Prime Minister Christopher Luxon has announced nine goals for the public sector to achieve over the next six years.
He said New Zealand had been going backwards in recent years and these public service targets would help turn things around.
The list includes 95% of patients being processed through hospital emergency rooms within six hours, and spending less than four months on the waitlist for elective treatments.
A 15% reduction in youth reoffending and 20,000 fewer victims of violence. School attendance should be lifted until 80% of students are present for 90% of the term.
There should be a 75% reduction in the number of households in emergency housing and net greenhouse gas emissions should be on track for the 2050 net zero target.
There are no explicit economic targets other than reducing the number of people on the Jobseeker Support Benefit by 50,000 or approximately 25%.
This target is a nominal number which will ignore population growth and the ongoing decrease in employment after several years of a historically strong labour market.
Luxon said the average adult on a benefit was staying there for 13 years on average.
This is not true of the Jobseeker benefit, which includes people ready for full-time work and those who have some sort of disability. People are on Jobseeker for an average of three years.
A better measure of how long people were spending on that benefit before exiting would be the median number, which was just under two years. But many go back on it at some point.
What the Prime Minister was referring to was 2022 modelling which estimated the amount of time current beneficiaries will spend on any of the main benefits, excluding superannuation.
Those currently receiving the work ready Jobseeker benefit were forecast to spend an average of 13 years receiving some kind of government support before turning 65 and retiring.
The median person was predicted to be spending roughly nine years on a main benefit in the 2022 forecasts, up from seven years in 2019.
Main benefits refers to the youth benefit, both kinds of Jobseeker, sole parent support, and supported living, but it excludes superannuation and other government transfers.
The number of work-ready Jobseekers was increasing prior to the pandemic as the exit rate fell from about 17% to 14% after Labour took office in 2017.
Forecasts by Taylor Fry expected the exit rate to stabilise in 2025, after pandemic and inflation related volatility, albeit at a structurally lower level than in the decade to 2019.
Lower exit rates and a higher future unemployment rate were the main drivers of the extra years Jobseekers were predicted to spend on some kind of benefit.
A model is a simplified version of reality that simulates future outcomes based on historical data. They are useful for policy making but are rarely perfect predictions of the future.
Surging social investment
Luxon said the 50,000 reduction target was “ambitious” and had been chosen in discussion with the Minister for Social Development and relevant chief executives.
The goals set out on Monday were supposed to be “provocations” for conversation that will occur between the Prime Minister, ministers, and agencies at Strategy Committee meetings.
This is a new Cabinet sub-committee Luxon will chair to track progress on these targets and make decisions about where to direct resources.
He suggested more money could be targeted at helping Jobseekers into work using the social investment framework pioneered by Bill English in the previous National Government.
“When you think about [how much] we’re going to spend in the next six years supporting people on welfare, we’re better off taking some of that money and surging it, and do social investment properly, so that we can get people set up for success,” he said.
Luxon said he wanted social investment to be the basis of his government’s social policies.
Economic policies would be based on enhancing productivity and environmental policies would be focused on reducing emissions.
Social investment is based on three principles: taking a customer focus to services, making decisions based on long-term returns not upfront costs, and using data to refine settings.
Luxon’s list of nine targets is:
- Shorter stays in emergency departments: 95 per cent of patients to be admitted, discharged, or transferred from an emergency department within six hours.
- Shorter wait times for (elective) treatment: 95 per cent of people wait less than four months for elective treatment.
- Reduced child and youth offending: 15 per cent reduction in the total number of children and young people with serious and persistent offending behaviour.
- Reduced violent crime: 20,000 fewer people who are victims of an assault, robbery, or sexual assault.
- Fewer people on the Jobseeker Support Benefit: 50,000 fewer people on Jobseeker Support Benefit.
- Increased student attendance: 80 per cent of students are present for more than 90 per cent of the term.
- More students at expected curriculum levels: 80 per cent of Year 8 students at or above the expected curriculum level for their age in reading, writing and maths by December 2030.
- Fewer people in emergency housing: 75 per cent reduction of households in emergency housing.
- Reduced net greenhouse gas emissions: On track to meet New Zealand’s 2050 net zero climate change targets, with total net emissions of no more than 290 megatonnes from 2022 to 2025 and 305 megatonnes from 2026 to 2030.
58 Comments
That jobseekers target tells you that the Govt are going to find a way of just making it happen. Let's break it down.
The Dec 2023 figure was 190,000. The 2029 target is 140,000.
Of that 190,000, about 70,000 are health and disability claims. These are very stable and only went down notably when the labour market was very tight (employers took on people with disabilities or gave them more hours). So, that realistically leaves the Govt 120,000 people to go at.
