Simon Wilson: Grant Robertson and his Budget Day Holy Grail

OPINION:

Everywhere you look, there’s a crisis: A gap between the equitable society we say we want and what we actually have. The Government knows it – frequently, it is the one that tells us about it. In every Budget it has committed to closing those gaps. To really making a difference.

But the fine words haven’t concealed very much. The background to Budget 2021 is that we have welfare programmes that actually widen the gap between those with liveable incomes and those without, so they force beneficiaries more deeply into poverty.

We have an official transport plan for Auckland, billed as the first-ever plan to reduce the city’s carbon emissions, that will make those emissions worse.

And none of the housing-sector measures currently in place has slowed the raging growth in property values. Directly as a result, first-home owners are locked out, growing numbers of tenants can’t afford their rents and that has caused the demand for emergency housing to rise and rise and rise.

And there’s more. The Infrastructure Commission warns that despite big projects being announced a year ago, not much is actually happening. Shovels have stayed in the shed.

The disability sector is sick of being ignored. The mental health sector hasn’t been ignored: It has enjoyed a real moment in the sun, when everyone recognised there was a crisis that had to be addressed. But that was in the election campaign of 2017, after which there has not been nearly enough progress.

There’s a pay freeze in the public sector. It’s beyond belief.

This time, Grant Robertson says things are different. It’s his first Budget with no coalition partner to appease and his third explicitly labelled as a Wellbeing Budget. Social goals are well to the fore.

Gaps are identified and serious money will be spent. But the biggest gap, the one that underpins the whole enterprise of this Government, is the gap between the constraints of neoliberal economic orthodoxy and the stimulus opportunities that arise when you actually decide to fix a problem.

Bridging that gap seems like Robertson’s goal. He told us he acknowledged the “moral duty” to right some of the wrongs of Ruth Richardson’s Mother of All Budgets, 30 years ago. But he also told us he will pay down debt even faster than was earlier announced.

This Budget is his attempt to persuade us he’s found the Holy Grail of social democracies everywhere: To keep the high priests of money happy while also solving problems of equity and ecological balance.

It helps that those high priests are on their knees, their backs to the wall, their little footsies quivering in their jackboots. (Sorry, the occasion seems to call for it.)

But it’s now official: Everybody deserves dignity, respect and opportunity. Including – especially – beneficiaries. The post-Covid rebuild is supposed to work for everyone.

Has Robertson really delivered on that?

And, related: Post-pandemic and pre-climate catastrophe, are we poised on the edge of something? If we are, how fit for purpose is this Budget?

Yesterday I listed three big policies that would help solve problems and would signal a new way of thinking. Here’s how they fared.

1. Increases to benefit levels: Yes!

Bingo. I called for a 50 per cent rise and we’ve got less than that, but it’s pretty good. Core benefit rates will be lifted by $32-$55 per adult per week. Robertson called this “the biggest increases in main benefit rates for more than a generation”.

He added, “All main benefits will be lifted to the levels recommended by the Welfare Experts Advisory Group [WEAG].”

Professor emeritus Innes Asher, who was a member of WEAG and is a spokeswoman for the Child Poverty Action Group (CPAG), responded by saying, “The changes today are useful if insufficient. Our modelling shows the changes fall short of liveable incomes, but these increases should still be high enough to make a difference for many families.”

Pleased but not too pleased. CPAG also said, “If Government forecasting is correct and 19,000 to 33,000 children are lifted out of poverty by these changes, that will still leave 180,000 to 190,000 children in poverty.”

We’re not done yet.

2. Funding for the community housing sector: Sort of

Iwi will get $380 million for housing, including papakainga and repairs to existing homes. If you’ve seen the housing coverage on Newshub’s The Hui you’ll know what a huge difference to people’s lives this could make.

But there’s no mention of the other parts of the community housing sector, which are desperate for funding so they can do more of what they do so well: Build social and affordable housing and provide the wraparound services the tenants may need.

Not much, either, to speed up construction, although the extra support for polytechs should help boost tradie numbers.

Robertson did stress that a stronger focus is going on transitional homes. This is important: They’re likely to be far better than emergency motel accommodation for housing people waiting for a proper home, and we don’t have nearly enough of them.

But, housing: The job is definitely not yet done.

3. Free public transport: Nope

Ha ha ha. Free public transport! The generous thing to say is perhaps there’s room in every Budget for only one really big idea, and in this one it’s raising benefits.

But we’re running out of time to be that generous. True, there’s a long list of spending on climate-related programmes, headlined by an extra $300m pumped into Green Investment Finance: a fund for research and development of low-carbon technologies.

But I doubt Climate Change Minister James Shaw is beside himself with excitement just yet.

And some signs are worrying. The Budget raised the amount of money now allocated to infrastructure from the existing $42.2 billion to $57.3 billion, to be spent between now and 2025. There’s over a billion allocated to rail, but most of it seems to be for maintenance and stock replacement. There’s no strong signal yet of a big mode-shift to rail for freight or public transport.

Robertson’s talk of new money for “roads and public transport” leaves much answered.

Also tellingly, there was little to help the rural sector pivot to greater sustainability.

On the positive side they will recycle revenue from the Emissions Trading Scheme: a technical way of making a handy $3b available over five years for climate action.

The Government is legally required to produce a plan by the end of this year for slashing emissions. That makes the Budget an opportunity missed. My guess: They’re still arguing how to do it.

Meanwhile, Grant Robertson holds his Holy Grail aloft. While benefits rise, debt levels are lower than expected and coming down faster than expected.

It’s all very well. Housing and transport – and, yes, a very long list of other urgent priorities – are still well short of the help they need.

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