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UBI: what is it good for?

Written By: - Date published: 7:10 am, February 27th, 2020 - 122 comments
Categories: benefits, disability, economy, wages, welfare - Tags: , , , , ,

There seems to have been an upswing in New Zealand UBI discussions recently. While many progressives see value in a UBI and want to be rid of the punitive and soul destroying aspects of MSD and WINZ, we hardly ever talk about what would happen to disabled people (or their carers, or solo parents and others) who can’t work. Time to put welfare in the middle of the UBI debate. What we need is a UBI with welfare bolted on*.

Who wants a UBI?

Here’s what a UBI is good for, across the political spectrum.

The right: an opportunity to remove welfare (think the Bennett reforms on steroids), and control workers.

The liberal centre: an opportunity to push liberal reform of right wing economics while resisting social democracy and the left.

The centre-left: an opportunity to prevent the worst impacts of automation on the work force, by providing guaranteed, steady, low income, and to encourage better security for low income and precariat workers.

Lefties: an opportunity to provide for the precariat, and to get rid of the horror show that is WINZ without having an actual plan for people who cannot work.

Beneficiaries, the precariat, low wage workers: an opportunity to do away with punitive welfare culture, and enable fairer and higher income streams.

Of the UBI models routinely discussed in New Zealand, none I am aware of adequately solve the problem of income for people who cannot work. Either the UBI would have to be set very high, or we would be pushing tens of thousands of people into poverty.

Comparing a UBI to Welfare

To make it clear what the problem is, here’s a comparison between the current main benefit for long term disabled people who are assessed as unable to work, and the main UBI model most often discussed in NZ as a replacement for welfare.

The Supported Living Payment is $273/wk or $14,196/yr, after tax, for a single adult with no children. A UBI rate often referenced is around the same as the dole/Jobseeker rate, at $11,000/yr. That’s a 22% drop in income right there.



In addition, anyone on SLP currently also has access to the non-taxed supplementary benefits – Accommodation Supplement, Disability Allowance, and various hardship and emergency grants – that most long term beneficiaries rely on to survive. Please bear in mind that for many on SLP, existing welfare is already not an adequate amount to live on. With the supplementary benefits gone most disabled people who are unable to work would lose a large portion of their income.

My back of the envelope calculations:

That’s a difference of $15,000, or a drop of 57%. 

(Have to stop here and point out that while people on SLP get $14,000/yr base benefit, there are people with the same level of long term disability on Jobseeker at $11,386. This is because of successive governments’ punitive approach to welfare and it’s a gross injustice).

Many on SLP can’t work any regular hours at all. Some people on SLP would be able to earn part time, but not enough to make up the shortfall. 

That $15,000 is $288/wk or 16 hours at the minimum wage of $17.70/hour. The eligibility criteria for the 93,600 people on SLP is they are unable to regularly work 15 hours or more a week.

New Zealand’s UBI models

Of the professional people promoting a UBI in NZ, Keith Rankin acknowledges the issue, but I can’t see where his solution is.

In his Big Kahuna model, 
Gareth Morgan actively sought to kill welfare for ideological reasons, expected that some beneficiaries would be worse off, and had no plan for disabled beneficiaries who couldn’t work apart from some vague hand wave in the direction of the state somehow providing services directly to make up for the missing Disability Allowance.
 But no more Accommodation Supplement, or food or hardship grants either.

The Opportunities Party followed Morgan’s lead, including designing a Youth UBI that actively discriminated against youth who are disabled and unable to work. I have been told TOP are in the process of reviewing their UBI policies, so hoping there is some change there.

Of the quick read around I did to check the current state of UBI debate in NZ, the only piece I found that stated categorically that welfare should be bolted on is this 2017 article from Danyl McLauchlan.

Managing disability support payments

The idea that the shortfall for disabled people can be made up by the Ministry of Health providing services directly is missing two critical aspects: what Disability Allowance currently covers, and the right of disabled people to have their own income just like everyone else. The key thing to understand here is the difference between having income and having access to services.

Disability Allowance is capped at $64/wk but additional costs can be partially met by the hardship grant TAS. DA is for a range of costs including things like phone rental, counselling, power and firewood, or travel to a doctor. The Ministry of Health isn’t in a position to provide for many of those things via services. It would be very odd for them to become firewood merchants for instance. If they instead provided funding, how is this different from welfare via WINZ? Or would they pay a third party (private agency or NGO) to organise provision?

For the people who think the MoH would be an improvement on WINZ, please start listening to disabled people dependent on the department about what it’s like to deal with the MoH, because they often tell a different story. Transferring management to the MoH would require recreating WINZ but in a bureaucracy with its own set of serious cultural problems.



It’s discriminatory to remove income from disabled people and expect the shortfall to be made by the state deciding what services disabled people should be allowed to access. Imagine if your boss held back 1/2 your wages and told you which budget cafe you would be allowed to get dinner from instead of being able to buy your own groceries. There is a basic principle here that people have a right to income and to make choices about how they spend that, rather than an agency being in that role. The neoliberalisation of welfare that has harmed so many has included policies trying to control what under-65 welfare recipients spend their money on, and this is something we should be absolutely resisting in a UBI model.

Disability Allowance is paid out on the basis of GP support. Were that to transfer (either as income or services) to the MoH, it’s akin to letting WINZ staff make assessments i.e. someone who doesn’t know the person or their situation. The MoH’s disability needs assessment processes are already fraught, and tied into capped budgets and restrictive eligibility criteria, as well as the internal cultural issues.

Finally, the emergency grants that most beneficiaries rely on would be gone. Need a new washing machine because the old one suddenly breaks down? Or an urgent car repair so that you can still get your kids to school? Or need help with getting to a parent’s funeral, or urgent dental work? These ‘non-disability’ things would now be expected to be met from the reduced income. 

Changing the UBI debate

There are of course many benefits to a UBI, including for beneficiaries. The underlying concept of a progressive UBI is sound. 

A UBI with welfare bolted on meets the needs of the precariat in having steady income, as well as people who for whatever reason are unable to work (or where no suitable work is available). It has the potential to bring great benefit to disabled people who cannot work regular hours but could do intermittent work if freed up from the WINZ abatement and reporting traps.

But we are still a ways from designing a model that is fair, feasible, and tory-proofed. I support a full debate around a UBI, but let’s remember that the right want one too, and not for good reasons. The best approach I see so far is from the Greens, who want to investigate a UBI with welfare bolted on, but would reform WINZ in the meantime to remove the punitive aspects, raise benefit levels, and address pressing issues like the abatement rate (a 30 – 100% deduction rate applied to beneficiaries’ earnings) and the massive elephant in the living room that is the housing cost crisis.

I don’t know if WINZ are the right department to manage the bolted on welfare, but the MoH or IRD certainly aren’t. Ideally we need a new department, starting from scratch with none of the punitive culture that currently exists in WINZ/MSD. One that starts with the premise that humans have the right to a core standard of living and to access that without punishment or degradation.

Because of this, the UBI debate needs to centre how to design a fair and efficient welfare support system to run in tandem with the basic income. Instead of starting the conversation with the economists’ view of tax rates and maybe trying to tag on welfare as an after thought, let’s start with the full range of people who a UBI is meant to be helping.

*Thanks to Chloe Ann King for consistently voicing the need for welfare alongside a UBI, bolted on, and for being able to advocate for working people and beneficiaries at the same time.

