The Post: Why are we cutting programmes that get young people into work?

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You would think that, at a time when youth unemployment is higher than it’s been this century, the government would be straining every sinew to help young adults find work.

So I was all the more puzzled – distressed, indeed – to learn that an apparently successful work-skills scheme has just been shut down. The closure, and the manner in which it happened, tells us much about the failures of the modern state.

It was, Nicky Austin told me over the phone, a “devastating” result for her Katikati community, tucked away between Tauranga and Waihi Beach. I’d first met Austin last year when my think-tank, IDEA, was researching a welfare-to-work report that we ended up calling The Pipeline of Potential.

Austin was helping run the Katikati branch of a nationwide scheme, He Poutama Rangatahi, its name referencing the stepped “pathway to heaven” often seen in tukutuku panels. Her Poutama programme gave wraparound employment support to 16-to-24-year-olds at risk of “going down the wrong track”, in her words. Mentoring, mental health support, life skills, training referrals, interview prep, work placements: whatever was needed, Austin’s team did it.

The programme was a loving one, but not a soft touch. Austin didn’t have my innate liberal aversion to benefit sanctions, and refused to entertain any notion that there mightn’t be jobs going in her area. The Mount Maunganui packhouses alone were employing “dozens” of forklift drivers, she told me firmly.

The far greater problem was the “terrifying” lack of understanding of what work actually meant, for young people who’d grown up with perennially unemployed parents, in addict households, raised by older siblings. “The idea of going into work – they have just got absolutely no idea what that involves: how that feels, how to achieve that, what it might mean.”

All the more remarkable, then – in the best sense of the word – that the Poutama programme had got four-fifths of its struggling young adults into work or vocational courses. Austin’s staff placed people with local earthworks contractors, got previously illiterate young men into security jobs, generally hustled for their charges: “life-changing” work, as she called it.

All the more remarkable, then – in the worst sense of the word – that on May 26, Austin was told the scheme would end on June 30. The Ministry for Social Development was maintaining its nationwide funding for He Poutama Rangatahi – but, faced with a deluge of other applications, had chosen not to renew the Katikati scheme.

The ministry now says it’s funding providers in Tauranga instead. But, as Austin points out, that’s a 90-minute round-trip from Katikati, and local youth often lack a driver’s licence. That’s why Austin’s team had made a point of picking them up, and dropping them off, every day.

The rejection wasn’t necessarily the ministry’s fault. Something else I discovered researching The Pipeline of Potential– which is what jobseekers are, by the way – was that we spend half as much as the average developed country on welfare-to-work schemes.

Half the typical nation’s investment, at a crucial transition in people’s lives, when support can make all the difference. It’s madness.

But when our government is obsessed with cutting spending to the arbitrary figure of 30% of GDP, there’s no room to put the madness right. Even the opposition don’t seem to feel the urgency: inspiring policy launches have been in short supply.

Adding insult to injury, the ministry won’t explain its decision, leaving Austin with “absolutely no idea” why her scheme was scrapped. “Tell me what we were doing wrong”, she says; she could have made changes.

But this is what it’s like to deal with government in the 21st century. You can, to the best of your knowledge, be successfully delivering an initiative for the state – and have it swept away with five weeks’ notice and zero explanation. One of the most basic elements of the democratic process – an account of why a decision was made – is absent. It oughtn’t be allowed: and yet it is.

So where does this leave Austin – and the young people she served? “I worry for them,” she says. “They have no support other than our staff. For our town, and the wider surrounds, there’s no other [comparable] programme.”

Since the axe came down, she’s had to turn away several young people wanting to join a scheme that no longer exists. “I don’t know what’s going to become of them,” she says.

But she does often drive that 90-minute Katikati-to-Tauranga round trip. Along the way, some of those she sees working on the roads, building roundabouts and the like, are people Poutama placed with a local firm, HEB Construction.

Those young adults were “absolutely over the moon” when they got their jobs. But now, she says, “I look at those kids as I drive past most days and I think, ‘What would have happened to you if it hadn’t been for Poutama?’ And then I just see a void.”

Sunday Star-Times: If I was PM – Power to the people, respect for planet

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OPINION: I’ve never wanted to be prime minister, a view only strengthened by watching Christopher Luxon’s gruesome struggles this week. But if I somehow found myself in the role, I’d start by reminding everyone of the purpose of politics, as I see it: to ensure that each of us can live a rich and fulfilling life, in harmony with others and the planet. I’m a social democrat, and take both parts of that term seriously: the people should exercise political power, but do so together, and for a life lived together.

What first-100-days flurry of changes would flesh out that vision? Nothing else matters if the planet burns, and the public needs climate action to feel uplifting. So I’d quickly introduce a localised renewables package: subsidies for rooftop solar, support for community batteries, and a fair price for selling energy to the grid. That’d ease cost-of-living pressures while warming people up for the harder climate fights to come.

On similar lines, I’d largely retain Chris Bishop’s Resource Management Act replacements, because the country can only stand so much chopping-and-changing. But I’d ditch the sweeping ministerial discretion and payouts to landowners affected by rule changes. I’d also legislate hard environmental bottom lines, ensuring the planet is protected, indeed replenished.

One central threat to the environment is our economy – which not only relies too much on digging stuff from the ground and selling raw materials, but also struggles to provide well-paid jobs. In the first 100 days, I’d lift R&D tax credits and pilot new career pathways for young scientists.

