Mike Hosking: No proof Govt's jobs spending spree will work

Author
Mike Hosking,
Section
Video,
Publish Date
Tuesday, 5 February 2019, 8:47AM

COMMENT:

The Government is on quite the spending spree ahead of our national day.

$100 million for the region up north, $20m for a local council and now some $80m for jobs. Not just up north for jobs - but for regions that are struggling. As always, like KiwiBuild, their rationale is sound - even if the delivery will prove problematic.

The country has been doing well when it comes to jobs. Whether it continues that way is another question for another day - but over the past decade we have worked ourselves into the globally envious position of basically having full employment.

But as is always the case growth and success is not universal. Some places have done better than others - hence the $82m.

But - and it's a but well worth considering - just what is the $82m going on? Like the $100m, just who is getting it - and what do they do with it?

That's the test of real government policy - not the announcement - anyone can pick a number and yell it from the rooftops. The real test is where it went and what sort of return you got from it.

And like KiwiBuild, the Government has quite rightly identified an area where governments can help. Hopefully, unlike KiwiBuild, it'll actually work.

Hawke's Bay, Bay of Plenty and Manawatu-Whanganui are targeted. Now that initially surprised me. Are they seriously telling us that Hawke's Bay and especially the Bay of Plenty aren't booming? Because they are.

And that's your first red flag: if you can't get work in a booming economy, there's something seriously askew. If you can't start a business, hustle for work, expand or grow - you most likely are doing something very wrong.

The money goes to a set of hubs that brings together government agencies. And right there is your next red flag. Lots of government agencies, being paid more to do what they really already should.

$21 million for 'regional connectivity schemes' - whatever that means. There are separate digital hubs, there is internet access for marae, and there is money to expand a couple of existing programmes to help young people who aren't doing anything - no training, no schooling and certainly no work - into work.

Now, ask yourself a simple question. If there is a problem - which there is - could that mean the existing programmes don't work? And if they don't, if giving them more money solving that?

Your simple reality of full employment, in a country that has been booming, is that if you're not part of the success, there will be profound and obvious reasons for it. Drugs, crime, attitude, motivation, and almost certainly - location.

At the end of the day, no amount of government money can get an employer to operate in a remote area, or employ unemployable people. And no government can create work where there isn't any, without permanent financial assistance - which is basically a subsidy.

And further, if these places haven't boomed in a decade of strong prosperity, how are they going to handle a slowdown? We've already begin to experience it.

The Government is going to find out that making the promise is easy and that, like KiwiBuild, actually doing it is beyond them.

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