Social Security (Jobseeker Support and Accommodation Supplement) Amendment Bill

Committee of the whole House

Thank you so much, Mr Chair. While Part 2, particularly clause 15, may be brief in terms of pages, I believe that it impacts quite a large number of people, so it is worthy of debate.

First of all, as of today, is the Minster for Social Development and Employment aware of how many people are captured under the new thresholds that was lifted to 40 percent of the base rate? Since the bill was introduced, I believe that most families that were affected—particularly by clause 15, in Schedule 4, Part 7, clause 4 and then clause 6—I think, were families with children. Is that correct, and is it still the case?

Is it still the case that most of the families—families that are working families—will see a reduction on the accommodation supplement under this provision? What impact does she think cutting the accommodation supplement by certain amounts—which I’d like to know what the latest estimates are of the weekly reduction on accommodation supplement for low-income homeowners will be.

And I wanted to know whether she has also received advice that whatever savings may be produced as part of Part 2, may be offset by those families having to access assistance in other parts of the system in the form of advances, hardship grants, and the likes, because, obviously, this Part 2 also produces a bunch of savings as part of her budget initiatives. Effectively, what Part 2 does is that it, basically, means less people can access the accommodation supplement if they’re homeowners. Normally, you can access the accommodation supplement if you’re spending more than 30 percent of your income on housing costs. In this Part 2, it lifts it to 40 percent, right? So it means less people are eligible. I would like to know how many people and what the weekly reduction is. I don’t think these are issues around changing the policy, but wanting to get clarity on who exactly this is capturing as off today.

Lastly, just talking about the cost, can she confirm to me how much money she thinks she will save with this Part 2, and has she sought any further advice on how much actually will be spent elsewhere as a result of the potential hardship she may put families under?

Committee of the whole House

The initial examination of this, or the consideration, estimated that with the entry threshold increasing from 30 percent to 40 percent for some homeowners getting their accommodation supplement, it was estimated that there would be 9,300 homeowners impacted. The savings from the accommodation supplement initiative go pretty much to then expand the accommodation supplement boundaries for a whole group of people who are currently not eligible for the accommodation supplement at all. This was a Budget 2025 measure. Then, in Budget 2026, those who get the accommodation supplement get an increase of between $10 and $30 a week. I’m sorry I can’t give you the exact number, because there are multiple levels. The intention of this was to ensure that the accommodation supplement was better targeted. As I said, this allows for a whole group of New Zealanders that—because where you have a town that extends into a rural area, the rural area might previously have been excluded completely, and no one got an accommodation supplement in that area, but housing has been developed there, so with this, it is a switch. The savings from this particular initiative will go to those who will now be eligible because of the boundary change. As I said, in addition to that, there’s been measures in Budget 2026 which increase those getting the accommodation supplement by $10 to $30 a week.

Committee of the whole House

Thank you so much, Minister, for confirming that there are thousands of families that will see a weekly reduction rate to their accommodation supplement. Can she just confirm that those families will be predominantly low-income families who are single homeowners and potentially be having quite high rates of mortgages—

Suze Redmayne: Did you actually listen?

RICARDO MENÉNDEZ MARCH: Low-income families, I asked. She didn’t actually clarify. I appreciate that Suze Redmayne is listening to the debate, but I’d like to clarify whether those 9,000 families are predominantly low-income families and/or people on the benefit.

Hon Member: Would it be a concern if it was predominantly high income?

RICARDO MENÉNDEZ MARCH: I don’t know why the Government members take issue with who this is affecting. The other question I wanted to check was whether the amount that is being cut of the accommodation supplement from those families—those over 9,000 families—will be directly proportionate to the increase that these new families will see. If I recall correctly in this select committee stage, I think, at the time, some families will see—I think maybe the Minister would like to confirm—a $40 a week reduction on their accommodation supplement, and I don’t believe that the families that will see an increase in the accommodation supplement will see a net increase, potentially, off that. Would the Minister be able to outline whether it is one-to-one comparison? It seems to me that she’s justifying taking from one group of low-income people who may be struggling with their mortgage payments to then give to another struggling group of people. That seems like taking from one struggling group to another. But, again, despite our policy differences, I just would like to confirm the make-up of those families and how many of them are in work or out of work and the sorts of incomes that we’re talking about.

Would she also have any information on the demographic make-up of those 9,300 families? For example, I think in the advice that we received, there was some commentary around Māori and Pacific family being disproportionately affected by high housing costs. Does she know, actually, how many of them would be Māori and Pacific families that are covered in that 9,300 families that she spoke about?

