A Budget surplus built by beneficiaries


Forget the fact that running surpluses at a time when the private economy is still slow is counterproductive, The true ugliness of this surplus is that it has been created by cutting beneficiaries to the bone…

Forecast surplus of $1b from drop in welfare
The Government’s forecast surplus for the coming year was a result of a $1 billion drop in welfare spending.

That was one of the key messages of Finance Minister Bill English who was in Christchurch yesterday selling the Budget message of continued restraint in Government spending.

English told an audience of business people that in 2010 the Government had expected to be spending $11.5b on welfare this year.

However in following Budgets it trimmed the forecasts and this coming year it would be spending about $10.5b.

“The welfare bill is going down and going down faster than we expected.

…what is happening in welfare in NZ should be a deep source of shame. Paula Bennett’s reshaping of Welfare into a whip has produced thousands of beneficiaries being thrown off Welfare as a host of new reasons to disqualify them come into effect. The purposely dense application process is skewed in order to intimidate and create a sense of anxiety designed to produce hopelessness so that the applicant gives up. The dole application for example is 73 pages long, a Mortgage is about a dozen pages.

So the myopic and wrong focus on Budget Surplus has been paid by the most vulnerable and least able to cope with such a withdrawal of financial state support. There are consequences to applying naked ideological cruelty as social policy and they are all negative.

It’s going to be a terribly cold winter for many New Zealanders this year, I doubt the glow of National’s Budget surplus will keep them warm in the dead of night.


  1. I completely agree Martyn – it’s false success. Not only are people getting thrown off the benefit, or forced to constantly prove they are unwell, they hear National gloating daily about the ‘success’ of their welfare reforms. Disgusting. F### this government, I’m tired of it. It’s the same gloating us non-homeowners have to listen to when public figures go on about the success of their property portfolios. One guy from TVNZ was on the front page of the Dom a few months ago, smiling smugly to himself because he’d ‘scored’ a block of four flats in Wainuiomata, and he’s happy because ‘they’re paying for themselves’. No, dumbass, the poor are paying your mortgage and for your retirement.

    Thanks for the post Martyn. I do love a good dose of political rage in the morning 🙂

    • Yes, KATHRYN,

      you are right when you say this:
      “Not only are people getting thrown off the benefit, or forced to constantly prove they are unwell, they hear National gloating daily about the ‘success’ of their welfare reforms. Disgusting.”

      Paula Bennett, the Minister who published the names and details of two sole parents, who “dared” to criticise her and the government for reducing the “Training Incentive Allowance”, and who said she would do it again, is a bully and mercenary. Once she took advantage of the social security system, and once she changed and went to the Nats, she now as Minister pulls the ladder up behind herself. I am close to spewing, whenever I see and hear her on TV.

      Bill English is another utter hypocrite and self serving Minister, who had no scruples to milk the public purse by getting nice housing subsidies for his home in Wellington, and he only gave that up, once it was raised in the media. He is still one of the many privileged, and he goes around now, boasting himself, for taking a billion out of the pockets of beneficiaries, so he can balance the budget. It is indeed despicable and disgusting.

      And yes, they now hold the hoops higher, also for sick and disabled, who get their own doctors’ medical certificates questioned, and sent to WINZ trained and paid “designated doctors”, and now even outsourced, private “work ability assessment” providers, who will deliver diagnosis and assessments that are more to the liking of WINZ staff. They did with the welfare reforms adopt the approach from the UK, where they look at what clients “can do” rather than what they “cannot do”. In practice that means they confront sick and disabled with an approach, where they have to prove that they are too sick and disabled to work. It is all given a pseudo “scientific” justification by using “bought science” from controversial “experts” from the UK.

      What they do in the way of “assessments” can be found here:



      Sarah Wilson appears to have gathered her shocking experiences with how MSD and WINZ now treat many sick and disabled. Read her blog, where she continues to write her stories:

      And Paula Bennett basically told her to get stuffed:

      She shows her cold, ruthless face in this, she does not care, and they appear hell-bent to follow on with the “investment approach”, and with culling 40,000 off welfare benefits over the coming years.

      I wonder how many will be driven to despair, that may have fatal consequences. Shame on Paula Bennett, Bill English, John Key and the whole lot of these ruthless operators, how can they sleep at night?

      • To add to your statement about Bill English and the allowance for his house in Wellington, when it was exposed the rules were changed so now all politicians get a $35k allowance for housing per year….