122 comments on “UBI: what is it good for? ”

  1. Tiger Mountain 1

    Thoughtful post with a wide scope. Will process for a bit before commenting. Most politicians not wanting to touch this seriously is another issue. As full time, or regular, livable work heads off into the sunset for so many this has to be dealt with–not everyone can drive an Uber or run Air B & B! or exist on the resulting pittance…

    • weka 1.1

      I'd like to see potential solutions driven more by people who are affected by the issues. In this case, I'm seeing left wing people so sick of WINZ and talking about a UBI a saving us, so there's an opportunity to do that in a progressive way rather than leaving it up to the eventual adoption by mainstream parties (Labour looked at in their Future of Work project a few years ago, I expect they will revisit it eventually). There's more understanding of welfare issues now in the public since Turei's speech, and more MSM and public discussion. I'm not even convinced that a UBI is the way to go, but centering people rather than economics seems critical at this point.

  2. Pingao 2

    But David Seymour says "you can't solve poverty by throwing money at it".

    https://www.scoop.co.nz/stories/PA1707/S00238/national-must-rule-out-working-with-socialist-greens.htm

    Sigh.

    • In Vino 2.1

      Oh how that Rightie argument annoys me. The overpaid rightie bastards always apply it to underfunded areas like Health, Education, Social Welfare.. – exactly where money is actually needed. Amazing how the pricks can throw money at overpaid CEOs. etc.

  3. Chris 3

    It's interesting that a key part of the conclusions reached by the 1972 Royal Commission on Social Security is that regardless of where main benefit rates are set it's essential to retain a comprehensive supplementary benefit system in order to ensure 'social security' and a truly functional safety net.

    • weka 3.1

      I've never really quite understood the attachment to a single rate. I guess it makes it bureaucratically easier, but that's the problem with starting with economics rather than people. There's a greyscale between a single rate and so many rates that it becomes impossible to administer.

      • Chris 3.1.1

        The idea of the need to retain a comprehensive supplementary benefit system of special needs grants, special benefits and so on, I think is consistent with the need to provide for different types of general need, such as unemployment, sickness, disability etc. For the same reasons a UBI that treats everyone the same does not work, which are also the reasons why Labour's attempt at a single core benefit was doomed from the start. CARITAS published a report a few years ago that looked at how Labour's single core benefit would fail because it relied on creating a whole new set of supplementary benefits to deal with the differences between people's situations that would no longer be recognised when all the main benefits are replaced by one single core benefit. Bennett and the nats pretty much carried on with the idea after 2008 except they replaced the main benefits with three core benefits instead of one.

        • weka 3.1.1.1

          I don't remember much about Labour's one benefit idea. What kind of rate where they thinking? The dole?

          • Chris 3.1.1.1.1

            I don't know if they reached the point of determining the rate. Labour was all over the place with it. Its introduction was put out a number of times because of all the policy difficulties and contradictions. I do remember one line from the rhetoric which was 'nobody will be worse off', but that would have meant setting the rate at what was the invalid's benefit so people on the dole would’ve got a reasonable increase, and of course Labour were having none of that. The whole concept was designed to simplify things and reducing the seven or so main benefits down to one was supposed to be the silver bullet. The problem is that the complexity comes from the endless myriad of add-on benefits so the complexity issue wouldn't have been addressed at all, and in fact would've been made worse by the need to introduce even more add-ons to cater for the reduced differentiation between the categories of main benefit. The problems Labour had delivering what they'd promised were endless so the whole thing never happened. It was a really bad idea based on erroneous assumptions.

            • Sacha 3.1.1.1.1.1

              Here's some research we were asked to do as part of the Single Core Benefit policy development which you have accurately characterised. Let's just say that MSD were not happy with the wide range of costs that emerged from our work when they were hoping for a simple number. This is about the only place that still has a copy – can't find it on any govt sites:

              http://carers.net.nz/information/research-cost-of-disability-report-2010/

              • Rosemary McDonald

                A fine piece of work Sacha, and should it disappear from the interweb, I have it (and other similarly useful e-tomes) on a wiggle stick or two stashed around the place.

                It has become clear to me over the years that it is possible for such pieces of work to simply disappear…and if these works have been government funded the implications of these disappearances is sinister.

                Time to reline my tinfoil hat.

                • Sacha

                  Thank you. Original NZ Disability Strategy nowhere to be seen either. Am considering putting lots of that stuff online myself.

                  • Rosemary McDonald

                    Hmm…Chris Ford wrote a very interesting piece about the gestation of the NZ Disability Strategy I. I wonder if that is still around? It was far from an easy or straightforward process producing that first one…from what I can make out the difficulties were exacerbated by a genuine attempt to listen to the opinions of as many 'stakeholders" as possible, and then encapsulate these into clear and concise Objectives.

                    Which, IMHO, they achieved in spades.

                    The current version of the strategy is a mixed up, muddled dog's breakfast and fails to even remotely fulfil its purpose under the PHDAct.

                    Which of course is a win to them.

            • RedLogix 3.1.1.1.1.2

              It was a bad idea because it retained the idea of a benefit at all. That meant the core benefit needed to be set as low as possible, which then meant they couldn't avoid all the add-ons. An idea set up to fail.

              It simply never occurred to them to make the single core benefit sufficiently generous so as to make the vast majority of the extras unnecessary.

      • Sacha 3.1.2

        I've never really quite understood the attachment to a single rate.

        Economists are simple creatures..

      • Chris 3.1.3

        Thinking about it further, we also have at the other end of the spectrum unprincipled differences between rates that create unfairness and/or administrative difficulties. Axing the difference between the single and half-married rate, for example, would be a great and, importantly, achievable first start towards individual entitlement, in order to address the increasingly indisious relationship status problem.

  4. Rosemary McDonald 4

    I shared here a few weeks ago how MSD has pared back our National Super based income because they are assuming we are earning a 'notional' amount of interest on the $$$ from the sale of our house.

    Because I am a non qualifying partner means testing applies.

    The fact that I am on his Super because he needs full time care does not enter into it and the fact it will take us longer to purchase suitable housing because of wheelchair also does not enter into it.

    The reason we have not stuck our house $$$ into an interest bearing account or hidden in Bonus Bonds is that we feel having it on call just might help our bargaining should we find something suitable-ish.

    They've also cancelled his Disabilty Allowance.

    So…we get to live on $211 per week each.

    We can always live off our precious house $$$.

    And down we spiral.

    We did have an appointment to see someone about this in the Hamilton office on Tuesday, but had to cancel.

    Peter's been in hospital trying to find a cause for his extremely low blood pressure blackouts other than his high spinal injury.

    Having had an heart scan early that morning I couldn't resist an "I Daniel Blake" dig when I phoned 0800kickthemwhenthey'redown to cancel.

    Good post weka, and I'll be interested to see what ideas will emerge.

    You'd think it wouldn't be that difficult to apply some flexibility to the system to allow for different extraordinary circumstances.

    They could stop assuming everyone is trying to rort the system.

    They could have "Try a Little Kindness" playing on an endless loop over the PA.

    • weka 4.1

      Ug, hope the blood pressure thing gets sorted out soon, that can't be fun.

      This is a really helpful comment because it highlights that Super isn't as Universal as presented. It's also profoundly rage inducing. I can't believe we still do this shit to people in your situation.

      Do you have to deal with WINZ regular i.e. they deal with the Super and the other issues as one case? Or does the Super stuff get separated out from the DA etc? I think people assume that Superannuitants get treated better by WINZ for some reason.

      • Sacha 4.1.1

        Disability trumps being over 65 in terms of how the system treats you, unfortunately.

        • weka 4.1.1.1

          in terms of attitude or entitlements?

        • Rosemary McDonald 4.1.1.2

          Unfortunately, it appears so.

          When we pointed out the disability factors, I swear she sneered.

          Do you think if Our Leader was seen to be disability empathetic the kindness might trickle down?

      • Rosemary McDonald 4.1.2

        @weka

        Hah! After years of having to deal with them while on the SLP, we firmly but politely refused to sit in the special Old Gits' area of the Dinsdale branch.