I also believe that, in the advice, it was noted that disabled people also disproportionately face higher housing costs, is she aware of how many disabled people who may be first time homeowners and who may be struggling with mortgage payments will see a reduction on their accommodation supplement as a result of these changes? I totally hear that she’s trying to justify it by saying that we’re giving it to a whole group of people, but what I’m wanting to seek engagement on is the impact this has on the people who will see a reduction, right? Independent of whether she thinks other people are benefiting, I’m trying to just seek engagement on who these 9,300 families being impacted are and the demographic breakdown, which I don’t think are unreasonable questions, Minister.

Committee of the whole House

The first thing is there’s no change in the eligibility to the accommodation supplement. It is provided for low-income households—and working households as well as benefit households. All this is doing is saying that if somebody is eligible, they would then need to contribute slightly more.

Hon Willow-Jean Prime: Oh, so a change? That is actually a change.

Hon LOUISE UPSTON: No, it’s not a change in the overall settings for who is eligible for the accommodation supplement. As I was saying, the accommodation supplement is available for working households and beneficiary households. I don’t have the data in front of me, but I did want to make sure that the member was fully aware that there are exclusions for those on the supported living payment, for those on the New Zealand superannuation, and for those on the veteran’s pension. They are excluded from this.

Committee of the whole House

Thank you, Mr Chair. I want to talk about the supplementary analysis report, and I want to ask some questions about the comments, on page 7, about the policy assumptions underpinning this decision. Those are of concern to me, and I’d like the Minister for Social Development and Employment’s answer to those assumptions and why she decided to continue. The first one is: “This proposal assumes that affected homeowners may be able to leverage other financial options for meeting their accommodation costs, such as refinancing their mortgage or taking on additional occupants ([i.e.,] renting out a room or … a boarder).” I’d love to know what the Minister thinks about that, because it then goes on to say, “There is a risk that this may not be realised. If this assumption is not met, some homeowners may choose to manage their accommodation costs by deciding to sell their home and move into rental accommodation.” That’s an impact. And then it goes on to say, “The ability of homeowners to manage their accommodation costs will vary depending on their individual circumstances.” It will matter what their interest rates are, and what their council rates, insurance, and mortgage payments are. They are at risk, and it is really worth reminding the Minister about my earlier concern that the two changes together are going to impact on the same group predominantly, which is our poorer families. They’ll be worse off in this circumstance. If you could do address those issues, I’d be grateful.

Committee of the whole House

Thank you, Mr Chair. I’ve just got a further question on the group’s included—just following up on a comment she made on who she’s excluding. How many people is she aware there are who are disabled on other forms of income support or in work that will still be included? She kind of alluded, “People on the supported living payment are not included.” Sure, but that’s not the make-up of the full group of disabled people who exist in this country. Surely she is aware that some disabled people will be included in this.

Secondly, would she be able to clarify exactly how much money she’s saving and whether she received any advice of these savings in engagement on this, and whether she believes these savings may be offset by costs elsewhere in the system? I say this, again, not to trifle but because I know she has received the advice on previous changes to the accommodation supplement that she has made. For example, when she made the changes to the accommodation supplement for people who have boarders, she was advised at the time that these savings could be offset by people needing support elsewhere. I don’t think it’s unreasonable to simply ask: has she sought reassurances that the savings are accurate, the ones that she’ll be producing on Part 2?

Secondly, I did also want to explore in terms of the design of Part 2. She spoke earlier, and we had a bit of an exchange about the groups that she’s taking from to give to—at any point in the bill did she explore, for example, taking from, say, the likes of entitlements from Government Ministers’ housing subsidies as opposed to low-income homeowners? In terms of the options that she prepared for or she sought initial advice on the bill, I’m interested to know who she explored taking support from to give and expand the accommodation supplement to others? Surely there are other subsidies that people receive more generally that are well off and that do not have to be low-income homeowners, right—including the subsidies that some of us MPs or Ministers receive for houses that we have no debt on. I am just curious to know whether she explored any other options in the design of this bill.

Lastly, I know that she said that she doesn’t have the full demographic breakdown in front of her, but I did want to just check whether she is confident that no families will be unable to actually meet the full cost of their mortgages and will fall behind as a result of this. Again—not to trifle—this is something I am seeing more and more constituents struggling with. Just genuinely keeping up with the rate of mortgages is something that has been canvassed in media articles quite a bit, so whenever I see legislation that reduces the accommodation supplement for people with mortgages, the first thing that comes to me is: “Well, could this risk people losing their home?”—particularly, including families that are, according to select committee advice, low-income families. Can she guarantee that she will do everything that she can to avoid any of these 9,300 families from losing their home as a result of the reduction in the accommodation supplement?

