Winston Peters’ Super – the real scandal

Posted: August 30, 2017 by Admin in At the coalface, Class Matters, Economics, Limits of capitalism, New Zealand economy, New Zealand politics, Pensions/retirement, Political & economic power

by Phil Duncan

Writing about the NZ First leader Winston Peters and the non-scandal around him receiving the pension for a single person when he is in a relationship, Duncan Greive of The Spinoff declares, “The worst part is that the presumed justification – that he was only taking what he was entitled to – mirrors that which has accompanied his whole cohort as it has glided through life with a level of governmental support to which it has studiously taken care to deny its children.”  Greive wants superannuation to be means-tested and suggests that Peters should have refused to accept the pension as he already receives close to $200,000 as a politician.

Firstly, I don’t think it is true that an unjustified sense of entitlement has guided “his whole cohort”; in fact, although I disagree with Peters’ fundamental politics, I don’t even think it has guided Peters himself either. He and “his whole cohort” obtain superannuation because it is a universal entitlement.  It’s not his superannuation that should be questioned – and, to be fair, Peters has done more for older people in this country than any other politician in recent decades – it’s the salaries of parliamentarians per se and the messed up priorities of the existing overall economic-political-social system.

Duncan Greive’s intentions may be good – he seems to be genuinely concerned about families living in cars – but his argument is entirely misguided.  Playing off generations against each other is not the answer to anything.  People aren’t living in cars because wealthy Waiheke Island residents have gold cards, as he seems to suggest, but because we live in society where economic life is organised around the business interests of the few rather than the human needs of the many. It has nothing to do with NZ Super or immigrants or sun spots.

I think Peters might have been better to have taken NZ Super and then donate it to people fighting poverty or homelessness, but I am actually glad that he applied for it and took it. The last thing we need is people undermining universal entitlements.

Moreover, why leave it at the pension?  The logic of means-testing pensions is that access to all public benefits – including education and health services – should be means-tested rather than being universal entitlements.

Where would that leave any concept of free education and free health care?

Behind the arguments of Duncan Greive and like-minded people, many of them political liberals, are certain assumptions.  The key one is that there is a finite amount of resources – in this case money resources – and these are insufficient to pay for what are currently universal entitlements like the pension.

This may be the case within the confines of the existing economic order – capitalism – but it is not some universal truth.  There are actually plenty of funds available not only for a universal pension at 65, but for universal pensions much earlier, along with a shorter working weeks and shorter overall working lives.  Plus free education and free health.

If we lived in a society in which economic life was rationally planned to meet human needs rather than private profit, we could have a work-week of 25 hours a week, free health and free education, and be able to retire significantly earlier than at present.  And still have a growing percentage of the population being retirees.

An article on Redline over five years ago noted:

“. . . back in 1901 there was no welfare state, and just under 43 percent of population 15 years and over were in the labour force.  By 1951 a core welfare state had been established, but labour force participation rates had actually fallen in the interim – in 1951 just over 38 percent of those 15 and over were in paid employment.  If the statistics that are being used to justify raising the age of retirement really were the key statistics, then New Zealand in 1951 would have been a complete economic mess.  But, of course, it wasn’t.  In fact, New Zealand in the 1950s, despite a falling rate of labour force participation alongside the expense of a basic welfare state, had the highest standard of living in the world.

“Moreover, this wasn’t unusual.  As Michael Yates has noted in his excellent and moving account of the growth of the working elderly in the United States, ‘we were living longer and had better health during the decades when labor force participation rates were falling.’ (See, Whooppee, we’re all gonna die. . . working.)

“This is because there is a much more important statistic than the ones used to rationalise the failures of capitalism and argue for making us work more years.  This statistic is the overall productivity of the economy, and especially labour productivity.”

And therein lies the real scandal.  It’s not Peters and his super; it’s that we aren’t enjoying now those better lives that our productivity has made possible.

What we need is not inter-generational confict about entitlements, but unity across the generations to put the benefits of this productivity – something that is socially-created – in the hands of society as a whole.

Further reading: Pensions and the retirement age – the problem is capitalism, not an aging population

  1. Daphna Whitmore says:

    I don’t think Peters intentionally set out to get overpaid, maybe it wasn’t even his error, but Ardern’s response was interesting. When she was interviewed on Radio NZ earlier this week about whether she would rule Winston out of a Cabinet position, like she did Metiria Turei. She is now trying to rewrite what happened.

    She is claiming she merely confirmed Metiria’s decision to rule herself out. At the time it was reported in an article headlined “Greens co-leader Metiria Turei’s decision to rule out Cabinet role follows warning from Jacinda Ardern”.

    The article stated “Ardern said she did not speak to Turei directly, but her party conveyed to the Greens this morning that Turei would not have a place in Cabinet if she was Prime Minister.” So Metiria was told clearly by Labour that she was ruled out. I don’t think there is any doubt about who called the shots there. And it was done “without specifically identifying what Turei had done wrong to warrant being blocked from Cabinet”.

    Espiner was interviewing Ardern; he didn’t buy the spin and said “but you ruled her out didn’t you”

  2. Phil says:

    Yes, Ardern is a typical Labour politician. They treat people with contempt – think they can just make up stuff like we have all forgotten. Unfortunately, quite a lot of people prefer to ‘forget’ because such ‘forgetting’ is needed to keep their illusions about Labour and its careerist politicans intact. Just another reason not to vote for them.

  3. Irvine says:

    In the meantime and while our energy is absorbed by the fascinating machinations of the greater beings – policy makers and politicians, ordinary folk better not make mistakes or own up to MSD or their benefits will be cut or worse still they may go to prison. Ordinary folk cant repay overpayments in a flash and dont have the luxury of doing so as a political gesture. Phil Duncan rightly points out that it is not superannuation but “…it’s the salaries of parliamentarians per se and the messed up priorities of the existing overall economic-political-social system ” that needs addressing.