Dole rules
June 29th, 2009 at 9:41 am by David FarrarThe Herald reports:
Two economists are calling for a fundamental rewrite of New Zealand’s welfare system because of the numbers of people being made redundant who can’t get the dole because their partners are still working.
When I read this, I thought to myself that I bet one of the economists is Susan St John.
Dr Susan St John of Auckland University and Keith Rankin of Unitec say the system is based on “outmoded social concepts” such as assuming that everyone lives in single-income families where dad goes out to work and mum stays home with the children.
I don’t think the system is based on those assumptions. I think a change with what Dr St John proposes would be both unaffordable and inefficient – it would be more middle class welfare and tax churning.
Going from two to one incomes is not nice, and many families struggle I am sure. But that can’t be compared to a zero income family. The unemployment benefit is for families where neither partner is (significantly) working.
The Government already has massive deficits and debt. This is the silliest time to be proposing making it worse – in my opinion. Any extra welfare payments have to be borrowed and eventually paid back by future taxpayers.
Related posts:
- Tax Cuts vs Working for Families
- Voting Labour to keep 5 years of dole
- Low-tax threshold
- Dole at 28 year low
June 29th, 2009 at 9:54 am
and i would guess dpf..
..that you think it totally ‘fair’..
..that those forced into unemployment..(as a result of rampant ‘free-market’ ideologies..having ‘broken’ everything..)
..that these newly ‘poor’/below poverty-line families..
..also have their support from ‘working for families’ torn away at the same time..?
..does not that double-whammy seem to be a particularly potent ‘cruel and unusual punishment’..?
eh..?
..any of your ‘family’/nearest and dearest there .. yet..?
(we should kep in mind tho’..when reading your ‘opinions’..
..who you are..where you are right now..
..and what you have gleefully admitted before..
..that you were at the elbows of richardson/shipley when they ‘dealt to’ sole parents/the sick/the poorest..
..that you were there..urging them to ‘cut..!..more..!..more..!’..
..you feel they ‘didn’t go far enough’..
..eh..?
phil(whoar.co.nz)
Vote:June 29th, 2009 at 9:57 am
Once again you argue from facts and not emotion Mr Farrar; how can you continue to be so vindictively malicious to ignore that justice demands the rich must pay? Pawn the future for votes now!
Vote:Edit: I posted my comment as a joke, but before it was completed there was an entity posting the same sentiment seriously.
June 29th, 2009 at 9:57 am
These people are “economists” in name only and are giving a bad name to real economists. They are in truth, social engineers with socio-political agendas and axes to grind which substantially damages their credibility.
A real Economist would have accompanied a suggestion for reform with predictions of effects/costs and benefits and associated collateral outcomes.
Academic freedom is one thing but unsupported calls for social restructuring does little for enhancing the image of the institutions involved when they go to gret lengths trying to convince the world that they are serious places of rigorous and high quality of education and study. Its all a bit rich given that the both of them are recipients of public funding themselves.
Vote:June 29th, 2009 at 10:00 am
oh and phil, I do feel a great empathy for those made redundant (it has happened to me 4 times) but I have no sympathy for those whose presence on the dole queue is voluntary – like yourself for instance.
Vote:June 29th, 2009 at 10:10 am
“..A real Economist would have accompanied a suggestion for reform with predictions of effects/costs and benefits and associated collateral outcomes..”
think capital gains tax..
oh..!..and dave..i am not on the dole-queue..
..i am raising my son..so receeive a dpb..
phil(whoar.co.nz)
Vote:June 29th, 2009 at 10:14 am
“A prophet in his own country is without honour”
Would be interesting to see a report from a truly independent, and dispassionate Economist on the implications.
It is traumatic for anyone to lose an income. More so, if there are dependents.
Just think if Cullen hadn’t bought SodorRail, then there would be well over a Billion Dollars in cash to help.
Silly, silly, Kullen.
Vote:June 29th, 2009 at 10:15 am
add in some revenue from legal-pot..
..some punitive taxes on the biggest pollutors..(and cuts/incentives for the ‘cleanest’..)
..and the imperative of economy-re-jigging..
..is under way..
phil(whoar.co.nz)
Vote:June 29th, 2009 at 10:19 am
St John and Rankin are both fruit loops. They are perfect examples of academics who live in a rarified atmosphere on another planet.
