Social Security Amendment Bill

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

When I was speaking last week about this matter, I was talking about the extraordinary performance of this Government, or, more accurately, the extraordinary performance of Work and Income front-line staff and their dedication to the delivery of the wonderful results we have seen recently in New Zealand in relation to reduced youth unemployment. Most New Zealanders are already only too well aware of the delivery of this Government in terms of its policy around supporting people into work. But, for most New Zealanders, the most rewarding of Work and Income’s successes is the breaking of a cycle we inherited from our political predecessors in terms of unemployment, work expectations, and the proper work ethic for young people. That is, perhaps, the most rewarding of the initiatives of Work and Income, and I compliment it on that.

I would like to finish this call by reinforcing the contents of the document I was fortunate to be able to table in Parliament with the leave of members of the House earlier today. The fact is that at the end of last month, April 2007, there were 28 Work and Income service centres with nil—zero—unemployed youth aged 18 and 19 receiving the unemployment benefit, and there were a further 66 Work and Income service centres with fewer than 10 such unemployed youth on their books. That is an extraordinary achievement and a very serious compliment to the efforts of the policy analysts who designed the Working New Zealand policy, which is so successful, and the people on the front line who are already delivering what are, in fact, the effects of this legislation, on a voluntary basis. A number of calls were taken by myself and my colleagues last week about this issue. This legislation is about the legal mandating of an approach that is already delivering results for New Zealanders.

I guess that is why I and my colleagues find it so inconceivable and illogical that the Opposition—despite its support of these amendments in the select committee process and its voting for them at deliberation time—continues to oppose this legislation in the House. I just say to members opposite that they need to consider the fact that the residents of Alexandra, Ashburton, Blenheim, Christchurch City, Hastings East, Hastings West, Hāwera, Helensville, Hornby, Kamo, Kilbirnie, Linwood, Matamata, Mount Maunganui, New Brighton, Ōpōtiki, Ōtaki, Papanui, Point Chevalier, Queenstown, Riccarton, Richmond, Sydenham, Tauranga, Te Kūiti, Thames, Tūrangi, and Warkworth are the lucky centres where Work and Income offices have no unemployed 18 and 19-year-olds on their books.

JUDITH COLLINS (National—Clevedon) Link to this

Thank you for the opportunity to speak to this bill, and in particular to Part 1. I found those figures from the Minister very fascinating, because what I would like him to explain to us is why the household labour force survey does not come up with the same sorts of figures. In fact, in March 2000 there were 24,200 unemployed 15 to 19-year-olds, yet the March 2007 household labour force survey states that there are 27,800 unemployed 15 to 19-year-olds. Now, that is an increase, not a decrease. So what is happening? The answer is probably that, apart from the fact that these people are being shoved from one benefit to another and are being put on to dopey training schemes, which will give them absolutely nothing, except, probably, student loans that they have to pay off—

Dr PAUL HUTCHISON (National—Port Waikato) Link to this

Thank you, Madam Chairperson, for the opportunity to speak on the Social Security Amendment Bill. It seems that there is a bit of an irony when we have the Minister, David Benson-Pope, going through a long, long list of figures—a very, very long list, I might say—then bringing in such complicated, bureaucratic legislation.

One of the things he has just accused the previous Government of doing—and he finds it, in his words, “despicable”—is the use of economic tools to get people off work. Well, I think it is important to look at the explanatory note of this Government bill, when it was brought into the House. Mr Benson-Pope was quite happy to talk about sanctions then. The explanatory note states: “When people fail to meet their requirements without good and sufficient reason, a sanction will be imposed.” That is what Mr Benson-Pope’s bill stated, and the explanatory note actually goes into the details of it: “The sanction regime for people on domestic purposes or widow’s benefits is unchanged. Failure to meet their PDEP requirements”—that is the personal development plan, and, of course, it is one of Labour’s pieces of bureaucracy, which one does not actually have to keep to any more—“results in a 20% reduction in the benefit for the first 4 weeks and a further 30% reduction after that …”—to a maximum of 50 percent—“until they comply.”

That is the true Mr Benson-Pope, who was using economic tools. It was not until he finally went out and was browbeaten by fellow members of the union he belonged to and by others who supported him—and those numbers are crumbling, after all—that he relented and said he would not have the sanction regimes any more. So Mr Benson-Pope had better take a call and explain to the Committee why, in the explanatory note, there are details of sanctions and economic tools, and comments about how successful they would be in moving people into work from the unemployment benefit.

Mr Benson-Pope has also gone through a very wearying list of centres where there are offices with very little to do, because of the low number of unemployed youth. We are happy about that. It follows a trend that started from 1990, when the last National Government came into office and gradually inflation came down, interest rates came down, employment came up, and unemployment came down. That is all that is happening. It has occurred despite the Labour Government, not because of it. I was interested that Mr Benson-Pope said only five youths were still on the unemployment register in Waiuku, but he has not talked about all the problems in that town. It is the same in Tūrangi—he said no one was unemployed in Tūrangi. I wonder whether he has been to those towns and had a real look at the youth crime that is going on—the youth crime that this Labour Government has failed to do anything whatsoever about. In fact, it has become much, much worse during Labour’s tenure.

