From emergency housing to employment dispute resolution, the government’s cutbacks are a misguided attempt to shrink our sense of what constitutes the public good – and it’s not an issue that solely affects the poor and the weak.
When even employers are complaining about public service cuts in the National Business Review, the organ of the country’s corporate elite, it’s a sign that the shortcomings of the government’s cost-cutting agenda are spreading far and wide.
Under the headline “Lengthy mediation delays forcing employers to go private”, the NBR reported that “extensive funding cuts” at the Ministry of Business, Innovation and Employment (MBIE), combined with increased demand, were causing “a lengthy backlog to access the country’s employment dispute resolution service”. And it’s a similar story across the country.
The number of people in emergency housing declines; the number of people sleeping on the streets increases. Emergency grants from Work and Income become harder to get; charity-run foodbanks have to hand out more parcels. State-funded social services retrench more generally; everyone else has to pick up the slack.
As the government is rapidly discovering, cutting back public services does not – astonishingly enough – make the need for those services go away. It simply shifts that need somewhere else.
National’s push to end emergency housing, for instance, has genuinely seen hundreds of people settled in state homes (that Labour built). But it has also driven more people onto the streets. In Wellington, the Downtown Community Ministry, which works with local homeless people, says the number of people rough sleeping in December 2024 was up by one-third compared to the year before. The ministry’s Natalia Cleland told RNZ that the criteria for getting emergency housing had been toughened so much that people had even “stopped asking”.
Another charity worker, Cindy Kawana from Auckland’s E Tipu E Rea Whānau Services, said she knew of one young couple using a hospital as a night shelter. “Them and their baby were sleeping in the emergency waiting room at night, so they had a roof over their head and it was safe and warm, and were in the park during the day, and they couldn’t even get onto the housing register.”
The government’s cutbacks are an attempt to shrink our sense of what constitutes the public good – the set of interests we share as citizens, as opposed to the varied and individual interests we pursue in private. This seems deeply misguided.
Being able to access publicly provided mediation services, for instance, certainly delivers a private benefit to employers and employees, but it is more fundamentally a public good – something that is in all our interests – for such disputes to be resolved with relative ease and speed, without a long and costly court process. Ensuring everyone has enough to eat, including via foodbanks if need be, is also a basic public good: we are all diminished if others go hungry, and we pay the long-term costs – in rising ill-health and falling productivity – when they do so. (Of course it would be better if paid work and welfare benefits covered people’s grocery shopping in the first place, so that foodbanks were not needed.)
Note that this is a question of funding, not service devolution. The government could legitimately take the view that some charities are better placed to deliver than central government agencies, and shift funding accordingly. But that is not what is happening. Funds are simply being removed.
Nor is this an issue that solely affects the poor and the weak: it has consequences for the middle classes. In opposition, National promised it would “co-invest” alongside councils to deliver new water infrastructure as an alternative to Three Waters. The government having backtracked on that pledge, councils are being left to bear more of the cost themselves: hence, in part, why rates bills are rising so rapidly. (Decades of under-investment are, of course, the principal villain – another example of costs being illegitimately shifted, in this case from one generation of ratepayers to the next.)
It’s the same story with items like vehicle registration fees (increased by $50 by National) and drivers’ licence re-sit fees ($89, removed by Labour but reintroduced by National). Your taxes may be lower than they would otherwise have been, but your user charges will be higher. Again, this goes against the public good: registering a car and re-sitting a test undoubtedly bring private advantages, but by far the most significant benefits – safe cars and safe drivers – are to the public as a whole.
The sad thing is that National could probably have reduced spending without harming public services. One public servant recently told me that, because there certainly was wasted spending, her department could have cut around 5% from its baseline had it been allowed to carry out a considered search for efficiencies over a year or so. Instead it got hit with a blunt 6.5% reduction target delivered at breakneck speed.
The same has been true across the public service, hence the cuts – proposed or actual – to climate change modellers, officials who help track down child pornographers, and countless other valuable staff and programmes. The vast majority of health-sector workers (in an admittedly self-selecting poll) recently said they had seen service cuts – something that is, of course, forcing people to turn to the private sector. Cutting the police’s backroom staff just means frontline officers have to spend more time filling out paperwork.
None of this generates productivity, efficiency or service improvements. It doesn’t make need go away. It just shifts the burden onto other people – often those least able to bear it.
