Written By:
lprent - Date published:
7:00 am, February 19th, 2010 - 21 comments
Categories: business, education -
Tags: ACE, adult education, anne tolley, simon powers
I see that Simon Power is taking up some of the recommendations of the Capital Task Force. All very good. But the emphasis that Powers is putting on improving the financial literacy of New Zealanders in the spin on the decisions is quite strange bearing in mind decisions already made by the government. All of the reporting I’ve seen has been about starting to teach more financial literacy in schools.
But that is a long-term strategy – it does nothing for investors now. What the government should be doing is improving basic financial literacy for current investors. They are the people who need the advice the most right now. In particular they need to be able to sort the bullshit from the gems offered by financial advisors like stock or financial brokers. So what is the best vehicle for delivering that type of education?
Ideally it should be accessible to people doing relatively small investments. That means it should be low cost and most commercial financial seminars are done by sharks pushing their own products and charging like wounded bulls. It should not interfere with work or weekends. Therefore it should be available in the evenings.
In fact the ideal system would use existing classrooms in schools as night classes with people teaching the basics, and where there is no direct salesmanship in selling financial products. But Anne Tolley just destroyed the long running cheap effective and more efficient than the alternatives Adult Community Education program in a burst of short-term stupidity, pushed through under urgency with no public submissions. This appears to me to be done to financially prop up private schools.
“Adult education in New Zealand has survived one hundred years, two world wars and a global depression.” Fordyce stated. “We will educate this government that social needs are just as important as economic ones.”
Approximately 220,000 New Zealanders participate in outside education courses each year. The petition delivered to Parliament this afternoon is the largest to be presented this term.
Expecting Anne Tolley as Minister of Education to understand the importance of education in financial literacy in schools as seems as unlikely as her ability to comprehend exactly how important the second chance opportunities that ACE offered are. She appears to have little idea about many of the objectives of education, preferring to concentrate on unrequired and probably ineffective irrelevancies like ‘National Standards’.
On Simon Powers panacea of kid education in finance, I’d suggest that current investors here keep their scepticism and caution well and truly alive. This looks more like a short-term PR stunt by a government wanting to shore up the battered confidence of investors rather than anything substantial. Clearer statements are not a lot of use if you don’t have the basic education required to understand what they’re saying. They’d be better off educating the adults.
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On a personal note about adult education. My mother had to leave school early to become a nurse and later to raise me and my siblings. A decade later, she returned to education using the adult community education night classes to get her university entrance. Having night classes were critical – she was raising three small children.
She subsequently got a degree and started working at a much more productive level than would have been possible otherwise. She also triggered a a interest in higher education not only amongst her children, but also in the wider family – which had previously not been noted for any interest in education.
If the night school had not been there in the first place, it is unlikely any of that would have happened. Nor is it likely that our family would have been making the contribution to our economy that we have made over the decades since that all-important second chance. Night classes are an important second chance point of access to education. They were cheap and remarkably effective in providing people the incentives to do further education.
I’m furious at the effective destruction of night classes by this government. As far as I’m concerned cutting them to push money into private education is ridiculous, as well causing a economic problem for New Zealand further down the line. If there are budget constraints in the education budget, then cut the subsidisation of people affluent enough to pay school fees. Use the money saved to rebuild the critical second chance adult education system.
That is a policy that I think parties of the left should adopt and push for the next election. Who is drafting the resolutions for Labour?
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Finance Company Collapses
At least Power is doing something which doesn’t fit with the left’s thesis that this is a do nothing government. During the Labour government’s term of office finance companies fell like nine pins and the government of the day did nothing. Why was that? Maybe it suited their purpose to destroy independent wealth thus creating more dependents on the state?
Maybe it suited their purpose to destroy independent wealth thus creating more dependents on the state?
What a bizarre thing to day.
You think the Labour Party is engaged in the planning for the overthrow of the capitalist system. You must be stuck in the 1950s.
The last Government was actually very good for the business sector. Just have a look at the tax take. The corporate take went up because businesses were doing so well.
You mean like the building sector, hey they cannot evan build a house that keeps out the rain, somewhere betw 22k and 89k of houses leak, and will cost inexcess of $11b no wonder business take was up. Also we had a timber selling roof trusses with under designed timber equalting to $250m sales from CHH, fnance coy giving money away to dig a hole in Queenstown, billions lost in finance coy who paid for all these ?/ The people that are to be protected by laws/govt yet these coy made huge profits and taxes. Great long term results for NZ
And maybe what NACT+MP are doing is to increase peoples dependence upon the rich? Because removing peoples access to educational resources certainly doesn’t allow them to improve themselves.
Or because the process of law making is slower than the markets. You sound like a conspiracy nut with your theory
But I didn’t mention finance companies. I was looking at the education in financial literacy. Do you have anything on that topic?
Not a conspiracy nut – Just being provocative – the lack of action by the Labour government probably reflects incompetence rather than predetermined action.
You notice that the measures taken by Powers were not exactly far reaching. As he pointed out, there is a balance point between differing objectives that has to be reached. But there are no optimal ‘sweet-spots’.
The most effective strategy is to promote financial literacy amongst investors so they are able to make their own risk assessments, not only of the products – but also about the advisors.
However Tolley has removed the best system to help make that happen.
Yes, as it happens ……
The wanton destruction of the ACE system is a blot on this government that will never be erased. Tolley et al are bereft of any idea how widespread participation in continuing education cements society together. Whether macrame or mathematics, education is an intrinsic good that cannot and need not be captured in crude monetary measures. These idiots, having got up the ladder, are kicking it away to deny others the chance. This is not just a left/right issue, this is a human rights issue and National have got it wrong.
I agree about improving finacial literacy especially for polynesians who know little of the market and stocks. Mainly cos they’re usually too poor to afford investing in such schemes.
For instance, when the money market/stock exchange stuff comes on the news, thats my cue to do something else for a few minutes because i dont have a vested interest in it so why bother watching it ? It’s not news to me and only applies to the more well to do section of the general populace that have a maeasure of disposable income to invest.
So how about teaching it on a pay per view freeview channel with an accompanying interactive website and maybe 0900 helpline if you really get stuck ?
That way the whole family can learn and you don’t have to leave the comfort of your own home.
Judging by the ethnicity of the people DTR, Cash Converters and other loan sharks put on their ads, I’d say they need education in basic principals of debt and interest rates.
No doubt Lanthanide , we’ve always needed it and thats part of the failure on everyone’s part in allowing a polynesian underclass to develop.
So naturally it would all be offered as part of the subsidised freeview subscriber package paid for by whanau ora 😉
Ah yeah…. Most people doing investments are older than I am, and I’ve been on the bleeding edge of this type of technology since my teens. Many of them don’t have the technology, and even where they do, they don’t know how to drive it.
The short answer is that approach may work for people at the same age or younger than I am. But it is almost certainly less effective than bums in classrooms interacting with each other.
I’m a skeptic about the effectiveness of enhanced learning technologies. Lyn is the optimist in that field
So teach the technology first. Subsidise cheap computers and free dial up. Then make em pay for extras like webcams, headphones etc. Apply national standards and performance based incentives tied to increased benefits using a secure log in and ID like your IRD or winz number…
Get that happening and then we can look at online voting and binding referenda via a tie in to Parliament TV using the proposed broadband upgrade.
…just riffing of the top here but the whole bums on seats thing is sooooo old school and it never worked for us before. There are however shitloads of jobless young poly’s out there who know how to download music and rip movies of torrent sites and have nothing better to do but talk shit interactively online.
It isn’t the hardware that is the real issue – it is the hardwired logic in peoples heads.
I’ve taught MANY people how to use computers and software. There is a distinct generational gap that is currently in the 45-50 age group between those that grew up with computers and understand the internal logic intuitively, and those who didn’t (and pretty much learn everything by rote). The teaching methods are quite different
I think that you’ll have to wait about 30-40 years before what you’re after is really feasible.
Re online voting tied to TV : It’s feasible now, but it’s in every politicians interest to maintain the status quo and conduct stupid MMP referenda hoping for a rewind to the glorious old boy days.
…sooo back asswards looking as to distract from envisioning a future and working towards it. Thats the trouble with polticians and it doesnt matter whether you lean left or right.
It’s all about passing the buck and covering your arse…
Nice post, as for the finance company thread……the law never keeps up (internet a classic example) and once again if we had a MSM that did it’s job the likes of bryan gaynor would have allies in print, all he copped was criticism and Hotchin and co were given soapboxes to counter his concerns.
This same MSM sits on it’s hands while Tolley creates years worth of damage, has already driven senior academics offshore and imbalances the system yet further……before we factor in this ludicrous ticket based system ACT are pushing where kids can go to more than one school and create more traffic congestion.
As for any real meaningful reform of Finance……smoke n mirrors.
You write – ‘As far as I’m concerned cutting them to push money into private education is ridiculous, as well causing a economic problem for New Zealand further down the line.’
I take it much further and say it is a tory non-theistic form of evil. There.
I have personally gained from the former system and loath the loss.
Getting increasingly irate with these mutts, the humour is just falling away…
How does investing in stocks and shares square with the reality of finite growth… climate breakdown, environmental degradation and resource depletion…?
And how does it square with redressing the balance of the share of the proceeds from production received by workers…increasing levels of poverty, a stagnant and slipping middle class and burgeoning underclass?
Just asking.
And I’m taking it as read that any financial literacy will roundly ignore all the real world consequences of investing that exist beyond the abstract calculations of risk and return and as such will be a basic and degraded literacy… a bit like being taught to read the words on a page but never being introduced to the concept of reading comprehension… one scenario being merely pointless and the other being pregnant with all sorts of dangers.
“But Anne Tolley just destroyed the long running cheap effective and more efficient than the alternatives Adult Community Education program in a burst of short-term stupidity, pushed through under urgency with no public submissions.”
I agree about adult education generally, but what particular course would people be taking to invest their money better? There are loads of books on investing in NZ, either in bookshops or the library. There is also the internet of course.
There is one thing that is hard to educate GREED. Why else would seemly literate finance people invest in 2nd/3rd tier finance coys other than for a 1% of extra return for what risk, or the Blue Chip scenario for a few $0,000 you will earn $100,000, and then we want this money to be guaranteed or govt protected???
Easy education risk vs reward, and if it is to good to be true …. run as fast as you can!!