Committee of the whole House

In terms of the breakdown, the information I’ve been provided is that there will be 1,300 Māori households impacted and 500 Pasifika people. In terms of disabled people, I was just simply making the point—I didn’t want anyone in the Chamber thinking that those on supported living payments were captured by this. One in eight New Zealanders has a disability—many are working, some will be on benefit, some will be on low-incomes, and some will be on high incomes—so, no, I don’t have that figure.

It’s hard to give an exact figure for the savings of this particular initiative because, as I said, it’s going to fund the accommodation supplement, adjusting area boundaries, which I know the member for Southland is very excited about. He has lobbied very hard to get the boundaries for the accommodation supplement changed, so I know he’s very excited about that. One side of it, which is what we’re talking about here in terms of the entry threshold, is $36 million—as I said, offset by the accommodation supplement now being available to a lot more families than it would have been otherwise.

In terms of the member Helen White’s question, I think she answered her own question, in that homeowners have more choices available to them, and she actually outlined them. The intent of the policy is to better target support, and, as I said, there are other policies that we’ve put in place in Budget 2026 that actually provide increases to the accommodation supplement.

Committee of the whole House

Thank you, Mr Chair. I’ve got a series of questions on Part 2 for the Minister for Social Development and Employment. I want to start with clause 13, but I’m actually going to refer to Schedule 2. In Schedule 2, “New Part 18 inserted into Schedule 1”, new clause 132(a), I just want to check—and this might be an understood term, so please just feel free to clarify—what does “immediately before 1 April 2027” actually mean? Does it mean any time before 1 April 2027, a day before, a week before? I think it does help to understand the overall package of new clause 132 there. I think it’s just that one word that would need some elucidation and clarification.

I’m going to go on to clause 15, amending Schedule 4, which is, essentially, what we are all discussing here. My first question is: in terms of this increase in terms of the threshold for homeowners from 30 to 40 percent, whether it’s 30 or 40 percent, does it currently include, for example, insurance premiums for the property, or does it just simply refer to the baseline cost, which is both mortgage payment for principal and interest? This is just so I know exactly what is considered in this 40 percent package.

My other question for the Minister is: considering that, based on the supplementary analysis report, there are going to be children who are affected as a result of this, has the Minister sought any advice from Mana Mokopuna, the Children’s Commission, around advice on the impact on children from this, or alternatively has she conducted a child impact statement to look at what impact this will have on children?

Now, the reason I raise that specifically is that we have seen the Child Poverty Action Group report only yesterday, where there have been 47,500 more children living in hardship since 2022. Is this policy helpful or unhelpful towards our child poverty reduction targets?

Committee of the whole House

Thank you so much. I note that the Minister for Social Development and Employment has an amendment tabled in relation to Schedule 2. I find it surprising that we have an amendment where the Minister did not seek the opportunity to talk about what it does and why she chose to bring it forward post - select committee stage. I would welcome the Minister’s elucidation on what she’s intending to actually achieve under the amendment to Schedule 2 and whether it actually addresses, perhaps, some of the questions from Dr Lawrence Xu-Nan—

Dr Lawrence Xu-Nan: Yes, it does.

RICARDO MENÉNDEZ MARCH: Well, you may think that, my dearest colleague, but until I hear it from the Minister, I will not be reassured that it actually addresses your concerns.

I’m just generally wanting the Minister to talk about it, and I’d be keen to know why perhaps there was an error on Schedule 2 that needed to be addressed at this stage of the process. It kind of feels like a bit of a trend, at this point, of legislative lawmaking errors, whether they’re the inclusion of the winter energy payment, or even I remember on a previous bill there was an “A” that was supposed to be a “P”, and vice versa, when it comes to “applicant” or “person”, that, I believe, the Clerk fixed before it had Royal assent. I would love the Minister to also tell us at what point she identified that perhaps there may have been an error in the drafting of it.

Going back to the comments in relation to families with children, something that I think is not clear to me, and there are two different definitions—I know that my colleague asked about child poverty targets. I’m very specifically interested in the impact this has on material hardship rates. These are two very different concepts that the Government measures. I’m interested in the material hardship rates because they actually just simply tell us whether children have enough to make ends meet, and that’s actually the very strict definition—are they able to cover their basic essentials? Because we know that around 60-plus percent of the families affected by this have children, I would like to know if there’s a statistically significant difference in child material hardship rates arising from the decrease in the accommodation supplement that 9,000-plus families will see.

I say this because I think the latest reports on child poverty have found that there have been statistically significant changes around this, and so I’m curious to know whether she modelled the hardship rate stuff and whether it’s statistically significant. I want to pre-empt that she may claim, “Well, but I’m increasing it elsewhere,” but I want to know, across the board—I believe that the reductions in the accommodation supplement from this bill are still steeper than what the increases of some families may end up seeing on a per week basis per family. I’m interested in those things, and I’ve got some more questions on the people who it affects if the Minister would like to comment.