I’d also launch an assessment of which strategically important domestic industries we need to protect as global supply chains buckle. That review would simultaneously identify options for lifting regional growth with better infrastructure, high-tech clustering, and subsidies for low-carbon industries. If the old economy is a coal mine on the West Coast, the new one is a forestry refinery – turning every last bit of the tree into sophisticated products – on the East.

I couldn’t ignore AI – but knowing I didn’t have all the answers, I’d immediately launch an AI safety unit and a national summit, gathering the community to figure out how we exploit the technology’s productivity power while guarding ourselves against its immense dangers. Responding to the decimation of entry-level jobs for young people would be an urgent challenge.

As a social democrat, I believe the ills of democracy can be cured only with more democracy. I’d issue instructions to public sector bosses to involve regular people more deeply in policy-making – a win-win of increased trust and better delivery. I’d convene a citizens’ assembly – a group of 100 ordinary Kiwis, selected at random and representative of the whole nation – to “unstick” things by finding solutions on an issue where politicians have failed – superannuation reform, for instance. And I’d roll back the previous government’s attacks on Māori rights while creating more room for iwi to deliver services to their own people.

I’d spread democracy to the workplace as well, introducing legislation to make it easier to set up worker-run co-operatives and put staff representatives on company boards. That, combined with fair pay agreements (quickly exhumed), would drive up wages, allowing people higher earnings on fewer hours, and leaving them more time to spend in their communities. Giving the Commerce Commission tougher powers to break up monopolies and cartels would be another boost to families, lowering everyday costs and putting curbs on price-gouging.

I’d also want to reshape the goals of politics. Too much policy-making is reactive, and targets near-term fiscal surpluses at the expense of long-term social deficits.

Nowhere is this more obvious than in our appalling rates of child poverty and abuse, often generations in the making. So I’d immediately convene a whole-of-society effort to start writing a Generational Plan that outlines the key policies needed to ensure all young people are thriving by 2050. Owned by the country at large, the plan would ensure politicians protected the future.

My initiatives would of course cost money. So the final act of the first 100 days would be a bill introducing a capital gains tax on all assets bar the family home. That would close a major loophole, one that currently allows the wealthiest Kiwis – who take most of their income as capital gains – to pay a mere 9.4% tax rate. And it would pave the way for further reform in the second term: specifically, the closing of another loophole by taxing income taken in the form of large inheritances (those over $1m, say).

Power to the people, respect for the planet: through the above initiatives, we would have begun to address some of our country’s greatest challenges – high emissions, low productivity, severe hardship – while deepening democracy and making politics more future-focused. It would be a packed 100 days, full of urgent action. But given the scale of the problem, what else does the moment demand?

The Post: The world has moved on, but can NZ move with it?

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That world has gone.” When Pro­fessor Ngaire Woods spoke these words on Wed­nes­day, she wasn’t just refer­ring to the now-shattered rules­based sys­tem of global trade. Woods – head of Oxford’s Blav­at­nik School of Gov­ern­ment, and one of our lead­ing intel­lec­tual exports – was talk­ing just as much about the post-Rogernom­ics view that politi­cians should be hands-off with the eco­nomy.

Speak­ing at the Treas­ury’s Ter­race HQ, Woods com­pared that approach – in which gov­ern­ments simply allow mar­kets to determ­ine which sec­tors flour­ish – as being like an old-fash­ioned “cock­tail party host­ess”, help­ing guests have a good time, but not par­ti­cip­at­ing her­self.

Now, even bas­tions of ortho­doxy like the World Bank are shift­ing their ground. In the 1990s, the bank argued vehe­mently against “indus­trial policy”, in which gov­ern­ments foster stra­tegic indus­tries using sub­sidies, trade pro­mo­tion, net­works to con­nect pub­lic and private bod­ies, and assist­ance with form­ing Sil­icon-Val­ley-style clusters.

But earlier this year, the bank acknow­ledged this argu­ment “has not aged well – it has the prac­tical value of a floppy disk today”. So why the shift?

First, Woods argues, chaotic Trumpian trade policy and grow­ing geo­pol­it­ical con­flict make it dan­ger­ous to always depend on trad­ing part­ners to sup­ply goods vital to our eco­nomy.

Second, China is decim­at­ing other coun­tries’ man­u­fac­tur­ing sec­tors thanks to a dec­ades-long indus­trial strategy in which the state expli­citly picked – and fostered – the areas of the eco­nomy that needed devel­op­ment. European and Amer­ican gov­ern­ments are, in response, ramp­ing up sup­port for domestic indus­tries.

Woods’ chal­lenge to Kiwi politi­cians was unequi­vocal. “In a world where all the major powers are now using indus­trial policy,” she asked, “what chance do you have as a coun­try if you are not?”

These ideas run counter to much local think­ing. In an edit­or­ial last month, this very paper argued that the $60m Golden Bay sub­sidy to secure domestic cement pro­duc­tion was simply “cor­por­ate wel­fare”. Such policy, it added, “saps pro­ductiv­ity and lowers our wages, profits and liv­ing stand­ards”.

One counter-argu­ment, though, is that in the post-war East Asian Mir­acle, coun­tries like Taiwan and South Korea became rich at break­neck speed pre­cisely by using indus­trial policy. Their gov­ern­ments suc­cess­fully strong-armed local com­pan­ies into becom­ing world lead­ers in semi­con­duct­ors, elec­tronic goods and other key sec­tors. Far from lower­ing pro­ductiv­ity and liv­ing stand­ards, “cor­por­ate wel­fare” – as part of this indus­trial upgrad­ing – did exactly the oppos­ite.