Of course, the major problem is the absolute way that this Labour Government has reconfigured the figures regarding sickness and invalids benefits—the 50 percent increase over the last 7 years. That is a contortionist act of the same magnitude as Mr Benson-Pope saying that this Government does not want to use economic tools. Of course it does, but he has been browbeaten by his supporters into not doing so. When it comes to sickness and invalids benefits, Mr Benson-Pope cannot hide. He has been protecting large numbers of New Zealanders, without making any changes at all to the eligibility criteria in terms of getting on to those benefits. As my colleague Judith Collins said, doctors want a better system of criteria for eligibility, and the Labour Government has, time and time again, failed to address that very important question. We have had no major epidemics in New Zealand over the last 7 years. A 50 percent increase in invalids and sickness benefits during that time is just a figment of the reality of what is happening. The reality is that Labour has not adjusted the criteria so that they are realistic, and it has shifted people from the unemployment benefit on to an invalids or a sickness benefit.

KATRINA SHANKS (National) Link to this

I rise to speak to the Committee stage of the Social Security Amendment Bill. The National Party is opposing this bill, but it does recognise that a handful of good amendments are contained in it.

The most important changes in this bill are that it introduces a new pre-benefit activity requirement for applicants, and that the unemployment benefit will enhance the current requirements for people who are work tested. The bill introduces planning requirements for sickness and invalids benefits, it introduces an activity requirement for young people receiving an independent youth benefit, and it updates the maximum stand-down period to 2 weeks.

This bill is meant to change the focus from a “benefit first” mentality, which Work and Income had adopted, to a “work first” mentality. Unfortunately, this amendment is not inspirational enough for either Work and Income or its clients. Work and Income and its clients can still think of their unemployment entitlements first, as opposed to considering what work they should be looking for, what work they can do, and how they can get there.

Even though Labour claims that the number receiving the unemployment benefit has dropped, it is a fact that the numbers on the sickness benefit and the invalids benefit have risen. It is also a fact that there has been a movement of people from the unemployment benefit to the sickness and invalids benefits. Can this be interpreted as those beneficiaries actually getting sick as a result of decreased personal expectations, the stress of not being employed, or the lack of social interaction that results from unemployment?

Recently I spoke to a constituent who was on a domestic purposes benefit. She stated that she had been on the benefit for a number of years. She had not once been asked whether she would like to go back to work. She had not once been asked by Work and Income what type of work she would like. She had not been once been asked how Work and Income could help her to find work. The sad thing was that she wanted to work, she wanted to improve her standard of living, she wanted to improve her life, and she wanted to improve her children’s lives. She wanted to retrain; she wanted a good job. She has done this now, all on her own. She has had no help. This legislation, this change for her, will not help her at all. It will not improve her life.

RUSSELL FAIRBROTHER (Labour) Link to this

I move, That the question be now put.

JUDITH COLLINS (National—Clevedon) Link to this

In speaking on Part 2, I will try to find something nice to say, and I think I have found it. What I can say is that National is very pleased that there will now be a section 33A, to enable a person in receipt of an invalids benefit granted on the grounds of his or her sickness, injury, disability, or total blindness to be absent from New Zealand in order to receive vocational training or disability assistance training if the chief executive is satisfied that the training is particularly good for the person. We think that that is a reasonable provision and something that actually looks at the fact that sometimes people will need to travel overseas, and it would be extraordinarily counterproductive for people to suddenly not be entitled to receive their benefit because they are overseas for a short period of time in order to increase their ability to find work when they come back to New Zealand. We think that is a good move.

One of the things we do not like about Part 2 is the provision in relation, particularly, to clause 30. It follows on from clause 29, which is all about personal development and employment plans. We heard quite a bit about personal development and employment plans in the submissions to the select committee. One of the things we heard, which deeply disturbed many of us, was that a recent study for the Families Commission—presumably paid for by the commission, which certainly contracted for the study and apparently peer reviewed it—by the Rotorua Peoples Advocacy Centre, found that personal development and employment plans were all very well and good, except that most of the people whom the centre came across had never actually received a copy of their plan. According to the submitter from the Rotorua Peoples Advocacy Centre, when the Work and Income person was asked why beneficiaries do not get a copy of their plan, the answer was: “Because nobody expects them to do anything with it.”—or words to that effect. We thought that was quite disturbing.

One of the things I see in the bill is that there are significant sanctions in relation to some of these personal development plans. But I do not think I can see anywhere here a requirement that the beneficiary be given a copy of his or her plan. I would have thought that that was a pretty basic requirement for a plan that is supposed to be an annual plan, a plan that should be able to be looked at and worked on, but also a plan that has some sanctions with it.