        Do you think perhaps we upset them and they're bearing a grudge?

        And yes, they do DA stuff from the Old Gits's section too.

        (Peter seems to be fit as a flea apart from wildly fluctuating BP. Waikato hospital checked all the obvious things and after consulting with Otara spinal unit it is being attributed to autonomic dysfunction from his cervical spinal injury. It is truly un-fun)

        • weka 4.1.2.1

          I'll have to remember that for when the time comes (I'm a good decade away, who knows what the state of things will be by then).

      • Blazer 4.1.3

        this guy wasn't invited back to Davos…has some pertinent ideas…(also has a longer UBI vid).

        • SPC 4.1.3.1

          Note his more affordable form was paying tax credits up to the income required to alleviate poverty without a welfare bureaucracy, thus not UI.

    • Chris 4.2

      Sounds like they're applying the income deprivation rules to your situation. Whether the benefit is reduced or not is discretionary. Firstly MSD decides whether there's been a deprivation of income, which in your case there probably has been because you could put the money into an interest bearing account. But then they must decide if your circumstances justify reducing the benefit. In your case you'd argue no because you need to retain that capital amount to purchase another home. There's already a policy that sees proceeds from the sale of the family home exempt from the accommodation supplement asset test if your intention is to use that asset to purchase another home, so the principle is already accepted by MSD to use when applying the discretion as to whether or not the benefit is reduced because of the income deprivation. The alternative is that you're forced to live on that asset until it's depleted, then you can't purchase another home, and then you're more likely to be permanently reliant on an accommodation supplement because of the need to pay rent. These are the broad policy factors behind the various flexibilties. If I were you I'd look into it. If MSD changes its mind make sure the decision is altered from the time it was initially made.

      • Rosemary McDonald 4.2.1

        @Chris. Being OCD about these things Peter did specifically ask that question in November 2018.

        Was told we had a year from the sale of the house before it influenced the Super.

        House sold in September 2019 and initial Super reduction kicked in in November 2019.

        She claimed the year's grace policy had been changed.

        When we phoned the 0800kickthemetc afew weeks later…the call taker found my calm explanation of our quandary so emotionally affecting she had to hang up.

        Left us somewhat stunned.

        There is a growing part of me suspects that despite claims of MSD undergoing transformational change resulting in a kinder and less dehumanizing environment, staff (some, hopefully) are digging in their nasty little toes to break a few more of us until their Rightful Rulers get back in in September.

        Fuck me. All very depressing.

        • Chris 4.2.1.1

          I'm referring specifically to the discretion in the legislation to pay a benefit despite an income deprivation. I was suggesting that the policy to disregard proceeds from the sale of the family home as an asset for accommodation supplement purposes could be relied upon in principle to support the discretion being applied in your favour in relation to paying a benefit despite the deprivation. If I'm behind the times and that policy no longer exists, which is highly possible, then it's the general principle behind that policy, which is still based on common sense, that can apply. My point really is that a deprivation of income does not automatically mean a reduced benefit. There's a discretion there that can apply, depending on your circumstances, that could see you entitled to the full rate of NZ Superannuation and which I doubt MSD has even considered. The fact you're intending to purchase another home is likely to form the basis of why the discretion should be applied in your favour. There may be other reasons also.

          • weka 4.2.1.1.1

            This is my understanding too, it's discretionary. Also, no reason why that 1 year can't be extended because of specific circumstances (in this case disability).

            Rosemary, how come he lost DA? (if you don't mind sharing).

            • Rosemary McDonald 4.2.1.1.1.1

              The letter said 'failure to fill out the form', but whenPeter explained to the 2nd call taker on 0800kickthem…that at the November 2019 meeting he asked about filling our the DA form and if it was going to be affected by the House Money and was told 'don't worry about that I'll sort it…'

              And so she did.

              We were a little pissed. More than a little.

              But, we're finding out place, .here deep in the

              As I said before…we have $$$ for a house, we're luckier than so many.

              But Jacinda can take her hugs and cuddles and shove them.

              They're not for the likes of us.

              • Chris

                I don't know if there’s a group in Hamilton that provides advocacy on benefit issues but you could ask Auckland Action Against Poverty if they know. I'm always very impressed by their work when it's reported in the media.

                • Rosemary McDonald

                  AAAP are real-time heroes and from what I hear, front line WINZ staff have to resist the urge to flee out the back when a client they have been happily torturing turns up with an AAAP advocate.

                  We don't need an advocate. We are wedged in an anomalous crack and lack the strident sense of entitlement that we know has been the key to the success that others in similar situations have deployed to ensure the 'discretionary' decisions go in their favour.

                  And some of it can be 'personal'. Over the years we have encountered one or two WINZ staff who have shown true empathy and have quietly railed against the system that should work better for us…but doesn't.

                  The unpaid family carers issue is one area that provoked discussion. At the time National was digging its toes in over paying family carers, the true magnitude of the gross shortage of paid carers was being realised. Carers were being imported from the Philippines and the Pacific and schemes were set up so that contracted care providers would be paid by WINZ to train long term unemployed as carers. One of our 'human' WINZ staff was greatly concerned because staff were instructed to send totally unsuitable candidates off for compulsory training.

                  And because the Ministry of Health is opposed to paying family carers (despite this being the safest and most efficient way to deliver the required personal care in many cases) the cost of providing this care is passed onto WINZ.

                  And this is cheaper as the WINZ system is by design punitive.

                  We'll get by, and when Peter's BP settles down we might have another go at getting WINZ to have another look.

                  For sometime now we've found it much easier to have near zero expectations of these government departments set up to provide supports for people in our situation.

                  • Chris

                    Yes, I forget sometimes there are people who understand the inequities but choose to ride above them. May the force be with you.

                    • weka

                      and those who understand the inequities but are too ill or disabled to do anything about them.

                      Rosemary, I agree the sense of entitlement thing is a big part of why some people get more than others. The thing that fucks me off is that up until the Bennett reforms there were a lot of ways that WINZ/MSD could have been making things way better for beneficiaries, but National and Labour have simply chosen to not make that happen. Didn't need big legislative change, just a change in attitude. Of course that would mean more money had to be paid out and with Labour I *still can't figure out if it's budget or ideology that stops them. But even since the Bennett reforms there's still plenty of low hanging fruit that Labour won't touch and I can only assume now this is deliberate.

                    • weka

                      Although listening to the wider disability strategy stories here, it's entirely possible Labour are simply incapable of knowing what to do.

                  • RedLogix

                    Without gainsaying any of the struggles you are going through, the big picture of your story speaks directly to the inherent problems of all targeted welfare systems. The system innately sets up categories and everyone is either going to be in or out.

                    Crucially it always measures it's success at how many people it can exclude.

                    • Rosemary McDonald

                      "Crucially it always measures its success at how many people it can exclude."

                      Bingo.

                      And look at the language used around Working For Families and free first year uni fees and other government expenditure on the 'worthy'.

                      They boast about how many are benefitting.

                      WINZ clients are seen as embarrassing failures.

                      Terrible it is we have so many dysfunctionals in our country.

                    • Chris

                      It was surreal how after the benefit cuts and HNZ started charging market rent that so many people lost the ability to manage their money. Nobody's managed to explain that yet.

        • RedLogix 4.2.1.2

          I've been dealing with MSD on a similarly crazy making issue for about a decade. The very expensive lawyer who I need to represent me now basically says the dept has gone rogue and someone needs to clean them out with a High Court proceeding.

          • Chris 4.2.1.2.1

            Can I sheepishly ask what the issue is?

            • RedLogix 4.2.1.2.1.1

              Well. I'll try to keep this simple.

              In the 80's my parents formed a family trust whose purpose in the Deed was explicitly to ensure my disabled brother always had a home. It was formed on the back of a legacy from an auntie who had passed away.

              The Trust was badly formed and badly served by it's independent legal trustees from the outset and while my brother and I are it's final beneficiaries we were never trustees, nor involved in any decisions.

              I'm tempted to include a lot of detail here, but I'll keep it short. In essence the MSD have on three occasions now determined that my father who has been in residential care for almost a decade now, deprived himself of income by putting the home my brother lives in into a trust. As a result I've been paying his care costs (now adding up to north of $250k) but the MSD is playing the game that while the Trust assets belong the my father, any costs incurred do not. This way they keep him over the $330k threshold.

              To make matters worse the title to home was screwed up by the independent trustee and until very recently we were not even able to sell it. Sorting that out in the High Court was another expensive adventure.

              Our most recent MSD application this year, where we demonstrated clearly that we should now fall under the threshold, was simply deflected by a list of questions and demands for documentation going back decades, that unfortunately we can no longer access. It's a paper game they can play indefinitely.

              There are many people who would happily trade an arm for our problems, so no I've never thought it worth mentioning before, but slowly it's wearing us down. We're frankly now close to the odious position of hoping my father will die soon.

              • Chris

                So the auntie left money to your father, who in turn placed the funds into a trust and/or used the funds to purchase a house which was then placed into a trust – the benefit of all of this being to ensure your brother had a roof over his head?

                There may well be issues with ignoring the costs – of course a trust has costs. However…

                Surely this must be a case where even if there has been a deprivation of assets, the discretion to pay the subsidy could/should be applied in your father's favour. If ensuring a roof over your disabled brother's head avoids the cost to the state of providing care then there's a good reason for a start. What's the alternative? Throw your brother on to the street? That's surely the logical extension of what they're saying because an asset test is about using the asset, in this case for your father's care, which means selling your disabled brother's home. This is non-sensical, therefore the discretion should at least be considered, and a decision made. How far through the review/appeal process has this been taken?

                Without knowing how far you've already gone with this, I'd say approach a group like the AAAP, even if just to get the name of an advocate in your area.

                • RedLogix

                  Thanks this is pretty much my understanding as well. We've been through the application process three times over the years and now on our fourth.

                  I won't drag out the conversation here though, as I said it's our problem really and I'm not of a mind to dump it on anyone else. But I appreciate your obvious experience and expertise in this area; it certainly is way more of a minefield than anyone has a right to imagine.

                  • Chris

                    MSD will be quite happy to assess and reassess til the cows come home. They love that because things just go around and around. It's when you enter the review and appeal process that they start looking at an issue properly. Until that happens they remain unaccountable and are like pigs in shit, answerable to nobody. That process, which is pretty easy to access, involves adjudication therefore MSD must abide by decisions. I'm afraid it sounds like you may have go down that road. I should also add that MSD routinely ignores the discretion in the section of the Act that governs deprivation, so it's no surprise to hear that's what they're doing. That section's 74(1)(d) of the 1964 Act, and what ever the equivalent is in the 2018 Act, in case you want to check it out.

  5. AB 5

    Thanks for putting the time and thought into this piece. I don't have a lot to add.

    I think the most important thing we need a UBI to do is to limit employer power. Something that makes people feel free to leave or not take low-wage jobs with horrible conditions, constant KPI-driven assessment and surveillance, sexual harrasment, bullying etc. Also so people feel free to leave jobs that are alienating, depressing, pointless and without any discernible social value.They can then try something else – maybe start a small business or community enterprise with other people. A UBI should be about liberation.

    However – its appeal to most of its advocates is as an efficient, administratively simple replacement for the welfare system that lowers the cost of delivery. And this means that we are far more likely to get bad implementations of UBI that leave those people without additional income (or the ability to earn it in future) in a very deep hole of real hardship.

  6. mikesh 6

    Thanks, weka, for the Danyl McLauchlan link. I missed that one when it was first published, and found it most interesting.

    It should be noted that Keith Rankin suggested that the welfare system should be retained, and that a UBI introduced on top of it.

    The purpose of a UBI, it seems to me is to benefit workers whose jobs are precarious, or who prefer temporary or part time employment, or indeed, who prefer not to engage in paid employment at all (assuming they can afford to do so). In other words, to provide a degree of flexibility in the labour market; not to act as a substitute for welfare.

    • RedLogix 6.1

      Indeed if you read the literature this is the group it helps the most, but the positive impacts go much wider than this.

      The other important but subtle effect is that eliminates the social stigma surrounding welfare and beneficiaries.

  7. Bill 7

    UBI was born of, is and (I'd argue) always will be, right wing ideology. It's at centre, an idea of rank individualism.

    ie – Give everyone something that would appear to be enough to survive on – porridge. And people then want fruit, or whatever, to go with their porridge, or something in addition to porridge? They'll have to work for it. And to push the analogy a bit. If a person's allergic to porridge Tough. (That person had the same "opportunity" as everyone else.)

    Welfare, on the other hand, is about social provisions being provided across society, and if necessary targeted, such that an entire citizenry can experience well being and security.

    Welfare and UBI come from diametrically opposite ideological spaces, and UBI locks in inequity. We all have the same "opportunity" with UBI and so "I was born healthy, enjoy robust health and/or inherited a fortune" will be deemed extraneous to "permissible" conversations "because porridge".

    Governments of whatever colour have swung the wrecking ball of liberalism into the concept and reality of welfare in term after year after term. UBI would see the final destruction of welfare as an actual thing. Any attempt (no matter how well intentioned) to marry the two concepts would be a short lived illusion…the chunk of masonry that's presumed to be attached slipping off the wrecking ball soon enough.

    • RedLogix 7.1

      UBI was born of, is and (I'd argue) always will be, right wing ideology.

      We have a UBI for the over 65's. All the evidence is that it works pretty damned well, and right wing ideologs have consistently argued for it's demolition for decades.

      Wherever UBI's have been trialled in one form or another, they've had pretty much nothing but good outcomes. And while allocating political affiliation is a fraught business, its my firm view that the vast majority of it's proponents are located in a left wing space.

      Welfare and UBI come from diametrically opposite ideological spaces, and UBI locks in inequity.

      My brother has serious sight and hearing disabilities … how exactly do you propose to make my life outcomes the same as his? Because he will vehemently tell you that dealing with WINZ is by far the worst aspect of his life and if told him you want more of it ….

      Humans are all different, in multiple dimensions, to an infinite degree. In essence each one of the 7.5b of us is mathematically unique … we are individuals and want nothing more than to both belong and be recognised as individuals. We recoil at the idea of belonging in the sense that worker ants belong to a colony, the idea of equal outcomes is repellent and toxic to the human spirit. Achieving it demands an immense totalitarian bureaucracy, micromanaging us into a myriad categories, and then insisting that we stay in them.

      Equal outcomes is statist totalitarianism enshrined as our permanent master.

      • Nic the NZer 7.1.1

        I don't really understand the tone of this or the following comments.

        What is being compared to the UBI is a welfare system which has been through decades of reform to make it systematically cheap and nasty. Basically the same reforms to run a UBI with extremely broad categories (but still close enough to call universal) and simply making the welfare system less regressive might amount to the same proposal.

        Ultimately if there is a particular kind of UBI payment for your brother then WINZ are still going to be involved and making an assessment.

        In fact i would still only call a single flat payment a UBI and categorise the alternatives as welfare and I think this is the trade off being considered. Considering that the cost of living will certainly adjust to the new income levels then i still believe any replacement of welfare income with a universal payment from the current levels will be quite negative for those on welfare. A shift of the magnitude proposed by Morgan would be exclusionary.

        • RedLogix 7.1.1.1

          Considering that the cost of living will certainly adjust to the new income levels then i still believe any replacement of welfare income with a universal payment from the current levels will be quite negative for those on welfare.

          What I find fascinating is how so many people here happily propose radical social reforms, yet when it comes to tinkering with something that affects them personally like welfare they come over all conservative.

          But in this I agree with you, what you are effectively saying is that throwing money at poverty does not solve the problem, it merely mitigates the symptoms. You are probably right, no matter what level we set income assistance at, the people at the bottom of the heap will unlikely shift out of deprivation from money alone. There is more to it.

          The big predictors of keeping out of poverty are:

          1. Getting a decent education with a qualification

          2. Getting married in your 20's and having children within a stable relationship

          3. Getting a full-time job and a stable work record.

          These applies regardless of your ethnicity or background and they are complex issues with many factors feeding into them. But in the context of this discussion, the question is, is a welfare based system as we have now, or a universal based one as proposed more or less likely to assist with the above factors?

          After almost a century of running the welfare based model the results are in; it tends to diminish people's sense of agency and responsibility, trapping them into cycles of intergenerational dysfunction. By contrast wherever UBI's have been trialed the indications are that it has the opposite, beneficial impact.

          • Nic the NZer 7.1.1.1.1

            Actually I have been suggesting welfare used to be essentially universally available to those who needed it. Its (only) been since the 90s that everything became particularly about getting people off welfare and really gutting it.

            Returning to more of that would be quite beneficial to poverty reduction and does not require any major overhall of the tax policy aligned with it. This govt probably carried a mandate for it I feel just reading its messaging at the previous election, not that it lived up to any of that. And contrary to what you said just providing income without obligation is one of the more effective means of poverty reduction available.

            On the other hand I don't think extending income support to people who have an income is the most pressing thing and if that also involves reducing the income of present welfare recipients its (I think) likely to make things worse for them.

            • RedLogix 7.1.1.1.1.1

              And contrary to what you said just providing income without obligation is one of the more effective means of poverty reduction available.

              I think you misread me. That is exactly how I see a UBI working … it is for those not working it is an income by right, by definition without obligation. This to me was always the prime reason for it.

              On the other hand I don't think extending income support to people who have an income is the most pressing thing

              For those who are working a UBI in effect just becomes a 'negative tax' and if designed correctly smoothly integrates with their other taxation. In the technically pure case a flat UBI combined with a flat PAYE rate, combines to be nicely progressive overall taxation package depending on the exact settings.

              if that also involves reducing the income of present welfare recipients its (I think) likely to make things worse for them.

              There is no innate reason why a UBI has to do this. It's simply a matter of where you set the numbers. But more importantly if a UBI does expand individual agency, and reduces the well-known poverty traps, then over time I believe most people currently stuck in endemic poverty will have a better chance of escaping it.

              After all we know the current system sucks at this.

              • Nic the NZer

                The core issue still appears to be the restrictions on access to the existing welfare regime. This could be significantly relaxed just between the minister and WINZ, as advertised by the govt to have already occurred. That appears to be a comparatively simple reform for a progressive govt to implement.

                On the other topics, while a flat tax and a negative tax band still resembles progressive taxation its an order of magnitude less progressive than NZs progressive taxation. I already catalogued Morgan in with ACT quite some time ago on the basis of this kind of position.

                And of course you don't need to couple UBI with welfare income reductions but this is just what Morgan and several of your comments here describe doing in relative terms. Even Rankins proposals may be problematic after the cost of living adjusts as the shift has added income to everybody at the same time. A reasonably likely outcome seems to be the cost of living rises to capture the additional income of the median so relatively welfare recipients incomes fall compared to wage earners.

                • RedLogix

                  On the other topics, while a flat tax and a negative tax band still resembles progressive taxation its an order of magnitude less progressive than NZs progressive taxation.

                  How progressive the system is completely depends on what the settings are. Nor is there any reason to limit yourself to a pure flat PAYE tax rate … we can retain whatever progressive rates needed to maintain the overall result desired.

                  But quibbling over numbers is a distraction from the real issue which is endemic, entrenched multi-generational dysfunction that our present system does not appear to help with. By contrast everywhere it has been trialed a UBI is strongly correlated with people getting themselves out of poverty because the tax system now helps them rather than getting in the way.

                  But this concept seems to provoke quite a lot of resistance around here for some reason.

            • pat 7.1.1.1.1.2

              the reason welfare was universally available was because..

              1) it wasnt accessed by many

              2) the level it was applied at was minimal

              As we would expect as the 'system' was understood and society adapted what was possible became less and less so…consider, any economic unit can plan and provide for a minor cost but should that cost become more prevalent/expensive the cost becomes more and more difficult to accommodate

              • Descendant Of Smith

                It is so so easy to tritely say the level it was applied at was minimal as if this was somehow true.

                From 1950 to 1975 the single benefit rate was between 26.3% and 31.6% of the average wage. Lets say for simplicity's sake 30%.

                https://www3.stats.govt.nz/New_Zealand_Official_Yearbooks/1976/NZOYB_1976.html#idchapter_1_53820

                The average wage is currently $32-83 per hour or $1313-20 for a 40 hour week.

                The equivalent rate of single benefit if applied at the same rate as those 25 years would be $393-96 per week.

                The current rate is $145-98, $182-47 or $218-98 depending on your age.

                Your notion that it was minimal is untrue.

                NZS on the other hand currently sits for a single person at $411-15 or $379-52. Not co-incidently within the ranges that both NZS and benefit used to be.

                The fact is is that successive governments, both Labour and National (and the various coalition governments post MMP) and deliberately and cynically have driven benefits down while continuing to maintain super at the same levels it always has been.

                Two previous Royal Commissions and the WEAG group and many other people have recommended benefit rates be lifted and re-instated to decent amounts and all have been ignored.

                There is no reason other than political to not re-instate these to 30%.

                A reminder too that the cost to our most vulnerable citizens of the $20-00 per week benefit cuts turned out later to be equivalent to the amount of tax that the likes of Fay Richwhite had avoided paying as came out via the winebox enquiry.

                https://bealeness.tumblr.com/post/31987806819/the-basics-behind-the-winebox-inquiry

                In effect the poor paid for the manipulations of the rich.

                On your point two it might be argued that few accessed it but that is only because there was a second parallel welfare system operating called "a job in the public service" which sucked up in particular the school leavers and people with illnesses and disabilities that the private sector could not provide jobs for. This approach also countered the racism in the labour market against Irish Catholics, Maori and Pacific Islanders in particular. This was welfare at a much higher cost than the benefit system. Many apprenticeships were in the public sector as well.

                This part of the welfare system is one previous generations do not wish to acknowledge. Welfare it was however and without it many, many people would not have gone from school to work.

                • pat

                  how many were accessing it?,,,the cost is not the proportion of the average wage but the aggregate.

                  The same conditions apply to all facets of society….health care is a prime example….as our capability has increased so has expectation, demand and costs.

                  You may misunderstand that as trite….rather it is simply reality

                  • Descendant Of Smith

                    You said the level it was applied at was minimal.

                    I pointed out that clearly it wasn't – it was 30ish% of the average wage.

                    And the decision to keep it low is political and as such an artifice. There is no reality that says it has to be that way. It's not a law of physics.

                    • pat

                      it was minimal in aggregate…and the laws of physics do indeed apply..

                      Consider a society that comprises 20 individuals…to provide the wherewithal for an acceptable existence requires some 800 hours of labour ( we will assume abundant physical resources)…that community can provide the required resources with 19 contributing that labour, perhaps with 18 or even 17 but at what point does the burden upon the contributing members become self defeating?

                      We have created a society that not only requires that 800 hrs of labour but we have supercharged that labour with the (unsustainable) multiplier of fossil fuels.

