A chapter of Globalisation and Welfare State
Keywords: Distributional Economics; Labour Studies; Social Policy;
The issue of gender excites a passion which makes dispassionate observation and analysis nigh on impossible. We all have views about how gender relations should be organized, so that any changes are welcomed or a challenged according to those views. The debate is so dominated by judgements of proper relations, it has no understanding of what is happening.
There seems to be two broad reasons for this – perhaps uncharacteristically for New Zealanders – intensity. First, each of us has a conception of proper gender roles, usually based upon a history, of our own life, of our families, and from friends and colleagues. Variations from that pattern may seem a threat to the individual’s identity, or at least raise further challenges or painful episodes in one’s life: the man whose wife went out to remunerated work, developed a confidence, and left him, may have very different views of working wives to the man whose wife’s earnings enable him to stay at home to pursue his (almost unremunerated) creative activities; the older woman who had little opportunity for remunerated work in her life time, may feel her life experience is challenged by her daughter putting the grandchild into a creche and taking on a paid job.
(Even the language is a minefield. In the original draft of the paragraph I wrote `work’ without the adjective of `remunerated’. Most people will react, on way or another, to this modification. As discussed below much social activity is work – housework, childcare, voluntary work – even though it is not remunerated, while there is the ambiguous status of `relative assisting’ which was probably more common than the statistics record.)
A second reason for the passion is that on some matters gender issues interact with sexual behaviour. Bill Pearson commented that `few of us have the guts to uphold any moral principle (except in sexual conduct) when it is flouted by a party of greater number than ourselves.’ (1) So New Zealanders’ sexual morals have a separate status from other public and private ones. In some areas, most notably in regard to solo motherhood, the sexual dimension of the situation (or the perceived sexual dimension) dominates – sometimes explicitly, but more often implicitly – other issues in many people’s judgements.
Thus our own gender experiences and moral codes provide inform our account of the nation’s gender experiences and gender policies. It would be too much to expect the reader of this chapter to abandon all her or his social values, although one might ask that he or she tries to articulate them as explicitly as possible, and to be consciously aware of them during the reading of the chapter. It would also be unrealistic for the writer to pretend he had none, and that this was totally objective account of some pure reality. Rather let me state what are the two key values which inform this chapter, some of whose implications will be made more explicit as it progresses.
First, I do not have any explicit or preferred social role for each gender. It is for each person to make their own way over work, domestic and other social arrangements, Their view of their gender will be one of the factors which determine that path. But in social policy terms as far as possible gender issues should be treated as neutral, where there is no consensus (which is very often).
Second, as a general principle I am opposed to one person exploiting another. I do not need to go into the issue here, other than in regard to children. Children have less control over their social environment and destiny than any other major social group. That places a major onus on the community to ensure that there is a decent environment for them. This to my mind is a question of right, although I also acknowledge the good sense of doing so because when children are adults they determine society’s future. It happens that women have been the main guardians of the nation’s children. Thus policy towards children (traditionally known as `family policy’) has a gender dimension. Were there to be a more equal sharing of this responsibility, and if we could ignore that only one gender gets pregnant, family policy would remain a major component of any welfare state. If social policy should be gender neutral, it cannot be parent (or child carer) neutral. As long as the greater role of child care is by mothers, there is an interaction between family policy and gender policy.
The Traditional Welfare State and Marriage
The traditional New Zealand welfare state was not based upon my first principle of gender neutrality (and as a result had a complicated relationship with the second of commitment to children). In the social security stockyard, the selection gate regularly discriminated between men and women. In particular, an early gate in the stock race said a woman who was married, was sent down the race labelled `to be supported by husband’ rather than the state.
The outcome has not been a persistent biased against one gender or the other. some times men are better off, sometimes women. For instance a married women was not generally entitled to a social security benefit for unemployment, sickness, or invalidity, but one who is not-employed received income support if her husband became unemployed, sick, or invalided. (Many women objected to the underlying assumptions about the status of a married woman, which could be said to retain overtones of the chattel element that preceded the 1882 Married Women’s Property Act. On the other hand many men and women seemed to think this an eminently satisfactory arrangement.) It could be argued that the law was about marital status rather than gender, for if the woman was the earner and the man stayed at home, then he would be treated like the married woman described above. In practice this occurred rarely, and in any case practice also assumed the man was the earner. For instance when two sickness beneficiaries began living together in the 1970s, the woman’s benefit was withdrawn and the man given one at the married rate.