Perhaps I am missing the point here in terms of the actual section where it should state that, but I do not see any obligation in the bill. I am particularly concerned when there are going to be sanctions relating to these plans that they be treated seriously. There is an ability here, for instance, for the chief executive—in other words, the person working at Work and Income—to decide that the beneficiary has not demonstrated commitment to the goals in his or her plan. I am just a little bit concerned about that, because I think that that quite blanket discretion gives a huge amount of power to a Work and Income staff member. That power might be well exercised—in most cases, no doubt it will be—but there does not seem to be much in the way of ability for the beneficiary to actually say: “Well, look, I have been doing my very best according to this plan, but I am going to be sanctioned because I am being told that I am not doing my best.” We think that that is something that should be looked at.

In particular, I note the quite interesting new amendment that the Government wanted in, clause 30(3A), which inserts section 60S(5A), relating to the chief executive not being able to take into account a refusal or failure to undertake activity in the community. What we are saying to beneficiaries with this bill is that they have to undertake all sorts of plans and training—everything except work experience. So the one thing that is most likely to be able to get them into a work situation where they can start working alongside other people, in order to get the idea of what to do and to get their confidence going, is not going to be part of the plan—certainly not part of the sanction parts of the plan. What is really the point of these sanctions, when we are actually saying to beneficiaries: “Well, you don’t have to do the work experience bit. You don’t actually have to get out there and do anything. You just have to go to endless seminars.”?

LYNNE PILLAY (Labour—Waitakere) Link to this

It is a pleasure to stand and speak in support of Part 2 of the Social Security Amendment Bill. In doing so, I once again commend Russell Fairbrother for his very good chairing of the Social Services Committee. I also acknowledge the many submitters who came along and told their stories. I believe that at the end of it the majority of the select committee members had listened very hard and taken on board the issues that had been raised, and I believe that we brought back to the House a really good report. I think the bill is the better for the select committee process.

I am proud that the purpose of this bill is to enable the provision of financial and other support, as appropriate. The bill is to help people to support themselves and their dependants while they are not in paid employment. But the bill’s real focus is to help people find or retain paid employment. It will help people for whom work may not currently be appropriate—because of sickness, injury, disability, or perhaps caring for a young child—to prepare for a future career in the workforce.

The bill accepts that there are certainly circumstances in our society whereby it is not appropriate for people to be in paid work. Indeed, it is the role of a good society, of a caring society, to care for and support those people—whether they be mothers or people who are impaired in some way through sickness or injury. We will have a richer, better, more benevolent society if our citizens are supported in that way.

I want to talk about the basic principles. Working with people to assist them into paid employment means offering the best opportunity possible for them to achieve their full potential. Indeed, the best way that we can do that is by offering job opportunities, by offering training, by considering what is the best training for that person, by having a department that does not treat people as just a mass but whose staff sit down with them, talk realistically about their aspirations and goals, and steer and support them in the right direction. Clearly, that is happening. Clearly, we see our unemployment statistics going down dramatically. That can only be because we are supporting people into work. We are actually working with people’s strengths rather than focusing on their weaknesses, which the Opposition members are very much into. In the past, through the 1980s and 1990s, we saw very much a blame mentality; if someone was not in work, he or she was somehow lazy or deficient in some way. That is often not the case. It is frequently not the case. It is most often not the case. We need to work on giving people a hand up rather than a handout.

Government members believe that the Social Security Amendment Bill actually enhances the opportunities that we already have in place for people. Those opportunities are seeing our people in work, thriving, providing for their families, and having the dignity of having a job. When it comes to self-esteem and to people feeling they have reached their full potential, the dignity that comes from their having a job where they are contributing, where they feel they are valued, and that is not tokenism cannot be measured. Of course, it also economically is more beneficial.

I acknowledge that there are many times when it is not appropriate for people to be in the workforce. It may be that because—as I said before—they have an impairment or an illness, be it a physical disability or a mental illness, it is not appropriate or in their interests for them to be at work at that time. I acknowledge the submitters who came to the select committee and spoke very openly about such situations to us. I also want to acknowledge single parents—especially women—who contribute much to this society.

SUE BRADFORD (Green) Link to this

I am proposing to amend clause 23, which will insert purpose and principles sections into the Social Security Act, by way of Supplementary Order Paper 113 that is on the Table in my name. The Green Party fully supports legislation having purpose and principles sections to aid in its interpretation. In that context, given the plethora of amendments that this Parliament has made over the years since the 1964 Act was passed, I find it strange that only now are we considering inserting purpose and principles sections into it.

However, many of the submissions to the Social Services Committee on this bill were highly critical of the particular purpose and principles sections that the bill proposes. I agree with most of the criticisms raised by those submitters. The first problem is that the purpose and principles sections proposed in this bill advocate a “work first” approach to welfare. There is no statement in the purpose and principles sections of any significant role for the welfare system that does not have an underlying focus on paid work. Work is seen as the ultimate goal, no matter what the conditions or the pay are. No recognition is given to the value of the unpaid work that beneficiaries undertake in caring for children, for the elderly, or for people with impairments, or to the valuable voluntary contribution many beneficiaries make to their communities. These purpose and principles sections treat people as nothing more than economic units, thereby reinforcing the attitude that people on the benefit system are somehow less worthy of dignity and respect than anyone else, and that they are not fully realised and recognised members of our community unless they are part of the paid workforce.