They dont deserve the title of Economists and bring that noble profession into disrepute.
Laugh at them and those who agree with their junk ideas they deserve it
Vote:June 29th, 2009 at 10:24 am
“..They dont deserve the title of Economists and bring that noble profession into disrepute..”
..as in the ‘noble’ free-marketeer ‘economists’..?
..those proponents of the ideology that has ‘broken’ everything..?
..and got us into this crap in the first place..?
..yr standing on shaky ground there..tiger..!
..eh..?
phil(whoar.co.nz)
Vote:June 29th, 2009 at 10:36 am
Philu:
I don’t want to be rude but could you post in normal sentences please? I’m not sure whether I decipher your messages correctly.
Vote:June 29th, 2009 at 10:37 am
Philu, can you pelase post coherent paragraphs? It’s incredibly annoying…to…read…your…elipsed…sentence…fragments…Thanks.
Vote:June 29th, 2009 at 10:37 am
That’s funny DPF- I made the same prediction that one of the economists would be Susan st John when I saw the headline in the NZ Herald.
Albeit I think it is good for any profession to be able to sustain a wide range of viewpoints. And in my experience, a lot of economists get on very well personally with each other, despite often differing viewpoints on policy.
Vote:June 29th, 2009 at 10:42 am
chrisdoms..j5..try..harder..eh..?
(tee-hee..!..didyahear that old starbored is a libertarian..?)
..bless him..!..
..eh..?
..they are so..kinda..quaint..
..eh..?
phil(whoar.co.nz)
Vote:June 29th, 2009 at 10:42 am
It always surprises me when left wing economists and political parties advocate welfare for the middle class.
God forbid Mr and Mrs Middle class should have to sell the holiday home because one loses their part time office job or the other faces no bonus this year. God forbid they can’t afford the annual trip to Fiji this year. God forbid they have to shop at Pakn’Save with the plebs. God forbid Mr or Mrs middle class should have a take a job at PaknSave to see them through! Oh the horror.
Vote:Quick Johnny and Bill borrow more money and write them out a big welfare check before the poor darlings are degraded any further!
June 29th, 2009 at 10:45 am
DPF- The underlying problem is not that some two income families are struggling (probably due to high mortgages more than anything), but the classification we use for ‘couples’. This has led to all sort of rorting where people pretend to be single when they aren’t, in order to achieve higher welfare benefits. I would be more interested in ways available to stop this. The unfairness of this to people who are honest about their relationships is more the issue.
Vote:June 29th, 2009 at 10:49 am
A country cannot have its cake and eat it too. The system NZ decided on under the first Labour Govt was universal social security funded from tax – not individualised employer/employee contributions. Our dole is universal, is not restricted in terms of time-limits or reducing payments. The price we pay for that is means-testing, which includes a partner’s income.
If people want to properly protect their income/lifestyle, then we need a system based on an insurance model. To a insignificant degree we already have that but because they are paying tax towards social security most people cannot afford loss of income protection as well. The people who are cited in this article are being shafted by redistributive socialism. Nothing new there.
The Herald article contains a significant error BTW. http://lindsaymitchell.blogspot.com/2009/06/unemployment-chickens-coming-home-to.html
Vote:June 29th, 2009 at 10:49 am
In the old days, the man went to work, the woman stayed home and looked after the kids. So, when the man lost the job, the family got the benefit.
In todays world, feminism and economic realities mean both parents often work.
The dole was a product designed for a different era, and it needs updating.
And, if you use DPF’s argument, that it is the total family income that counts, then why do ird not tax on total family income?
Vote:June 29th, 2009 at 10:52 am
The Fair Trading Act is supposed to protect us from false or misleading practices, such as calling an academic an “economist”.
Perhaps the more appropriate descriptor is “ecomist” — a dispenser of a fine mist of repellent nature, typically with lots of bugs involved.
Vote:June 29th, 2009 at 10:54 am
I suppose the taggers will write “dole rules” all over the city now, as a 1000 sad souls a week look set to join the WINZ handout club.
Vote:God save New Zealand.
June 29th, 2009 at 10:55 am
She would be the first to cry foul if the extra money for dole payments came straight from the Health vote.
Lunacy.
