NZ – Kiwi Polemicist – Governmental abuse of its ability to gather information at gun point

Kiwi Polemicist

• Update: Govt makes it harder for beneficiaries to get off the benefit (Bennett releases income info)

Posted: 30 Jul 2009 07:13 AM PDT


The comments button is at the bottom right of this post.

This is an update to my earlier post Govt makes it harder for beneficiaries to get off the benefit.

The story so far:

1.      Two women went public, complaining about cuts in the Training Incentive Allowance that supposedly helps beneficiaries get off welfare by gaining qualifications (details in my earlier post).

2.      Minister of Social Development Destruction Paula Bennett released details of the income of those two beneficiaries, citing advice from the Privacy Commissioner which, she claims, allowed her to release the information.

This post has five sections:

§ Did Bennett comply with the Privacy Act (as interpreted by the Privacy Czar)?

§ Is the income information actually relevant information?

§ Is this governmental bullying?

§ The Privacy Act is dangerous and this case sets a precedent

§ Conclusions

Did Bennett comply with the Privacy Act (as interpreted by the Privacy Czar)?

The Privacy Czar’s advice to ministers says in part:

8. In making allegations against a Department, an individual has released considerable personal detail to the news media. The Minister wishes to respond to the allegations using those details, but wants to add some further detail in order to answer specific allegations.

By releasing a large amount of personal information to the media, the individual is taking the risk that unfavourable publicity could result. If the Minister releases only information which is relevant to the issues raised by the individual, that person may not be able to claim that any particular harm was caused by the Minister’s disclosure rather than by the individual’s own disclosure. If the individual is not harmed, there would not be an interference with the individual’s privacy under section 66 of the Privacy Act.

In my humble opinion, using this as justification for releasing income details is marginal at best. I would not have said that these two released “considerable personal detail” (judging by this article).

Did Bennett release “only information which is relevant to the issues raised by the individual”? The NZ Herald quotes Jennifer Johnston as saying

“The DPB is a living, for which my children and I have been very grateful. But it does not afford an ability to save for these sorts of extra expenses. I was utterly dismayed to find out that the TIA had been canned.”

I cannot find a similar statement by Natasha Fuller, but absence of evidence is not evidence of absence.

So, strictly speaking, Johnston at least raised the issue of her income and its insufficiency for funding training, so Bennett was compliant with the Privacy Czar’s advice.

Is this governmental bullying?

I believe so. The core issue here is the Training Incentive Allowance, but Bennett chose to release income details, and I am reminded of the “chilling effect” of the Electoral Finance Act. Remember that this sets a precedent, and a Minister could use the same justification for releasing income details of a wage earner or business owner.

Not PJ says

The details of my income are private because they’re a purely voluntary arrangement between me and my employer. They don’t concern anyone else. Those of Mses Fuller and Johnston on the other hand (and that of Ms Bennett, for that matter) concern everyone who has their pay packets raided by Inland Revenue to fund our gargantuan welfare state.

He has an excellent point, but I believe that the issue of restraint of governmental power is more important than the taxpayers’ right to know (I use that term very loosely) how much of their pay packet is going to Johnston and Fuller. In all situations the government has far too much information, and the public has little or none (asymmetry of information): we must not allow the state to abuse that knowledge/power more than they already do.

Is the income information actually relevant information?

Bennett is effectively saying “These women are earning $X, therefore they don’t need the Training Incentive Allowance”. That is financial naivety of the highest order, and it is worrying when someone when someone who is supposed to be running the country thinks so simplistically.

The income information is not relevant information because it does not take into account the personal circumstances of theses women: i.e., they may have medical or other problems that chew up a chunk of their income for reasons beyond their control. The release of effectively meaningless information supports my contention that this is governmental bullying.

