Social Security Amendment Bill

JUDITH COLLINS (National—Clevedon) Link to this

The Social Security Amendment Bill we are debating today, and that we have been debating for the last few weeks, is a bill that could possibly be more properly called the “Single Core Benefit (Phase One) Bill”. I say that, because this is a bill that brings in an amendment that the single core benefit was supposed to bring about—effectively, a work requirement for some people, whether they were sick or simply under-employed, whether or not they wished to work, and whether or not they could work. Given that this Labour Government has been talking in various stages since 1989 about the single core benefit, I think that we could just hold off putting this bill through and instead wait for phase two, which we have been promised since 1989.

A huge amount of money has been spent on resourcing and doing the policy work behind this bill. A huge amount of work has been put together. In fact, it is so huge that the current Minister and the previous Minister have been incapable of listing the number of reports on the single core benefit or its progress because, apparently, to do so would require a great deal of manual collation. Apparently it would require so much manual collation that those reports cannot be counted.

We support some parts of this bill. We support the idea that those who can work should work, if they are to be recipients of benefits under the social welfare system. However, we do think that some things could change. We are a little bit worried that some people who are genuinely incapable of working, and who are genuinely unable to participate in the workforce, will feel they need to try to work even if they simply cannot. That is something that people have certainly spoken to us about at the Social Services Committee. We have received submissions from various groups, including IHC New Zealand, that felt that if people did not work, then under this bill, if it goes through, they would be noted as simply not contributing. People can contribute to the community in lots of ways; paid work is certainly one of them and raising children well is certainly another. In fact, in my opinion the most important contribution people can make to the community is to raise their children well. But they can also contribute by helping out others, by helping those who are less well-off, and by working with children in a voluntary way. All of those things are commendable activities that can be supported as contributing to the greater community and the greater good. We think the concept of “work first” is good, but we also think it needs to be looked at from the point of view of what people can actually do. We do not want this to be a country where those who simply cannot work in the paid workforce feel they are not valued, and feel they are not able to contribute in some other way.

We are also very concerned to see that the “activity in the community” programme, which we think could have been developed properly but which has not been, under this Government—it has in fact been ignored and under-resourced—will not be taken seriously under this bill, and we think that that is a real shame.

We would like to see phase two put in, though, so that we can see this bill in its entirety. Phase two, which is what we now call the single core benefit, is about amalgamating seven main working-age benefits into one and calling it a single core benefit with multiple add-ons. How will that work with this bill? We think it is somewhat premature to have one without the other. Given that we have been waiting since 1989 for the single core benefit, and that this Government has been in power for almost 8 years, one would think that we could have had some idea about when the single core benefit will happen. Instead, we hear constantly from the Minister that apparently Cabinet will look at it either later this year or next year. It is always in election year that something is going to be looked at. Just like the housing policy and everything else, it is always going to be announced, going to be launched, and going to be the newest thing. Particularly when Mr Steve Maharey is in the ministerial role, it is going to be the most fantastic and outlandishly exciting scheme that has ever been seen. But what happens? As soon as the election is over Labour members forget all about it and say they are going to look at another phase.

So we will now have this new part of our vocabulary in Parliament—phase two. Phase two means the bit of the bill, the bit of the policy, that is promised but that, frankly, cannot be done because, first, the Government does not have the votes to do it. We know that there is no appetite in this Parliament anywhere, except on the front-bench of the Labour Party, to amalgamate seven main working-age benefits into one benefit and call it a single core benefit. We know that nobody in the Greens wants that. We certainly know that the National Party does not want that. We know that the Māori Party does not want that. We know that actually nobody wants it, except the Minister.

ANNE TOLLEY (National—East Coast) Link to this

I stand to speak on the title and commencement of the Social Security Amendment Bill, following my colleague Judith Collins’ excellent discussion of the never-ending planning and discussion phase of the single core benefit. Perhaps we should have called this bill something like the “Social Security (Pre - Single Core Benefit) Amendment Bill”, or the “Social Security (Phase One and a Half) Amendment Bill” because we have had phase one and we are looking forward to phase two. We are not quite sure where it is at. We seem to be dealing with amendments to the social security legislation in a piecemeal fashion, prolonged by this Labour Government’s interminable fiddling with the unemployment benefit.

We are told that this bill will focus on changes for youth, and that the goal is to have all 15 to 19-year-olds either in employment, in training, or in an educational institution of some sort.

Hon DAVID BENSON-POPE (Minister for Social Development and Employment) Link to this

I rise to respond immediately to the previous speaker. I would be very surprised if those people were not sanctioned. How that member would ever know what action Work and Income—by the way, it is Work and Income; there is no such thing as that other acronym she was using, and there has not been for some years—has taken is beyond me. But I can assure her that if she were to give me the details of the employer and the names of those concerned, I would check that that was the case, because there is no need to introduce sanctions in this bill around work testing. That exists right now, and that does not change.

