Wellbeing budget – transformative, or just ‘variation on a them’

Peter Dunne has said that most budgets he has seen (34 while an MP)  are just variations on a theme – and he includes this year’s ‘wellbeing budget’ in that description.

@honpeterdunne:

I saw 34 Budgets in my time – twice as many as Parker.

The biggest changes were Douglas’s reforms in 1984; Richardson’s Fiscal Responsibility Act in 1994, and English’s social investment reforms after 2015.

The rest, including this year’s, are just variations on a theme.

Others (I have heard a number of people promote this theme) have said that the this year’s budget is not transformational on it’s own, but sets a framework for transformation in the future.

Glen Bennett (New Plymouth Labour Committee Spokesperson):  Wellbeing budget transformational framework for New Zealanders

This week the Hon Grant Robertson delivered the Coalition Government’s second Budget. This Wellbeing Budget 2019 is different from any we’ve seen in New Zealand.

In the past budgets have had one measure, Gross Domestic Product (GDP). Simply put, GDP measures the value of economic activity within a country, what we earn and what we spend those earnings on.

In Addition to GDP, Wellbeing Budget 2019 is measured across five other key priorities, aimed at improving the wellbeing of all New Zealanders and broadening the Budget’s focus beyond economic and fiscal policy.

The priorities are; taking mental health seriously, improving child wellbeing, supporting Māori and Pasifika aspirations, building a productive nation and transforming the economy.

In the lead up to the Wellbeing Budget, in his Budget Policy Statement, the Hon Grant Robertson said:

“Faced with complex issues such as child poverty, inequality, and climate change, we cannot hope to make the best choices for current and future generations if we do not look beyond economic growth and consider social, environmental, and economic implications together.

“While economic growth is important for creating opportunities, our recent history shows that focusing on it alone can be counterproductive and associated with poor outcomes such as greater inequality and pollution.”

Recently several people have asked me what I see as being transformational about this Government, questioning if it’s just business as usual with nothing innovative or new.

The introduction of a Wellbeing Budget is something that I see as being transformational for New Zealand over a long period of time.

The Wellbeing Budget has challenged those sitting around the Cabinet table to look differently at the funding  they lobby for, to look across all Ministries in a holistic way, measuring their long term goals and aspirations against the five priorities of the Wellbeing Budget.

This can only be good for New Zealand and our wellbeing. I can’t see a quick fix to inequality, environmental challenges, child poverty or our mental health crisis, but this is a start.

It’s a moment in time when our Government is laying out a framework that will be transformational for all New Zealanders, not only in 2019, but for years to come.

Mental Health Foundation: Wellbeing Budget 2019 a good start towards transformation

The Mental Health Foundation (MHF) are pleased the Government are taking mental health seriously by creating a $1.9 billion mental health package, announced in today’s Wellbeing Budget.

“The funding and initiatives set out in today’s budget are a fantastic start, but it’s crucial Government keep up the momentum into the future if we are to create a New Zealand where all people can experience positive mental health.”

But…

Rod Oram: Budget long on rhetoric, short on transformative funding

… the Government chose six priorities for its first Wellbeing Budget, and devised some innovative ways to bring multiple agencies of Government together to work on each.

This approach has brought about the biggest changes in the three priorities focused on people – mental health, child wellbeing and Maori and Pasifika aspirations. The investment will be substantial, particularly on mental health, and applied in some novel ways.

However, the Government has made far less progress in applying the wellbeing methodology to its other three priorities  – the productive economy, the environment and infrastructure investment.

All three are largely business-as-usual with only a few gestures to new and co-ordinated approaches; they don’t get to grips with the massive transformation all three need; and, worse, there are some serious disconnects between them.

…but it has none of the innovation in programmes or serious commitment of money that the other three capitals have. Yet it is this transition to the low carbon economy which will drive our transformation to a highly productive economy, wealth generating and strongly sustainable nation.

So, while this is a good start on the Wellbeing Budget in social areas, the Government has a Herculean task ahead in economic and environmental ones. One simple search of the Budget document illustrates this: The four new capitals used – financial and physical, natural, social and human had just 17 references in the 149 pages of the Budget document.

David Hall (senior researcher in politics at the Auckland University of Technology): Ardern more transitional than transformational:

New Zealand Prime Minister Jacinda Ardern saddled herself with the word “transformational”. She used it heavily in the heady days of the 2017 election campaign, although less so in the compromised reality of a coalition government. Still, it is the aspiration she is held to. The 2019 wellbeing Budget is held to it by association.

But how do we know transformation when we see it?

Obviously, transformation must go beyond the status quo. But to be transformative, it must also go beyond mere reform.

A reform agenda recognises that trouble is brewing, that social, economic and environmental trends are on the wrong track. It accepts that major changes to policy and lifestyle may be required. As sustainable development research shows, it does “not locate the root of the problem in the nature of present society, but in imbalances and a lack of knowledge and information”.

It tends to reach for existing policy levers, and to hang its hopes on technical solutions. It reacts to the toughest choices by devising new frameworks for analysing them.

The wellbeing Budget easily goes this far. Finance minister Grant Robertson is entitled to say, as he did in his Budget speech, that this is a government “not satisfied with the status quo”.

