The welfare system is a more sustainable safety net. Successive annual reports show substantial decreases in long-term costs associated with future welfare benefits due to policy and operational changes.
One benefit of these reductions is that it gave fiscal headroom to increase benefits to those who needed it. In 2017 the government substantially boosted benefits to families through the Child Material Hardship Package, the first increase beyond CPI in many years. Subsequently there have been further packages to increase benefits, particularly for families. This has led to a reduction in the child poverty rate in New Zealand.
This modelling was seen as a success, and helped justify some of the interventions taken. The government invested in youth coaching to support young people into education and employment. They changed work requirements for sole parents. Policy decisions on part-time work for parents brought New Zealand into line with other developed nations.
Actuaries continue to add new components to the model, projecting different potential futures. They’ve added justice outcomes and tertiary education outcomes and can project how people move through those systems alongside the welfare system. There’s an increased emphasis on mental health as a predictor for some outcomes, and how people move through the mental health system and access different services. There’s also been work around tracking income trajectories to ensure that jobseekers who exit benefits find and retain good jobs.
“It’s exciting to work in a team of actuaries affecting real change on a large scale over the long term.” Hugh Miller, Taylor Fry.
Analysing and modelling data with a human-centred approach and a goal to improve the lives of people over generations is just one example of how actuaries are using data for good.