In the 1990s, Ger­many’s state-led Ener­giewende push for renew­ables laid the found­a­tions for a dra­matic decline in solar and wind power costs that benefited the whole world. This year, a National Bur­eau of Eco­nomic Research (NBER) paper found China’s own solar sub­sidies have gen­er­ated loc­al­ised social and envir­on­mental bene­fits that are twice their costs.

Nor are these out­liers. In 2023, another key NBER paper, co-authored by the respec­ted eco­nom­ist Dani Rodrik, can­vassed evid­ence that indus­trial policy – when done well – is gen­er­ally effect­ive.

The phrase “done well” is, however, of huge sig­ni­fic­ance. In her lec­ture, Woods argued that indus­trial policy can’t involve pick­ing indi­vidual com­pan­ies – espe­cially estab­lished play­ers or quasi-mono­pol­ies – and hand­ing them sub­sidies.

It should instead be guided by a clear stra­tegic view of the areas where the local eco­nomy is lack­ing and the kinds of invest­ments only gov­ern­ments can effect­ively make. This can include the shifts that bene­fit all firms, like lower power prices.

But it also involves industry-spe­cific sup­port for clusters, boosts to sec­tors that will cre­ate pos­it­ive spillover effects for oth­ers, and the filling of gaps where the local eco­nomy has not become as diver­si­fied as it should. It can extend to set­ting the “mis­sions” that the eco­nom­ist Mari­ana Mazzu­cato advoc­ates, in which an auda­cious gov­ern­ment goal – like get­ting to the Moon – “crowds in” private invest­ment and spurs new tech­no­lo­gical devel­op­ment.

But to avoid the closed-room deals that make many people nervous, indus­trial policy needs to be done with full trans­par­ency. Joint ven­tures between gov­ern­ment and busi­ness must involve com­plete pub­lic­a­tion of meet­ings, agen­das and minutes.

Sup­port for indus­tries should be time­lim­ited and depend­ent on increased export earn­ings. And if cer­tain sec­tors are favoured, there should be what Woods calls “ruth­less com­pet­i­tion” within those sec­tors, to retain mar­ket dis­cip­line.

On Septem­ber 1, the think-tank I helped found, IDEA, will host an Auck­land panel dis­cus­sion on “Made in NZ” eco­nomic policy. (Regis­tra­tion is avail­able online.)

The event will double as the launch of an essay we’ve com­mis­sioned from another Kiwi intel­lec­tual export, Lon­don School of Eco­nom­ics pro­fessor Robert Wade.

The essay acknow­ledges The­Post’s fears, not­ing that “the dangers of indus­trial policy are real”, espe­cially when it is used “for polit­ical pat­ron­age ... more than eco­nomic object­ives”.

Part of the answer, Wade writes, is for the gov­ern­ment to main­tain a del­ic­ate bal­ance with the indus­tries it sup­ports, close enough to know what is needed but not so close as to lose its inde­pend­ence.

Crit­ics will rightly ques­tion whether the New Zea­l­and state, cur­rently unable to update its bio­met­ric bor­der sys­tems without mat­ters des­cend­ing into sub­ter­fuge and project col­lapse, can handle the far-harder task of execut­ing an eco­nomy-wide indus­trial upgrade.

But these are the cut­ting-edge ques­tions of our time, the issues we can­not dodge. As Woods says, the world has changed.

The Post: The blindness and blame that make NZ a not-so-great country to raise children

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What impulse, buried deep in the New Zealand psyche, makes us treat children so badly, even as we proclaim this the best place on earth to raise a family?

When I lived in Britain, any New Zealander heading back home to have children was greeted with approving nods, even from the Brits, who would often murmur, “Wouldn’t want to try doing that in London.” Yet those Kiwis might have been better off in the sprawling metropolis.

New Zealand is, in fact, one of the worst places in the developed world to be young. Last year, a Unicef report ranked us 32nd out of 36 rich nations when it comes to children’s wellbeing: our young people experience alarming rates of bullying, obesity and suicide.

The Ministry of Social Development’s 2026 Child Poverty Report, released on Thursday, shows that 14.3% of young people – one in seven – live in material hardship. Their families cannot afford basic items like two good pairs of shoes, fresh vegetables and meat, trips to the doctor and home heating.

As well as being deeply sad, these figures are also strange, in that they aren’t true for other groups. Just 5% of our pensioners, for instance, go without the basics. In no European country, bar Sweden, are children treated so much worse than older people.

What can explain this apparent contempt for the situation of our youngest citizens? Two things, I think: blindness and blame.

Every opinion survey tells the same story: many New Zealanders blame poor children’s position on their supposedly feckless and work-shy parents. But although personal choices matter, to lay the blame so squarely on individuals is to forget about the wider forces holding them back.

Psychological research, detailed in the 2013 book Scarcity, shows that, for poor people struggling to manage their budget, the stress of an unexpected car bill has the same disastrous effect on their decision-making as going a whole night without sleep. It is less that poor choices cause poverty, in other words, and more that poverty causes poor choices.

There are so many barriers to success: lack of qualifications, lack of available jobs even if people have the right qualifications, lack of affordable transport and childcare even if there are available jobs. And as the Child Poverty Report reminds us, in one of its most devastating facts, half of the young people living in hardship have a parent in a full-time job.