The other substantial criticism raised by submitters is that the purpose and principles sections contained in this bill provide for an interpretation of the Act that promotes rigidity and parsimony. They provide for an Act that is regulated, inflexible, and mean-spirited, and designed not to help eliminate poverty—which is what the Green Party believes should be the objective of the social security system—but to alleviate hardship, and to do so only to the extent provided for by the Act.

The Treaty of Waitangi is our country’s fundamental constitutional document, and any legislation concerned with the welfare of this country’s citizens, be they tangata whenua or tauiwi, should be based upon it. My amendment also recognises this. The two royal commissions on social security provided the basis for a valuable vision for our society—one in which all people could participate and feel part of their local community, promote and maintain the well-being of their families, and be actively involved in meeting their potential and creating fulfilling lives for themselves and their families. My amendment also proposes to incorporate the vision of those two royal commissions into these purpose and principles sections.

Our children are our taonga and our future, and that vision is already acknowledged in the Children, Young Persons, and Their Families Act 1989 principle that their interests should be paramount. I am also proposing that this principle should be a principle of the Social Security Act. It is no more acceptable for children to grow up in poverty and to be denied a healthy upbringing than it is for them to be beaten or sexually abused.

I am also proposing to add a principle expounding the paramount nature of the provision of full and correct entitlements. That is already, supposedly, the policy of the Ministry of Social Development, but the anecdotal evidence I hear on a weekly and almost daily basis indicates that it is a policy that is often not followed. I hope that to insert a principle around that, as part of this legislation, will go some way towards rectifying that.

Finally, I am proposing to amend the principles to provide that although seeking suitable and sustainable employment should be a priority activity for people who are unemployed, the priority activities for people receiving financial assistance for reasons other than unemployment should be determined in consultation with them, and in accordance with their individual circumstances. This reflects the reality that the personal and family circumstances of many people means that paid work is simply not the most important activity for them to be undertaking at that particular time.

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

I would like to take just a brief call to discuss three matters. The first of them is in response to the previous speaker, and I say to her that I have absolutely no doubt that the information she hears anecdotally about policies not being followed is passed to her in the best of faith. I have absolutely no doubt of her integrity and commitment, from her historical commitment to people who are less advantaged in this sector of our New Zealand community, but I say to her that I, the Government, and those who work in a very efficient—I have found—Ministry of Social Development are unable to help individuals who have issues unless they can be identified. So I make an appeal to that member that if she has particular instances where she believes that the policy I am articulating, and the policy that is clearly articulated by the ministry, is not being followed, then I think she has a responsibility to pass that to me or to appropriate people in the ministry, so that those issues can be corrected. I repeat my appeal to her to do that.

The second issue I want to raise is in relation to the comments of Ms Collins about so-called research that, as such, was presented to the Social Services Committee by Mr Paul Blair from Rotorua. It is true that Mr Blair’s research—oh, sorry, Mr Blair’s work is probably a better description—was commissioned by the Families Commission. It is not true to suggest that the Families Commission had completed a full peer review of the work, or indeed had authorised its release. In fact, that work has not subsequently been released because the Families Commission found it—shall I say, charitably—“seriously wanting”. The fact of the matter is that that work covered a sample of, we believe, fewer than 15 people. Given that the cohort we are talking about, sole parents receiving a benefit, is around 90,000—it has reduced, but it is still too many, I know, but these are people who need that support—then 15 out of 90,000 is not what one, even in National Party circles, would describe as a very robust or credible basis for any research. I guess I am therefore not surprised to hear Ms Collins basing her specious arguments on that matter.

The most important thing I want to say to the Committee is that for me the important thing about this legislation is what it means in reality for New Zealanders. I cannot better characterise that than by using the words of Leanne Keep. Leanne is a young woman who lives in Christchurch. She is a beneficiary of this policy, actually—the policy that the National Party is continuing to object to, and that the Green Party is continuing to oppose. I would like to tell the Committee her story. Leanne’s situation is very different now from the one in which she found herself last year. Leanne has authorised me to use her name and circumstances to talk about the effects of the changes that are now operating on a voluntary basis. She first visited a case manager about a year ago, seeking help. She was struggling with a small child—she had a 3-year-old with health and behavioural issues—and she was referred, by her case manager, for advice and support on parenting skills. As she put that advice into action, she has been able to begin planning for her and her child’s future. The first of those steps was a course at the Next Step Centre for Women in communications skills, goal setting and self-esteem, job search, and computer skills. I quote Leanne: “When I was struggling I felt supported by Work and Income. I am grateful for the help I have received to study, to have my son in childcare, to help with disability costs, and to have a referral for parenting support. All of this has contributed to me being able to work.”