                      Now you may correctly identify that much of that output is going disproportionately to a small section of society and that can be addressed by a (politically) difficult redistribution but it does not solve the basic equation….there is limited labour capacity and reducing the available labour reduces both the production and capability….to the point of collapse

                    • Descendant Of Smith

                      Nonsense. The world continues to get richer and more and more people get lifted out of poverty every year.

                      Paul Callaghan for instance pointed this out many years ago.

                      We can afford whatever we want if we lift our GDP – as he pointed out we make ourselves poor by working in low profitable jobs.

                      We have missed many opportunities Tait Electronics for instance could have been Nokia or Ericsson. We've let many, many of our inventions and patents move offshore.

                      GDP does not have a fixed limit. Fonterra is a classic example of going from making a range of products at varying degrees of profit to identifying what they could make at lowest cost for most profit. Chicken McNuggets are another example of how to sell the smallest amount of chicken for the most profit. It was invented precisely for that reason.

                      If we keep putting our proverbial chickens in low paid jobs like tourism then we will struggle. The fact that many people are making money from capital gains or rent shows that physical labour is not a constraint.

                      Several economists have also pointed out that increasing benefits would stimulate the economy as low income earners spend all their income.

                      Similar to the Miracle of Wörgl in effect.

                      https://mises.org/library/free-money-miracle

                      For a more modern example think of how economists calculate the flow on compounding effects of large events.

                      Think of Piketty's work on wealth, not income gaps being the problem.

                    • pat

                      Money is not a resource….money is a method of rationing resources.

                      If you want resources it requires labour….reduced labour equals reduced resources.

                      Reduced resources equals diminishing capability…..a negative feedback loop.

                    • mikesh

                      Galbraith, in his book, The Affluent Society (published, I think, in the early sixties), suggested a system in which anyone out of work, even if by choice, would be entitled to draw an unemployment benefit as of right; however the amount af that benefit would vary inversely with the level of employment – the benefit would be large if unemployment was widespread, and small if labour was in great demand.

                      There may have been fishhooks to the idea, but in principal it seemed sensible.

      • Ross 7.1.2

        We have a UBI for the over 65's. All the evidence is that it works pretty damned well, and right wing ideologs have consistently argued for it's demolition for decades.

        I'm not aware that there has been any argument to demolish it. As for it working well, it's expensive. If Muldoon had left Labour's scheme in place, oh how much better off the country would be.

        New Zealand stole a march on Australia in 1975 when Norman Kirk's Labour Government introduced a compulsory superannuation scheme with individual accounts.

        However, Robert Muldoon's newly-elected National Government terminated the scheme immediately after winning the November 1975 general election.

        The abolition of Kirk's scheme is arguably the biggest economic policy mistake in the past 50 years, as New Zealanders would be facing a far more comfortable retirement if it had been maintained.

        In 2007, Brian Gaynor wrote:

        The scheme was innovative, remarkably similar to KiwiSaver and well ahead of its time. It would be worth more than $240 billion today and would have transformed the New Zealand economy into a world beater over the past 30 years.

        https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10465138

        https://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=12192600

  8. RedLogix 8

    The entire OP is straining at a problem that doesn't need to exist. Simply set the UBI to a range of levels. One for children, another for youth, another for adults and another for the disabled similar to the existing UBI for the over 65's. Then transform the tax system with higher PAYE levels and a much bigger focus on taxing assets and financial transactions. And if necessary partially fund the UBI with RB money creation.

    As I suggested in a comment yesterday, there is no reason why this cannot be achieved in a gradual staged fashion over a period of a decade or more. Simply start with a small UBI and gradually shift each year progressively toward the desired goal. Gives everyone time to adapt.

    Nor is there any particular reason why we have to finish up with an ideological ‘pure’ UBI. It’s tidy and efficient from a technical perspective, but life is messy. If we retain some ‘bolted on welfare’ well this works for me too.

    At present we have a 100% targeted welfare system that is premised on the idea that you have to 'deserve' the miserable handout they deign to give you. This may have been justified 100 years ago when resources were far more limited … but in this era we have more than enough wealth to move beyond this niggardly, mean minded, demoralising model.

    We are rapidly entering an era when the nature of work is changing so rapidly that the old welfare model will break down anyway. A UBI in conjunction with tax reform (the two can never be meaningfully separated) is an extraordinarily powerful tool to help reverse the innate wealth concentration effect that occurs in any successful economy.

    • Blazer 8.1

      One for children, another for youth, another for adults and another for the disabled similar to the existing UBI for the over 65's. '

      very good…um so do rental rates fluctuate through these bands?

      After all shelter is easily the biggest cost to …'staying alive'!

      • RedLogix 8.1.1

        Keep in mind a UBI is paid to everyone in a household with an income or not.

      • weka 8.1.2

        "very good…um so do rental rates fluctuate through these bands?"

        Not just rentals, but a range of other needs. We will always need supplementary benefits because people's life situations and needs vary a lot. That was the point of the post. Whether we have a UBI or welfare benefits sans the punitive culture, we will always need a system tailored to take individual circumstances into account. For people on SLP currently, their income needs vary. Having a set base rate is something we already have (it needs to be raised), replacing that with a higher UBI rate doesn't solve that problem (although it solves others).

        • Blazer 8.1.2.1

          Dead right.But if you look at present society…the cost of shelter is way out of kilter to historical ratios.

          This we can attribute to my constant gripe…banksters and the creation of..money.

          Addressing this root cause of misery should be ..paramount.

          • weka 8.1.2.1.1

            Yes. It's my opinion now that we can't solve poverty in this country until we act to reverse the housing as investment culture. That or we wait for a major recession and then rebuild something different afterwards. I don't hold much hope for anything happening other than tinkering around the edges, and it's probably time that the welfare discussion shifted to reflect this. eg if we are committed to housing as retirement investment, and the consequential rising house prices (and thus rents), that's fine, tax those people on their capital gains in a bigger way so that we can increase the incomes of people who can't afford housing at all. Financial tax and wealth tax too.

            • mikesh 8.1.2.1.1.1

              There is nothing wrong with housing as an investment if the purpose is to obtain rental income. There will always be a demand for rental accommodation since not everybody wishes to be a homeowner. The problem arises when the investment picture is muddied by rampant capital gain. The problem with CGT is that it is an an attempt to treat the symptom without treating the disease, and overseas experience suggests that it doesn't even seem to have much impact on the symptom.

              One of the problems is that homeowners themselves benefit from capital gain so exempting them from any tax on property – CGT, land tax, RFRR, or whatever – seems to deal with only half of the problem. Worse than that, it probably encourages people to put more of their resources into their own homes rather than into other forms of investment.

              Generally speaking, would-be homeowners need to take expected outgoings into account when purchasing a property, so a tax levied during their occupancy, ie a land or RFRR tax, is likely to be more effective ,in curbing capital gain, than a CGT which is imposed only after the property is sold.

              More important, however, is to get the electorate onside with any property tax; or the politicians will need to be prepared to "tax and be damned".

              • weka

                yes, I was specifically referring to investment for retirement (or general capital gains to support lifestyle), which has been actively promoted for the past few decades. It's the middle classes that are the sticking point on the housing crisis, because even the liberal ones don't want to give up their riches.

                I'm good with the concept of landlords and renting, where that is regulated to protect tenants rights to a home (not just a dwelling).

                I wasn't even really meaning a CGT. I was meaning that if we are going to give up on trying to solve the housing crisis, i.e. let the middle class keep making shit loads of money from housing, then we should tax that appropriately and umse that to fund more income for lower income people so they can afford rising accomodation costs. It is of course an inflationary nonsense, but it would be a damn sight more honest than what we are doing now. Whether that taxation happened via a CGT or some other mechanism, I don't know. I'm probably being facetious here, the main thing I was pointing to was that most of NZ has no intention of actually solving the problem, because greed.