        Also on disability, I am disabled, am unable to get a job because employers discriminate against my physical ability, not my capability (and qualification and experience) and have done an MSD funded work scheme called Mainstream, this is a way for the disabled to get into the workforce in government departments, my contract expired just as National came to power, subsequently my contract wasn’t renewed, now after 5 years waiting to be eligible again, I find that the criteria has changed to only allow young people access to Mainstream, not everybody with disability.

        • Hi MARK –

          I appreciate your situation. I am not so familiar with what that earlier program offered that you refer to, but what I observe now is, that this government talks a lot about “enabling” disabled to find work but I see damned little in practical support.

          They may “talk” with employers, but I have not heard of any extra law changes, enshrining rights of disabled to be given access to suitably fitted and otherwise designed work places, which would of course cost money, same as “training” staff to understand the needs of disabled. There is nothing in the way of expectations that they put into employers, and instead the “motivation” is targeted at the disabled person, whether mentally, psychologically or physically impaired.

          I suggest you have a look at the info on work ability assessments (see first link above in my earlier comment), and read and listen to the interview Kathryn Ryan from Radio NZ had with Sandra Kirikiri from MSD on their new approaches and schemes.

          That interview reveals, that MSD do not even discuss with employers any conditions a client may have, and what special needs there are!

          And yes, so far at least, they are only targeting those under 25 years of age, but they will probably look at expanding that.

          This government is not fulfilling their obligation under the UN convention for the rights of disabled persons, that is for sure!

    • Don’t lie. Interest rate rises reflect international changes – a reduction in QE in the US for example – as you know perfectly well.

      The NZ economy is flat and has a pernicious trend as unregulated extractive financial institutions – together with the interest costs of Bill English’s disgraceful and utterly irresponsible borrowing spree impact on the declining productive economy.

      The only virtue in Gnat budgets are tax cuts for the crooks. Guess you’re one of them.

    • It’s about time ‘the economy’ was delicately dissected into its assorted parts.

      The construction sector and cow cockies are not ‘the economy’. (Or – horror! – they are, and that’s it!)

      I mean, if we can have league tables for schools, surely we can do the same for ‘the economy’ – and for a much clearer picture on which areas are thriving and need skilled labour.

      Time for governments of all stripes to stop glossing over the details. It’s sending false messages.

    • Gosman – apart from the Christchurch rebuild and the increase in dairy exports to China, not that much has “grown”. The Reserve Bank is increasing interest rates due to the inflation coming from the housing sector, as other inflation is rather low, and does not give any reason to increase interest rates.

      Actually consumption has only grown moderately, as wages and salaries have not increased for nearly half of the work force, and only moderately for others.

      Dairy prices are now dropping, so the “boom” there is slowing.

      With your blind faith in Key and his government, and his Minister English, you are trusting the snake oil merchants.

  2. Jan Logie from the Greens held a good speech on the Budget the other day, it can be viewed on ‘Inthehouse’ – here is the link:


    She lists a few real life examples of how cuts affect the sick and disabled, who are in too many cases suffering extra under this government.

    Also there is some further info on UNUM Provident insurance corporation, the company that funded early research by the “expert” Mansel Aylward from the UK, who was quoted by Paula Bennett and others, as giving them “advice” on welfare reforms here in NZ.

    It mentions the involvement of UNUM, ATOS and Aylward in reforms in the UK, and how UNUM followed ulterior business motives all along.

    It was UNUM that paid for Professor Aylward’s and his colleagues research, now so often referred to as “evidence based” approaches and findings:


    “Prof Rutherford wrote that Unum had also been “building its influence” in a variety of ways over a number of years. He said that in 2001 Le Cascio was a key player at a ground-breaking conference at Woodstock near Oxford, title “Malingering and Illness Deception”. Malcolm Wicks, Labour work minister at the time, and Mansel Aylward, then chief medical officer at the DWP, were among the 39 delegates.”

    “In the same year, Unum launched a public private partnership to act as a pressure group to extend influence in policymaking. And in 2004 it opened the £1.5m UnumProvident Centre for Psychosocial and Disability Research at Cardiff University. (The Centre has since be renamed and Unum says it no longer provides any funding – no doubt because of claims that academic integrity could be called into question by its influence).”

    It is beyond belief that such biased and vested interest holding players are given due respect and are listened to, when governments are forming “welfare policy”.

    But we know, it is all about cost saving, not much else.

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