With her support systems in place Leanne was able to take the next step into full-time employment. Now she works full-time at a local primary school. Leanne has a good reason for celebrating her success in finding a job that interests her, as well for providing a better lifestyle for herself and her son. Leanne, of course, also gets substantial support from the Working for Families package. She cancelled her domestic purposes benefit from 23 April this year. She is working full-time at the Allenvale Special School and PreSchool. She gets per week from Working for Families $372 worth of support—$82 of that is the family tax credit, $60 is the in-work credit, she gets a $75 accommodation supplement, and she gets $155 of childcare assistance. That gives a total of $372 a week. Starting a full-time job, therefore, has meant that Leanne is better off by $127 a week. That is what this legislation is about, and that is what National is opposing. This legislation is about supporting real New Zealanders with real issues, to go back into the workforce.

JUDY TURNER (Deputy Leader—United Future) Link to this

I want to take a brief call on Part 2 of the Social Security Amendment Bill, and I particularly want to address the concerns that the Green member Sue Bradford raised, because I am on the Social Services Committee, obviously, and heard the submissions and the concerns.

I also met with several groups of concerned people in my office privately and listened very closely to their concerns. I agreed with them that if the work focus, which is now being built into the principles of this Act, was such that it meant that everybody was assumed to be able to work, then I would be unhappy with that. But I have checked and rechecked very, very carefully what is written, and I do not believe that the work focus being introduced into the principles of the Act in any way disadvantages people for whom work is not a reality.

The bill says very clearly in clause 23 that “people for whom work may not currently be an appropriate outcome should be assisted to plan for work in the future and develop employment-focus skills:”. This is talking about people like mums and dads on the domestic purposes benefit. This is about people who are currently committed to parenting their children but who see this as a season in their lives at a time when they require some support, and who also see that in the middle of this season they are well able to start focusing on their futures and what employment may be round the corner for them. No one is saying that they must drop their kids immediately into day care and take any job that comes along; that is not what the principles state, at all.

Another thing that is stated in the principles is the acknowledgment that there are “people for whom work is not appropriate” and who “should be supported in accordance with this Act.” Therefore, the work focus is a new provision that is layered into the legislation and focused on people who are already able to take up work, should they be willing. Because of the type of benefit that these people are entitled to, they are required to be willing and ready to take advantage of all the opportunities that Work and Income may put their way in order for them to become further work-ready, to hone their skills towards achieving specific employment opportunities, and to take advantage of all additional help that may come along.

United Future welcomes the work focus being put into the principles. I think it is something that has been missing from this Act for a long, long time, and that has created a lot of angst for taxpayers who worry about benefit dependency, and who worry that it is too easy to get a benefit and stay on it when one is well capable of employment. The new wording of the principles makes it really explicit that this department is focused on finding suitable work for all people who are capable of doing it.

The other thing that I think is really important to note is that the work focus creates an understanding that there are people for whom work expectations are not appropriate but who actually have some dreams and ambitions. These people could never hold down a 40-hour-a-week job. It is beyond their capability because of the challenges they live with. But they would really love the chance—I have met a number of these people, and they would just love the chance—to find some productive areas of employment that may take them an hour or two a week, and for which there is some remuneration. I accept that where these people would like some employment, even if it is on a limited basis, Work and Income should try to facilitate that.

A lot of people, particularly those on disability benefits, really would like to participate in the workforce at a level that is suited to the challenges they live with. A work focus requires the department, rather than disregarding them because of the small amount of work they are capable of doing, to actually take them seriously and look for opportunities. One of the things I have experienced with people in this category is that often they start out with a couple of hours’ work, they kind of get their heads around it, they organise their life around it, and over time they surprise themselves that they can take on a few more hours—not because anyone is pressuring them or putting their benefit under threat, but because they want and enjoy the contact and the reward that employment offers to them.

I think that the member proposing the amendment, Sue Bradford, is well-intentioned in this regard, but that she has really misunderstood the fact that there is nothing oppressive in the new wording in the principles of the Act. The wording really just makes sure that work focus is available to all those who are able to work under that focus and who want to.

Dr PAUL HUTCHISON (National—Port Waikato) Link to this

I rise to speak on Part 2 of the Social Security Amendment Bill. Like my colleague Judith Collins, I too would like to find something nice to say about this bill. Indeed, if I look at the purpose, I think there are some sensible and supportive things to be said about the purpose “to help people to support themselves and their dependants while not in paid employment;”. Surely, that is very much common sense. We like common sense. Unfortunately the Labour Government tends to depart from common sense very rapidly and far too often.

Another purpose is “to help people to find or retain paid employment;”, which we agree with entirely. Another is “to help people for whom work may not currently be appropriate because of sickness, injury, disability, or caring responsibilities, to support themselves and their dependants:”. That is where we depart from Sue Bradford, who said, I think, that work is seen as the ultimate goal no matter what the circumstances of the individual are. Well, that is not the case in that purpose, in section 1A(a), in clause 23. It is explicit that those for whom work may not currently be appropriate because of sickness are indeed catered for, and I think that is right and proper.

