I spent yesterday at the Welfare Working Group’s Forum in Wellington. Like a lot of progressives, I’ve been a bit concerned at where this process is headed. There’s been some talk of moving to an insurance-based system like they have overseas and/or putting a limit on benefit durations.

Day one of the Forum hasn’t confirmed my concerns, but it hasn’t really allayed them either. So I’ve decided to do something about it.

The Welfare Working Group looks to be following a similar model of operating to the Tax Working Group, which was actually pretty transparent with public meetings and all the documents they deliberated upon available on their website as they went along.

My personal impression is that we as progressives (and I’m sure there were exceptions) didn’t make as much use of that last year as we could have done, to work through our own responses and counter-arguments ahead of the publication of the Tax Working Group’s report. I want to do my small bit to help ensure that that doesn’t happen again with the Welfare Working Group.

To that end, I’ve set up a new website, welfarewatch.org.nz. It’s been established as a venue for people to monitor and comment upon the activities and ideas of the Welfare Working Group.

Welfare Watch will operate somewhat differently to Policy Progress. For one thing, it’ll be much more topical and focussed on current policy controversies.

For another, I don’t intend to be the primary author at Welfare Watch — I’m aiming for it to be much more of a group-blog with a fairly wide cast of contributors. I don’t have enough hours in the day to make this work on my own, and there are a lot of good people out there who have more expertise than I do on these sorts of issues anyway.

So if you’re interested in being part of Welfare Watch, get in touch with me via email. Given the sensitivities of this issue and the somewhat different approach of this site, I’m happy to accept pseudonymous contributors if people don’t feel able to post under their own name.

In the meantime, I’ll start the ball rolling with my own contribution (which will also be posted on Welfare Watch): impressions on the first day of the Forum.
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The Working Group has put up an outline of the first day of the Forum on their website. It includes links to profiles of most of the speakers and some of the presentations, including Working Group Chair Paula Rebstock’s (text and video). Hopefully, more will go up over the next few days.

Rebstock’s speech is what I’d describe as being in a “technocratic caring” style. She raised many of the dire stats about (quote) benefit dependency (unquote) that I’m sure will be reiterated many times between now and December, and didn’t really relate to people on benefits as individuals, but she did seem to convey the impression that her driving concern was to reform the system to improve their life-chances and especially those of their children. She didn’t talk about the insurance model except to note it being part of their terms of reference, and spoke as if the Group was approaching the Forum with an open mind and without a set policy agenda (“We have a lot to learn, share and consider over the next two days. Every one of you here has an important role to play.”)

Minister Paula Bennett spoke as well (her speech is supposed to be on the website too but doesn’t seem to be so far), and similarly made a virtue about not really saying anything about her own views: “I’m not going to give a speech prescribing what I think should happen”, “my prescriptions can take a back seat”, “I won’t define the problem — this is your turn”.

At the same time, she softly made it clear that she was the final decision-maker: “At the end of the day, it is my responsibility to get this right.” And then there was that odd bit about “this could spark prejudices — we may even see an ugly side of New Zealand” which seemed a bit out of place at the time but turned out to provide a handy sound-grab for the TV news.

In my opinion, though, the most important and welcome presentation of the day came from Peter Whiteford of the Social Policy Research Centre at the University of New South Wales who spoke on ‘Welfare in New Zealand and Australia compared to other OECD countries’. You can find his powerpoint slides here, and they’re sufficiently wordy that you’ll get a pretty good gist of his full presentation.

One of Whiteford’s themes was something that a lot of people don’t realise, which is that New Zealand and Australia’s welfare system are pretty-much unique in the world.

Europe, the US and Japan all have systems that are financed by employers and insured employees, and where benefit levels are often related to a person’s previous earnings. By contrast, NZ and Australia has flat-rate entitlements, which are subject to income and asset tests, but with broad coverage of the population and eligibility based on residence, with no time-limit on duration.

Whiteford looks at how our model compares in term of international stats. He finds that New Zealand:

• has one of the most progressive structure of benefits of all OECD countries.
• has lower ‘churning’ than most other OECD countries
• has the third highest level of transfer efficiency in reducing poverty
• is above average in reducing inequality.

Australia, with a similar but in some respects more generous model, comes out even better.

Whiteford concludes by musing that processes like the Welfare Working Group have a broad choice between taking a ‘demolition’ or ‘refurbishment’ approach to the system.

It seems to me that his presentation makes a strong case for ‘refurbishment’ — New Zealand’s welfare approach clearly has many virtues and we should be very cautious about jettisoning them just because we don’t conform to the standard international approach.

Whiteford ends with a suggestion that our real problem might precede the interventions of the welfare system:

Despite impressive design features of tax and transfer systems, disposable income inequality in New Zealand is above the OECD average; this means that income inequality before taxes and transfers is higher than in most countries with better inequality outcomes.

If New Zealand wants to be more effective it could either increase its high level of progressivity, or tax and spend more while at least maintaining effective progressivity, or identify the factors associated with its relatively high level of market income inequality and address these problems more directly.

There were two other plenary sessions, one from the OECD (a video of the presentation is included following the Rebstock one at the link above) and one (which I missed) on whether the benefit system will deliver in the future.

The rest of the day was filled with two parallel sessions. I went to one on What contributes to long-term benefit receipt? and the other on Long-term benefit receipt and unequal opportunities for children and young people. The speakers in both of these challenged the assumptions of the Forum as a whole. The former session did this by making people on benefits the subjects (i.e. protagonists) of their narrative rather than its objects, while the latter did so by making child poverty rather ‘benefit dependency’ the central problem.

I found both sessions refreshing and informative, and was glad to see both were chaired by Working Group members (as all parallel sessions were) and attended by government officials. Yet, as someone pointed out to me afterwards, these sorts of voices don’t seem to be scheduled to be featured in any of the plenary sessions, so they are easy enough to step around.

It remains very much to be seen whether the perspectives reflected in these sessions, or the lessons from Peter Whiteford’s analysis, get incorporated into the further work of the Working Group, or whether this is just a polite nod to diverse viewpoints before they get onto the real business of their reform agenda.

Tags: benefits, Welfare Watch, Welfare Working Group

This entry was posted on Thursday, June 10th, 2010 at 6:00 am and is filed under Child Poverty and Cycles of Disadvantage. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.