Whatever the rights or wrongs of the arrangement, the gate could only select efficiently if marital state was readily identifiable. Since marriage involves legal registration, the distinction was clear enough. However, at the very least, this raised opportunities for behavioral response. Initially anyway, there seems few instances of individuals who manipulated their marital status to enhance their benefit entitlements, but there were a series of anomalies, which kept irritating the system.
For instance, suppose a man and woman separated, but did not divorce, with the woman living on her own earning an income, while the man formed a relationship with another woman. This may be a perfectly satisfactory arrangement, until one of them needed a social security benefit (say because of sickness). If it was the woman, she would not be entitled to one, because her legal husband was responsible for her support. A similar confusion applied for the man, with the additional complication that would he get the married rate for a defacto wife who was not working?
The social security system struggled with such anomalies, partly by neglect, and partly by using existing provisions creatively or extending them in an ad hoc way. The Old Age Pension had a morals criteria for entitlement when it had been established in 1898, a carry over from the Charitable Aid Act and the English poor law. (There were also criteria which excluded drunks and asiatics, while later legislation often discriminated against illegitimate children.) A morals criteria could be used to discriminate a couple who were not legally married but living together, so that neither was entitled to a singles benefit.
An example of the development of an ad hoc response to solo mothers is described below, but the law began to shift towards a systematic principle that it was the de facto status which mattered, not the de jure one. Thus a married couple living entirely separately could be treated as two single people for benefit purposes, while a couple who were legally single entities but were in fact living in a married relationship were treated as if they were married.
This created a problem for the gatekeepers, since de facto marital status is much more ambiguous to assess than de jure status. Almost all readers have friends who at least at some time in their lives were in a situation where no one – even those involved – were sure whether the couple was de facto married (and with hindsight did it matter?). Initially, and not surprisingly, given Pearson’s insight, the gatekeepers seemed to use a test of whether the couple were sleeping together, but that proved difficult to operate. (What if they were also sleeping with other people? This is not a rhetorical question. A couple of reported cases seemed to be distinguished on this basis, with the woman who said she was essentially monogamous losing the benefit, while in the other case it was retained (2)).
But once such a reasonably concrete, if difficult to observe, test was abandoned, the application of the de facto test became hard to apply. In any ways de facto marriage is a subjective and very (intra) personal. The objective measures which bureaucrats need are not especially relevant. In one particular case seemed to depend upon the woman involved not thinking she was in a marriage-like relationship, but the effect of the officials telling her she was married on their `objective’ criteria was to break up the relationship (whether married or not) between the couple involved. The objective tests no longer applied.
Indeed any explicit test for testing practical marital status no longer applies, insofar as there can be a behavioral response to circumvent it. For instance, consider a support test made up of two components of the form that if X supports Y, Y is not eligible for a benefit in her (or his) own right. Then all X and Y would have to do is arrange their affairs so that X never appeared to be supporting Y in terms of the published criteria. Practically this could mean that X was earning, and living with Y, but Y remained on a benefit. This pushed the officials into using implicit tests, but that gives considerable discretion to the gatekeepers, potentially shifting the notion of entitlement to the dire need of the residual welfare state.
A second approach would be to completely ignore marital status, treating such transfers that occur between people as a private matter. After all we do not offer higher benefits for individuals who support pets. Let us leave aside the question of children and their caring, which further complicates the story, and also the complications of part-time employment (next section).
Even so there remains the issue that the gatekeepers would then have to decide whether a woman should be working full time or not. Those in the latter category would be entitled to a benefit. Thus, assuming there was full employment, all women caring for children (or invalids) or retired, sick or invalided would be entitled to a benefit, including married women. All others would have to seek work or rely on their husband’s support. A further consequence would be that the benefit to the man would be paid at a rate irrespective whether he were married or single. Perhaps the traditional welfare state could have afforded this, when their was little unemployment.
