Unemployment

Social policy students may like to take note of the report in the Herald on the latest unemployment figures.

It's not over yet for Bill English

The questions over Bill English’s ministerial housing allowance are not over yet. Mr English has tried two tactics to put an end to the crisis. First, he said that it was time we all got back to thinking about the recession. Then he decided to pay back the difference between the ministerial housing allowance and the allowance payable to any out-of-town MP who rents accommodation in Wellington. That may have satisfied public opinion to some degree for the time being. Many people are accepting this as setting an example. But it’s not over yet, and questions remain unanswered.

On 1 August English said: "I get the same deal as everyone else. This isn't about the money this is about the support I get which I appreciate that enables our family to be together." Article. Yes, but it's also helping his family pay for a valuable property in Wellington, even though his 'home' electorate is in Southland.

On 6 August, on Morning Report, John Key was saying something quite different. Mr English was not getting the same deal as other MPs, but his situation was ‘unique’ for some reason. Mr Key said there was an ‘anomaly’ between how Mr English was treated compared with others. Nonetheless, Mr Key claimed that Bill English had not broken any rules, and so the solution was to clarify the rules.

By paying back the difference between his allowance and that to which ordinary MPs are entitled, Mr English has not just admitted that his housing allowance was politically embarrassing, he has also exposed himself to deeper questions about how a family trust made it possible to get that higher allowance.

According to a report in the Herald, it appears that Mr English has had a Wellington home that is owned by an English family trust declared an official ministerial residence. How did he do that? It appears that his name was not on the family trust (though his wife’s name is on it). He then rented the house from the trust as an official ministerial residence, entitling him to the higher ministerial allowance. What information did he supply to ministerial services in order to justify this? Can we, the public, see the trust deed and the property valuation?

It’s not just that we are in a recession and that Mr English, as Minister of Finance, is cutting costs in a way that affects many members of the public, and hence that he should be setting an example. There is a further point that, as Minister of Finance, his custodianship of public funds should be above question at all times. And, at the moment, that is not the case.

Action at last.

From a social-policy point of view the obvious problem arising from a recession is rising unemployment. According to Stats NZ figures, unemployment began to rise sharply, from a relatively low level in late 2007 to about 5% in the March 2009 quarter. As I write, there is no sign that this trend is reversing, and the next quarterly figure will presumably be higher than that.
What are some of the negative social consequences of unemployment?
And what is the government doing about it? As if to prove me wrong (see previous post), the government has recently outlined a package of special measures to address the present economic crisis - Youth Opportunities. The target appears to be young people, especially those aged 16 to 24. A number of subsidised employment and training schemes are outlined on the Beehive website. These tend to be of limited tenure (6 months for the main two employment schemes, down to summertime scholarships for 1600 tertiary students) and, of course, limited numbers. The government predicts that there will be 16,900 new opportunities as a result of this package.
Compare this with over 100,000 unemployed, and growing. Some of those unemployed have been laid off from the public sector as a result of the government's line-by-line budget review. Presumably at least some of those savings have now been reallocated into the scheme that has just been announced.