Tue, 16 Aug 2011 12:11p.m.
By Duncan Garner
58,000. This is the crucial number that should be ringing in John Key's ears every night he bunks down in the refurbished Premier House.
58,000 young people between the ages of 15-24 are not in education, training or work. The majority of them are on a benefit.
Picture a revamped Eden Park and fill it with these young people, because that's how bad it is. We are at crisis point. 27.6% of those aged 15-24 are out of work and out of luck. It's even higher for Maori and Pacific youth.
But don't take it from me. Take it from the Human Rights Commission which said in its latest report that this now threatens "social cohesion" in New Zealand. These people need training, apprenticeships, jobs, direction, hope and most of all, help.
So what did Key do in the weekend to target the problem? Very little. But he was widely applauded for it, by his National Party delegates and probably the country.
Targeting a couple of thousand 16 and 17 year olds and telling them that the state doesn't trust them to spend their benefit money will offend no-one. Mentioning booze and cigarettes was political gold for Key, his delegates and voters will probably still be nodding with approval.
But Key is now facing new and mounting pressure to fix the problem of this growing underclass.
He put the 'underclass' on the political agenda before he was Prime Minister, now it promises to haunt him all the way to his valedictory speech - if he ever does one.
Key needs to be bold, he needs to take risks - he needs to tell officials the old way, the old programmes, like Community Max (remember the one pumpkin in the field after the six month vege garden course closed up shop) have been hopeless failures.
Over the last three years the Government has spent more than $200m on young jobless people to school them up, to train them, to give them some hope.
They've been given a shovel, a computer course, a weaving course, a sewing machine, a horse to catch, a vegetable garden to tender, a Maori medicinal garden to build, a carving programme, yet the statistics show, while a few have succeeded, the bulk remain unemployed and not in any other form of training. Many have voted with their feet and now live in Australia.
On The Nation at the weekend I interviewed Dale Williams, the Mayor of Otorahanga. He runs a town of 9500 people and not one youth is unemployed. They are all engaged in work or training. He has partnerships with small businesses. He says the Government needs a different approach, it needs to take risks, it needs something new. It needs to track kids the day they leave school, to not let them drift, to keep them busy.
Sure the recession has been tough on young people worldwide. 81 million youths are now unemployed around the globe, it was 71 million before the recession. It is a ticking time bomb. In London, it's already exploded.
And Williams laid down a challenge to Key - think outside the square and do it now.
Incentives need to be given to businesses to employ young people again. Employers need to be encouraged to give a school leaver a job. Is it tax breaks? Maybe the Government needs to reintroduce some form of training wage? A youth rate. The Government needs to get more hands on. Williams is right. These kids need to be tracked, traced, encouraged, prodded and pushed into something.
But Key and National's record so far suggests they have taken their eye off the ball. The much-hyped Youth Guarantee to get young people into some form of training if they are not at school, has just 2474 young kids in it.
Youth apprencticeships have actually fallen by 1200 since National took office.
The "boot camps" see just 18% of participants go on to get a job, according to Treasury.
Another factor in such high youth unemployment may be the demise of youth rates. Since they were abandoned by the Labour Government, youth unemployment has rapidly increased. But much of that can be blamed on the world wide recession surely. But now we need to be encouraging businesses to hire our young people.
In 1989 when I was 16, I powder coated curtain rails part-time in a factory for $4.60 an hour on Porana Road, in the Wairay Valley industrial zone on the North Shore. It was boring as hell.
I then worked at Red Seal in Avondale putting caps on organic toothpaste for $5.00 an hour. That was worse. At 17 I worked in Whitcoulls for $6.00 an hour sorting books in the top floor attic on Queen Street. In every job I was on youth rates. I thought it was miserable money, but it got me into part-time work and I earned and learned while I was studying. I knew no other way.
Labour leader Phil Goff said yesterday that a 16 or 17-year-old should be paid the same amount of money as a 50-year-old in a factory. He said it was discrimination otherwise. Key said he doesn't believe that.
But should a 16-year-old really be paid the same money as a 50-year-old in a factory doing the same job?
And Key has for three days now refused to rule out a return to youth rates. It seems something is coming. An announcement perhaps during the election campaign - but he keeps saying, on their own, they are not the answer. That probably means, as part of a wider package, they may be part of the solution.
Key will also have more announcements on welfare at the start of the election campaign. He refuses to rule out sending DPB parents back to work part-time when their youngest child turns three. But given his background, I doubt he'll go this far.
It was a feature of the Welfare Working Group's report. He immediately ruled out sending Mums back to work when their youngest turned 14 weeks, and rightly so, but he's leaving the door open for more changes around the DPB.
He's also making it clear he'll target the more than 130,000 people on invalid and sickness benefits. The Government wants to target at least 10 percent of these people it believes are ready for work or training. If you can box Sonny Bill Williams on a sickness benefit, you can pick up a shovel and build a road surely.
But there's a real disconnect here, and Labour has picked up on it. Where are the jobs? Seriously. Where are the real jobs for these young people and sickness and invalid beneficiaries?
The only way to really stop the number of beneficiaries going through the roof, is jobs, jobs and more jobs.
And they come when businesses are doing well and employers are hiring. In the meantime, the Government must get the settings right, get the incentives right, get young people training and stop them being idle. We need to have them ready for work, not sitting at home.
And on that front, the critics say Key and National have failed poorly. The stats do not lie.
Key wants to come across as a compassionate conservative. He has seen previous National leaders fail badly taking a stick to welfare and offering no carrot on the way through. The ghosts of Ruth Richardson and to a lesser extent Jenny Shipley remain around the Cabinet table. Key wants to take people with him. He has a stick in one hand and a carrot in the other.
But right now the there is a yawning gap between Key's rhetoric and the reality. 58,000 young people are down and out. Record numbers of Kiwis are once again heading to Australia.
Key's optimisim is being questioned. He wanted to close the wage gap with the Aussies and stop the brain drain. Who really believes that's happened? Not even his most senior Ministers.
The tax cuts put more money into the hands of the wealthy and the poor missed out. Again. The underclass certainly didn't get smaller when National cut taxes.
I asked Key yesterday what his goal was on reducing welfare numbers. He says he doesn't have one. I suggested 10 percent. He said he didn't know. He doesn't want to set a target that he can be judged against. When was there last a Minister in New Zealand who was successful in reforming welfare? When did it happen? Name him or her?
But he now stands to be judged by how the underclass, and the unemployed do in the next few years because he put the underclass on the map, he took Aroha to Waitangi, he got all the media attention because of it.
Now two and half years on he looks set to win his second term. I have no doubt a second term National Government will be tougher, harder and more right wing than the first term Nats.
Sure, Key pulls back some of his cabinet colleagues that wish to go further. He does have a genuinely good centrist streak and hold on the Cabinet. His ambition and opitimism is to be admired and voters seem to like it. It is part of his DNA.
But the reality cannot be ignored as a result. Indeed the spotlight must go on it.
In my view, this Government's biggest failure to date is our young people. It's scary how many are idle. It's dangerous for all our prospects. We can't sit back and allow another generation of teenagers to become benefit dependent, and their kids and their kids.
Key's record on this is on the line. It does not match his rhetoric. He will be judged on this. Maybe not on November 26, but in the years ahead.