Work doesn’t pay in modern-day New Zealand. In the 1980s, staff used to get 70% of their company’s revenue paid to them as wages and salaries. Now, it’s just 60%, that lost 10% going to the firm’s owners instead, in a world where trade unions have been marginalised and the typical person’s bargaining power is greatly diminished.

If staff had held onto their 70% share of company revenue, the average wage would now be around $14,000 higher, according to calculations by the economist Bill Rosenberg. No wonder so many working families struggle so badly.

That struggle, though, is often invisible to those who do not experience it. Which is where the blindness comes in.

Since the 1980s – funny how that decade of hyper-individualism keeps recurring – the disparity between rich and poor has widened alarmingly. In New Zealand, it rose more, between 1985 and 2005, than in any other developed country.

In the last 40 years, the disposable income of someone in the richest 10% has doubled, rising by an extra $75,000 or so a year, while poorer families are just $9000 a year better off than they were in 1986.

In the richer households, life is good. There, it remains true that New Zealand is one of the best places one could raise a child. A low average score for the country conceals some striking heights.

But those parents increasingly exist in splendid isolation from the country’s harsher realities. As incomes become more divided, so too do lives: rich congregate with rich, leaving poor to congregate with poor.

Last decade, a joint Kiwi-US research project found that the wealthy often oppose redistribution not just out of self-interest but also because, living surrounded by people like them, they are left with very little understanding of the depth of poverty that exists in suburbs they never visit.

And from that vast distance, it is all-too-easy to engage in the blame game. It would be much harder for people to do so face-to-face, when they’d have to confront the unforgiving reality of another’s life.

The appalling situation for Kiwi kids, in short, is less a reflection of the importance we place on childhood, and more a reflection of the views that better-off adults have about worse-off ones. That, in turn, suggests that matters are unlikely to change until the former can be made to see the struggles of the latter.

The Post: NZ can’t keep hiding from its climate impact – or the opportunities of tackling it

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It is the most seductive of siren songs. As, once again, climate-change-exacerbated floods sweep through the country, the argument from some quarters is that we can no longer do anything to stop runaway global heating, and must instead simply adapt to it.

It is a convenient claim for politicians whose rigid ideological dislike of state action has always blinded them to the science telling them that carbon emissions must be rapidly slashed. Convenient – but wrong.

Yes, we must – with equal rapidity – put in place measures that limit climate change’s horrific impact on communities. But we cannot abandon the fight to mitigate – that is, reduce – that change in the first place.

Those arguing against emission cuts inevitably fall back on the same tired old claim: New Zealand contributes less than 0.2% of the world’s atmospheric carbon, so it makes no difference what we do. Nor, they argue, should we “impoverish” ourselves in the attempt.

The first claim, however, was shattered last week by data from the Global Carbon Project. There are, its analysis shows, dozens of “small-emitting” states that are each individually responsible for less than 2% of global emissions. But when added up, their collective emissions are 32.8% of the worldwide total.

Small things rapidly become big ones – in both directions. If New Zealand said it had no responsibility for cutting emissions, every other small-emitting country could reasonably follow suit... and, in short order, a bloc responsible for a full one-third of the problem would suddenly have absented itself from the fight. So to use size as an excuse is simply not a defensible position: like a house of cards, the argument collapses at the first touch.

Nor is it true that tackling climate change need leave us worse off. Quite the opposite.

Writing earlier this week, the entrepreneur and tech investor Guy Haddleton argued that a shift away from importing expensive fossil fuels and towards building our own cheap renewable energy would eventually keep around $5 billion of spending in New Zealand every year.

“That is the single most powerful cost-of-living policy any government can implement,” he wrote. “It just stops the flow of money out the door.”

And whatever the costs of tackling climate change, the costs of not tackling it are far, far worse. Exactly two decades ago, the British economist Nicholas Stern, in a landmark report, calculated that while the price of emission reductions might be 1% of global GDP, inaction would cost at least five times as much. New Zealand’s flood-damage bill – in the billions of dollars and growing – only reinforces this message.

What’s more, many of the changes needed to limit our emissions – such as cutting commutes by allowing more people to live in city centres, or walking to the shops rather than driving – come at essentially no cost. And there are, as Haddleton and countless others have argued, huge economic opportunities in environmentally friendly, high-tech and low-emissions sectors.

It’s also false to say that the fight against global warming has been irrecoverably lost. Climate Change Minister Simon Watts has taken stick from left-wingers for writing to councils to warn them against policies that rely on scenarios for very high global emissions.

But Watts is right. In a little-noticed piece of good news, climate scientists in May retired their worst-case scenario, known technically as RCP8.5, which predicted 4.5°C of warming by 2100.

The growth of renewable energy, EVs and battery storage has noticeably bent down the curve of projected global heating. In the words of the Australian climate expert Andrew King: “Although often slow and incomplete, our efforts to tackle climate change have made a tangible difference.”

The bad news is that although the worst-case scenario was retired in May, so too was the most optimistic one. SSP1-1.9 had envisaged global warming sticking to a 1.5°C rise above pre-industrial temperatures: that’s the limit the world really need to obey, if it wants to avoid the worst climate-change-induced disasters.