What this bill does do, though, is to mandate the success that is already happening out there in our communities. It is the sort of success that has led to the extraordinary numbers that I have canvassed for the House previously, such as the stunning reduction we have seen in unemployment benefits received in this country since National left the Treasury benches. Just to remind those people who did not hear the figures on unemployment at question time, I say that in 1999 the number of unemployed in this country was 161,000 and a bit. As of May this year, that number is just over 24,000. That is an extraordinary change. The most pleasing change, of course, as part of that—as members of the House know—is the huge reduction in youth unemployment, from 17,500 in 1999 when the National Party was last in Government to around 1,200 now receiving benefits. It is always good to have the opportunity to compliment the professionalism and work of our front-line people in Work and Income—that is Work and Income, not “WINZ”, I say to Mrs Tolley—and I do that again. If we couple that success with the policy initiatives of this Government, such as Working for Families, we do get a very powerful force for good in this country.

I want to quickly share with the Committee two of those success stories. Both of these young people are happy for me to use their names, but I will stay with using only their Christian names. Brodie, from Gore, is 19, and he began to receive a sickness benefit in January 2007. Brodie was keen to find employment, and he worked closely with his case manager to determine his skills and his appropriate job opportunities. The case manager liaised with a local ground-spraying business and secured an interview for Brodie. Work was begun with that firm at the end of March, and Brodie is still successfully employed there. Brodie finds the job very rewarding and the new opportunities available are welcomed. He no longer receives benefit support, which he had been receiving previously.

Then there is Natelle, from Whakatāne. Natelle is a sole parent; she has a child. She had been receiving the domestic purposes benefit for 14 months. After her case manager explained the benefits of Working for Families to her, Natelle was quite motivated to find employment. With the assistance of her case manager, she did that. She found a part-time position working 20 hours a week at a childcare centre, and was able to cancel her benefit in March 2007. With Natelle’s part-time wage and Working for Families assistance, she now earns $117.52 more a week than she did when she was receiving the domestic purposes benefit. She is, understandably, pretty pleased to be working and enjoying the financial benefits that Working for Families, coupled with Working New Zealand—the new employment initiatives of Work and Income—are providing for her.

That is what this legislation is about. I have said that this legislation mandates what is already happening out there. Since 1 April this year the Working New Zealand regime—the new service approach—has been the way that people operate in all Work and Income front-line offices. People who come through the door, whether they are new and in need assistance, or whether they are on a regular rotational check from their case managers, are receiving a level of support that was previously available only to people in receipt of the unemployment benefit. It is a simple equation, actually, because one can understand how busy Work and Income staff were when they had to cope with 161,000 people who were looking for jobs that were not there under the political regime of our predecessors. Now, that human capacity, and the skills that have been further enhanced, of Work and Income staff are available to all beneficiaries, irrespective of the class of support they are receiving.

That is a very powerful shift. It is a shift that is showing incredible results. It is a shift that is about supporting people, not punishing them, and that support works for the good of the people in this country. I know most New Zealanders would welcome a continuation of the sort of success that we have already demonstrated.

KATRINA SHANKS (National) Link to this

I rise to speak to the Committee stage of the Social Security Amendment Bill. This bill amends the original Social Security Act 1964, which was the principal Act. In fact, the 1964 Act consolidated and amended the Social Security Act of 1938 and its amendments. In essence, the title “Social Security” has been consistently applied from 1938 until today, in 2007. However, we must consider whether the title is as relevant now as it was then, in 1938.

In short, the 1938 Act provided for the payment of superannuation benefits, and other benefits designed to safeguard the people of New Zealand from disabilities arising from age, sickness, widowhood, orphanhood, unemployment, and some other things. It goes on to say that it will provide a system whereby medical and hospital treatment will be made available to persons requiring such treatment, and provide such other benefits as may be necessary to maintain and promote the health and general welfare of the community. Thus the 1938 Act was considered “social security”. Let me fast track to 2007. The general policy statement in the explanatory note states: “It puts into effect the Working New Zealand: Work-Focused Support package of proposals to reform the social support system.” So we have now changed from “social security” to “social support”.