Committee of the whole House

To answer the previous member, Lawrence Xu-Nan’s questions, there’s no grandparenting of the accommodation supplement payments; they apply to all existing and new clients on or after 1 April 2027.

In terms of the Amendment Paper, that was just one of those technical changes that’s picked up by the Parliamentary Counsel Office to make sure that we are absolutely accurate when the bill is presented to the Parliament.

In terms of the question around accommodation costs for homeowners, allowable accommodation costs include mortgage repayment, insurance, rates, water, and those sorts of costs.

Committee of the whole House

I move, that debate on this question now close.

SPEAKER: There’s a little bit left in there, but it’ll be fairly focused.

Committee of the whole House

Thank you. Would she have any information on the geographical areas across the country? I know she talked a lot about the rural areas that she’s expanding the accommodation supplement on. I’m interested in the geographical areas that may see the steepest reduction in the accommodation supplement on a per week basis.

Like I said, I believe that the advice showed us that some families may see a reduction of around $40 per week, which is actually quite substantive if you’re trying to meet your costs. But something that hasn’t been addressed or engaged with has been the sort of geographical concentration of where those reductions will be. She talked a lot about the expansion of rural communities, but is the reduction, for example, predominantly in urban areas? Is it also in rural communities that currently have access to the accommodation supplement? Did she even make any analysis on the geographical sort of distribution of the families that will see a reduction; if not, why wouldn’t she take that into account, well knowing that housing costs do differ across different parts of the country?

Committee of the whole House

So the member will be aware that the accommodation supplement is based on bands across the country. I didn’t address the comment before about the impact on child poverty. All measures in a budget are all taken in as a collection, rather than individual initiatives. So with Budget 2025, there was a report at the same time around impacts of Budget 2025 in its entirety, rather than this individual initiative.

Committee of the whole House

Thank you so much, Mr Chair. I think the Minister for Social Development and Employment may have misunderstood my question. I think most of us know that accommodation supplement eligibility varies area by area. I’m asking: where will the reduction be concentrated? I don’t think it’s the same thing. We’re maybe speaking past each other. I say this because, for example, she hasn’t engaged with another part of my question, which is around: does she foresee or does she guarantee that no one will miss out on mortgage payments and end up losing their home? The reason why the geographical distribution matters is: is she aware that perhaps some of these homeowners may be in areas where emergency housing may not be readily available? If they do lose their home and they do become homeless because they can no longer afford the mortgage, what options do families have?

I raise this further point because she hasn’t given me any reassurances that no one will end up not being able to afford their mortgage as a result of these cuts. So if they’re in areas where emergency housing doesn’t exist, what will be left for these families? Again, this is no minor issue: $40 a week may not mean a lot for people in this Chamber, but it actually could mean a lifeline for the families who she is trimming the accommodation supplement for.

Committee of the whole House

The two areas—two regions—who are most affected by this are Auckland and Canterbury. As the member Helen White herself answered the question, in terms of homeowners, they have more choices available to them than those that are renting.

Committee of the whole House

I move, That debate on this question now close.

A party vote was called for on the question, That debate on this question now close.

Ayes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Noes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Motion agreed to.

CHAIRPERSON (Greg O'Connor): The question is that the Hon Willow-Jean Prime’s tabled amendment to clause 15 amending the homeowner accommodation supplement entry threshold to 35 percent be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Noes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Amendment not agreed to.

CHAIRPERSON (Greg O'Connor): The question is that the Hon Willow-Jean Prime’s tabled amendments to the new clause 16 be agreed to.

A party vote was called for on the question, That the amendments be agreed to.

Ayes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Noes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Amendments not agreed to.

A party vote was called for on the question, That Part 2 be agreed to.

Ayes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Noes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Part 2 agreed to.

CHAIRPERSON (Greg O'Connor): We come to Schedule 1.

A party vote was called for on the question, That Schedule 1 be agreed to.

Ayes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Noes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Schedule 1 agreed to.

CHAIRPERSON (Greg O'Connor): The question is that the Minister’s amendment to Schedule 2 set out on Amendment Paper 758 be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Noes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Amendment agreed to.

A party vote was called for on the question, That Schedule 2 as amended be agreed to.

Ayes 67

New Zealand National 48; ACT New Zealand 11; New Zealand First 8.

Noes 39

New Zealand Labour 26; Green Party of Aotearoa New Zealand 11; Te Pāti Māori 1; Kapa-Kingi.

Schedule 2 as amended agreed to.

Committee of the whole House

Clauses 1 to 3

CHAIRPERSON (Greg O'Connor): Members, we come now to our final debate, clauses 1 to 3—“Title” and “Commencement” and “Principal Act”.