I did notice, though, that Sue said it would be appropriate to make reference to our children being our taonga and our future. I must say that all too often we do forget that the implications of this sort of legislation absolutely fall heavily on our children. I think we have groups in this country, such as the Every Child Counts group, who would very much like to see child-impact reporting in this sort of legislation. It is absent from the bill; the Labour Government has not taken any notice of it. I agree with Sue that this is something that should have been thought of.

I note that Mr Benson-Pope cited the paper from Paul Blair from Rotorua. In fact, he belittled the figures from Paul Blair in Rotorua.

RUSSELL FAIRBROTHER (Labour) Link to this

The reason this Government will be returned to the Treasury benches after the next election is contained in the bill before the Committee that we are addressing right now. The reason the National Party will be returned to the Opposition benches in a much depleted state is because of the bill we are talking about right now. What does the bill tell us? It tells us that this Government is committed to ensuring that all people who are on a benefit get the right services right from the start. Who can argue with that? There is not a voice from the National Party. Beneficiaries will get the right services right from the start. One cannot complain about that, can one? That is what Part 2 of this bill delivers, and that is why this good Government will return to the Treasury benches after the next election.

Working New Zealand, which this bill is really about, is a substantial reform package that will stand the test of time for future generations, and it should be read along with the Working for Families package, which is the first part of this dramatic policy of putting people back into a working environment. For once, our beneficiaries will be assessed because of who they are and their potential, rather than by the type of benefit they receive. As soon as that happens, every speech made by Judith Collins will no longer have any substance at all, because she has repetitively gone on about sickness benefits and invalids benefits, and she has classified people by their ailments rather than by their potential. What the National Party has failed to grasp is that this is a bill that recognises potential. This is a bill that says to people: “We will assist you to get the work that you’re capable of doing.” And those in the rare circumstance of being totally unable to work will be given assistance to make them feel, and become, valid members of the community, albeit not in the workforce.

Mr Clarkson should listen to this because his companies will be direct beneficiaries of this bill. He knows, as I know, that he would have many more workers if they were encouraged back to the workforce, which this bill does. His private business interests would profit from that, and he must know that. He should get up and explain that, and explain why he will be crossing the floor to support the bill.

In Napier there is a teen parent centre. If one chooses to visit the teen parent centre none of the teenage parents there—the young women who gave birth at a relatively early age—say they want to go ahead and study to become doctors of philosophy, or learn about Greek literature or Greek history. Each one of them says that they are delighted for the chance to have another go at education so that they can enter the workforce. Their sole aim of returning to the teen parent centre is to get the training to return to the workforce, and that is what this delivers. Who can argue with that? There is not a murmur or a voice from the Opposition, because this bill delivers that very thing.

I am fortunate enough to be married to the lovely Mrs Fairbrother, who has a very busy family law practice. She has noticed already among her clients the change in expression and the change in attitude to life of those people who are benefiting from Working for Families. She knows very well that when this bill becomes law and people are judged on their potential, not on their benefit label, the people who attend her family law practice will do so with an attitude of hope and a belief that they have a valid place in society.

It is against that background that we should read the principles in clause 23 of Part 2. Clause 23 brings in new section 1B, “Principles”. Paragraph (a) states: “work in paid employment offers the best opportunity for people to achieve social and economic well-being:”. Who can argue with that? Dr Hutchison could not argue with that. The National Party does not argue with that. There is stunning silence on that one, because everybody in this Chamber understands that to be valued one needs some work that reflects one’s ability and one’s skills. People who had been out of the workforce because of the previous economically ruinous policies of the National Government during the 1990s when they had no hope of getting employment, and who were then categorised because they were in receipt of a State benefit, were permanently on the heap of disappointment. If people are now encouraged back into work, then the principle of paid employment as being the best opportunity for people to achieve social and economic well-being will be seen as a fundamental tapping into the vein of hope and prosperity to which this country is heading.

This is a very good bill, for those very reasons. It is a good bill because the philosophy of the bill is one of encouragement, hope, and support. The philosophy of the bill is not the philosophy of the National Party of damning people by labels and sticking them away so they cannot be seen, and not talking about them again except to be critical of those fellow human beings. Anybody who falls upon hard times will be delighted that the Social Security Amendment Bill went through this House this year. They will be delighted because when they approach the Work and Income office or the Ministry of Social Development they will immediately receive assistance. No longer will there be a bureaucratic stand-down while the paperwork is done, because as soon as a person who needs assistance fronts up to the counter he or she will be directed into the appropriate avenue to take on successful employment.

We can offer that because the economic boom times that this Labour Government has brought about over the last 6 or 7 years mean that there is work for everybody out there. What we really need now is to have everybody working, so that in a positive environment the benefit system is now there as a fall-back provision and as a step-up to employment. There is work there even for those who are not keen to get it, and those who are not keen to get it will be identified by the very good staff in the department. They will be given assistance to work through the expectation bred into them in the 1990s by the National Government, which was that we had to have a permanent pool of unemployed, and they will come to realise that that is one of the mean, terrible myths of the neo-liberals who are sitting opposite and listening spellbound to this dissertation on the future well-being of this country.