                • mikesh

                  My point was that it better to treat the disease (the housing bubble) rather than the symptom (pseudo income from capital gain). A capital gains tax might work,though, if it was set at a very high rate; 90%, say .

            • RedLogix 8.1.2.1.1.2

              Yes. It's my opinion now that we can't solve poverty in this country until we act to reverse the housing as investment culture.

              The real reason why we have high priced housing is that in a global world NZ is considered a relatively desirable, safe and trustworthy country. People want to live here and the demand for housing exceeds our relatively limited supply for it.

              We use price as the rationing mechanism, which puts the poorest in our society at a disadvantage. Look around the world, it's pretty much the same everywhere, the only places where houses are cheap enough for the very poorest are where no-one really wants to live.

              The reasons why our housing supply is limited are complex, but over the years I’ve proposed a number of things we could do to mitigate the problem … I can’t be arsed typing them out here again because few on the left seem interested in actual solutions. I’m increasingly struck these days at how many so-called progressives hate progress.

        • RedLogix 8.1.2.2

          We'll as I said there is no reason why some residual level of targeted welfare can't remain. Let the UBI get everyone up to a base standard by right, then top up to meet individual needs as required.

          That way you can get the best of both systems.

  9. SPC 9

    Why is the disability payment $270 when the over 65 single rate is over $400? The person will be on the disability benefit for longer than they will be on super and less likely to own their home.

    Then there is the fact that those on the disability benefit lose it when they move in with a working partner.

    Which leads to my UI penny or two, pay UI to NON WORKING PARTNERS (their individual entitlement – while in study, or caring for children, those doing volunteer work and unpaid but useful activity gardening/community/activism – this will assist with retraining and providing a place to those outside the paid workforce) and set it at the single adult rate c$220.

    Another area are those over 60 unable to work because of ill-health but not on disability (put onto super rate benefit) or unable to get employment (UI allows more dignity and if they find part-time work they can still try and save for retirement).

    • weka 9.1

      "Why is the disability payment $270 when the over 65 single rate is over $400?"

      Partly because in 1990 National cut benefits deliberately, including the then Invalid's Benefit. Partly because we're just really bad at dealing with disability and illness as a society.

      There are a lot of mechanisms within the system currently that could be used to improve the lives of disabled people who can't work. But we've had successive governments (National and Labour) choose to apply the punitive approach to all beneficiaries even disabled ones. It beggars belief, but when you talk to disability activists they tell a pretty consistent story about how disabled people get treated across society.

      During the 2017 election campaign Labour were asked some pointed questions about the SLP and what they were going to do about the issue, and they had no answer. I don't expect that has changed.

  10. pat 10

    absolutely nothing

  11. Descendant Of Smith 11

    When I started work in the banking sector in the 80's married men with non-working wives got an extra allowance until they reached a certain salary level. No one minded at the time that they got paid a little more because we all knew they had a family to support.

    The state didn't pay the extra the employer did. Society valued quite a bit more raising a family. Banks were not the only employers doing this by a long shot.

    The state doesn't have to be the ones to provide the support. Many employers like to tout themselves as family friendly – well why not go back to paying your staff with families more than those without.

    I reminded people yesterday that benefits and super used to be the same rate. There is no reason why they can't be again. It is purely a political decision.

    In the 80's too you could claim through the tax system for a non-working spouse. Those of us who have supported an unwell spouse/partner since then on one income have just been penalised by this government as we come up to retirement age by having $140-00 per week effectively taken off us by the removal of including underage spouses in NZS.

    The notion presumably is that over those years I could support two people on one income, raise kids with disabilities and all the extra costs that that incurred and save as well for both our retirements. I will have our mortgage paid off at 65 but will now be working longer to provide for us both.

    Thank god I haven't like many others ended up raising my grandchildren. We could have managed in the NZS rate, we won't on $140-00 per week less. And I on one income will have paid more tax than two people on an equivalent income. I'm fortunate that I have managed to stay in employment and not spent time on benefit. I truly do not know how those on benefit manage and why this has been allowed to perpetuate. This government is moving in the wrong direction by putting families with under-age spouses into more hardship.

  12. RedLogix 12

    And back then we also had a Universal Child Support. Effectively a UBI as well. The idea of universality is not new, we just need to extend it to everyone.

    • Descendant Of Smith 12.1

      Aye I've argued consistently over the years universal family benefit should simply re-instated – making sure it is paid to the person primarily looking after the children.

      Benefits were fully paid to one person back then, not split between partners as they are now. Many women were trying to feed their children on family benefit alone as the husband had all the other income – whether it be from working or benefit.

      This would also stop the playing off of one group of New Zealand citizens against the other – and face it lots of rich people end of getting it when it is income tested anyway as they have minimal personal income.

    • pat 12.2

      "At the launch of the CPAG 2001 report in Wellington in January, the Deputy Prime Minister recounted how, in his family, the family benefit in the 1940s was enough to pay the rent. However in the post war period the Family Benefit was not indexed and the changes that were made to it were insufficient to maintain its purchasing power. Relative to average wages, its value declined from around 8% at the end of the war to about 3% by 1983. It remained unaltered at its 1979 level of $6 per week per child until it was finally abolished in 1991 when it represented under 1% of average wages."

      https://www.cpag.org.nz/assets/Backgrounders/Family%20Financial%20Assistance.pdf

      as I remember it it was pocket money….indeed several of my school friends received it as such in the 70s

  13. Descendant Of Smith 13

    It ran parallel however to income tested child assistance – in 1984 for instance income tested Family Care was introduced.

    Over time the universal part was taken over by the income tested part.

    Basically the ideology was changing from universal to targeted assistance.

    This is a good summary of the changes over time.

    http://www.weag.govt.nz/assets/documents/WEAG-report/background-documents/133db2ad05/History-of-family-support-payments-010419.pdf

    One of the anomalies is that as assistance was extended to working people then IRD definitions of income were used rather than Social Security Act.

    This difference is substantial – under IRD legislation for instance drawings from trusts are not income, under the SSA they are. This meant some people had significant advantages in being able to get assistance even though they had significant income streams.

  14. Jackel 14

    UBI, next you'll be telling me that you want a universal complex income. We on the left are playing checkers while our opponents are playing chess. But then those have always been the odds when you're from the wrong side of the tracks. Dig deep.

    • Sacha 14.1

      We are playing checkers while our opponents own the board, the table, and the house.

      • Jackel 14.1.1

        Well, that doesn't sound right or just. I'm sure there's a sensible solution to the problem you pose. As good a critique as it is I don't think it's Marxism though.

  15. David Mac 15

    I don't think the government is ever going to make anyone comfortable ever. Whether I'm in a wheelchair or not, I believe getting comfortable will be down to me or my patrons.

    When I say comfortable I mean meeting everyday occurrences. Like when our kid says "Can I go on the school camp to Te Aroha?" Or 'Oh look, it's the annual comprehensive insurance bill for the 2 cars." These things are not luxuries, they're life. Meeting costs of this everyday nature on a WINZ wack is out of the question.

    Of course the solo Mum that backed into you is uninsured… idiot!

    I fear I'd die waiting for a government to make me comfortable. If I was in a wheelchair, I'd be bashing out a few stories for one of the multitudes of electronic newsletters that the corporates pump out these days. Toyota News, Mitre 10 Weekender etc etc

    The Govt is never going to make us comfortable, that will always take a little side hustle of some sort.

  16. Ross 16

    The right: an opportunity to remove welfare (think the Bennett reforms on steroids), and control workers.

    I'm not sure that many on the Right would regard UBI that way. UBI is welfare. And I'm not sure that the Right would be entirely comfortable with millionaires potentially receiving a handout from the government (it was the Right, not the Left, which wanted to means test super). Would those on the Left regard spending taxpayers' money in such a way appropriate? What exactly is a UBI trying to achieve? What’s its purpose? It’s unclear. It’s especially unclear how a UBI would be an improvement on the current system.

