits. The most cost-effective way is to give all low-income children the same weekly assistance."

That's bull.

Family tax credit (FTC) is paid regardless of your source of income.

I read the above quote out to my husband. He accepted it. He said he didn't realise children on benefits got more than just their parent's benefit.

The Family Tax Credits, plus accommodation supplement (or income related rent), plus the basic benefit rate all add up to make welfare a viable option.

CPAG want to make is even more viable.

Tuesday, May 13, 2014

Income redistribution is great ... but not by government

The NZ Herald reports the Spirit Level authors are in New Zealand to lecture us about inequality, no doubt to boost the electoral chances of the left. Simon Collins writes:
But in New Zealand, the Labour Party is struggling to get inequality off the ground as an election issue. Professor Hazledine points to a 2006 survey of 32 countries which found New Zealanders were less supportive of redistributing income from the rich to the poor than people in any other nation.

The question asked was, "Do you think it should be the government's responsibility to reduce income differences between the rich and the poor?"

But I notice in Simon Collin's description of the finding he has ommitted  word 'government'. He talks about redistribution with the implicit assumption it's a  function of government. For the left 'income redistribution' and 'government' go hand in glove.

I am all for income redistribution. But not by the government. By unfettered exchange of goods and services and formation of family units that endure, and build wealth.

Government has made people poorer than they would have been through too much welfare, too much employment legislation, and too much taxation.

There must still be some sense of this amongst the population, reflected in NZ's position at the bottom of this table. Let's hope a similar or better response would occur in 2014.

Sunday, May 11, 2014

A breath of fresh air

ACT's alternative budget is a desperately needed breath of fresh air:

This alternative budget highlights how far
National, Labour, The Greens and New Zealand
First have moved from sound economic policy.
These politicians peddle the self-aggrandizing
fantasy that if only they had a bigger role in the
economy, it would grow faster. If only they took
more of our money in taxation, spent it for us,
decided which businesses we should invest in,
who we should sell our products to, how we
should use our property, the terms on which we
may be employed and almost everything else,
then we would all be better off.
ACT is the only party that utterly rejects this
foolish and ugly idea.

For all seventeen pages go here.

One measure made me scratch my head. Abolishing the Ministry of Pacific Affairs. Only because there is no accompanying  abolition of Te Puni Kokiri, the Ministry of  Maori Affairs. Under Jamie Whyte ACT has indicated it wants to steer well clear of any perceived anti-Maori feeling. Fair enough. But this approach is hardly a principled, consistent rejection of publicly-funded ethnic collectivism.

Labour's attitude to other people's money

Labour MP Sue Moroney says:

“The select committee report shows the impact of the Bill would be just 0.05% of the crown funds being spent in this year's budget."

What is .05% of $72 billion?

I make 0.05% $36 million

Extending Paid Parental Leave to 6 months is calculated to cost $138 million according to Treasury.

Oh what's a mere $100 million.