Susan St John of the Auckland Retirement Policy and Research Centre , contacted me, with a correction re a sentence within the recent means testing article.
Of course, there’s the argument that getting rid of universal benefits means that the jam can be spread more fairly. Please show me one example where cuts made in one valued service ever resulted in politicians spending more on another valued service. That is the weakness of Susan St Johns paper on income allocation. New Zealand Superannuation is a great model, don’t remove foundation policy, in the context it might be used elsewhere for even better value.
Susan’s comment is below
“It misrepresents the RPRC position. We have never advocated a means test- or a welfare style income test. We already have an income test on NZS it is called progressive taxation—it is just not very progressive.The basic income proposal we have made retains the universal character of NZS- all can access the non taxable grant.Of those over 65, 75-80% would notice no difference. The rest pay more income tax—using a broader definition that includes PIE income and trusts. Changing the winter energy payment to an opt in is NOT means testing. This year such a policy would have saved around $400m. The fiscal pressures from the ageing population DO constrain other valuable expenditure and will do so in the future as he long term fiscal projections show.
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