Through its austerity measures, the coalition government has engineered a rise in unemployment in order to reduce inflation while – simultaneously – cracking down harder and harder on the people thrown out of work by its own policies.
To that end, Social Development Minister Louise Upston this week added two new punitive measures to her already draconian “traffic light” system of welfare management:
…Job seekers will be required to perform a minimum of three job-search activities every week for four weeks and report back to MSD on this. ….Job seekers will be required to attend and participate, to MSD’s satisfaction, in one or more employment-related training courses or programmes for a minimum of five hours per week over a four-week period.
No consideration is being given to the extra transport costs involved in fulfilling these costly exercises in futility, which will have to be paid for out of inadequate benefits that are already being eroded by rent increases. According to Upston, the additional compliance requirements will “drive economic growth by incentivising more job seekers to enter the workforce….” Because :“Our economy is stronger when more people are in work, and as we look to unleash economic growth, it’s important that as many Kiwis as possible share in the benefits.”
Meanwhile back on Planet Earth, the reality is that the government’s economic policies are (a) generating more, not fewer beneficiaries at a time when (b) jobs ads and job openings are falling, not rising. Upston’s compliance requirements are looking more and more like those expected of people on probation – because, in effect, we are seeing the neo-criminalisation of people on benefits.
Every week, more people are being harassed and hounded to pursue fewer work opportunities, under threat of having their benefits reduced, or even – in some cases – having their spending controlled on a weekly basis, by their case managers.
It amounts to a systematic humiliation of the vulnerable, and it isn’t working, even on its own terms. As Bernard Hickey pointed out this week:
The irony is the Government’s actions over the last year have both increased the number of beneficiaries sanctioned (156,000, up 126% from a year ago) and increased the numbers of beneficiaries going into work (33,000, up 22%), but have also increased the overall number of beneficiaries, including those on sickness, sole parent and supported living benefits, by 30,854 or 8.2% to a record-high 409,665.
Moreover:
The Government’s exhortation to hunt harder for fewer jobs and for more people to work more, and for longer hours, comes as fresh evidence was published to show real incomes after living costs and inflation are still falling, especially for those on the lowest wages and benefits.
An important component of this grim cycle of impoverishment is that rent increases are exceeding wage increases. In sum, Upston is a party apparatchik in over her head. She has adopted a “whip the victims harder and harder” approach to welfare needs pursued long ago by the Tories in Britain, and evaluated and rejected as a failure by our own Welfare Experts Advisory Group six years ago.
Look across the Tasman to the different set of policies being pursued by the Labor government – and by a central bank less prone to extreme swings of policy – and you see a far more optimistic employment outlook, judging by these figures released by the Australian Bureau of Statistics for the period up to the end of November 2024:
+ Total job vacancies were 344,000, an increase of 4.2% from August 2024.
+Private sector vacancies were 308,000, an increase of 4.7% from August 2024.
+ Public sector vacancies were 36,000, an increase of 0.4% from August 2024.
No wonder New Zealanders are streaming across the Tasman in record numbers. No wonder the immigrants who come here on a temporary basis to plug our labour market gaps are also heading off to Australia as soon as they can possibly manage to do so. Unlike the clowns currently running this country, the Australians seem to know what they’re doing.
No shelter
Much the same can be said about the housing crisis. Despite a waiting list of over 20,000 and Census figures showing 5,000 people living without shelter and a growing population, the government plan is that public housing should not “reduce” but should instead “stabilise” from 2026 onwards. In other words, its ambition is to stand still at best, when it comes to the provision of affordable public housing.
Here’s the “turnaround plan” for the state housing provider Kainga Ora unveiled by Housing Minister Chris Bishop. It envisages the build of 1,500 new homes and 400 refurbishments annually. However there is a simultaneous plan to sell 800 state homes and demolish a further 700 state houses annually. Net outcome: standing still. If this is stabilisation, it is only in the sense of a possum in the headlights.
Much has been made of the fact that some of the state houses to be sold are located in areas such as Remuera. The reality is that Kainga Ora has built in such locations in the past partly in order to avoid the ghetto-isation of public housing, and the virtual gated communities that result when housing provision is left entirely to the market. One can only hope that the state houses in wealthy areas will not now be sold at fire-sale prices to the affluent, within a depressed housing market.
These diversions aside, the failure to build sufficient state houses for a growing population in dire need, is a social disaster in the making. Part of the problem is the government’s ideological allergy to the government building anything that doesn’t – or can’t – turn a profit. The alternative view is that providing the population with shelter is a necessity, not a profit opportunity.
On that point, much has been made of the private sector’s alleged ability to build public housing for less money. For example: Bishop said recently that Kainga Ora should be building or acquiring “simple, functional warm and dry houses as quickly and efficiently as possible.”
This would mean bringing construction costs down from the current estimate of 12% above market rates to “fully allocated costs that are in line with, or better than, market rates.”
This plan will include “simplifying social housing building specifications.” Simon Moutter, the new Kainga Ora chair has repeated the same basic message:
The new board chair, Simon Moutter, and chief executive, Matt Crockett, claimed that project costs were 12% higher than the market rate due to inefficient designs and unnecessary “bells and whistles”.
But here’s the thing. That 12% cost margin in favour of the private sector is the result of comparing apples with oranges. According to Labour housing spokesperson Kieran McAnulty, about 70% of social housing inhabitants have disability needs that are part of the cost of state housing designs.
So…are disability needs now and in future to be treated as the disposable “bells and whistles” cited by Simon Moutter? Probably, since the government seems intent on making the provision of good, durable public housing conform to the cheap, private sector cost models.
No home, no relief
This morning, this track readily comes to mind. It’s by The Band, and is their revival of the old 1950s track by Clarence “Frogman” Henry. Both versions managed to be buoyant, and refused to be defeated by the situation: