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Make-work don’t work

Written By: - Date published: 2:15 pm, October 15th, 2008 - 24 comments
Categories: economy, election 2008, maori party, wages, welfare, workers' rights - Tags:

The Maori Party wants the dole abolished to be replaced by work schemes. It’s a bad idea but it’s not too far from being a good one.

Make work schemes are bad in several ways. They distort the market for low-skill work. The State with an army of cheap, semi-involuntary labour ends up undercutting the normal labour market, pulling down wages for workers or forcing them out of a job (and into the work schemes). When unemployed people are stuck in work schemes they don’t get the opportunity to look for proper work. It’s likely that workers in work schemes will be poorly used, we remember the stories from the Great Depression of one work gang digging a hole, which another filled in.

The Maori Party is right about the demoralising effect long-term dependence on benefits can have but it is wrong to think forcing people against their will to do useless work is the answer. Instead, the Government should look to get them into proper jobs. The Government should create more ordinary jobs by expanding its infrastructure construction, which is exactly what Labour is proposing to do. 

Let’s remember, too, that there are very few long-term unemployment beneficiaries in New Zealand. Only 5,300 people (0.2% of workers) on the UB now have been on a benefit for longer than a year. That’s down from 45,000 in 2003 and over 100,000 in the 1990s. Most people are on the UB for very short periods. We don’t want to be unnecessarily diverting those people out of the normal job market into make-work schemes. Yes, we should continue the good work that is being done to eliminate long-term unemployment but we don’t need to throw the baby out with the bathwater.

Rather than make-work schemes, the Government should also help unemployed people find work in the private sector – WINZ should go into competition (and, ideally, replace) the labour hire companies by putting unemployed workers and businesses in need of short-term labour together. WINZ could offer decent work rights to these workers, as well as better rates to the workers and the businesses than the labour hire companies do at present by operating on more reasonable margins.

I do worry that there is starting to be a trend of the Maori Party blurting out poorly considered ideas. If they want to make serious gains for their people, they have to get more serious.

24 comments on “Make-work don’t work ”

  1. vidiot 1

    …replaced by work schemes. It’s a bad idea but it’s not too far from being a good one. Make work schemes are bad in several ways….

    Wasn’t this make work scheme Helen’s answer last night to the ‘hard’ question, something like we shall engage in (excuse the pun) Labour intensive projects to help NZ move out of this depression/recession.

    Now was it Eden Park or Auckland Grammar sports fields that were done this way, way back then… the work was finished, things still weren’t economically right (excuse the pun again) and they were told to redo them again, this time 1″ lower.

  2. No, it wasn’t Clark’s answer. Read the post.

  3. vidiot 3

    SP – suggest you watch last nights debate again, she clearly inferred on more than one occasion, that she would introduce infrastructure schemes that tied up (employed) large amounts of people vs having them on the unemployment books, if the economy tanked badly. That’s not work for teh dole, but it’s very close to it.

    [ no, she said they would bring forward infrastructure scheme providing employment and stimulus to the economy. These are projects that are worthwhile in their own right simply being accelerated, that’s quite different from creating work schemes for the purpose of having unemployed people doing something. Stimulating employment economic activity in a downturn is great, work schemes are not. I’m sorry if you can’t understand the difference. SP]

  4. randal 4

    make work schemes are just chain gangs for tories to work out their underlying psychological fantasies on semi-slaves. nasty

  5. Scribe 5

    Hmmm,

    I would think the Maori Party would have advisers who know a thing or two about what the best strategy is for their people, who are grossly over-represented in these statistics.

    IMHO, Sharples/Turia and co are in touch with the majority of Maori and are — despite policy disagreements I’d have with them — people of character who want what’s best for their people.

  6. Tane 6

    Scribe. From my experience the Maori Party are all over the place on policy. They’re an empty brand looking for a political ideology.

    Did you see Hone on Agenda the other week? Going on about how he’d like to cut this tax and that tax, then when asked how much it cost he had no idea.

    Anyone know if they’ve actually costed their plans to cut GST, corporate tax and create a tax-free threshold?

  7. Does The Standard have a cesorship policy? I wrote a comment last night arguing against this blog’s analyis of the debate and by morning it was gone. No expletives and nothing prurient. What’s the problem?

    [lprent: Nope – not unless you’re banned or moderated or the anti-spam engine recognizes you. The most likely reason is that it simply didn’t save at the server.

    That is usually because people get the recaptcha required to enter comments incorrect. The reason you have to do that is because we don’t require logins and it is the most effective way to stop spambots.]

  8. Tane 8

    I can’t see why it would be gone Ron. As you can see from the posts over the last 24 hours there’s a fair bit of disagreement even amongst ourselves.

    Feel free to post it again, could have been an error or the spam trap.

  9. randal 9

    ron hanson..bad luck…write it again and stop bleating!

  10. bobo 10

    This is all part of a predeal with National coming through back to work for the dole.. Labour means real jobs in regards to building roads and state assets in the quiet times , do you think that a laborer on the roads is going to do a full week for the dole +20 dollars a week which I remember was the old policy. The Maori Party are badly advised to go down this road when unemployment only drops with real jobs not token ones below the minimum wage.

  11. Aj 11

    It’s about time someone asked if the M Party will support changes to Kiwisaver if National try to form a coalition

  12. Ben R 12

    Although there is the crowding out problem with these schemes, I think it’s good that they recognise the self destructiveness of having nothing to do. It’s a good idea apply the basic principle of reciprocity to the benefit system so people feel they’ve done something to earn their money.

  13. Thanks, just wanted to check, good to know.

    cheers

    Ron

  14. simon 14

    There is an easy solution to long term dole bludgers. The dole will only be available for 12 months, after that you’re on your own. To clean up the mess, build enough prisons for 4-5000 new inmates, which will stimulate the economy and create jobs thus no more long term unemployed.

  15. Bill 15

    Anyone ever thought of paying the unemployed for the work they do?

  16. Bill – only someone who didn’t realise it was a privilege to provide your labour to capital would say something silly like that…

    Arbeit Macht Frei, old chap…

  17. Quoth the Raven 17

    What an amanzingly simple plan simon, why didn’t anyone think of that before, that’ll solve all our problems. If the dole bludgers don’t get work after 12 months they can starve to death. 4-5000 new inmates we’re have to make new laws for that. No problem. How about if you don’t wear a tie on sunday, we put you prison. The economy will go swimmingly the billions and billions of dollars to build the prisons will be got from leprechauns. And then to keep them running and administer them don’t you know there are pots of gold at the ends of rainbows. We’ll get the scientists working on finding them. All will be well.
    I guess you’re voting ACT, Simon. Right?

  18. Alexandra 18

    Scribe
    the Maori party do not represent most Maori on all issues. Our politics are as diverse as non maori. I for one do not agree with work for the dole schemes because everyone has a right to be paid a decent wage for a decent days work. I do however support full employment though the creation of real jobs.

  19. Pascal's bookie 19

    “The economy will go swimmingly the billions and billions of dollars to build the prisons will be got from leprechauns. ”

    Could be, but it’s risky. Those little feckers are mean.

  20. Dom 20

    I’m with Tane – until the Maori Party learn how to put budget numbers beside their plans then they’re not plans but musings. I’ve noticed this same failing from them for years now. Unless its a costed policy then its just an interesting thought.

  21. Bill 21

    SOd

    “Arbeit Macht Frei, old chap ”

    Silly me right enough. Potatoes anyone?

  22. Bill me old mate I think that might have been over their heads… What a fuckin fiasco…fiasco after fiasco after fiasco…

  23. Felix 23

    “The economy will go swimmingly the billions and billions of dollars to build the prisons will be got from leprechauns.”

    So…
    Phase 1: Build prisons
    Phase 2: ?????
    Phase 3: Profit!

    Really does sound like ACT plan when put like that.

  24. Scribe 24

    Alexandra,

    the Maori party do not represent most Maori on all issues. Our politics are as diverse as non maori.

    Well, who’s a more representative voice for Maori on a range of issues? Who’s more in touch with Maori?

    If the Maori party says something that affects their people heavily should be handled in a certain way, I’ll listen. Just as if the Greens say something is best for the environment, I’ll listen to them.

    (Not that I agree with many policies of either party…)

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