But once significant unemployment appeared, equity would require that a married woman be entitled to the unemployment benefit, and the cost of social security would have markedly increased, as would opportunities for behavioral response. Many couples might be happy for one to work, and the other to stay home while receiving a full unemployment benefit. (In addition note that in the past – and perhaps today – many women without children might well object to a social policy with an underlying premise that they would be in paid work.)
A third approach would be to make entitlement dependent upon contribution. Thus married or not a woman’s unemployment, sickness, or invalid benefit entitlement and level would depend upon her labour market record as reflected by the contribution she had made to some fund. (The principle would have to apply for men and single women also.) Such an option is complicated by the changing nature of work histories.
Work and the Traditional Welfare State
More often than not we think of the labour market as consisting of individuals (they are very man-like) who enter it after their formal education, and remain there working full time or actively seeking full time work if unemployed, until retirement at some predetermined age. Economists regularly use this simple model of labour market behaviour. Although there are more complex ones, the simple model unconsciously pervades the implicit account used in the public debate on employment and unemployment. Yet virtually every aspect of the account is increasingly wrong and misleading.
Even if we confine the analysis to men, most enter the labour market to some extent while they are still in secondary education. Even full time tertiary students are likely to be in paid remuneration for part of the year. For many the transition from formal education to full time employment is not abrupt. (3) Not all actively seek work during their working life. For instance the labour force participation rate for men in the 35 to 45 age group was 98.2 percent in 1956 (near enough to every available man employed), but down to 90.9 percent in 1991. (4) Other male age groups had even lower participation rates in the 1990s. Participation includes the unemployed, but any person in paid work for more than 1 hour a week is classified as employed. In 1991 7.6 percent of employed males reported they were working lees than 30 hours in census week, and 4.7 percent reported less than 20 hours a week. (5) Only 8.0 percent of males in the 15 to 65 age group said they were not actively engage (including students), unemployed, or working less than 20 hours in the 1956 census week. The other 92.0 percent might be said to be working full time. By 1991, the proportion of not actively engaged full time on this definition had risen to 31.4 percent. (6) Even this underestimates the true situation, because it pertains to only one week, and in other weeks of the year some of the census week fulltime will be working part-time, unemployed, or not actively engaged, so full time full year are an even lower proportion.
The tumble of figures in the previous paragraph can be briefly summarized that while in the 1950s the vast majority of men in the 15 to 65 age group were employed full time all year, by the early 1990s at best there was but a slender a majority. The traditional assumption of the full time full year working male no longer applies.
The change in labour force behaviour for women has been largely in the opposite direction. In 1956 only 29.1 percent of women in the 15 to 65 age group were actively engaged for at least 20 hours in the census week. By 1991 the proportion was 61.6 percent, only a little lower than, and not too dissimilar from, that for men. Of the others, some 10.1 percent of the age group worked less than 20 hours, and 7.0 percent said they were unemployed and actively seeking work. (7)
For our purposes here, the rise of women in paid employment nonetheless dilutes the model of a labour force manned by full time full year full life workers. In the 1991 census week only 73.6 percent of the labour force said they worked more than 30 hours. Since some did not work most weeks in the preceding year (for whatever reason), and that most would not work, every year between 15 and 65, the standard assumption hardly applies.
A complicating factor is that as a result of rising unemployment, individuals may desire a full time full year job, but have to settle for part-time and/or part-year one. There is a wealth of information from the Household Labour Force Survey which demonstrates that some people choose to work full year full time (but also that some part-time workers would like to work more hours). (8) A nice illustration from the census is that 23.6 percent of its unemployed, reported they were actively seeking part-time work. Women out numbered men in this group by over 2 to 1. Thus while part-time, part-year for some workers is a matter of fait de mieux, for others it is a conscious choice. And while women predominate in the latter category, there are men.