Vote:June 29th, 2009 at 11:01 am
Typical academic tossers. Where do the find these mentally retarded fuckwitts. Perhaps if they spent more time working on ways to generate income rather then trying to distribute it further the better off we all shall be. I vote to ship these two bobs off to a much fairer society where all wealth is redistributed, North Korea would be a good place to start. Please someone email these eggheads and explain the word recession to them.
Vote:June 29th, 2009 at 11:14 am
damocles (75) Vote: 1 1 Says:
June 29th, 2009 at 10:52 am
The Fair Trading Act is supposed to protect us from false or misleading practices, such as calling an academic an “economist”.
Love it!!!!!
Vote:June 29th, 2009 at 11:34 am
I stopped reading the article after these 13 words having agreed with each and every one of them.
Vote:June 29th, 2009 at 12:03 pm
Mention the Dole and Philu gets excited.
The only trouble David, is that two income families pay two individual sets of tax which contribute to the government coffers. Surely each person should therefore be entitled to support as an individual. It seems unfair to treat husband and wife as individuals when you want to tax them but as one entity when they want unemployment benefits. I can see a lot of people becoming “flat mates”.
Vote:June 29th, 2009 at 12:03 pm
The comparisons with how Australia does things were quite interesting. I think all that needs to be changed is to bring us in line with Australia’s system.
Interesting that you didn’t mention how Australia does things DPF
Vote:June 29th, 2009 at 12:18 pm
This will be the first and probably last time I ever say this, but despite the ludicrous conclusions she draws, Susan St John does have a point. The assumption is that couples ought to pool their money and support one another, but many modern couples, including my spouse and I, do not do that. In many relationships there is no practical difference between what one person gives the other and what a flatmate would normally pay in rent and bills. But WINZ do not test benefits against flatmates, so why does the fact you are having sex with them make a difference?
There is a degree of unfairness in having one person in the relationship use hard-worked-for savings to prop up the other. It puts strain on the relationship, and if the couple breaks up, you end up paying one of them the dole or the DPB anyway, and when you add an accommodation supplement, it will end up costing the taxpayer more than it would otherwise. You may as well, at the very least, just pay them the dole as an entitlement (which is buggerall anyway) and be done with it.
All of this, of course, shows how flawed the once-a-week flat rate entitlement payment is. If social welfare was based on a series of specific grants that assessed need on an individual basis, it would be fairer and would also encourage people not to take entitlements for granted – and therefore motivate them back into self-sufficiency.
Vote:June 29th, 2009 at 12:36 pm
Just a quick point to anybody talking about the people being made unemployed because of the GFC:
They were probably employed because of the things which you think caused the GFC in the first place.
Vote:June 29th, 2009 at 1:03 pm
they do make a fair point though, about the bizarre inconsistencies in how both WINZ and IRD determine what is and isn’t a relationship – it changes between departments and is based on the particular thing you’re applying for, which is completely strange in my view.
I had a friend who was unemployed many years ago and went on the dole briefly. I think he was about 19 at the time. His de facto partner, who was quite a bit older, was a student. When he went to apply for the dole (which he reports was a MUCH easier process in the nineties than it is today), he was told that he was in a de facto relationship and this impacted on what he was entitled to.
He decided to go to university, and applied for the student allowance based on the entitlement which people in a de facto relationship or marriage could receive (which was significantly more, at that time). He was told that he was no longer in a relationship. The person at WINZ told him that yes, if he wanted the dole, he was in a relationship. If he wanted a student allowance he wasn’t.
Say what you like about whether people should be entitled to benefits, and what exactly they should be entitled to, but it seems ludicrous that the definition of a relationship should be so inconsistent across a government ministry. I don’t know how many (if any) of these inconsistencies have been tidied up in the last few years. I’m guessing none.
Vote:June 29th, 2009 at 1:12 pm
Have those arguing that because two people who are married are considered as two separate people for tax purposes then they should also be considered as two unrelated people for dole purposes considered the implications of this thinking? Taken to its logical conclusion it would mean that every spouse who chooses to stay home and look after the children or to be involved in community work should also be considered a single person and would therefore be entitled to the dole.
Vote:Maybe some form of income sharing would be fairer.
June 29th, 2009 at 1:18 pm
Bob100 – I agree that would be fairer. However, at the moment every government department considers your relationship in a different way. But how does income sharing work for defactos, or people who flat together but screw each other. Or for that matter people who live together, have kids but don’t screw each other and live seperate lives under the same roof? I think it is better to treat people as individuals, but have a welfare system that only allows specific time limits on either the dole or dpb – say 5 years in a person’s lifetime.
Vote:June 29th, 2009 at 1:51 pm
Why didn’t these two propose these radical reforms when their Socialists mates were in power and wasting money in all directions. During the bountiful years it was basically only the poor and hopeless who were un-employed, were they below the horizon of concern of St. John and her mate, or is it now that redundancy and unemployment could visit them that they advocate reform as a solution to the nation’s economic troubles at this particular time.
Vote:June 29th, 2009 at 3:11 pm
backster, it was precisely because their socialist mates were in power. Wouldn’t want them to look back.
Vote:June 29th, 2009 at 3:19 pm
Well for once, I’m on the side of the economists.
If you’re going to treat people as individuals for the purpose of picking their pockets to fill the troughs of government then you must also treat them as individuals when it comes time to pay some back by way of the welfare system.
I’ve long been an advocate of income sharing for tax purposes.
I get really pee’d off when I see that the tax system actively discriminates against the woman staying home and becoming a full-time mother in the way ours does.
And of course, if you examine the crime statistics, you can see that we reap what we sow when we force both partners to work because we provide no automatic income splitting for couples.
If the government is so hard-up then stop all this stupid talk about cycle-ways and a useless $9m referendum, the result of which it has already been clearly stated — will be totally ignored.
It’s time we had some politicians with brains!
Vote:June 29th, 2009 at 3:46 pm
..those proponents of the ideology that has ‘broken’ everything..?
..and got us into this crap in the first place..?
Whoar, what rubbish are you talking about?
You continue unimpeded your aimless life at taxpayers’ expense. Bludgers like yourself glide through thick and thin completely oblivious to the problems faced by the productive elements of society.
In other words: people like you, parasites and leeches, have it easier than the rest of us.
Vote:June 29th, 2009 at 3:52 pm
Look “bad”, not “back”.
Vote:June 29th, 2009 at 3:58 pm
aadvark, 4 things to fix this country.
Flat tax.
income sharing
No tax on bank interest
Cut government/ local government back to core services.
Too bad roger douglas got kneecapped, maybe the greatest financial brain in the country – the stupid country bumpkin kiwis just couldn’t understand him.
Vote:June 29th, 2009 at 5:49 pm
> Any extra welfare payments have to be borrowed and eventually paid back by future taxpayers.
Roger Douglas would be proud of you, David. So any extra spending on hospitals, superannuitants, etc has to be borrowed?
I’m surprised you aren’t quoting from Treasury advice given to this government. Treasury advised that every beneficiary be given $1200 as a one-off payment. Those bloody left wingers in Treasury!
Vote:June 29th, 2009 at 5:54 pm
“….those proponents of the ideology that has ‘broken’ everything..?
..and got us into this crap in the first place..?”
..Whoar, what rubbish are you talking about?..”
..’rubbish’..?..
have you not been following the news..?
..just how delusional/ideologically blind/blinkered are you..?
..anyone you can ask to explain it for you..?
..hang on..!
..try googling ‘global economic meltdown/rightwing/freemarket greed’..
..that should see you right..
..eh..?
phil(whoar.co.nz)
Vote:June 29th, 2009 at 7:15 pm
P…h…i…l, I automatically give you negative ‘karma’.
If you’re saying something I agree with, then you’re putting off people who might agree with your visual abuse. If you’re saying something I disagree with, then you probably deserve negative karma too.
Vote:June 29th, 2009 at 7:41 pm
Another example of spousal abuse by Govt. is ACC especially when the are self employed and income share. Two people working in 1 business share the income, usually one is the “working partner” with the skills and the other is the admin partner. If the working partner gets hurt then the business has big problems where as the admin partner is easy to cover.
Vote:But because its tax effective to split incomes ACC only pays according to the split.
June 29th, 2009 at 7:58 pm
I’ve said elsewhere that New Zealand’s unemployment system harms productivity. No, not because it sustains people like Phil U.
