Targeting makes sense

April 13th, 2013 at 9:52 am by David Farrar

Simon Collins at NZ Herald reports:

A subsidy that has helped to insulate about one in every six low-income homes looks likely to be cut back in next month’s Budget to a more targeted scheme.

The Green Party, which won the subsidy in a post-election deal with the incoming National Government in 2008, is pushing for it to continue at the current level of about $70 million, reaching about 50,000 homes, a year. …

Energy Minister Simon Bridges said the Government was considering, as part of its Budget process, “whether or how the programme might be extended” beyond its scheduled expiry in September.

“Were it to continue – and I emphasise no decision has been made – consideration may be given to transitioning it to a more targeted programme towards households in need,” he said.

He said the scheme had been “a huge success”, with 204,000 homes insulated at a cost of $347 million.

A cost-benefit analysis led by Reserve Bank chairman Dr Arthur Grimes found the country gained almost $5, largely in reduced health costs, for every $1 spent on the subsidy – a net benefit of almost $1 billion.

But the study also found that the health benefits averaged $854 a year for households with community services cards, but only $336 a year for other households, and recommended that the scheme should be aimed at low income earners.

Targeting makes sense for me. Households that can afford to insulate should do so without taxpayer subsidies. Government assistance should generally be directed at the least well off, not those who have sufficient income to make their own choices.

They want welfare for millionaires!

December 11th, 2012 at 9:00 am by David Farrar

Ben Heather  at Stuff reports:

A $2 billion Government overhaul, including more state homes and universal child support, is needed to fight child poverty, a report from the children’s commissioner says. …

They include scrapping many benefits for parents and replacing them with a universal payment for every child under 5.

Never ever ever. It is morally and economically wrong to tax people more so you can turn every family in New Zealand into welfare recipients. They want to turn the clock back to the 1970s.

The welfare state should be targeted at families in need. Handing out cash to every family with children is nuts and comes from people who have no appreciation of the fact all those welfare handouts need to be paid for by.

Trans-Tasman on Key and income inequality

August 30th, 2012 at 1:16 pm by David Farrar

Trans-tasman reports:

 John Key showed his mastery of the political process when, with one verbal swipe in Parliament, he demolished what appeared to be a promising line of attack by Opposition parties on his coalition’s social policies. Armed with a report on child poverty, Green co-leader Metiria Turei was demanding Key acknowledge inequality in NZ has increased to the highest it has ever been, and institute a universal child payment. Key’s response “let us run through the logic of what the member has said. She says we are an unequal society, because the rich are getting richer, and now she’s on her feet telling me to give the rich families even more for their kids. What a dopey idea that is!” Turei was left complaining “I am not thinking straight.”

This is the great mystery. The left call for less income inequality yet fight for universal rather than targeted government support.

Herald on targeting

July 16th, 2012 at 11:00 am by David Farrar

The NZ Herald editorial:

Sometimes the Government must think it simply cannot win. Take the action plan outlined in the Green Paper for Vulnerable Children. If Social Development Minister Paula Bennett failed to pay particular attention to this group, she would be accused of being negligent and uncaring. But her formulation of proposals to overcome shortcomings in the identification and tackling of child abuse has led only to criticism on another count. According to a joint statement issued by 72 non-government agencies, the funding of services for better-off children must be sacrosanct in this drive to help the neediest.

I bet you all 72 of those agencies get most of their funding from the taxpayer.

The agencies’ statement is, in effect, a plea for the retention of universal social spending, no matter the fact that many parents could afford to pay more if they had to. …

In an ideal world, such universal benefits would be retained. But the present situation is far from that.

Actually in an ideal world, there would be no universal benefits outside schools and hospitals. There are significant economic deadweight costs in taking money off people in taxation and giving it back to them in subsidies. We should provide subsidised services to those who can not afford them for themselves – not to everyone.

It is imperative that any fiscally responsible Government adjusts both its spending and its priorities. Those most in need of temporary help should be targeted.

In the context of children, that means concentrating funding where it is most needed and most cost-effective. It makes no sense to provide welfare for the comfortably off as well as the most vulnerable if the burden on the budget cripples the economy on which all New Zealanders depend.


The United Nations children’s fund Unicef, which drafted the agencies’ statement, also said that Ms Bennett’s proposals risk “stigmatising” the 15 per cent of children defined as vulnerable. That, again, is a skew-whiff view of the Government’s intent.

Oh, get out of here. This is like the PPTA saying it is racism to try and improve educational outcomes in South Auckland and Porirua. Helpng vulnerable families is not stigmatising them.