Of that 120,000, 40,000 are actually working - but they don't earn enough to disqualify themselves from the benefit. Mostly because they can't get enough hours (casual work).
That leaves the 80,000 work ready people who are often in areas where there is a lot of competition for jobs, or skills don't match ,and / or it is simply not worth working given the costs of travel, precarity of the hours, mismatch with childcare availability etc.
Now, population growth alone will add another 10,000 to 20,000 to the numbers.
So where does the the 50,000 reduction come from? Simple - a sleight of hand rule change - eg a limit on the amount of time you can claim without working *some* hours (targets the 80,000), probably with a kicker of chucking people with health problems onto work ready category so they get caught by the same rule. While you're there, introduce some kind of mandatory work scheme (slave labour) to cap it all off.
If Govt wanted to target lots of good jobs and get everyone who needs work into work - you know, low unemployment - they would have used a target based on the underutilisation rate / number. But this Govt, like every other sociopathic govt of the last 40+ years, sees no alternative to an economic model that relies on keeping a bufferstock of desperately underemployed people available to employers offering crap jobs for crap (govt subsidised) wages. I mean, how else will we keep a cup of barista coffee below $10? How will we look after our old people if care costs go up a few dollars per hour? How will our low productivity horticulture businesses compete internationally if they have to offer a higher price to persuade people to work in the fields.
I'm not totally against the "work for benefit" scheme idea, it doesn't have to be slave labour we could top up their pay to at least minimum wage for showing up.
What it could do though is provide some competition for temping agencies that typically charge $30 - $50 an hour for a labourer, who can (in my experience) often turn out to be shit. The employer could top up their wages the difference between the benefit and minimum wage pro rata 40 hours.
The next challenge is getting them to job sites, as many probably have non road worthy cars. Put on a few shuttle vans in the morning??
Those kind of arrangements exacerbate the problems caused by 'in work benefits'. They quickly become a subsidy for the employer and whole business models and businesses get built around them. This leads to a massive *increase* in claimants because employers and employees find the sweet spot between paid wages and govt subsidy.
What I would do is guarantee any resident up to 40 hours work and use work and income offices and NGOs to broker people into local 'transition jobs' at minimum wage doing something useful in their community (helping out in schools, building trails, training people, fencing off streams). This replaces the unemployed bufferstock with a bufferstock of people in 'transition jobs'. If the private sector wants to recruit / expand, they have to offer more than the transition job.
This approach better matches human history - why would people be left idle when there are important things to do? It also provides a much more humane price and labour market stabiliser.
Jfoe the track record of make work schemes is not great.
I thought Otorohanga had a good community run programme that looked to have all unemployed youth into work or training - not doing anything is seen as a failing (of the community)
It is also now quite easy to stay in a region where there are no jobs or prospects - Murupara, Taumarunui, the East Coast/West Coast to name a few. the decision to stay is the individuals but not sure that anyone wins when the state picks up the tab
I don't think offering people the chance to do useful things in their communities is 'make work'. At what other stage of humankind have we purposefully left people idle to prevent demand exceeding supply? When food was in short supply in ancient times, did we say to our hunters / gatherers / farmers, 'sorry, down tools lads, people are bidding up the price of food, so we need to make people too poor to eat'? It's mad - an approach dreamt up in in the 1970s by lunatics looking to crush the rights of workers and ensure a ready supply of casualised and powerless labour to their sponsors. We need an alternative that better suits human nature.
I also don't think the answer to a lack of work in rural areas is to give up on them and move everyone into cities. Provide people with basic jobs and there will enough stimulus through wages to create a reasonable level of private sector regional activity - enough to stop the downward spiral into meth and mental illness. Also note that a low-wage economy won't support new house building so that will put a natural cap on growth.
Many unemployed are not capable , or do not want to work 40 hours a week , all the time . Plus many of the jobs , no one would wnat to work them full time.
The labour pool idea is a good one, an employer should be ble to ring up winz , nd say , i need a labourer for a day / week / month etc.
Good breakdown. I'd also add that there would ideally need to be more investment in training e.g apprenticeships to assist in giving unskilled workers and the youth the skills they need to obtain employment. In this regard, and with a tanking economy currently which doesn't show any signs of changing for the next 6months or so, I as Mr Luxon, with all that's being done in the hopeless aim of meagre tax cuts, where is the money for these ambitions?
It's looking like they want to to reduce the numbers on health and disablity as well.
https://www.newshub.co.nz/home/politics/2024/04/prime-minister-christop…
Paywalled however headline says it all
"Planned cuts to the public service so far won’t even wind back the last six months of expansion"
https://www.nzherald.co.nz/business/planned-cuts-to-the-public-service-…
Thanks for the hearty discussion kiwikids. Excellent points made.
