Child Poverty Action Group endorses Green policy


Some supportive words for the Greens from CPAG:

“Thousands of New Zealand families are struggling with either the recession, or a natural disaster. Others, like many families in Christchurch, are now finding both the recession and the earthquakes dragging on and on.”

“It is the children in families made redundant through no fault of their own that are bearing the brunt of this ill-designed policy.”

The Greens are being very clear about prioritising children in their policies. They have committed to paying the In-Work Tax Credit to all families. This would provide support to those who need it most, and lessen the financial hardship of losing a job. CPAG applauds this policy as a very direct and cost effective way to help families in Christchurch maintain confidence as their economy picks itself up from this latest disaster.

Make it permanent, Phil

Labour leader Phil Goff is reported in the NZ Herald as:

…challenging the Government to seriously consider temporarily paying the full unemployment benefit to workers laid off because of the downturn regardless of the income of their spouses.

He said those losing their jobs were carrying a “disproportionate burden” of the recession and the National Government was not doing enough to help them.

He suggested the requirement that a spouse’s income be means-tested be suspended, if only during the recession.

Why only during the recession, Phil? Despite the Human Rights Act, New Zealand’s welfare system continues to discriminate on the basis of family status. If someone is unemployed and their partner earns over $80 a week, their benefit entitlement is abated by 70 cents for every additional dollar earned. If their partner earns as little as $534 a week (before tax), they are entitled to no benefit at all.

Couples are taxed as individuals, so why don’t they receive benefits, which are really just negative taxation, as individuals?

And, in contrast to unemployment and sickness benefits, weekly compensation under ACC is an individual entitlement, and has no spousal income test.

Isn’t it time we started to bring the welfare system into the 21st century and get rid of the spousal income test there too – not just for the recession, as Phil Goff has suggested, but permanently.

Social Development Minister Paula Bennett scoffed at the Goff’s suggestion:

I doubt many Kiwis would consider that a good use of the considerably fewer resources this Government now has. I’d be interested to hear what Mr Goff would cut, or which taxes he would put up, to fund such an initiative.

Well, okay, it would be expensive, but the discriminatory provisions applying to benefits could be progressively phased out over a period of time so the cost doesn’t all hit at one. Fairness and justice don’t always come cheap.

And how to fund it? Well we could start by reversing last year’s income tax cut, so the money goes to those who most need it.

Goodbye recession

It might have seemed in the last couple of days that the big issue over in this small corner of the world has been the Toad vs Whale Oil feud.  Yawn.

But, there is other news that has caught our attention here at; the recession seems to be over, at least for wealthy Goldman Sachs bankers who needed to be bailed out by the US government less than a year ago.  They paid back their US$10 billion bail out and also posted a US$3.44 billion dollars in quarterly profit. This from the New York Times:

Even on Wall Street, the land of six- and seven-figure incomes, jaws dropped at the news Tuesday: After all that federal aid, a resurgent Goldman Sachs is on course to distribute bonuses that could rival the record paydays of the heady bull-market years.Goldman posted the richest quarterly profit in its 140-year history and, to the envy of its rivals, announced it had earmarked $11.4 billion so far this year to compensate its workers.

At that rate, Goldman workers could, on average, earn roughly $770,000 each this year — or nearly what they did at the height of the boom.

Senior Goldman executives and bankers would be paid considerably more. Only three years ago, Goldman paid more than 50 employees above $20 million each. In 2007, CEO Lloyd Blankfein collected one of the biggest bonuses in corporate history.

Meanwhile the reession that these bankers helped create has left over 6.5 million people jobless since December 2008.  Nearly half a million Americans lost their job in June alone and the unemployment rate, currently 9.5 percent, is still climbing.  That doesn’t include the tens of millions of workers who have lost and are about to lose their jobs in the rest of the world, New Zealand included.

So it seems it’s back onto the financial roundabout for everyone except all those who lost their job or are about to lose it.  Is anyone worried that collectively we may not have learnt the lesson embedded in all of this?