Social Security Amendment Bill

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.

💬 Hon David Parker: None?

None—zero. And the Opposition is opposing the legislation! I will not dwell on this matter further, but that was a list of 28 Work and Income service centres. There is a further list of 66, which I am happy to dwell on if the member asks. I will now dwell on that. There is a list of 66 service centres where there are fewer than 10 unemployed people in that 18 and 19-year-old cohort on the books.

When one considers that there are only 135 Work and Income service centres, the fact that 28 have zero unemployed 18 and 19-year-olds on their rolls, and the fact that that 66 have fewer than 10 unemployed 18 and 19-year-olds, one can see an extraordinary record of policy delivery to New Zealanders and real support for them by our Work and Income front-line people. For the benefit of those National Party members who find this so hard to take, I will detail those. The real high count starts with Cambridge. It has nine unemployed 18 and 19-year-olds.

💬 Jill Pettis: Nine?

It has nine on the roll, as do Ponsonby / Grey Lynn and Wairoa. They are the only three with nine 18 and 19-year-olds on the unemployment roll. The fortunate front-line centres with only eight are Lower Hutt, Onehunga, and Tokoroa. The three centres with seven are Huntly, Ōtāhuhu, and Takapuna. There is a very long list of centres with six 18 and 19-year-olds receiving the unemployment benefit. I will detail these for the National members who have asked. They are Avondale, Greymouth, Highland Park, Horowhenua, Masterton, Mount Albert, Mount Eden, Queen Street, Three Kings, Waitara, Waiuku, Westport, and Whakatāne. Those with five—a group about the same size—are Feilding, Johnsonville, Kaitāia, Kawakawa, Kawerau, Ōrewa, Papatoetoe, Ruatōria, and Waihī. The group with four is Glenfield, Gore, Kaiapoi, Kaiti, New Lynn, Palmerston North Terrace End, and Rangiora.

I reinforce that these achievements are the result of the policy that this bill mandates. It is operating currently on a completely voluntary basis, and it is being extraordinarily successful, despite the opposition of the National Party members, who clearly do not want to see Work and Income supporting people into work. Before I get to the centres with zero 18 and 19-year-olds on their register, I have a long list of areas with only three or two. That list starts with Birkinhead District, Foxton, Kaikohe, Marton, Mosgiel, Ngāruawāhia, Ōāmaru, Stratford, and Waiheke. The centres with only two are Albany, Dargaville, Napier, Paeroa, Stanmore Road, Taihape, Taupō, and Waipukurau.

Just before we get to the big zeros—and I am happy to repeat all 28 of them again for Opposition members when I get the opportunity—let me tell them that in Balclutha there is only one 18 or 19-year-old. Only one! I am sure we do know the person’s name and he or she will not be on the register, receiving the unemployment benefit, for very long. Similarly, there is only one person on the list in Browns Bay, Greerton, Kerikeri, Morrinsville, Motueka, Nelson, Shirley, Taradale, Taumarunui, and Te Awamutu. So in all those areas only one 18 or 19-year-old is receiving the unemployment benefit.

It must be incredibly frustrating for Mrs Tolley to sit over there bleating about these figures, but the fact of the matter is that when those members, appropriately located on the Opposition benches, were in Government there were 161,000 New Zealanders on the National Party’s scrap heap—like the National Party members—unemployed. One of the most impressive achievements of many impressive achievements of this Government, which will sit on the Treasury benches for many years henceforth, is the fact that that number went to 30,000 6 weeks ago and to 28,000 a month ago, and last month it dropped to 26,000.

Now, that is too many people unemployed—of course it is. But the policies of this Government and the amazing front-line work of Work and Income has moved hundreds of thousands of New Zealanders from a position where they were parked by the previous Government—which used economic settings, including unemployment, as a tool to balance its books—to a situation where tens of thousands of them have been assisted into productive work. That is what this legislation is about, and that is why I find it so absolutely incomprehensible, so indefensible, and, frankly, so despicable that the very people who are bleating now and constantly beat on sickness and invalids beneficiaries, who need support from this community, are not supporting this legislation.

