«Te Oranga o te Iwi Maori: A Study of Maori Economic and Social Progress Maori and Welfare Lindsay Mitchell N E W Z E A L A N D B U S I N E S S R O U ...»
cnn.com/2009/03/05/news/economy/foodstamps.reut/index.htm?section=money_latest (last accessed March 2009).
102 James L Payne, Overcoming Welfare: Expecting More from the Poor and from Ourselves, p 78.
103 Senator the Hon Joe Ludwig, Minister for Human Services, ministerial speech, 11 June 2008, www.mhs.gov.au/media/speeches/080611-Ministerial-address-smart-cards-summit.
html (last accessed March 2009).
104 Welfare curbed for 15,000 Aborigines, The Age, 29 March 2009, news.theage.com.
au/breaking-news-national/welfare-curbed-for-15000-aborigines-20090323-96ou.html (last accessed March 2009).
30 MAORI AND WELFARE There is always a real risk that people will do ‘anything’ for cash. Policy makers must ever be mindful that in attempting to solve one problem another usually presents. If the latter problem is worse then they must be ready and willing to review.
Some Maori want an expanded form of ‘income management’ – adding a middleman to take control of recipients’ benefit money so that it cannot be used in ways that are detrimental either to themselves or their families. The process is sometimes referred to as ‘devolution’ because money is being diverted from state control to a local intermediary. This is an approach proposed by Waipareira Trust chief executive, John Tamihere. Both he and fellow ex-MP Willie Jackson can be heard frequently expounding on the subject via their radio talk show.
Faint alarm bells might sound at this juncture when recalling the past experience of appointing agents for Old Age Pensions. There is always a risk that unscrupulous types will misuse the money or the power that control of money confers. Even the well-intentioned Apirana Ngata eventually resigned under a cloud of alleged nepotism and misuse of state funds.105 Would Maori today be well served by such an approach? The arrangement may sit comfortably within a tribal and hierarchal society and result in some lives being improved, but the intermediaries might experience the same limitations as religious groups – traditionally missionaries and latterly, new age churches. In fact, they might act as the secular-state equivalents, succeeding only to the degree that participants are willing to be ‘ministered’ to.
The most obvious pitfall with income management, with or without intermediaries, is that beneficiaries do not mature and learn to stand on their own two feet. It would seem proponents of this form of welfare provision have given up on that eventuality, while clinging to the hope the next generation might. Ironically, when former Australian prime minister John Howard proposed the paternalistic control of Aboriginal benefits, he was pronounced racist, yet when Maori propose the same for their own, no such distaste is voiced.
Is that because the very idea of Maori finding Maori solutions overrides doubts about the usefulness of those solutions? If so, both separatism and paternalism are deemed acceptable.
My own view is future separatism is neither desirable nor sustainable in a country where the successful intermixing and intermarrying of two races has been quite unparalleled in the developed world. Maori and non-Maori can only progress together. After all, the redefinition of Maori in the Maori Purposes Act 1974 recognised that intermixing of the races had occurred to such an extent over the previous century and a half that it was necessary to produce a less specific definition of what was meant by the word ‘Maori’.106 Most recently, to be defined 105 Michael King, Nga Iwi o te Motu, p 94.
106 Correspondence from Michael Bassett, January 2008.
MAORI AND WELFAREas Maori it is sufficient to ‘feel’ Maori, which is largely a result of embracing cultural heritage and whakapapa links.107 However, any improvement on the current tragedy that is euphemistically called social security is preferable and, to that end, I discuss possible mechanisms for Maori solutions next.
Individual responsibility It is unavoidable that most weaknesses, like most strengths, begin and end with the individual. The philosophy of individualism has been misunderstood in recent times as the culture of ‘me first’. It is unsurprising that Maori, in particular, have shunned a concept that appears uncaring and isolating. In reality, however, individualism merely equates to personal responsibility. It does not throw out the voluntary groupings people naturally want to make.
The only abiding welfare system will be based on the principles of voluntarism and individualism. Individuals are first and foremost responsible for themselves and their dependants. Beyond that, help must come from a voluntary source. If the state is to continue as the prime funder of a last resort safety net, the taxpayer must be a willing contributor.
There is considerable resentment from taxpayers regarding the misuse and abuse of welfare. They are no longer willing funders of a benefit culture. However, if Maori (and many Pakeha) as taxpayers and voters will not accept these principles, then there can be no lasting or effective reform of welfare. That is because the reforms urgently needed are not dissimilar to those adopted in the United States under the PRWORA. A consensus that individuals are first and foremost responsible for themselves and their children must necessarily precede the required passage of legislation to enact reforms.
As part of achieving that consensus, an agreed priority must be established. For Maori, that priority must be to stop the inflow of young people into the benefit system. Many, including existing beneficiaries, can be persuaded of the sense and humanity in this. That aim is even more important than dealing with present caseloads.
Crucial to solving dependence and all the attendant problems is preventing more young girls with babies from entering the system that then traps them. That means discouraging them from getting pregnant in the first place. To that end, the DPB should be abolished. In its place, the state should provide strictly temporary assistance for a maximum period of one year. Any longer and the deterrent effect will begin to diminish; any shorter and the time for birth and
bonding will be inadequate. Beyond this, financial responsibility for raising the child lies with the mother, father and whanau.