Now, owing to the inadequacy of our action to date, the most optimistic pathway sees temperatures peaking at about 1.9°C. In King’s view, our best hope is to “only temporarily overshoot” 1.5°C, then draw carbon dioxide back out of the atmosphere to get ourselves once again under the limit.

That will require far more intense political efforts (and technologies as-yet unproven at scale). On current trends, we are heading for a world that, warming by 2.6°C by 2100, is riven by devastating floods and droughts, colossal damage to property and widespread loss of life.

To help avert that frightening future, New Zealand is being asked only to shoulder its fair share of the task: to follow the scientifically set pathway of halving emissions by 2030 then achieving net zero 20 years later. All that is required of us is, in the classic phrase, to do our bit.

The Post: National’s compulsory turn leaves the left with a bigger question

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This week has seen National emerge in a new guise: as the party of heavy-handed state compulsion. Christopher Luxon’s decision to push mandatory KiwiSaver tells us a lot about the current state of the political right – but also lays down a challenge the left has barely begun to grasp.

The compulsory tilt, first and foremost, reveals the absolute intellectual bankruptcy of modern libertarianism. Far from just letting individuals go their own way, National now wants to effectively force everyone to save up to 12% of their income.

One model is obviously Australia, which has long had compulsory savings; another is Singapore. There, workers must place a striking 21% of their wages into personal savings accounts; employers contribute a further 16%. Workers then use those accounts to pay for their pensions and healthcare, among other things.

It’s an individualised way to pay for public services, but a highly authoritarian one. Indeed, Singapore is less a democracy and more a one-party state that violates individual rights in ways that should shock right-wingers.

But then modern libertarianism has failed to offer anything better than the bizarre idea of setting up autonomous “seasteading” settlements in the middle of the ocean, freed from the state’s supposedly intolerable burdens. Incredibly enough, no-one seems keen. So all the right is left with (pun intended) is Singapore.

Compulsory KiwiSaver, however, is far from being an unadulterated gift to left-wingers. For one thing, it challenges the continued existence of New Zealand Super, a public policy that – as of a few years ago – ensured just 4% of pensioners were living in hardship, one of the lowest rates in the world.

It also raises even thornier issues about control over the economy. The centuries-long battles between left and right – between socialism, social democracy, hyper-capitalism and other ideologies – have often centred on questions of economic ownership.

The core of capitalism is in the name: the control of capital, in the sense of the key decisions about where to invest the economy’s resources, lies in the hands of the select few who own companies.

The paradox of capitalism, in the words of the American writer Jeff Gates, is that it produces so few capitalists – so few people, that is, with meaningful amounts of capital to deploy. The smarter or more compassionate conservatives have long recognised this weakness, and sought to foster a “property-owning democracy”, a phrase National referenced in its KiwiSaver policy launch.

In New Zealand, this has generally meant property in the most basic sense: home ownership. And until recently, landlording was a big part of that vision.

Now, though, both sides of politics are starting to realise that our obsession with property investment is holding us back. Compulsory KiwiSaver represents a different tack: widespread ownership of shares.

That’s certainly an improvement on the investment property obsession. But it brings its own challenges, especially for the left.

Conservatives like stock markets because they represent free individual choices while leaving capitalists’ power largely untouched – but also because they entwine those individuals’ fortunes with corporate profits. That, in turn, makes it harder for left-wing governments to regulate and tax those corporates, lest they be seen as harming the retirement savings of the average person.

Befitting its broader politics, the left’s conception of ownership has tended to be more collective. It traditionally encompassed public ownership of state assets, albeit we have precious few of those left.

Faced with the rise of stock markets – a trend turbocharged by new platforms that make investing easier than ever before – the intellectual left has now become very interested in sovereign wealth funds.

Such funds are, in essence, state investment vehicles. The government, often operating through an arm’s-length agency, takes stakes in publicly listed companies, ensuring that some of the economy’s riches flow directly into a collective coffer. That wealth can be used to pay for public services or doled out in an annual dividend, as Alaska’s Permanent Fund (built on oil money) has done for decades.

Commentators are increasingly drawn to such funds. Even the heads of AI companies – not generally known for having a collectivist outlook or, indeed, a social conscience – have proposed sovereign wealth funds that would ensure everyone shares in the profits from AI’s job-cutting effects (assuming the latter materialise).

Elsewhere, Norway’s sovereign wealth fund (again built on oil money) is huge and highly successful. So too, perhaps unsurprisingly, is Singapore’s own version, known as Temasek.

Some local commentators – and, notably, parties like New Zealand First – would love us to emulate Temasek. The big problem is that such funds are typically established with the proceeds from resource booms, the sale of profitable state assets, or government surpluses, and New Zealand currently has none of those. (With the possible exception of the gentailers.)

That makes the sovereign wealth fund dream much harder to attain. But the right-wing story about ownership of the economy is coming into sharper focus. The challenge for the left is that theirs is not.

The Spinoff: One of Brooke van Velden’s final acts as a politician will also be her most dangerous

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Consider this: you are an Act minister, for whom getting offside with the business community is almost impossible, and yet you have achieved this feat.

Consider this: your bill will put fewer health and safety responsibilities on a four-person abseiling company than a 21-person accountancy firm.

Consider this: you are bringing forward a bill that is designed to lower business costs but will likely do the opposite.

Given all this, what do you do? If you are Brooke Van Velden, the minister responsible for the above bill, the answer is that you plough ahead regardless.

