Stuff: National's new social plan goes back to the future - but is that a bad thing?

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I was in a Victoria University auditorium on Wednesday, listening to National MP Nicola Willis outline her party’s resuscitation of “social investment”, when I turned and saw Bill English sitting a few rows back. His face wore its usual quietly confident smile, as it had when he was prime minister.

Back to the future, then: for it was precisely English’s ideas that Willis, the party’s deputy leader, was reviving. English pioneered social investment, as National uses the term: a quest to minutely evaluate ​government​ programmes so that ministers can sift what works from what doesn’t, and transfer funding from the latter to the former.

In its earliest incarnation the scheme became, unfortunately, an excuse for kicking people off benefits. Once the boffins had calculated the lifetime cost of keeping someone on the dole, forcing people off it could be celebrated as a reduction in the state’s “forward liability” – regardless of whether those people then resorted to crime, fell ill or died.

Although by 2017, when English lost power, social investment had moved on from these brutal beginnings, the left’s instinctive hostility to it was entrenched.

In government, Labour initially renamed it “investing for social wellbeing”, then dropped it altogether.

This strikes me as a partisan mistake because, for all its flaws, social investment’s core idea is sensible – progressive, even. Implicit in the quest to find out which public services work best is the belief that public services work.

Indeed, social investment is compatible with the view – which I hold – that the positive effects of many such services are vast. Just think about last century’s immense progress in people’s health and literacy, much of it thanks to services delivered by the state.

Social investment is neither so revolutionary nor, for all the partisan rhetoric, so different from the Government’s much-touted “well-being” agenda. This reflects the basic sameness of modern politics, full of numbers but short on bold actions.

Both well-being and social investment are data-driven attempts to measure how well a given programme scores on multiple domains important for people’s happiness. Well-being spreads its net wider (100-plus indicators and counting), while social investment is better at modelling costs and benefits. Well-being offers a more holistic goal, social investment a sharper idea of how to get there.

The two approaches are compatible. And if Labour hadn’t dumped English’s baby, it would have a clearer story to tell about its use of taxpayer dollars.

Instead National can easily argue – with some justification – that Labour has good vibes but spends money badly, and that the well-being agenda remains amorphous. Social investment, which sounds compassionate but promises to allocate funds wisely, strikes at that weak spot.

It has, though, potential shortcomings. How might a National government avoid them? My advice, albeit unasked for, is as follows.

First, don’t use it as an excuse to cut spending. If, as seems likely, evaluations identify vast swaths of schemes with positive impacts, National ministers would have to fund them accordingly.

Second, drop this strange idea that philanthropists could provide social-investment funding for state schemes. If private money helps determine whether or not someone receives a core social service, that’s a wildly inappropriate privilege for the wealthy. And if we want more funds for social programmes, we should simply ensure millionaires pay more tax.

Above all, don’t let data become god. Social investment could lead ministers to fund only small projects whose benefit-to-cost ratio can be clearly established. But what happens when the data are patchy, or non-existent? Sometimes you just have to do what you know is right.

And what of the more sweeping schemes whose impact defies measurement? As the data journalist Keith Ng has written, a social-investment approach might have led the US not to reform civil rights in the 1960s, because life chances for African-Americans didn’t improve until years later while racial violence worsened in the immediate aftermath. Visionary, long-term public action can transform lives and generate ripples of improved well-being that no spreadsheet could ever capture.

Likewise, targeting sounds smart, but sometimes universal schemes – with their lower administrative costs, avoidance of stigma, and lack of demeaning hoops for applicants to jump through – can work better. And National would have to listen to communities to ascertain what “works”, rather than assume government datasets hold all wisdom.

Finally, accept that politics will intervene. At Wednesday’s lecture, I asked Willis if, as a committed social investor, she could explain the benefit-to-cost ratio of her party’s policy of banning gang patches in public, something I suspect is a net negative because it further alienates an already troubled cohort.

Looking like she didn’t much appreciate the question, Willis replied: “We have no idea.”

Populism trumps data, in other words. And English might have sympathised. He, after all, talked ceaselessly about social investment, but in 2017 was forced to run on a platform that included boot camps for teen offenders – an initiative that, research had already established, simply did not work.