They Make Sense, John
“The International Monetary Fund has urged the Government to cut spending by better targeting Working for Families, student loans and free GP visits to get its books back into surplus.
“But Prime Minister John Key rejected the call, saying National had campaigned on preserving those entitlements. “It’s not my intention to break those promises.””
Once again, Mr. Key hastily rejects what is eminently sensible advice, on the basis that he promised not to change anything. I seem to recall National making much ado about how they were going to reduce taxes as well, but that didn’t last very long, did it? Surely if the economy is damaged enough to delay the reduction of taxes, it is damaged enough to reconsider some rejigging of the three items the IMF suggests?
There are people receiving WFF tax rebates who are earning more than I am. Why the government thinks it is a good idea to take in taxes and then give them back again is a mystery to me. Surely it would be better not to take them in the first place? All you are doing with WFF is reducing the productive value of that money by churning it through government administration.
Student loans are even more poorly targeted. The two MacDaughters are at university and have (interest-free) student loans, despite their father earning considerably more than the average wage. This in itself is dumb. The money would be far better spent channeled into scholarships for students who are excelling at university, providing some incentive for university students to put some effort into their studies. Providing interest free loans for the very people most likely to be able to repay the loans seems a little crazy to me anyway – especially as those very same people are going to be paying that interest back in spades through the taxes they will have to pay to continue supporting the scheme.
I have saved the dumbest for last. Subsidized visits to the GP. How stupid is it that someone earning $200,000 a year can enroll at my practice and get his toddler seen for free and himself seen for a discount? This is not a free service. I still get paid for my consultation – you just pay for it through your taxes with the same loss of value as Welfare Working For Families. For the life of me I can’t see what was wrong with discounts targeted for those who qualified for community services cards or a similar stratifying device. Mr. six-figure-income does not need a discount for a GP (and probably has medical insurance anyway).
The IMF suggestions make very good sense. John Key would be advised to follow them as soon as possible.
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Mar 31 10 8:36 am
Breaking promises and making drastic change effectively neutered Bolger’s Govt from 1993, brought in MMP and gave us 9 years of Labour. A repeat of that is more to be feared than the costs of continuing with the above entitlements.
They have to go, but not yet, and they have to have some substantial level of public support or they won’t stay dead.
JC
Mar 31 10 6:57 pm
An undertaking to look at these things in their second term would be nice, however.
Mar 31 10 12:15 pm
It’s silly isn’t it?
I recall a Labour MP (King I think) talking about how if you create a cut off it isn’t far on those just over the boundary. So they chose to just give to everyone.
It’s one of the stupider parts of politics, that Labour is said to support the poor, when in fact it’s National who target the money towards them – so the difference boils down to Labour gives more free stuff to the rich.
Yet, it’s rarely put that way so Labour’s line “wins”, and National’s following it to win too.
.-= scrubone´s last blog ..Another case of dubious feminist statistics =-.
Mar 31 10 9:03 pm
The following is a parable from Ronald Reagan that he used to explain how leftists and statists view the productive members of society. Naturally in NZ these productive members fund ACC, WFF, and other benefits that you mentioned above.
“The Very Special Pig.
A traveling salesman stays overnight with a farm family. When the family gathers to eat there’s a pig seated at the table. And the pig has three medals hanging around his neck and a peg leg. The salesman says, “Um, I see you have a pig having dinner with you.”
“Yes,” says the farmer. “That’s because he’s a very special pig. You see those medals around his neck? Well, the first medal is from when our youngest son fell in the pond, and he was drowning, and that pig swam out and saved his life. The second medal, that’s from when the barn caught fire and our little daughter was trapped in there and the pig ran inside, carried her out and saved her life. And the third medal, that’s from when our oldest boy was cornered in the stock yard by a mean bull, and that pig ran under the fence and bit the bull on the tail and saved the boy’s life.”
“Yes,” says the salesman, “I can see why you let that pig sit right at the table and have dinner with you. And I can see why you awarded him the medals. But how did he get the peg leg?”
“Well,” says, the farmer, “a pig like that–you don’t eat him all at once.””
Mar 31 10 9:32 pm
Reagan was bang on the money…