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—

💬 Jill Pettis: Name the dopey schemes?

Twilight golf. Did Labour have that? That was one of Labour’s, was it not? Yes, it was. Unfortunately, what we have is figures that nobody actually believes. We have a situation where the household labour force survey, which most people think is a pretty impressive survey and is accepted everywhere, keeps showing there are all these 15 to 19-year-old unemployed people. If the household labour force survey is so wrong, then we should know why it is so wrong.

Obviously, there is not enough work. The Minister is very quick to take credit for getting all these people into work, but how many jobs has he created? I can tell the Committee that the answer is lots of jobs in the Ministry of Social Development, and given that he is always so keen to talk about the fact that the number of beneficiaries is coming down at the moment, he might like to explain why it is that the budget for the welfare system keeps going up, far surpassing the modest increases in the national superannuation payment.

Why is it that we have more bureaucrats in the Ministry of Social Development, when according to his records there are two people in some places and no people in others? Well, obviously the staff there are not needed to do anything. Clearly, there is nothing to do. The mayors who got together and said they needed to do something to get youth off the street and into work—those 27,800 youth—have given themselves an extension until 2009. The reason they have done that is that they know there is not a lot of point in shifting a young person from an unemployment benefit on to a sickness benefit and telling them that that is the way to go, just so that these numbers can look better. Unfortunately, that is, in fact, what is happening.

💬 Russell Fairbrother: That’s not right; you know that’s not right.

I say to Mr Fairbrother that we know it is right. According to the Minister’s own figures 8,500 people just last year were shifted from the unemployment benefit on to the sickness benefit. Doctors are saying they want better criteria, because the criteria they have been given are simply not working. Instead, the Minister says: “Oh, you’re blaming doctors.” Not me. I am not blaming doctors. The doctors are saying the criteria are wrong. This Government loosened up the criteria, and now everybody is supposedly stressed.

Well, I find that to be something we should take very seriously. It is an absolutely chronic situation when we have young people being told they should be on a sickness benefit because that would make the figures look better. It is a cynical manipulation of the welfare system, and it is one of the reasons that the welfare budget keeps going up, despite the supposed fall in beneficiary numbers. When we, in fact—

💬 Russell Fairbrother: But you support the bill.

No, I do not support the bill. The reason we cannot support the bill is that some of its parts are so contrary to our views. Some of the parts are good, and I have tried to list as many good points as I can. But it is hard to do so when I am being abused so much from the Labour side. That must be because that is the way Labour members behave when the polls are so bad that everybody has turned off their phones and no one wants to take their calls any more. Everybody does this because Labour members get very, very nasty and trot out these figures that nobody believes.

I saw a notice the other day from Rick Barker, who used to be the MP for Tukituki until he got beaten by Craig Foss. Well, he is now no longer there. He put out a notice saying no one was unemployed in Flaxmere. Unfortunately, some of the locals got together and said that 20 unemployed people were actually on the court list and were about to be tried for criminal activities—and they were supposedly unemployed. So we have to wonder what we are talking about. Have members ever wondered about magical numbers? This Government has them. It magically twists around numbers. One of the other funny little things that this Minister does is that he has 82 questions he is not answering at the moment.

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.

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: Why?

Because there was not a “work first” mentality; it was a “benefit first” mentality.

This bill also talks about children—16, 17, and 18-year-olds—who can go on to the domestic purposes benefit to look after those who are invalids or sick, and those who could be hospitalised. This is a good thing, but do we really want to trap these young people into being on the domestic purposes benefit to provide for relatives and others in need? Surely the Government itself can provide for these people in need. Surely we can provide a safety net for them without 17 and 18-year-olds doing so.

The sanctions in this bill make interesting reading. 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 that sanction. We do not support this bill, but we do recognise that there is the odd thing in it that will help.

I move, That the question be now put.