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LINDSAY MITCHELL: National needs to go further

In today's State of the Nation speech Christopher Luxon talked repeatedly about getting young people off welfare. It seems that National has devised a traffic light system which will use increasing levels of sanctions - welfare deductions - when beneficiaries fail to meet their obligations. He uses the word 'tough' a lot.


In his speech he made the following observation:


"Kids born this year will be turning 16 in 2040."


Well, because I can tell you something about them, let's look at the children born in 2022 who will be turning 18 in 2040.


By the end of their birth year 12,639 of them were dependent on a benefit provided to their parent or parents. That's 21.5% of all babies born that year. Over one in five.


Then consider that the link between a child's early entry into the benefit system and later benefit dependence in their own right, is strong.


MSD's own commissioned research showed:


 - Nearly three quarters (74%) of all beneficiaries up to age 25 had a parent on benefit while they were a child, and just over a third (35%) had a parent on benefit throughout their teenage years. - The greater the family benefit history the longer the client tended to stay on a benefit, particularly for the Jobseeker benefit.1

It's laudable to talk about getting 18 year-olds off welfare. Better still though to discourage their entry into the welfare system in the first place.


The focus of reforms must be two-fold. Dealing with 40,000 young people on Jobseeker right now is critical. But so is looking to the future and turning off the tap that feeds inter-generational dependence.


Labour's soft-on-sole-parents approach has to go. That means ending the nonsense of not naming fathers and reintroducing work obligations for parents who add children to an existing benefit.


But more broadly, the cash-for-kids scheme has to stop. The assistance provided to unemployed parents who refuse jobs should be through 'money management' - a system used for youth beneficiaries. The rules are:


    -your rent or board and things like your power bill and any debts will be paid straight from your payment. You won't get this money yourself.    -you will get paid a weekly allowance of up to $50 into your personal bank account.    -any money left over will be put onto your personal payment card. This is like a debit card that you can use to buy your food and groceries at approved stores.2

Until cash incentives that equal incomes from work are removed, the inter-generational problem will continue to plague New Zealand. Yes, there will be downsides to money management. But will they be any worse than the devastating social outcomes that come from unconditional welfare?






Lindsay Mitchell blogs here

3,127 views103 comments

103 Comments


Children born into welfare dependent families grow up perceiving this dependency as a "normal" lifestyle that will be available to them as well. Their parents do too. Therefore, there is little motivation for these kids to aspire to a different future.

Our accepted "victim culture" does not motivate people to take responsibility for their own lives and futures. In fact, it discourages them from doing so because, as "victims", they are entitled to compensation from other people who are better off. People identified as "victims" are generally not expected to overcome their own difficulties and do not expect this of themselves either because "it's not their fault". Oh really, If you and I have similar opportunities and I don't take advantage of them, is…

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basilwnz
basilwnz
Mar 05
Replying to

Foreign words nowadays, although not completely. Endangered certainly.

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National needs to go further and fast track their promise to raise the superannuation age.


At almost 20 billion dollars per year, New Zealand Superannuation is overwhelmingly the greatest benefit spend for our country. Many people at retirement age have the skills and experience and extend their working life. There needs to be financial disincentives to encourage others to do the same either raising the age or means testing it.



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basilwnz
basilwnz
Feb 19
Replying to

Yes, a common point of view (usually of the Under-65's), and one understands the argument as working citizens age better and generally last longer (although I've read that that trend has reversed slightly).

With respect Markus, I'd see it more favourably if I witnessed an effective review and action plan on all the loopholes, leaks, failures and other wastes of taxpayer funds that plague us, and that's not even counting the tax-avoidance of the criminal class.

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I've just got home from work, and I've never said anything like this, in my life before.

I was at a clients worksite this morning and sharp on 10 am we had smoko together.

And this is what broke my heart.

People, well paid, whinging and moaning because they felt the government wasn't doing enough to help them in a cost of living crisis. The more I listened, the angrier I became. Because their utterances of frustration were self centered, all about themselves, not about the good of the country as a whole. It was all gimme gimme gimme and a sence of self abasement and entitlement that utterly disgusted me. I packed up and left before my runaway mout…


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Aaron , Tommy G ,here I am with you on that one at my age I will still go if they do not sort this shit out.

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i believe that the unemployment benefit in the uk will now only be paid for 12 months. in that time you can either find a job or be re-trained. that is the one way of calling a halt to the inter-generational welfare dependence (which is quite significant there, i believe).


and yes, that should be introduced here. too many able bodies sitting on the couch, smoking pot and drinking beer, playing xbox or playstation games. as an example, i was totally disgusted when, during the lock-down (covid) produce (fruit, vegetables) were not harvested because the seasonal workers (mostly foreigners) were not allowed into the country. yet we had ample "arms and legs" all around the country to fill that g…


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And after he (Kennedy) got shot, Lyndon Johnson (and the Democrats) bought out the "No child will go without AS LONG AS NO MAN is in the house" welfare policy. How did that work out for them? It went from 75% Family unit (Mother & FATHER) to less than 24%. Yep, the bleeding hearts sure know how to get things done for the benefit of all - NOT.

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The time to address this was probably 40 years ago, but then we were a relatively rich country and took the soft option of quietly using taxpayer money to fix the issue.

Now the country is in the crap bigtime and I have doubts we can fix this at all. Apart from a primary industry sector which is mostly driven by commodity markets and tourism we produce little of value.

We bring in people to do the low paid work as our people often don't want to do. However when its never possible to achieve the high levels of income to have a family and a home with a mortgage you can have some sympathy for those who have lost…

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Spot on .. " We don't know how lucky we are ." ?????

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