In the categorical welfare state, eligibility depends upon health and age status, rather than the working record. However the level of entitlement might, since the sick or invalided might be obtain a higher benefit than their earnings if they had been working part-time or part-year. In the case of the unemployment benefit the entitlement criteria is much more complicated. How much work does one have had to be doing in the previous week, or year or whatever, to be entitled to the benefit? Working part-time or part-year may be their choice. Are they entitled to a full unemployment benefit? The ambiguity of labour force participation arising out of the non-standard assumption workers undermines assumptions on which the administrative rules of the welfare state.
To avoid such conundrums, the welfare state has to develop increasingly complicated categories of entitlement which become administratively onerous and yet subject to behavioral response. The pressure is to shift entitlement to based upon judgements of dire need together with some notion of deservingness, or to move to a system of entitlements based on past contribution. This is the principle in the Accident Compensation Scheme. However it has not been extended to sickness and invalidity benefits.
Where there is significant unemployment complicates a contributory system. Those who are part-time, part-year workers because of a lack of opportunities are also penalized by having a lower contribution than they would want. Ideally they need to be treated differently from those who chose part-time, part-year work. But how is the gatekeeper to make this distinction, keeping administrative cost down, and avoiding behavioral response?
While women are more likely to make voluntarily the choice to be part-time, part-year workers than men, the phenomena described in this section apply to some men.
Solo Mothers (and Fathers) (9)
The issue of rising ambiguity is nicely illustrated by the changing entitlement of solo women to welfare benefits. Note that historically a woman who had no dependent responsibilities was often not expected to seek employment, today the assumption is that the support is primarily for solo women who are caring for children or other dependents. The evolution of social security entitlements of solo mothers following the demise of the 1882 Charitable Aid Act are summarized as:
* 1911 Widow’s pension
* 1912 Wives of mental patients given similar entitlements to those of widows
* 1915 Miners’ widows pensions
* 1936 Deserted Wives’ pension
* 1938 Orphan’s benefit. Inclusion of previous developments in Social Security Act
* 1943 Deserted wives eligible, although husband’s whereabouts unknown
* 1954 Deserted wives benefit provided after divorce
* 1968 Domestic Purposes (Emergency) Benefit for virtually all solo mothers. Family maintenance allowance for children of beneficiaries
* 1972-3 Statutory Domestic Purposes Benefit proposed by Royal Commission on Social Security and enacted the following year. Fathers entitled to the DPB.
From one perspective the list reflects a progression of wider entitlement to social security support for solo mothers. However there is a significant break in the progression in 1968, which was initially obscured by emergency benefits being discretionary. The statutory benefit from 1973 exposed the 1968 development.
Until then something had to have happened to a woman for her to become entitled to a benefit, something over which she had little influence: her husband’s death, his desertion, and so on. From 1968, but at the discretion of the government, and from 1973 as a statutory entitlement the woman could do something which entitled to a benefit. For instance an unmarried woman could choose to have a baby, or a married woman choose to leave her husband. In either case they were now entitled to Domestic Purposes Benefit (DPB). Thus there were now opportunities for a behavioral response.
Readers, and indeed this writer, are likely to immediately react to instances of such behavioral response on the basis of some ethical concerns. Yes there are young unmarried women who decide that their life would be better on a DPB with a baby than being unemployed or in some low grade job, But there are also young women who are raped, choose not to have an abortion, and to keep their child. Yes, there are women who walk out on their husbands to a DPB (although social workers tell me those that plan it are more likely to seek paid employment first). But the husband may be drunk and violent. There are women who remain on a DPB rather than seeking work, But there are women who would love to get off the DPB but cannot find work. The point is that there is a diversity of reasons for a woman (or man) shifting onto, or staying on, the DPB. That reality includes cases where it is hard not to have some ethical concerns, but equally cases in which one would be very supportive of the woman obtaining an entitlement.