One year should also be sufficient time for those exiting relationships to be reestablished and the adults to reinstate themselves as breadwinners. (After 1938, but prior to the DPB, there was usually some level of financial assistance for single mothers, albeit short-term and discretionary. While the numbers of births outside marriage slowly increased, they were still relatively small in the mids, at around 15 percent of all births,108 compared with 47 percent today.) Other benefits In respect of other benefits, we can again be guided by the principle of personal responsibility and the arrangements that work more effectively and fairly in other countries. State welfare provides for the unexpected loss of income or other hardship. It is no more than a form of insurance. Once funding (and subsequent receipt) is removed from dedicated contributions and universal entitlement operates, the scope for misuse is widened. Therefore, a return to contributory unemployment insurance, at least, should be a second priority. Those who have not worked should be treated separately from those who have. This is normal in overseas jurisdictions. Any assistance from the taxpayer then ceases to be a legal entitlement and more a matter for discretion and tight administration.
For the time being, sickness and invalid benefits should continue to be funded by the state but with a rigorous tightening of eligibility applied. It is important to recognise that after their introduction, for many years (four decades to be precise), these benefits did not present a problem in terms of rapid growth. That changed and today over 130,000 – or one in 20 – working-age New Zealanders rely on these benefits. Over-represented again, Maori make up 23.5 percent of the total.109 What can be done?
The Organisation for Economic Co-operation and Development refers to the worldwide blow-out in incapacity benefits as, “… the medicalisation of labour market problems”, the implication being that many on these benefits are able to work.110 Perhaps qualifying certification needs to be shifted from solitary doctors to a panel of practitioners to prevent strong-arming and intimidation.
Independent Practitioners Association Council chairperson Doug Baird says there are people who think the easiest way to get a benefit is to get a 108 New Zealand Official Yearbook 1994, p 86.
109 Ministry of Social Development, National Benefit Factsheets, December 2008, www.msd.
govt.nz/about-msd-and-our-work/publications-resources/statistics/benefit/2008-nationalbenefit-factsheets.html (last accessed April 2009).
110 Sickness, Disability and Work Breaking the Barriers: Norway, Poland and Switzerland, Organisation for Economic Co-operation and Development, vol 1, 7 November 2006.
MAORI AND WELFAREpermanent one, and one they don’t have to justify to people in authority.
Christchurch GP Andrew Causer says the problem has become so bad he has a sign at his practice saying he doesn’t do sickness benefit medical assessments for casual patients. He says 95% of the patients he saw who wanted “sick notes” were fit to work.111 It goes without saying that there are genuinely needy people receiving these benefits. But, there are, for example, more people relying on an incapacity benefit because of substance abuse than because of cancer. Can we afford to keep indulging people who cause their own incapacity to work? We didn’t used to. At the inception of these two benefits, eligibility required that incapacity for work was not self-induced. That rule must be reinstated.
Under the US welfare reforms, for the purposes of eligibility for social security payments, an individual was no longer considered disabled if drug addiction and alcoholism (DA&A) were contributing factors material to a finding of disability.
If otherwise disabled claimants have a DA&A condition they must accept substance abuse treatment, their payments are made to a representative payee and a 36-month time limit applies.112 Beyond tightening eligibility, I suspect that the greatest reduction in overdependence would occur through changes in the health system, in particular, a re-evaluation of how and where mental health problems are treated and the role of prevention over cure. That debate is outside of the scope of this paper.
In any discussion about welfare reform, the thorny question of what happens to existing beneficiaries looms large. That is usually the point at which an impasse is reached and, consequently, nothing happens. We need not become paralysed by the issue of those in the system who may have prohibitive difficulty attempting to support themselves. If necessary, these people can be grandparented to retirement although it is not envisaged this would apply to a great many, certainly not a majority. Again, the priority must be turning off the welfare tap to prospective chronic beneficiaries. The basic goal is to stop inflow as the primary strategy to reduce the welfare roll and improve lives.
Accepting then the continuing, but reduced, role of the state as funder of a last resort safety net, a better mechanism for delivery is required.
Privatisation of services
Consider again the US reforms:
The welfare reform of 1996 replaced the old Aid to Families with Dependent Children (AFDC) with a new program named Temporary Assistance to Needy Families (TANF). The key to welfare reform’s reduction in dependency was the change in the funding structure of AFDC.
Under the old AFDC program, states were given more federal funds if their welfare caseloads were increased, and funds were cut whenever the state caseload fell. This structure created a strong incentive for states to swell the welfare rolls.
When welfare reform replaced the old AFDC system with TANF, this perverse financial incentive to increase dependence was eliminated. Each state was given a flat funding level that did not vary whether the state increased or decreased its caseload.113 With this in mind, it is possible to envisage a similar exercise in New Zealand, taking matters a step further. If Work and Income New Zealand were
i) regionalised and ii) privatised, with an initial flat government funding allocation based on its current caseload, the new operator would be incentivised to reduce beneficiary numbers, with the excess funding treated as profit. The funding contract would then be periodically renegotiated based on the caseload at time of negotiation. The change would obviously need to be accompanied by the legislative reform already outlined – time limits, new qualifying criteria, and so on.
Regionalisation (or tribalisation for that matter) allows for competing operators and increased efficiencies. The model could include urban Maori authorities.
Of course, the risk for the private operator is covering increasing demand between contracts. But the operator has protection from this scenario with the new eligibility rules. They also have an opportunity to provide profit-making employment or childcare services. Key here is flexibility and innovation at a local level unachievable under the present, no-incentives, state-run monopoly.
Flying some mana aute (kites) Outside of this proposal a handful of other ideas are worth mentioning.
Partial privatisation Grandson of Sigmund Freud, Sir David Freud, a key welfare adviser to Gordon Brown, recently defected to the Conservative Party, where he will take a front 113 Robert E Rector and Katherine Bradley, Stimulus Bill Abolishes Welfare Reform and Adds New Welfare Spending, 11 February 2009, www.heritage.org/Research/Welfare/wm2287.cfm (last accessed March 2009).