A transformative agenda goes further. It sees problems as rooted in the present structure of society. It isn’t only about managing the flaws and oversights of the dominant system, but overturning the system itself. This involves an order of ambition that the wellbeing Budget lacks.

There is another word for change that the Prime Minister sides with: not “transformation” but just transition. This is the idea that socioeconomic change should be guided by principles of justice, such as equity and inclusivity, to minimise the disruption change can bring. The aim of a just transition is to achieve revolution without revolt.

Ardern obviously sees the idea of a just transition as more broadly relevant, contrasting it with the “rapid, uncaring change” of structural reforms in 1980s New Zealand. To my mind, this better captures the temper of this Government – not transformational, but potentially transitional.

But transformation and transition are just simple labels.

Labour ministers and MPs have kept saying that they can’t change ‘9 years of neglect’ (I think an unfair label) with a single budget, but this was their second budget.

Transformation or revolutionary change takes longer than a three year term in an MMP Parliament.

The Government’s third budget will be trying to balance a carefully nurtured image of financial prudence with further signs of transformational intent – as long as they are re-elected.

Much my depend on whether voters chose to keep the transformation-resistant NZ First party in the mix to moderate changes, or dump them and take a risk with a Labour-Green Government. (Returning National to power looks a long shot at this stage but is an option for those preferring more incremental change than Labour/NZ First).

Little ‘transformational’ about Government so far

Jacinda Ardern promoted her Government as being transformational, but apart from transforming Winston Peters and Shane Jones into well funded promoters of their own interests these is not much transforming going on.

Ardern opened her year claiming that this would be her Government’s year of delivery, but what they have delivered so far has been underwhelming.

The just announced welfare ‘reforms’ have been paltry – see Welfare advisory group – 42 recommendations, 3 to be implemented.

Tim Watkin: Government is running out of chances to be ‘transformational’

Strike one: Capital Gains Tax. Strike two: Welfare reform. The Labour-led government is running out of chances to be the “transformational” administration Jacinda Ardern promised in the 2017 election campaign.

Today the Welfare Expert Advisory Group handed the government a radical blueprint to not just tinker with welfare, but – in their words – to make “urgent and fundamental change”.

It was scathing about sanctions against beneficiaries, saying evidence shows they do little but create more harm to those already at the bottom of society. And it recommended a massive 47 percent increase in current benefit levels.

Those would be hugely controversial reforms… or, you could say, transformational. And they are not of the cuff ideas.

The current and previous Children’s Commissioners have urged such substantial benefit increases as the most effective way to tackle child poverty.

What people seldom consider though is that since then wages and salaries have continued to grow. Super, linked to wages, has grown to. But other benefits – with any increases linked to inflation, not wage growth – have not been increased nearly as much. Until, that is, Sir John Key and Bill English famously raised them in 2015. So the gap between work and welfare has grown since the 1990s.

That’s why the report today says, “The level of financial support is now so low that too many New Zealanders are living in desperate situations”.

In sum, the argument in support of this radical prescription is that you can raise abatements here and offer support there, but the best and least bureaucratic way to tackle poverty is to – wait for it – give the poor more money.

So as part of their coalition deal, Labour and the Greens commission this report. They get the transformational advice most of them would have wanted. How do they respond?

Welfare Minister Carmel Sepuloni agrees the welfare system is not working.

Marama Davidson agrees the welfare system is not working.

And then they commit to ignore the report’s big recommendations.

They say no to up to 47 percent benefit increases, preferring “a staged implementation”. The call for “urgent change” is rejected. Remarkably, Ms Davidson has put her quotes into the same press release, tying the Greens to this approach, when they could have been dissenting from the rafters.

The political and institutional reality is that no government can make these changes overnight. But the cold water thrown on this report underlines what we’ve learnt about this government in its handling of tax, its debt level, labour reform and more.

It is not just incremental, it looks timid.

If the Ardern administration wants to be the transformational government she and her allies think they are in their hearts, they are running out of issues.

A lot of transformation has been limited by NZ First, who seem to have got most of what they want while limiting Labour initiatives (like the CGT) and hobbling the Greens.

Much may depend on what the Government come sup with on climate change, the issue Ardern describe as the nuclear free issue of the present time. Announcements on climate change have been delayed months already. There have been further delays, but promises for next week.

RNZ: NZ First voters will be happy with Zero Carbon Bill deal – Peters

New Zealand First leader Winston Peters says his party’s voters will be happy with the deal he’s struck with the Green Party over the Zero Carbon Bill.

Climate Change Minister and Green Party co-leader James Shaw this week delayed the release of two reports from the Interim Climate Change Committee until the government makes a decision on how to respond, which will contribute to the final climate change legislation.

Mr Peters wouldn’t be drawn on what the specifics of the bill are but did give an inch when RNZ asked whether his voters would be happy with the legislation, replying, “yes”.

That won’t be encouraging for those wanting transformative action on climate change.

Mr Peters said he couldn’t comment on when the bill would go to Cabinet because that was a matter for the Prime Minister but he understood it would be “sooner rather than later”.

Asked if it would be on the agenda at Cabinet on Monday, Mr Peters said he couldn’t answer that question.

Ardern and Shaw will have a lot of questions to answer if they fail to measure up on climate change. Their reputations are depending on actual transformation.

The future of the Greens in parliament may well depend on this one.