Do you agree, and you're saying no, it wasn't frivolous? You disagree and you're saying no, National shouldn't have trouble because it was frivolous? No, it was frivolous but also National can't wind back that many jobs? Which would mean it's not all frivolous but I digress.
Do you mind elaborating why you think that? I enjoy reading these discussions for both sides.
Kiwikids worked at Unilever when Luxon was there, so be mindful of that bias.
I suspect Kiwikids' stance is only achieving 6 months of unwinding highlights how mammoth the expansion was. If it's truly a "mammoth" task then why stop planned cuts at 6 months worth? National are struggling to balance the books, Luxon should put on his "Air NZ" hat and keep digging through the payroll data. Sort from newest to oldest and keep cutting.
The first round of cuts were only for the current fiscal year 23-24. More budget cuts are coming in subsequent budgets as I understand it.
A bigger concern is that all the power disproportionately sits with the top dogs at the public sector. In the absence of clear direction from the ministers on where the cuts should come from, the top brass will obviously protect their own kind and throw the frontline staff out on the street, worsening the outcomes for NZ.
Goodhart's Law will apply, just as it did in hospital emergency rooms in their previous term.
They seem stuck in this silly blind ideology that magical metrics can replace adequate investment, so they can put the budget into cutting taxes on their personal property portfolios instead. Idiocracy.
So they want to reduce unemployment until all the businesses start squealing that they need to pay too much for employees at which point they'll import more people so the businesses are happy and unemployment will go up and we can return to villifying them again. And the cycle goes on.
If our economic system requires people to be unemployed so that it functions "effeciently" it is morally repugnant to me to villify them for "doing their bit for the economy".
maximum sustainable employment. https://www.waikato.ac.nz/news-opinion/media/2022/nz-has-reached-full-e….
What on earth does that even mean?
It means that we can't have more people employed otherwise too much upward pressure will be put on wages to attract a smaller pool of unemployed. Increasing wages equals increasing spending and increased inflation. Eventually this will just lead back to the other side of the cycle, with culling of company spending and therefore jobs. So the cycle continues.
NACTFirst knows this, or at least I hope they do. Blissful ignorance seems somehow worse than willful ignorance. They just know that their supporters froth at the rhetoric of cutting people on the benefit that they think are taking their taxpayer money to not work. They want blood but they will never be satisfied as there will always be someone abusing the system. It's a problem these parties can champion every election cycle, every part of the economic cycle, ad infinitum.
""Reduced net greenhouse gas emissions: On track to meet New Zealand’s 2050 net zero climate change targets, with total net emissions of no more than 290 megatonnes from 2022 to 2025 and 305 megatonnes from 2026 to 2030.""
Isn't that a 5% increase? If so how does it progress NZ towards zero? What is it that I'm failing to understand?
Rodd Carr was on 9 till noon on National radio this morning . a good listen.
https://www.rnz.co.nz/national/programmes/ninetonoon/audio/2018933482/n…
Why would you set increasingly higher targets when the aim is to reduce greenhouse gas emissions?
- Reduced net greenhouse gas emissions: On track to meet New Zealand’s 2050 net zero climate change targets, with total net emissions of no more than 290 megatonnes from 2022 to 2025 and 305 megatonnes from 2026 to 2030.
I will be waiting for those 9 goal quarterly reports.... NOT......lol My tiny insignificant corporation (household) will be here next election ,Will yours? Folk want action ...not words. Enjoy the parliamentary pay rises , I suspect they will be well out of kilter with what the average Kiwi gets . Get on with it and show us all what your government can do... dont tell us...show us...
I don't know what you mean, short term they will lock up enough youths so they can't reoffend as youths, then after they are released later in life all of the emotional damage caused will mean they just reoffend as adults when they are much more dangerous (notably not youth reoffending. yay!). This gives the added benefit of creating more generational trauma where these peoples children don't know anything but to turn to crime. Notably, none of this counts as youth reoffending which is excellent news for the governments numbers, plus they get to complain about the same problems in 10,20,50,100 years. Mark that as a win-win for them.
Shorter stays in emergency departments
Shorter wait times for (elective) treatment
Excellent! they're going to abolish smoking again, and remove the charge for prescriptions.
Reduced net greenhouse gas emissions
Excellent! They're going to build fewer billion-dollar motorways more cycle lanes and encourage people into small fuel efficient cars by taxing large gas guzzlers.
Increased student attendance
Excellent! They've decided to keep the school lunches going. Probably helps keep people out of hospital, too.
Finally, some bold ideas from the new government. Hurrah!
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