The legislation in question is the Health and Safety at Work Amendment Bill, which Van Velden is trying to get passed this week. Its chief feature, in the words of the Listener’s Rebecca Macfie, is that it “radically reduces small employers’ obligations to keep workers safe on the job”. 

Under the bill, firms with fewer than 20 workers – that is, 97% of this nation’s businesses – would be carved out of most health and safety requirements, being required to manage only “critical risks” to their workers. As with much Act policy, this seems superficially plausible: small businesses are stretched, so why not let them concentrate on the biggest risks? But as with much Act policy it is evident, the moment one peers into the engine room, that this is an absolute trainwreck of a bill.

Although “non-critical risks” may not sound serious, they actually make up the bulk of workplace harms. They include musculoskeletal injuries from trips, slips and falls, and psychosocial risks that include mental stress, excessive workload and burnout. 

As the New Zealand Institute of Safety Management (NZISM) points out, these two areas are literally the top two causes of workplace harm. Treating musculoskeletal injuries alone takes up fully half of ACC’s work-related rehabilitation bill, totalling $3.6bn a year. 

Under Van Velden’s bill, in short, small businesses can stop trying to prevent the most frequent and most expensive causes of harm in the country. The fiscal cost this will impose is unclear because, in yet another reprehensible piece of policy-making, ACC was excluded from targeted consultation on the bill, and the government-dominated Education and Workforce Select Committee wouldn’t allow the agency to do the required modelling. Nothing says “we are committed to evidence-based policy-making” like a refusal to let that evidence even be produced.

Nonetheless ACC has, in internal documents, clearly identified the bill’s dangers, saying it generates “a real and material … risk of increasing deaths, injuries, claims and costs”. The NZISM, meanwhile, predicts it will “cost hundreds of millions more and cause huge suffering”.

Another bizarre facet of the bill is that small businesses aren’t even particularly safe places. According to calculations by Simplicity chief economist Shamubeel Eaqub, small businesses are already one-quarter more likely to injure their staff than bigger firms (adjusting for workforce size). ACC data shows they generate three-quarters of all work-related injury costs. 

“Carving them out makes no sense,” says the NZISM’s Mike Cosman. In just one “ridiculous” example, small businesses will no longer have to provide staff with safety boots or gloves, as hand and foot injuries are not deemed “critical”. 

Dividing up businesses based on size is also nonsensical. As above, a four-person abseiling business will, despite the extraordinarily dangerous nature of its work, face fewer health and safety regulations than a 21-person accountancy firm, simply because the former falls below the 20-worker threshold. Paul Jarvie from the Employers and Manufacturers Association told the Listener the carve-out “defies logic in terms of where the harms are occurring … No other country does this. It just doesn’t make sense.”

Which brings us to the final, and perhaps most bizarre, aspect of the whole bill: companies, for the most part, don’t even want it. The bill’s sole corporate cheerleader of any significance is former National MP and current Business New Zealand head Katherine Rich.

Others, like Jarvie, think the bill is “a really complicated hotchpotch” that “may unintentionally increase harm, complexity and compliance uncertainty for businesses and workers”. Members of the Business Leaders Health and Safety Forum say the reforms will leave large corporations still legally liable for what happens further down the sub-contracting chain – but without the reassurance that injuries are being avoided.

As a result, big firm after big firm has queued up to tell lawmakers that, if the bill goes through, they will simply use their contracting power to force small businesses to manage musculoskeletal and psychosocial risks anyway. Or they will avoid engaging those firms altogether. 

The bigger picture here is that, even under the current laws, New Zealanders are six times more likely to die on the job than Brits, and nearly twice as likely as Aussies. But Van Velden is determined to weaken even further the already-minimal guardrails protecting workers. Her refusal to listen to counter-arguments suggests that, far from being a pragmatic response to so-called red tape, the bill is just an exercise in ideological rigidity. 

Conscious of this truth, some National Party MPs have privately made it clear that they don’t really like the bill. But they aren’t prepared to oppose it. So it will be left to a party with more spine – and indeed more common-sense – to overturn one of the worst pieces of legislation in recent memory.

The Post: Why community power could be the climate change revolution we need

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One of the biggest problems with the climate change agenda is that it presents itself to the public so often as a negative. Ask ordinary people what the fight against global warming involves and they’ll probably say: taxes, levies, curbs, restrictions. Paying more, being able to do less. No wonder it’s not a political winner.

Conversely, though, one can’t just paint the public a picture of the glorious, sunlit uplands of a climate-friendly world. People don’t believe it, climate activists tell me; it seems too abstract, too far away.

Much promise, then, lies in “mid-range change”: green shifts that feel neither negligible nor implausible. All the better, too, if this shift happens locally, creating change that people can reach out and touch.

Enter community energy: renewable power projects that are partly or wholly controlled by small groups of locals. Community groups can get their neighbours onside with wind and solar installations, build them alongside expert developers, run those facilities democratically, slash emissions, and redistribute energy revenues. It is, potentially, a win-win-win-win-win.

Such models are common in other countries. Over half of Denmark’s 7000 wind turbines are community-owned.

Hundreds of such schemes operate in the UK. And across the ditch, a 2023 report found tens of thousands of Australians supporting community power schemes, and tens of thousands of megawatt-hours of clean energy being produced.

Claudia Hodge from the Community Power Agency, an Australian NGO, tells me that when people can have a renewable energy project on their doorstep, “and they fairly benefit from it … they see that climate change can be a positive thing for average people … It really turns the intangible into something tangible in their eyes.” The “co-benefits” – the strengthened social ties that come from running schemes together – are also substantial.