Instead, because people become stuck in jobs for which they are ill-suited. The costs of taking risks are particularly high as qualification for the UB requires exhausting all your liquid assets. If you have savings, you’re penalised for your irresponsibility compared to someone who spends all their income. If you have a partner with a job, then tough cookies. Once you actually get there the UB itself is set at a level that is designed to make it as uncomfortable as possible. Sustaining a mortgage is pretty much impossible. It was set at poverty levels (calculations were literally made about the absolute minimum needed to survive, and it was set there) and hasn’t been raised in the two decades since.
Employers know this, and are often more reluctant to lay-off staff than they would otherwise be. They’re people too, and don’t want to put their employees into hardship unless they really have to.
Once you’re on the UB, you are pressured strongly to take whatever jobs present themselves – working in McDonald’s for example, rather than trying to actually get something that uses your skills at least tangentially. Much better to stay in a job rather than be forced into the wrong one.
So people stay in jobs that are ill-suited. There’s plenty of work done on the productivity costs in a lack of mobility in employment, and the UB definitely has a negative effect. It also doesn’t surprise that Denmark, with very generous unemployment benefits also has some of the highest productivity and labour mobility. And they also have low unemployment rates too. Having a decent unemployment system is not a recipe for disaster.
Labour and ACT and National’s response to this criticism is almost always to bat it away with “the dole is a privilege not a right, and people should work”. Which ignores the thrust of the criticism.
Vote:June 29th, 2009 at 8:04 pm
Why didn’t these two propose these radical reforms when their Socialists mates were in power
I don’t remember Susan StJohn ever having a good word for the last Government. They made plenty of public criticism, on exactly the same issues.
Vote:June 29th, 2009 at 8:09 pm
Brian Smaller
doesn’t splitting tax between 2 people mean you pay less?
2x $50k as apposed to 1x 100k
two ‘single’ people a DPB and a $50k income is by far the best approach.
Vote:June 29th, 2009 at 8:58 pm
“..# georgedarroch (230) Vote: Add rating 1 Subtract rating 0 Says:
June 29th, 2009 at 7:15 pm
P…h…i…l, I automatically give you negative ‘karma’.
If you’re saying something I agree with, then you’re putting off people who might agree with your visual abuse. If you’re saying something I disagree with, then you probably deserve negative karma too..”
why don’t you tell someone who gives a flying fuck..eh..?
..and who the fuck are you..?..anyway..?
oh..!..that’s right..!,,you are one of those ‘scared’ greens..
..but you are brave enough to eat animals someone else has killed for you..eh..?
..the walking oxymoron:..the ‘carnivorous green’..
stand up and take a bow..eh..?
phil(whoar.co.nz)
Vote:June 29th, 2009 at 9:08 pm
and who the fuck are you? anyway?
oh! that’s right! you are one of those ’scared’ greens
but you are brave enough to eat animals someone else has killed for you?
Phil’s angry! Abuse the person he’s talking about for eating meat!
I’ve been a vegan for 7 years, and that’s why I think you’re a walking disaster. You either don’t realise how your incessant mutterings and linkwhoring look and sound, or you do and persist anyway.
Vote:June 29th, 2009 at 9:32 pm
sorry..that’s right..
you are an enabler..
..eh..?
..and once again..
..tell someone who gives a fuck..
phil(whoar.co.nz)
Vote:June 29th, 2009 at 11:41 pm
I’ve got to agree with everything georgedarroch says here. The way in which benefits are administered in this country is, at times, sheer lunacy, that is when it’s not operating as a shuddering simulacrum of some process in a Kafka novel. Just go to any winz office at any time of the day and feel the frustration in the air. Give their 0800 number a call and weep at the stonewall it operates by. As it stands presently there is very little that is helpful about our welfare administration: from the 6 week mandatory stand-down period to the rate at which a benefit is reduced after minimal additional weekly earnings the functionality of welfare in nz borders on the oxymoronic. St John’s and Rankin’s (… is it just me?…) criticisms are, at the very least, legitimate.
Vote:June 30th, 2009 at 6:39 am
whalehunter – Income splitting is only useful where incomes are significantly disparate, eg 1x $100,000, 1x $30,000 becomes 2x $65,000.
Vote:June 30th, 2009 at 9:09 am
How about some individual respnsibility as an option? Plenty of people, couples, families live on one income – maybe not even a very big income at that. Households with more than one income (ie anything > 1 income) have the option to spend up to and beyond total income. Or spend less and pay down the mortgage, set up an emergency fund, save for a rainy day
Vote: