A welfare reform for New Zealand: mandatory savings not taxation

Many nations are seeking to reform their welfare states so that costs to the government can be reduced and the quality of outcomes improved. In this paper we show how mandatory savings accounts can be established in order to turn a publicly funded welfare system into one that relies more heavily on...

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Bibliographic Details
Published inNew Zealand economic papers Vol. 54; no. 3; pp. 239 - 273
Main Authors Douglas, Roger, MacCulloch, Robert
Format Journal Article
LanguageEnglish
Published Auckland Routledge 01.09.2020
Taylor & Francis Ltd
Subjects
health-care
mandatory savings
Medical care
Medical savings accounts
Public welfare
Retirement income
Taxation
Welfare
Welfare reform
New Zealand
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Summary:Many nations are seeking to reform their welfare states so that costs to the government can be reduced and the quality of outcomes improved. In this paper we show how mandatory savings accounts can be established in order to turn a publicly funded welfare system into one that relies more heavily on individuals funding welfare payments out of their own accounts. To our knowledge, showing how a tax and welfare reform can be jointly designed to enable this transition to occur in a way that minimizes any effect on the current disposable incomes of workers has not been done before. The paper takes a new unified approach to the funding of health, retirement and risk-cover, using New Zealand as a case study. Our proposed reform relieves the fiscal pressures which an ageing population is forecast to place on the government budget in the coming decades.
Bibliography:Includes appendices, graphs, notes, references, tables
ISSN:0077-9954
1943-4863
DOI:10.1080/00779954.2019.1659846