Schemes with quintessentially Aussie names like Totally Renewable Yackandandah have installed community-owned solar panels and batteries, cutting locals’ power bills by two-thirds, boosting disaster resilience, and saving enough funds to pay for critically important local health services.

In inner-city Melbourne, community batteries – covered in street art, and situated right where people can see them – store solar power generated during the day and redistribute it during evening peaks. These batteries share energy even with renters and others who can’t install their own solar panels; they also make better use of the existing distribution network. Equity and efficiency: again, a win-win.

Back at home, Gareth Cartwright of the Community Energy Network says New Zealand has more schemes than people realise – 30-40 “good” ones – but they’re typically quite small. And faced with a hostile regulatory set-up, most plans fail. “You have to be remarkably stubborn to get a community energy scheme through in New Zealand,” he says.

One success is Energise Ōtaki, which in 2020 built Rau Kūmara, the country’s first-ever community-owned solar farm, generating clean power for the local high school and wastewater treatment plant.

Energy revenues, Cartwright says, have been used to fund school scholarships, bike repair workshops and community gardens. Local clean energy “is one of the pillars that you build a community on”.

It can also be good business. Rewiring Aotearoa’s Josh Ellison says that although big commercial projects can be cheaper upfront, around 11% of the power generated is lost in transmission. Then there’s the corporate profit margins, and the cut taken by the lines companies and others.

Grid-scale projects will remain important, as will individual household installations of solar panels, as part of what Ellison calls a technological revolution happening behind the scenes.

But community schemes are extremely powerful, he says. “People can trust their community and their neighbours about what to do. It’s no longer someone [from outside] trying to sell them something.”

Energy regulation, though, keeps getting in the way. Physics-wise, it’s clearly cheaper and more efficient to store power at the community rather than household level, Ellison says.

In practice, though, New Zealand makes it expensive to do so: someone in Kaikohe would get charged the same price for drawing from a neighbourhood battery as they would for taking power from a South Island hydro station. And anyone storing their household-generated solar power in a community battery would get charged for taking it back out.

Regulation, Ellison says, “hasn’t kept pace with technology”. And initiatives like Ara Ake, the national energy innovation centre, had their funding abruptly cancelled in this year’s Budget.

So much needs to change, from power pricing and regulation on down. Every country with a thriving community power system has built it with (temporary) state subsidies.

Government underwriting could help give communities security of returns, while the co-benefits of community schemes could also become a criterion for state investment. And despite all the barriers, people like Cartwright are cautiously optimistic.

Enthusiasm for community schemes is growing, he says, with iwi and hapū often in the lead. “It’s slow, and it needs a lot more leadership than it’s getting at the moment. But it’s definitely starting to shift.”

The Post: The bleak picture for the children for whom there is no more

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Poor children, it appears, don’t deserve security.

The Government told us this Budget was all about “securing the future”. And for some that will ring true.

There’s more than $2 billion for defence procurement – so if you like maintaining frigates, your future is secure.

There’s $1.8b for extending the Waikato Expressway – so if you want to drive more rapidly to Piarere, your future is secure.

There’s $500m extra for Corrections – so if you like locking more people up, your future is secure.

If you’re a child living in poverty, however, your future looks just as bleak after this Budget as it did before.

Currently, one child in eight– 12.6%, to be precise – lives under the poverty line, their families struggling to survive on less than half the typical household’s income. Many spend their days in cold, damp, overcrowded homes, in households where wages and benefits can’t keep ahead of bills, where fridges are virtually empty and there isn’t even a quiet place to study.

The Budget forecasts a temporary fall this year in child hardship, owing to the $50-a-week fuel relief package for certain families. But once that brief respite is removed, child poverty will resume rising until, in 2030, it hits 12.6% – exactly what it is now.

Once housing costs are included, even more children – 17.8%, or nearly one-fifth – are currently living below the line. The projection for that figure in 2030? – 17.8%.

At this point it becomes abundantly clear that the Government’s plan for child poverty is, in the long run, to do precisely nothing. As the head of the New Zealand Council of Christian Social Services, Alicia Sudden, said today, “There is no security in Budget 2026 for our most vulnerable children.”

At this point, it also becomes clear why the Government chose last week to announce its rent hikes for state-house tenants: to stop those hikes from contaminating the Budget coverage. And don’t buy the line that there is something equitable about raising rents $31 a week for those in state houses while giving up to $30 a week to those renting privately.

As Ministry for Social Development figures show, 32% of families who get the Accommodation Supplement – the worst-off private renters, in other words – live in poverty. The equivalent figure for state-house families? – 47%.

State house parents, in short, are the poorest of the poor – and this Government has elected to cut their budgets by another $1500 a year. (And then to pour that money into the Accommodation Supplement, a sizeable proportion of which flows directly into landlords’ pockets.)

The Budget does boast a few spots of light, in fairness. Another 20,000 places in secondary school “trades academies” will offer better vocational pathways for young people.

The free school lunches scheme continues, albeit in a form so badly vandalised by David Seymour that, according to BusinessDesk, one in three of its meals gets rejected by students and tossed in the bin. There is also $93m to help sole parents into work.

But much of the Budget’s spending gets things back to front.

