Monday, January 22, 2024

Robert MacCulloch: Ardern's Government misused public money..... instructing the Productivity Commission to pursue its own Social Agenda irrelevant to Productivity

The Head of the Productivity Commission, Ganesh Nana writes, "As the year ends, I reflect on the work of the Commission and am proud of what we have achieved. The completion of the A Fair Chance for All inquiry was significant. We .. made insightful recommendations recognizing the strengths of communities already addressing & successfully alleviating persistent disadvantage" and then he finishes with this, "I am proud of the way the team have responded to the news of our disestablishment – with dignity & professionalism".

Therein lies the reason why the Commission was wound up by the new coalition. It wasted taxpayer money. Its mission (& own name) was never about increasing fairness & alleviating disadvantage - it was meant to be about increasing productivity. The Ministry of Social Development writes reports about fairness & disadvantage - it was not the Commission's business. Its mission was to find ways of getting more output - more GDP - for given amounts of inputs, like hours spent working. The Commission was meant to help NZ become more efficient, not necessarily fairer. It was for others to work on fairness concerns. The Commission's report has a huge focus on well-being, but NZ is ranked in the world's top ten in terms of surveyed measures of well-being, like "life satisfaction", and Māori levels are similar to non-Māori. The Commission's report confuses well-being with income.

Economics has long distinguished between efficiency and equity. Much of the subject is built on the principle that a trade-off exists between the two - namely that increasing equity by increasing taxes reduces the incentive to create wealth. The Commission's job was to focus on efficiency - it focused on equity instead. It "recommends" introducing a "Social Inclusion Act". Not its job. Ardern's government perverted the role of the Commission. It burnt through taxpayer money in the process. Little wonder its legacy has been mistrust. Who'd not be mistrustful when the Productivity Commission became the opposite of its name? Namely, the Fairness, Inclusion and Equality Commission.


Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.


Peter said...

Indeed. It seems their first task should have perhaps been to have read, Thomas Sowell's 25th book - "Basic Economics" (published in 2000), which devoted a chapter to productivity, but anyone of his 41 books probably would have provided some helpful insight into everything else they had no business to be doing.

Good job they're gone. Now let's hope the Govt gets on and dis-establishes other complete wastes of space and taxpayers limited resources.

Anonymous said...

Robert, keep posting mate. Good stuff. I have a feeling these stories are going to keep coming out for years - labour, greens , maori...say no more. I would like to ask a question tho, especially after the latest transgression from the greens minister of Justice, where do the left find these terrible humans? And is it the lefts political criteria that you have to be a lying deplorable dishonest thief to become one of their political members? Is there anyone not morally and ethically bankrupt on the left?

OK, a few questions, but I keep asking myself these and the left still keep giving me more ammo!

mudbayripper said...

Leftisum must be a disease you catch.
Maybe someone will come up with a vaccine.