    Crampton said in 2010, Treasury worked out what would happen if the Government replaced all existing benefits, including NZ Super and Working for Families, with a universal payment of $300 per week for adults plus $86 per child per week. They found that income tax rates would have to rise to over 55 per cent on everyone to fund the scheme. And, the proportion of people living on less than 50 per cent of median household disposable income would rise by 5 per cent.

    "The system would be costly and would leave the worst off worse off."

    In other words, a UBI is a non-starter.

    https://www.stuff.co.nz/business/115773842/a-universal-basic-income-could-be-a-better-option-for-new-zealand–or-it-might-not

    • Ross 16.1

      What exactly is a UBI trying to achieve? What’s its purpose? It’s unclear. It’s especially unclear how a UBI would be an improvement on the current system.

      The only justification for a UBI is that instead of the current system – with its many and varied benefits and benefit rates – there would be just one benefit and one rate (with the odd exception perhaps). Whether you're sick, unemployed, or retired, all would receive a UBI. So, maybe it would be easier and cheaper to administer. Maybe. But would those currently struggling to make ends meet be any better off? If the only change is the name of the benefit, then no. The only way a UBI would be worthwhile is if those at the bottom of the heap are made better off. But that could be achieved right now by the government increasing benefits by 10-20%. A UBI is unnecessary.

    • mikesh 16.2

      Them treasury wallahs back then would seem to have been arithmetically challenged. A taxpayer earning $20,000 pa would have been paying $11,000 in tax, under their assumptions, but would have received $15,600 back by way of a UBI. ie he would have been receiving a net amount from the government of $4,600, so his total income would have been $24,600. Under the present system his net income would have been $20,000 less tax.

      People earning less than $20,000 would have been even more better off, proportionally, than that.

    • weka 16.3

      The post was predicated on people already understanding what a UBI is. If you want to comment on the post, please do some research to inform yourself first. For instance, in some models people on high incomes pay more tax, so in effect they don't get extra money in their bank account each week.

      If you want to know how the right and neoliberalism fit into this look at the history of the development of the UBI. There are clearly right wing interests in it.

      To be clear, if you want to comment here and argue against the post, you first need a level of understanding. You are free to ask questions here to increase your understanding, but not post questions and a rebuttal that is based on not getting what is being discussed.

      • mikesh 16.3.1

        I made no claims about people on high incomes. Ross's comment (No16) claimed that people on low incomes would be worse off. My comment was restricted to rebutting that particular claim.

        If you think I don't "already understand what UBI is" you are very much mistaken. And, frankly, I don't really care whether UBI is right wing, left wing, or any other wing. I judge it only on its merits.

        • Incognito 16.3.1.1

          Weka’s comment @ 16.3 (10:59 AM) was a reply to Ross’s @ 16 (7:46 AM).

        • weka 16.3.1.2

          What Incognito said. My comment is numbered 16.3 which means it's a reply to comment 16 (Ross'). You can also look at the Comments list on the right side of the page and see who I replied to.

          If you can't see the numbers or the Comments list please let me know what device you are on and I'll see if there is a better way to follow replies.

          • mikesh 16.3.1.2.1

            I apologize for my misunderstanding. I can see the numbers in he top right hand corner, though I rarely take much notice of them as they are very faint.

            It is true that the UBI concept has some right wing origins. In his book The Big Kahuna, for example, Gareth saw a UBI as a substitute for welfare. This would seem to be the wrong approach – UBI is about labour market flexibility, while welfare is a separate issue. However, Gareth's idea isn't necessarily wrong in principle. There may come a time, in, say, a decade or two, when a changed economy may produce a UBI sufficient to cover welfare needs, even if that is not its main purpose.

            • weka 16.3.1.2.1.1

              All good.

              Morgan's tax structure is worthy of debate. But his philosophy and thus the social aspects of his UBI are a huge problem. This is why I argue to start with the people we are trying to help and then design a UBI around that, rather than starting with the economics view (which is what has tended to happen in NZ).

          • Ross 16.3.1.2.2

            the numbering system here doesn’t make sense. If you were replying to my post, yours should be 16.1 or 16.1.1, not 16.3. If you were replying to me, your reply should come directly after mine but it doesn’t, it comes after Mikes so naturally it looks like you’re replying to him.

            • weka 16.3.1.2.2.1

              two other people replied to your comment before me, they were 16.1 and 16.2. Naturally I was 16.3

              It works well on a desktop. Replies are indented from the comment they reply to but if there are other comments in between you have to scroll up to see that. Eventually the system stops indenting otherwise we'd end up with very narrow comments.

            • Incognito 16.3.1.2.2.2

              It is not just the numbering but it also comes with indentation. You have been a long-term commenter here and by now, you should now the basics workings of this blog.

              I’ll try to give an example:

              1

              1.1

              1.1.1

              Et cetera

              • weka

                nice visual

              • Ross

                It is not just the numbering but it also comes with indentation.

                That doesn't help. Is someone at 1.1.2 replying to 1 or 1.1 or 1.1.1? There's an easier solution. The person replying can either use the other commenter's name, or simply quote from the piece they're responding to. Then there's no room for misunderstanding. I note that my comment here is not numbered.

                As a long-term commenter, I’m sometimes unsure who a response is aimed at. That was the case here.

                • Ross

                  I notice that some comments from yesterday have disappeared. Is there any reason for that?

        • RedLogix 16.3.1.3

          I don't really care whether UBI is right wing, left wing, or any other wing. I judge it only on its merits.

          Indeed that has to be one of it's fundamental merits that I first pointed to years ago; that it was a concept all sides of the political spectrum could find aspects they could live with. This speaks to the possibility that a well designed UBI is likely to be politically durable.

          But describing a UBI as a ‘right wing’ concept is a selective misdirection … the vast majority of voices who have advocated for it globally over many decades are palpably left wing. Including I might add the NZ Greens.

          • mikesh 16.3.1.3.1

            Major Douglas, who launched the the Social Credit movement proposed something similar back in the 1920's. He called it a "national dividend", but it was pretty much identical with a UBI.

            • RedLogix 16.3.1.3.1.1

              About 20 years ago I dreamed up the crude notion of a UBI from first principles and was conceited enough to be very pleased at how clever I was. It was quite deflating to discover later on that it was an idea that had been around for a long time.blush

              It does have a respectable intellectual history and I often think that if by historic chance we had gone down that path, instead of the welfare route, everyone would be totally adapted to it and regard it as normal. Welfare by contrast has it's roots in the Victorian poor-houses and church charities, both of which were definitely better than nothing, but tightly linked to the idea of the 'deserving poor'.

              • mikesh

                Galbraith, in his book The Affluent Society, expressed a belief that when a society reached a high level of affluence it could afford to support some level of unemployment. Those still in work would be able to produce enough for everybody – indeed, as he sardonically observed elsewhere: The goods and services that those unemployed would have produced had they been employed "would not be greatly missed". Thus it seems sensible to allow workers the choice of how much time, if any, they wished to devote to remunerative labour.

                A UBI would go a long way towards providing that choice.

                • mikesh

                  There was also, I believe, an engineer by the name of Bell, who believed that 10% of the working population with the aid of computers and other cybernetic devices could produce his country's entire GNP.

                  I admit I have never read any of this chap's writings, and I suspect he may have been a little optimistic, but people like Galbraith and Bell seem also to be part of the intellectual tradition leading up to the thinking behind the UBI concept.

  17. millsy 17

    The $6 family benefit back in 1979 would be worth $46 today according to the inflation calculator. As per upthread discussion.

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