The Government has allocated money to tackle truancy and children’s “avoidable” trips to hospital with things like rheumatic fever. But despite ministerial claims to the contrary, neither of these is primarily a cause of poverty: each is more fundamentally a symptom.

Kids often drop out of school because they have to get a job to help prop up the family finances; and they end up in hospital with respiratory diseases because of damp homes and their parents’ inability to afford heating. Increases in family income, meanwhile, have been shown to reduce the very same child abuse that the Budget is spending over $90m to address.

On a similar basis, the Budget’s $9.5m a year for foodbanks and related initiatives might be superficially welcome. But once again it treats the symptoms, not the causes – which are, on the one hand, inadequate wages and salaries, and on the other, skyrocketing grocery bills courtesy of our price-gouging supermarkets.

This Budget is, like so many before it, a monumental failure. Ministers typically argue that slashing child poverty by half – officially costed at $3b a year– would be far too expensive.

But the long-term costs of child poverty are estimated to be around $14b a year, in worn-out bodies, worse school results and lost productivity. Failing to address child hardship is one of the greatest false economies we have ever known.

There is a saying, often attributed to Mahatma Gandhi, that the true measure of any society can be found in how it treats its most vulnerable members. And this is why we must look at the Budget through the lens of child poverty.

The Budget’s more technical elements – spending allowances, surplus projections, debt ratios and the like – have their own importance, but to a far lesser degree. We won’t have a flourishing society and economy, after all, until we decisively lift children out of hardship, and ensure that no-one’s talent is stifled through hunger and disease.

The Post: A shift in voting power and how to give young voters hope

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Farewell, fees-free, we hardly knew you. The policy of waiving one year of tertiary education charges, placed on the political chopping block this week, was a sad, short-lived symbol of the worst of the Ardern era.

Making tertiary courses completely free, as many European countries do, might have been transformative: a bold statement about the societal value of higher study that could also have allayed poorer households’ debt fears. The half-hearted offer of just one year’s discount achieved none of that.

Its abolition, though, begs a bigger question: what hope can politics offer young people in this uncertain world? The coming generations face limited job prospects, large debts, unaffordable housing, and severe anxiety about runaway climate change and AI.

Fees-free, for all its faults, did at least attempt to soften that dynamic. And although some young people appear to have lost all hope, there are still political rewards for the party that can speak to that generation and those fears.

We tend to think of politics as dominated by Baby Boomers, but those born in the two decades from 1946 will conceivably make up no more than 900,000 eligible voters this year. Over one million adults, by contrast, might be Millennials, currently aged 30-45, with a further 800,000 or so Gen Zers aged 18 to 29.

Even allowing for historically lower turnout rates among young voters, there could plausibly be more Millennials going to the ballot box than there are Baby Boomers. This could mark an epochal shift in politics – but only if parties give those younger generations something to vote for.

Not everything that worries young people, of course, has an immediate solution. Take house prices, currently around six times average incomes, according to the Interest site.

No politician is going to crash the housing market overnight, so the only semi-plausible hope of restoring affordability would be a gradual, one-percent-a-year decline in prices. Assuming normal wage growth, that would return average house prices to roughly three times average incomes – the traditional benchmark of affordability – by around 2040.

That’s still a long way off. But signalling intent – talking openly of lowering prices, as housing minister Chris Bishop has bravely done, or freeing up more inner-city land for development – would at least show young people that help is on its way.

Politicians could also make long-term renting a more secure option, although Bishop’s reinstatement last year of no-fault evictions, allowing tenants to be evicted without any reason, was a retrograde step.

Another deep well of concern for young people – and one that, alongside unaffordable housing, explains why so many have left for Australia – is the struggle to find work.

Currently, one young person in seven – that is, 14.4% of those aged 15-24 – is a NEET: not in education, employment or training. Having hit its highest level since the GFC some 17 years ago, this is a figure that should have the Beehive’s alarm bells ringing wildly.

Yet the Government’s response thus far has fallen short. When I spoke to young West Auckland jobseekers for a research project last year, they described the dispiriting effect of being forced to fruitlessly apply for role after role.

One told me: “Eventually, over time, you lose hope. You develop a [negative] mindset.” But if they didn’t submit those applications, they risked having their benefit cut.

This is how our welfare system fails young people: too much punishment, too little support. And that’s why the think-tank where I work, IDEA, has proposed a “circuit-breaker” job guarantee: a temporary, state-funded job placement at a firm, NGO or government agency, to be made available to the 5000 or so youths who’ve been unemployed for over a year.

The idea is to break the incipient cycle of long-term joblessness by offering those young people something positive: work, its related routines and disciplines, CV points, the chance to learn on the job, and, above all, a much-needed confidence boost. Similar schemes overseas have lifted long-term employment rates by as much as 27% and had a hugely positive return on investment.

The savings from scrapping fees-free could easily be redirected towards such a scheme. And as AI starts to eat into young people’s job prospects, we’re going to need more initiatives to bridge the gap between 21-year-olds’ core skills and the advanced roles that will increasingly dominate the job market.

That bridge could be provided by longer diplomas and enhanced apprenticeships, all paid for by some combination of the state and the firms that benefit from AI’s efficiencies. And if, as above, house prices fall, sparking greater investment in economically productive businesses, there might be more jobs available in the first place.

Whatever the exact policy mix, though, the underlying point remains clear. Politicians have to offer young people a reason for hope – and with it a reason to vote. Otherwise they can expect to see an ever-growing number of one-way plane trips to Australia.