Digesting the Social Report

The Social Report 2005 has been released. I've spent the last hour or so digesting it, and like the Ministry of Social Development, I think that the statistics generally show an improvement. The 20% drop in child poverty in the last three years is particularly impressive, and that front is only going to improve as the full Working For Families package kicks in.

So, why is the media coverage generally negative? I'm not sure - but one thing I am sure of is that anyone complaining about "lower voter turnout and less women MPs" wasn't reading very carefully. The statistics in question date from 2001 and 2002, and were reported last year - and presumably in the 2003 as well. But at least they're not complaining about ten-year old literacy statistics as Judith Collins was last year...

This does highlight one of the flaws in the report though - too many of the indicators are only updated intermittantly. If this sort of social reporting is to become an effective means of measuring the government's performance, we need better and more regular data.

One other point I should make, since I'm sure the opposition will be trying to make hay out of it, regards income inequality. The income inequality statistics in the Social Report were updated this year, following publication of the Department of Statistics' triennialHousehold Economic Survey, and showed a slight rise in inequality. However, the measure used - the ratio of incomes at the 80th percentile to those at the 20th - is fairly crude, and what's interesting is that the more usual (but less intuitively understandable) measure, the Gini coefficient, dropped slightly, from 33.9 in 2001 to 33.5 in 2004 - signifying a slight movement towards a more even distribution. What seems to be happening is that incomes at the top of the scale are continuing to rise, while those at the bottom of the scale (benefits) are effectively frozen. At the same time, there's been some redistribution towards the middle. Again, the latter will improve when the full Working For Families package kicks in, to the extent that "middle class" incomes will be effectively equalised by assistance to those at the lower end. This will probably do even more to lower the Gini coefficient, but if we are to seriously tackle inequality between rich and poor, more work needs to be done on raising those at the very bottom. This means either getting people off benefits into well-paid (rather than just any) work (and in practice this probably means helping people off the sickness benefit through better health care), or raising benefit levels. And given the high proportion of beneficaries who report restricted living standards on the Economic Living Standard Index measure, this is well worth doing.