For an effective Christmas spirit

Dr Eric Crampton
Insights Newsletter
11 December, 2015

Christmas slouches ever nearer. And with it holiday shopping, impossibly loud brass bands on Lambton Quay, and television Christmas specials reminding us that charity ought not stop with the family Christmas tree.

But what is the best we can do?

A few months ago, I talked about effective altruism: how those who are charitably minded can make sure they do the most good they can with each dollar.

But it is important that policy also delivers the best bang for buck. It is harder for altruists to be effective if government policy undermines their efforts.

Earlier this week, the McGuinness Institute hosted a workshop on tackling poverty; I was one of the speakers.

Rather than look at how much the government is spending, I argued that voters should be focused on whether that spending is effective, and whether there are other policies blocking the poor from escaping poverty.

Primary among these is housing affordability. New Zealand’s land use policy has forced the urban poor into overcrowded wrecks of houses. And while there is reasonable cross-party consensus on the cause of the problem, and a promising new Productivity Commission enquiry into the regulatory system, we have yet to see any substantial action.

The problem makes other kinds of income support programmes far less effective: landlords reap most of the gains from boosts to the accommodation supplement when housing supply is overly constrained.

Is current spending effective? Treasury this week released data showing where spending might need to be targeted to reduce the long term costs of poverty and dependence. And this effort is laudable. But the next and harder step is checking which programmes are effective, and building the political support needed for trying new approaches.

But here the government could leverage its statistics just a little bit more to help those charities that want to know whether they are being effective.

Some charities, like Christchurch’s Family Help Trust, commission studies to find out whether their programmes really help. The government holds enough data to make this kind of evaluation fairly simple: providing a bit of statistical back-end support to help charities know how much good they do would be an excellent Christmas present.

And it would also help those with the Christmas spirit to make the most effective use of it.

Watch in the new year for our coming report on poverty.

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