The Privacy Act is dangerous and this case sets a precedent

Most people think that laws such as the Privacy Act and the Bill of Rights are good because they define their rights. They are in fact dangerous, because they restrict our rights to those which the government allows us to have. The advice to ministers from the Privacy Czar is a good example of this: if an individual raises issues in public then the door is wide open for the government to release private information. For example, a businessman could go to a newspaper and say “Inland Revenue is demanding weekly payments towards unpaid taxes that I cannot afford because my income is low. This is unreasonable and they’re pushing me towards bankruptcy”. Once he’s done so the door is wide open for the Minister of Inland Revenue Pillage to release that businessman’s income details and say “Of course he can afford the repayments demanded by Inland Revenue”.


New Zealand is a screwed up country (like all socialist democracies) and there is no “right answer” to the questions about privacy for beneficiaries and so on, because when everything is wrong then obviously nothing is right. In other words, when the foundations (the welfare state) are crooked the house (the answers to questions about the welfare state) will also be crooked.

I believe that the two primary issues here are:

1.      Governmental abuse of its ability to gather information at gun point

2.      Destruction of the right to privacy by the Privacy Act

What are your thoughts regarding this thorny situation?


Tagged: classical liberalism, Jennifer Johnston, Natasha Fuller, new zealand, paula bennett, privacy act, right to privacy, welfare, winz, work and income new zealand     


• Site Plug: Living Off the Smell of an Oily Rag (Or, How To Avoid Wasting Your Life)

Posted: 29 Jul 2009 04:38 PM PDT


The comments button is at the bottom right of this post.

Living Off the Smell of an Oily Rag is a website that gives free access to all sorts of practical tips for minimising waste and living cheaply. Updates are available via email, you can contribute tips, and books are available. The site is listed on my links page, and you can access that links page via the sidebar.

Why do I think that this site is worth a mention? I believe that it’s worth a mention because an essential part of economics (personal and otherwise) is wise use of the resources that you have. Here’s a couple of examples that illustrate what I’m talking about:

Example #1

If I’m throwing out a shirt I’ll cut off the buttons and put them in my sewing box. Those buttons are a resource that I have and if I throw them away it’s an unwise use of that resource (also, cotton shirts make great rags so they go into my rag bag).

Example #2

Buying house-brand cheese when it’s cheaper than the same thing with a big-name brand on it. If you buy big-name cheese that costs $2 more you’re wasting a resource, i.e. the two dollars.

But wait, it gets worse: people think of “wasting money”, but in fact “wasting money” is actually “wasting your life”. Let’s have another look at the cheese example: by spending $2 unnecessarily you’ve also wasted a chunk of your life, i.e. the time it took to earn those two dollars.

How much of your life have you thrown away by buying big-name cheese? If you earn $20/hour and your true tax rate is 40% (it’s probably higher), then it took you ten minutes to acquire two after-tax dollars. So, by buying big-name cheese you’ve wasted ten minutes of your life, and time is one resource that you can’t get more of.

You might say “I’ll get more money to replace what I’ve wasted”, but that is impossible. When you work you convert one resource (time) into another resource (cash), and you can’t get more time, therefore it is impossible for you to replace what you’ve wasted”. To put it another way, once you’ve converted your time into cash that cash is as irreplaceable as the time. This is your take-home message: you can only spend each minute once, therefore you can only spend each dollar once.

If you want to give ten minutes of your life to the company that makes big-name cheese you’re free to do so. Personally, I prefer to avoid wasting my life .

• Please share your stories about your attempts to save money/avoid wasting your life – the funnier the better.

• Consider this: if your true tax rate is 40% then the state has taken at gunpoint a huge chunk of your life: if you work for 40 hours per week then you’ve been enslaved for 16 hours per week. 45 working years x 52 weeks x 16 hours = 37,440 hours or 4 years and 3 months (4.27). You can look at this in two ways: (1) that’s 4 years and 3 months enslaved by the state for 24 hours a day, 7 days a week, 365 days a year, or (2) that’s 18 work-years enslaved by the state. In reality the numbers are probably worse (from your perspective: the state loves these numbers).


Tagged: budgeting, cheap living, economics, finance, frank newman, living off the smell of an oily rag, money saving tips, muriel newman, oily rag tips





Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: