Communities Count 2 – Democrats for Social Credit Party Response

As social issues spokesperson for Democrats for Social Credit (DSC), I am glad to respond to your document Communities Count 2.

As a party we are very concerned about the growing inequality in NZ. We support the activities and applaud the value of community organisations, and we agree that advocacy and Treaty-based policies are important to the effectiveness of community work.

DSC is firmly convinced that income, and a lack of it, is central to the issue of poverty and inequality. Too many government assistance programmes are targeted to people in work, thereby discriminating against families who subsist on a benefit, i.e. the very poorest families. Meanwhile, corporate executives are paid x100 more than the average wage.

We see the problem as this: that because of increasing technology there is less paid work to do. Because of an unjust economic system, more and more people are forced into low-paid and unskilled work, or on to inadequate benefits when no work is available. No aspirational goals or strategies will change the fact that there is less work, and that more and more families are struggling on low incomes.

Our solution is this: DSC advocates an across-the board reform of our financial system, involving our publicly owned Reserve Bank as the sole provider of the NZ money supply (rather than commercial bank monopoly we have now). When money is created for the public good rather than private profit, all kinds of social issues can be addressed.

Firstly, community groups will not need to compete for a smaller and smaller pool of funding. Your organisations will be able to co-ordinate services and afford the technology and resources you need to get the job done.

Secondly, DSC would establish a Basic Income paid to every resident of New Zealand, regardless of age. This income might arrive in a number of forms – a guaranteed dollar amount adequate to live in dignity and health; another amount as a variable dividend paid to residents as ‘shareholders’ of NZ; fully funded health care and education; and the public ownership and control of essential utilities such as power, water and telecommunications.

We see health care and education as investments in the future, provided as a ‘social wage’. Charges for utilities will drop when these services are not required to line the pockets of private shareholders.

Most importantly, we feel a fundamental shift in the way we regard income is overdue. As there is less work, and yet people still need to live and raise their children, the time has come to unhook income from work. Many people do essential work unpaid – your own volunteers are a good example. Parents caring for children, people who care for elderly or disabled relatives, students, service club members, church groups – all these do important work unpaid. Yet they need some kind of income to enable them to do this work.

One section of our population enjoys a basic income: people over 65. Our Super is a good example of how a basic income enables people to contribute to their communities. But people under 65 who must depend on a ‘handout’ are the target of envy, criticism and government cuts and policy changes. A basic income, going to all, would remove envy, would be much cheaper to distribute (no shop-front overheads, caseworkers or fraud investigations) and would not abate if a person took a job. Local businesses would get a boost as people with more money to spend would be spending it.

Thirdly, grants or no-interest lending from the Reserve Bank will have a wide range of benefits, including clearing of commercial debt and lower rates for local bodies, the purchase of capital items for community groups, more investment in blue-sky research of all kinds, wider home ownership, the repair and protection of our environment and much more.

NZ has had some of these advantages in the past. Michael Joseph Savage used Reserve Bank funding to build houses, roads, schools and hospitals. He provided more jobs, pulled the country out of the Great Depression and created assets that underpinned NZ’s prosperity for decades to come.

So it can be done, and if we want to escape more and more frequent recessions, increasing poverty and the corporate ownership of NZ, we need to change the financial system.

Vote Democrats for Social Credit this election and make history.


Katherine Ransom

Social Issues

Vice President