The objectives of the new bill are to “increase opportunities for people to participate in the labour market, where work is an appropriate outcome; and [to] continue to provide social and financial support for people with temporary or long-term barriers to work.” The fact is that there is significant change between the Act of 1938 and the bill of 2007, and their relevance to where we are today in our society. The original Act that provided social security was directed to those people of New Zealand who were disabled due to age, sickness, widowhood, or orphanhood. But now we use words such as “increased opportunities to enter the labour market where work is an appropriate outcome”. Somewhere along the way we have lost the focus of what social security is about. Social security is now about the acceptance of those who choose a lifestyle of not entering the workforce, in some instances. Has our society moved so far from that objective, in this bill, that it has to be to begin the movement towards a work-focused system for some people, who we know can go back to work but choose not to? I believe we have moved away from providing a safety net for those in need through sickness, age, and circumstances beyond their control. We should be questioning how an intergenerational choice not to work has become so acceptable to us.

I reviewed the assistance provided by our social security system, and there are 45 grants, allowances, and benefits available. In many cases, a person can apply for at least half a dozen of these allowances. Let me give an example. A person who has a family may be eligible for: childcare subsidy, out-of-school care and recreation subsidy, family assistance, recoverable assistance payment, child disability allowance, advance payment of benefit, home help, temporary additional support, care supplement, and the special-needs grant. That is a total of 10 grants, benefits, or allowances for which the family may be eligible. This bill is right in saying the objective has moved to social support. This bill takes away a person’s independence of the State and the ability to stand on his or her own two feet. The legislation no longer provides an invaluable safety net but introduces a level of interference in people’s lives. Instead of just getting on and living, they have to justify to a Government agency what they are doing, how they are doing it, and how often they are doing it. They are losing choices in their lives. They are justifying, to strangers, what they are doing in their homes.

This legislation has moved significantly since 1938, from social security to social support. Our expectations for people’s contributions to our society have been watered down. The State now plays a major role in many people’s lives. Independence and the desire to help themselves have been slowly eroded. With this erosion comes a state of dependence: a lowering of expectations and the standard of living, and, eventually a lack of self-esteem and confidence.

This bill legislates for things that most New Zealanders presumed Work and Income already did—that is, helping New Zealanders into work.

SUE BRADFORD (Green) Link to this

The title of this bill reflects once again the morass that is the Social Security Act 1964, as amended once again. Various parts of this Act have been amended literally dozens of times since 1994—54 times at my last count, which may well be an underestimate. It is way past time that this antique mosaic of fragmented law change was thrown out and a new Social Security Act written. Rather than amending it piece by piece, we should be starting again with a comprehensive law based on principles of simplicity, equity, and sufficiency. All the brave talk of the universal core benefit starting in 2000 led some of us to believe that we might conceivably see such a new, streamlined Social Security bill by 2007 or 2008, but it is manifestly not to be, and random amendments like the one we have before us today continue.

I feel that this particular rendition deserves its own unique title, not the ubiquitous Social Security Amendment Bill, which has, as usual, been applied. Given the new direction in which the Government is now sending the welfare system, perhaps this little number could be more rightfully called the “Work First, Welfare Last Bill”. After all, this is the overarching tenor of the changes contained in the purposes and principles provisions. As I have pointed out in earlier debates on this bill, although there are good features to this legislation and I do not want to disrespect them—for example, the reduction in the length of the stand-down period, and some beneficial changes to the domestic purposes benefit—there is an underpinning problem with the new interpretation of welfare provided in clause 23. As Louise Humpage and Susan St John said in an article in the New Zealand Herald last week, this bill “wipes away any notion that our social security system is about ensuring everyone can participate as citizens.”

Getting as many beneficiaries as possible into the paid workforce as quickly as possible now appears to be the primary purpose of the welfare system, which is a long way from the original 1938 Act and from the recommendations of the two royal commissions on social security in 1972 and 1988. This new direction for welfare means that people with long-term and major injuries, illnesses, and disabilities will be subject to the same planning for employment requirements as are sole parents, as will their spouses or partners, even when they are in a primary-carer role. The problem with this is not that these people now have access to employment services—I think that is great and I welcome this change in approach by the department—but that the overall sense is that the only kind of work that is valued by this society is paid work, not, for example, the work of caring for children, if the person is the primary carer of those children.

Even worse, should a more conservative Government come to power, this bill, ironically promoted by a Labour-led Government, will make it very easy for a Government to introduce and implement things like forced work for the dole, not only for unemployed people but also for those on the domestic purposes benefit, invalids benefit, and sickness and emergency benefits. If that is not a policy of the National Party, I would really welcome clarification from National members, at any time, as to what their welfare policy is.

Work first and welfare as a last resort is where this bill takes our social security system, which is why a title along those lines would be more appropriate. The Green Party will continue to oppose this bill, not because we do not support some of its more beneficial changes but because its overarching purpose is to take our welfare system in a direction over time that is likely to become more and more harmful to those most affected, especially if, and when, we again enter a major recession.