Even so the rise of the usage of the DPB is spectacular. In March 1976 there were 18,698 DPB and widows benefits in force for those caring for children (10): in June 1991 there were 97,291 such benefits. The public concern is somewhat greater than the actual systematic knowledge we have on the reasons for the rise. There were at least 150,000 single parent families in March 1991 (according to the Population Census). The comparable statistic is not available for March 1976. The closest I can get is there were at least 62,000 solo parent families. (11) This suggests the ratio of solo parent benefits to solo parent families was 30 percent in 1976 and 65 percent in 1991. Thus the proportion of potential solo parent beneficiaries who held a benefit more than doubled. This increase must in part be due to the increase in unemployment, which makes it more difficult for a solo parent to take on paid work. (We might ask to what extent it is better they should stay home, rather than taking a job which can be filled by another unemployed who has no children). At the moment we can say no more about the causes of the rise of solo parent beneficiaries, which leaves – one may regret – the opportunity for each person to interpret it using such theories, prejudices, and anecdotes which come to hand.
It could be argued that today there is no need for a special benefit for solo women without children, since any benefit entitlement should be covered by one of the other benefits. (The widow’s benefit is steadily disappearing or being amalgamated with the DPB. There is still a woman alone provision in the DPB but it is rarely used.) In practice the DPB is a benefit for the children of single parents paid to the parent. Thus the issue becomes one of benefits for children, or Family Policy, generally.
Family Policy and Women
For a society which celebrates choice and opportunity, the individual has no choice over the most important event in their life – whether they are born – and not much more over who brings them up. Once here children have, broadly, all the rights of an adult. However they need a guardian or guardians, typically their natural parents, and they need financial support and other public services. The two needs are conceptually distinct, but in practice the majority of children receive their economic support from their parents. Some people go a step further and argue that any state support (such as the DPB and the Family Support Benefit) should be withdrawn from guardians/parents who do not perform up to standard. There is a curiosity here since one might have thought that inadequate parents should be replaced (or given better support) rather than made even more inadequate.
One of the problems that social policy faces is how to distinguish between a woman (or man) who is primarily caring for children and one who is not, even leaving aside where the two parents are making a more joint effort than was common in the past. The issue is avoided in a world where children and their mothers are supported by the fathers, but while that may have been a reasonable approximation to reality in the early post-war welfare state (when significant exceptions were rare or were ignored) solo parenthood challenges the assumption, as do mothers from two parent families going out to work.
There were numerous reasons they went out to work. There was the financial incentive, given that many families were poor and could not survive on a single working parent’s earnings. Other factors included that as the children grew up the mother was less occupied with their care, that paid (or voluntary) work provided social opportunities, and that the women wanted to maintain or extend her work skills.
Once upon a time there was public considerable antagonism to mothers, even to all married women, working outside the home. Probably there is still some in private, although it is less explicit publicly. Social policy now has to face that not only is paid work by mothers acceptable, but that it has increased dramatically. Moreover, as we have seen, it is common for such women to work part-time, part-year, and – of course – part life.
For the categorical welfare state once more ambiguity arises over membership category. While it may not be so explicit as to ask when should (or can) a mother with children take up paid employment (perhaps part-time), even experts would disagree on the appropriate answer. Practically they might give one which involved so many of the particularities of the situation (including age and number of children, time of work, season relative to schooling, the women’s own skills, child care arrangements, the cover provided by the father or some other person, and the flexibility of the mother’s employment), that it would be administratively impracticable to apply the criteria. In practice we leave it to the parents to make a decision based upon their judgement, but that immediately leaves the administration’s gatekeeping exposed to behavioral response.
Some women hire child care for their (often) preschool children while they work. They may not necessarily do this for profit – the return to the carer made exceed that to the mother after she has paid for the care. And there are numerous different modes caring. Again there will be behavioral response to any social policy or administrative arrangements.
An oddity is the treatment of child care expenses for income tax purposes. A farmer is allowed to deduct from his gross receipts for income taxation purposes the cost of the shepherd he hires to enable him to do other work and earn income. But a mother has no such option. In tax law child care is treated as a consumption item, rather than a cost of production even when the care is a necessary consequence of the woman working.
There seems to have been three forces that have resulted in this double taxation of child care expenses. First is the conservatives who disapprove of working mothers (plus those without children who benefit from the additional taxation receipts, by their taxes being lower.) Second there is fiscal conservatism, which is loathe to allow any deductions because that reduces the tax base. However the fiscal cost of allowing child care expenses to be deducted for income tax purposes may not be that great, because it may in part be offset by the additional revenue paid by the carers. But such issues have hardly been debated. What is curious, to repeat an earlier point, is that the fiscal conservatives do not argue for the equivalent withdrawal of the costs of animal carers. Why the selectivity?
For, and this is the third point, while farmers are politically united in favour of their deduction, women carers are deeply divided. This is not just there are women who are social conservatives, and one way and another oppose what they see as any state assistance to working women. Radicals also opposed the deduction because they had a different policy solution – state provided and funded (or subsidized) child care. (Such provision and funding was standard in the traditional welfare state.) Unfortunately, then, the coalition of social conservatives, fiscal conservatives and radical feminists blocked effective policy initiatives, at the expense of women caring for children.
It is almost premature to offer a specific resolution, since it needs to be integrated with all family policy. But it is useful to put something down, to clarify issues (and break up the coalition for stasis). So here is a proposal.
* One carer of each child would be entitled to an income tax deduction for child care costs; (12)
* The maximum allowed will depend upon the age of the child, with preschool children entitled to a greater deduction.
* The deduction will apply for where there is a normal commercial transaction for child care (so that the carer would pay income tax, and there would be an ACC levy);
* However, one parent may hire a second parent to care for the children;
* A regulatory authority will ensure that carers meet certain minimum standards.
The effect of the proposal is that a working mother would be able to deduct all or part of the costs of child care from her income, thus reducing her tax liability. Her choice of carer would not be constrained, and could include a commercial creche, a kindergarten, play centre or Kohanga Reo (a Maori pre school centre – `language nest’), a voluntary agency, her employer creche or the tertiary one if she were a student, or the neighbour next door whomever (including the other parent).
Note that the proposal is structured so that a father might hire his wife at home to care for his children. The advantage to the couple is it would reduce their tax liability, since he would reducing his income at a tax rate of 33 percent, but she would be paying 15 percent, a net saving of 18 cents in each dollar paid. The advantage to the mother is that she would have a recognized payment for her child care work.
Market and Non-market Economic Activities
The last paragraph touches upon the point that families which have adequate income may nevertheless have a maldistribution of income within the family, so that (sometimes) the woman and children are in poverty while the income earner is not. This arises because some economic activity generate money income, some does not.
There is a growing literature which criticizes the emphasis on market income in social policy, especially as captured in the measure of aggregate economic activity Gross Domestic Product (GDP) which with a few exceptions values only market activities. (13) When economists first constructed National Accounts they were aware that they were only covering a part of total economic activities, and this would for some purposes generate anomalies. However the initial purpose of the measures were for macroeconomic analysis – (market) employment, aggregate demand management, the balance of payments, inflation, and monetary policy. For such purposes the National Accounts are still robust. They are less useful for analysis of long term social change, relative standards of living and welfare, and some key issues in economic and social distribution. Over time they were used for these purposes. mainly because there was nothing else. The original purpose and reasons for their construction became forgotten, and they became an easy target for criticism.
What however is significant is that the critics are silent on how they are to be elaborated or replaced. Certainly economists have tried to extend the notions, but usually they have hit substantial if nor insuperable problems. There have been failed attempts, usually unrecognized (or unmentioned) by the critics, long before the critics became enthusiastic. In the 1970s I tried to extend the GDP framework to include child care. (14) But I, and others, have failed to provide a robust theory to extend the measurement of GDP to cover major non-market economic activity. I suspect it is because the GDP and related measures have a deep theoretical structure based upon a market model of behaviour (a model which the critics rarely allude to), and the model simply does not extend to non-market behaviour, except on the margins. I have written the last few paragraphs to indicate the significance of non-market activity is important, but thus far the conceptual problems have proved overwhelming. The critics on the sidelines, not only ignore economists’ efforts to overcome them, but offer nothing constructive.
This study is not going to solve the problem, nor elaborate it in full. However I want to develop a little of how the issue impacts on the welfare state. An American study estimated that adult men and women each did about 3000 hours of economic activity a year. This probably reflects most `advanced’ cultures where women are relatively liberated, although in others we would not be surprised if women worked considerably longer than men. The big difference between the two is that about two thirds of the average male effort was in paid work, but only one-third of the female effort. (There are, of course, substantial differences within the genders – with greater variation among women).
Rather than use the term `paid’ and `unpaid’, I want to use a technical term `fungible’ (which will reappear in the section on the international monetary system). Market activity is more fungible than non-market economic activity, because it gets turned into cash, the most fungible of assets. It is this greater fungibility of their economic activity which gives men power relative to women. How is a civil society to deal with the power imbalance, (although some would argue that this is not a concern for civil society). This is a somewhat wider than the remit for this study, but we need to be aware that as the fungibility of some activity is changed (e.g. as occurs with entitlement to the DPB for child care) there will be changes in the balance of gender power, welcomed by some and rejected by others.
How is the welfare state to deal with these differences? In regard to retirement benefits the flat rate age entitled categorical benefit means that the unpaid economic activity is treated as much the same as paid activity. In some areas losses for unpaid work are covered, insofar as accident, sickness and invalidity benefits, or some supplementary support from the health or welfare, will cover loss of unpaid services as a result of mishap. The coverage is not perfect, especially if the person was not in the labour force before the mishap, but the principle is there.
One way or another public policy tends to ignore those unpaid services which occur between consenting adults and any income transfers that flow the other way. Thus a woman may prepare dinner for a man, who shares his money earnings with her. We see this as a voluntary arrangement and, for instance, do not tax it. (However, recall on some occasions the welfare system may compensate for the loss of the service, or provide an alternative with zero or low charge – as in meals on wheels.) But for other activities which have some of these characteristics – child care and maintenance for instance – cannot be so easily left to private arrangements.
At this point we note that the total amount of goods and services, with which the paid work is fungible is broadly fixed. (15) Thus any action by the welfare state which increases the fungibility of previously unpaid work reduces the fungibility of paid work in the sense of access to the market goods and service which money can purchase. In doing do it changes the power balance, usually between the genders.
Next Chapter Ch 7: Assessing a Poverty Line.
1. Pearson (1972:9).
2. B.H. Easton, Pragmatism and Progress (1981).
3. And certainly does not happen at the age of 15, which is the assumption implicit in the measurement of labour force participation rates.
4. B.H. Easton, In Stormy Seas (1997), Table 6.2.
5. The question on working hours in the 1956 census was “inserted purely to assist Departmental staff to code the other information, and so was not tabulated. The information … was used for classifying occupational status, all those returning under 20 hours a week being classified with the non-actively engaged population.’ (Department of Statistics Population Census 1956, Industries and Occupations, Vol IV, 1956. This means that the labour force participation rates for 1956 would have been even higher if a 1991 definition was used.
6. To calculate this figure I had to assume that there were no actively engaged older than 65, so the true figure is likely to be a little higher.
7. This is not the unemployment rate, which was 10.8 percent of the labour force.
8. According to the March quarter 1991 survey, there were 93,600 men and 212,600 women working between 1 and 19 hours per week. Some 25,400 of these (24.8 percent said they would prefer to work more hours, but only 19,800 (6.5 percent said they were looking for full time work). Thus at least 75 percent of part-time workers and possibly as much as 93.5 percent were satisfied with part-time work (even though some may have wanted more). While there were more than twice as many women as men in part-time work, about the same numbers were looking for full time work, consistent with the picture of women more likely having a preference for part-time work.
9. The term `solo’ is used rather than `single’, because the latter can also indicate marital status.
10. i.e. excluding those for women alone or caring for the sick and infirm.
11. The difficulties arise because in both censuses there are no details for the structure of some multi-family households – for two and more family households in 1976, for three and more families in 1991.
12. Of course it could be split between two carers.
13. The exceptions include imputed rent for owner occupied homes and an imputation for bank service charges.
14. Easton, The Value of Children (1976).
15. Ignoring behavioral responses, which usually do not markedly change the situation.