So I commend the bill to the Committee, and I am delighted that the National Party has not come up with one serious riposte or response to the many aspects of the bill. I take, for example, Dr Hutchison’s speech of just a few minutes ago. He was long on rhetoric but gave no analysis whatsoever. He accepted that the principles clause was a sound ideal. He accepted that. He then made some vague criticism that the bill fell short of something, without giving any analysis whatsoever—and this is a man who has had the benefit of a high degree of sophisticated analytical training in his academic life. This is a man whom we expect should be easily employable if he went to a Work and Income office, because he would get the assistance to refine those skills of analysis and to refine the ability to apply his mind to the task in hand, and, hopefully, he would be ushered once again into gainful employment after his last 9 years of resting on his previous academic laurels.

So I commend this bill to the Committee. It is a bill of hope, opportunity, and aspiration, and it is a statement to our fellow New Zealanders that we care for them, that we want to work with them, and that there is a place for them in our society. This bill is one of the reasons why we are becoming a knowledge-based economy, and why we are punching above our weight on the world economic stage. I say to members opposite that they should wait until Thursday afternoon, which is when they will get their comeuppance.

SUE BRADFORD (Green) Link to this

Thank you, Madam Chairperson, for this second opportunity to speak in this part of the debate, as I have a further Supplementary Order Paper—Supplementary Order Paper 113—in my name that deals with the section that relates to pre-benefit activity requirements for applicants for the unemployment benefit. The Green Party has no difficulty with unemployment benefit applicants being required to undertake certain activities while they are waiting for their benefit. The combination of a stand-down and delayed entitlements due to holiday pay and similar payments that may have been received often means that it will be several weeks before an unemployment beneficiary becomes entitled to payment of his or her benefit. I agree that it is incongruous that people should be expected to do nothing during that period, when they are expected to take reasonable steps to obtain suitable employment once the benefit comes on stream.

The difficulty with clause 36 as it currently reads is that it is an administrative shambles that is likely to result in instances of quite unnecessary hardship. It provides that a requirement by the Ministry of Social Development that an unemployed beneficiary undertake a pre-benefit activity may be given orally or in writing. That has the potential to cause misunderstandings regarding the precise nature of the activity required of the applicant. That in turn can result in benefit applications being inappropriately declined, or their investigation and eventual granting being inappropriately deferred.

The substituted subsection (3) of section 96A of the principal Act proposed by my Supplementary Order Paper provides that a requirement for an unemployed benefit applicant to undertake a pre-benefit activity must be given in writing, and is a decision subject to review and appeal rights under sections 10A and 12J of the principal Act. Beneficiaries deserve to be advised of their obligations in a written form, so that if they do not understand them they can take them to someone who does and have them explained to them. We had a number of submissions on that matter. Beneficiaries also deserve to have the right to challenge obligations placed on them that they may consider to be inappropriate.

I am also very concerned about the implications of the new subsection (5) of section 96A of the principal Act proposed in clause 36 of this bill. Under that subsection, the Ministry of Social Development will have no obligation to investigate a claim for an unemployment benefit until the pre-benefit activity has been completed. In some circumstances, eligibility for the benefit will occur before the pre-benefit activity is finished. The new subsection (5) will inevitably cause unnecessary administrative delays in the granting of a benefit, which may well cause consequent hardship. Although the benefit will eventually be backdated, that is no comfort to a beneficiary who has been evicted from his or her accommodation in the interim solely because of the delay inherent in section 96A(5), or to one who incurs other financial difficulties. We are talking here about people who often have nothing at all, or less than nothing. I am proposing to omit subsection (5), thereby ensuring that claims for the unemployment benefit, like claims for other benefits, are investigated as expeditiously as is practicable.

The new subsections (6) to (8) of section 96A of the principal Act relate to benefit applications lapsing in the event of pre-benefit activities not being completed. Those subsections become redundant if the ministry is required to investigate unemployment benefit applications as promptly as practicable, without deferring investigation until a pre-benefit activity has been completed. The ministry will still have the proposed power under new section 96A(10) to refuse to grant an unemployment benefit, or to terminate one that has already been granted, in the event of a pre-benefit activity not having been completed satisfactorily. That, I think, is sufficient to adequately sanction beneficiaries who do not meet their statutory obligations. I call on parties in the Committee who have understood what I have just said to support the amendments in my Supplementary Order Paper.

Finally, I will take just a moment to respond to the Minister’s response to my earlier comments about people not receiving their full and correct entitlements. The reason I do not take every case I hear about off to the Minister is that those are mainly cases that have already been dealt with in my own out-of-Parliament office in Auckland, by other MPs’ out-of-Parliament offices, or by information provided from beneficiary advocacy groups. They deal with those kinds of cases every day. In fact, beneficiary advocacy groups would go out of existence if they were not dealing on a daily and weekly basis with people who do not receive their full and correct entitlements. I think the Minister and the department would be the first to acknowledge that that happens every day. I certainly respect the department’s efforts to do better—and it is doing better. But it is just simply a fact of life, as I think every MP in this Committee knows, that many people are still not getting what they are entitled to receive.

BARBARA STEWART (NZ First) Link to this

I will take just a very short call on behalf of New Zealand First. We welcome new sections 1A and 1B in clause 23 of the Social Security Amendment Bill. We believe that the purpose of the bill and its principles should be clearly set out. We believe that New Zealanders as a whole would find it very difficult to argue with this part. We totally approve of the work focus.

People are far better off when they work, even if it is only for a few hours each week. My son goes to school. He also has a part-time job for a few hours a week pushing trolleys at the local supermarket. The change in that boy has been quite phenomenal. We believe that it is absolutely essential to interact with people in the workplace. The growth in people’s self-esteem from being part of a team is absolutely phenomenal.

We also want to see the number of people on the sickness benefit and the invalids benefit decrease. We are pleased to support any efforts to assist this group to work if they possibly can. We acknowledge too that there are times when people, for whatever reasons, just cannot participate in the workforce. The bill signals the commitment the Government has to work with people to assist them in moving into work that is appropriate for them. We cannot argue with that. We believe that any Government should have this focus. It is something we would criticise any Government for not having. All of the research shows that it is imperative for people to get into work if it is appropriate. Benefits are not the best lifestyle for long-term living. We want people to have more money than they can get on a benefit and to get all the other benefits they do not have when they are on a handout.

We believe that the hardest thing when one is on a benefit is to take the first step and determine what area one wants to work in. If people have been out of work for a long time, that gets harder and harder. So we believe that the personal development and employment plans are essential to help this come about. What is the point, though, in having a plan, or in being told that one has a plan, if one is not a part of it? We believe that people should have some time to reflect on their plans so that they can get behind them and push them. Most people have dreams and ambitions that they want to fulfil, and those dreams and ambitions are far greater than being on a benefit. We really support the work focus that the Government is showing in this bill.

KATRINA SHANKS (National) Link to this

I rise to speak in the Committee stage to Part 2 of the Social Security Amendment Bill. Parts of the bill were showing promise that it was moving towards a “work first” mentality. Let me highlight a part of the bill that makes interesting reading—the sanctions part. It is clear that when people fail to meet requirements without good reason a sanction will be imposed. However, “activity in the community” is exempt from the sanction. For those who do not understand what “activity in the community” means, let me explain. The definition in clause 4 states: “activity in the community means an activity associated with a community project under the supervision of a sponsor who is contracted by the chief executive to provide the activity”.

The National Party is disappointed with subsequent changes to the bill that remove the requirement for a person to undertake “activity in the community” from sanction provisions. In our opinion these changes will lessen the ability of the bill to remove barriers to employment. We believe that the requirement on a person in his or her personal development and employment plan should have to be fulfilled regardless of the source of that activity. The consequence of not meeting the requirement of his or her personal development and employment plan provisions in regard to undertaking “activity in the community” cannot be sanctioned.

The National Party is pleased that beneficiaries will be expected to engage in activities such as training to prepare them for work, but we are disappointed that the opportunity has not been taken to enable part-time, non-commercial work to gain work experience. We are concerned that some beneficiaries who engage in a number of training courses without work experience will find employment opportunities closed to them. We believe that people who work in the community have a lot to offer the community they work in. We believe they have valuable skills, good work ethics, and the ability to offer good work experience. In not recognising this workforce, which can contribute to the training and transfer of skills, we are not doing that workforce any justice. We are not even recognising them.

Many of the people who work in the community have come from professional backgrounds—backgrounds of relevance to the sector that they are working in. They are highly skilled, and they bring a lot of skills that they transfer quite easily. They are invaluable to the organisation that they work in, and they can easily pass on these things to others. We are talking about caregivers, administration clerks, event organisers, people with information technology skills, people with good communication skills, social workers—a huge number of people.

This legislation is closing a door to employment opportunities. In fact, the National Party felt so strongly about this that it submitted a minority view, which I will share with members. It was not only our view; three other parties on the Social Services Committee also attached minority reports based on “activity in the community”. “While generally agreeing with the stated purpose and aims of the bill, the National and ACT parties are disappointed with subsequent changes to the bill that remove the requirement for a person to undertake ‘activity in the community’ from sanction provisions. In our opinion, these changes will lessen the ability of the bill to remove barriers to employment. We believe that the requirements of a person in their personal development and employment plan should have to be fulfilled regardless of the source of that activity. The consequence of not meeting the requirements of his or her personal development and employment plan provisions in regard to undertaking ‘activity in the community’ could be sanctioned. The National and ACT parties are pleased that beneficiaries will be expected to engage in activities such as training to prepare them for work but are disappointed that the opportunity has not been taken to enable part-time non-commercial work to gain work experience. We are concerned that some beneficiaries might engage in a number of training courses but without work experience, will find employment opportunity closed to them.” Thank you very much.

STEVE CHADWICK (Labour—Rotorua) Link to this

I move, That the question be now put.