Social Security (Long-term Residential Care—Budget Measures) Amendment Bill

on behalf of the Minister for Social Development: I move, That the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill be now read a second time. This bill will set in place a fair and responsible framework for assessing a person’s assets to determine whether they are eligible for assistance through the residential care subsidy. Increasing the asset threshold by the change in the Consumers Price Index maintains the real value of the assets a resident is able to own for their own use, including for bequests if that is their wish. It ensures sustainability of the residential care subsidy into the future.

This bill amends the Social Security Act 1964 to change the amount of the annual increase in the applicable asset thresholds used in determining the amount residents in aged residential care are required to contribute to the costs of their care. Current increases of $10,000 each year in the thresholds are replaced with Consumers Price Index indexation of the thresholds. The bill sets the thresholds for 1 July 2012 to 30 June 2013 to $213,297, which is Threshold A, and $116,806, which is Threshold B, respectively. Threshold B is the lower threshold, excluding a person’s home and car. It also requires those amounts to be CPI-adjusted by Order in Council for each later year beginning on 1 July 2013. This bill also ensures that the thresholds will continue to operate and to be CPI-adjusted for each year beginning on 1 July after the close of 30 June 2026.

I draw the attention of members opposite to the Beehive website—not difficult to find—where they will find a press release from the Hon Tony Ryall that sets out this particular measure. I am pleased to be able to bring this bill before the House today. I commend this bill to the House.

I would like to thank the Minister for the Community and Voluntary Sector, who just rose to take a call on the second reading of this bill, the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill, because she took 2 minutes to speak to this bill, as opposed to the Minister in charge of this bill, the Minister for Social Development, who said that this bill was such a priority for this Government that she gave it all of 1 minute’s attention in this House. It was all of 1 minute’s attention in this House. If this is such a priority for this Government, why have the two Ministers for whom this bill roughly comes under their areas spent the collective wisdom of 3 minutes in this House—3 minutes—to go through the merits of bringing in this bill? It has been only 3 minutes. There was not one mention in the Minister of Finance’s speech yesterday—3 minutes, and not one mention in the Minister of Finance’s speech.

💬 Hon Member: Not in the media pack.

It was not in the media pack. We are told that maybe there is a press release, and I will take the Minister’s word on that. Apparently there is a press release. This bill has been the dirty little secret of this Budget. Where did it come from? It is so important and it is such a priority that we are in this House debating it, and National members did not even want to talk about it—go and find the press release on Tony Ryall’s website. Fine, we will go have a look, but it is burrowed away somewhere, I am sure, in amongst what else he is saying about the health budget in this year’s Budget, which was delivered yesterday.

We are going to oppose this bill, and we support other parties that are going to oppose this bill too. Yes, we are going to oppose it because the process is poor. I have already mentioned the fact that this bill has snuck up on us. The people who are concerned about this in the community—the elderly and the families of the elderly—will not get to have their chance to have their say on it. As I think Mr McClay, or perhaps it was the member for Hamilton East, mentioned, he thought that the measures taken in this bill would help the Government get back on track in terms of its fiscal plan. Well, $4.5 million worth of savings in the first year is hardly a significant step change for the economy in order for this bill to become a reality.

If this is one of National’s big ideas in this Budget, I would hate to see the little ones. I would hate to see the little ones, because this is going to save us $4.5 million in the first year. It will affect 170 elderly people around our country, and their voice in this process has been taken away from them. I am sure there will be many, many families around the country who are concerned about the welfare of their elderly mothers, fathers, and grandparents, who are—[Interruption] Yes, that is a very good point, Sue Moroney. They have spent their lifetime savings to make sure—they have done the right thing. They have paid off their mortgages, and now they find the fact that this Government wants to take money off them. So, again, I make the point that this Budget has hit the young and the old, and probably everyone else in between.

This is another example, another symptom, of a Government with no plan. It has no plan to deal with the big issues. Instead of dealing with the big issues, it is almost like a really bad horror movie, where someone is doing the dishes and someone is coming up behind them with a dagger. You shout: “No! You need to address the problem that’s behind you! There’s a big problem behind you. Look out! Look out!”. But, no, that person keeps doing the dishes because the dishes are the right thing to do. No—survival is the right thing to do. Survival is the right thing to do, and this Budget that was delivered this week is a bad B-grade horror movie. Unfortunately, the people of New Zealand woke up and it was their own personal nightmare. That is why we need some real leadership, especially the elderly people of New Zealand. They need some leadership on this area too. This is tinkering—$4.5 million in the first year and $16.4 million in the fourth year. Aged care in New Zealand will become an increasingly important issue for our nation. If we do not start addressing this in a way that is not tinkering—and this bill is certainly an example of that—we will have big problems.

That is why we need to have that select committee process, so that people from both sides of the fence can have this debate. It would be an opportunity for that. But they are not going to get that. It would have been a great opportunity for Roy Reid and his team from Grey Power to come forward and say: “We don’t necessarily agree with this. We think that you guys should take a broader approach as to how we go forward, and maybe work together across this Parliament to deal with how we deal with aged care going forward.” But we will not get that. Instead, we get a piece of legislation that will do very little. It sneaks up on us; it does not even get a mention in the Budget speech. Apparently there is a press release—

💬 Hon Trevor Mallard: We’ve found it.

Have we found it?

💬 Hon Trevor Mallard: It’s a paragraph of something else.

Right. There is not a press release; it is contained in a press release. This is how proud National members are. They are so proud of it and it is such a priority that there is a paragraph in a press release, probably at the bottom of the press release, so it is camouflaged in this Budget. If this was such a priority, why was it not in the first paragraph of the Minister of Finance’s Budget speech? What we get is more contempt for the New Zealand people, more contempt for our elderly, and, in a previous bill that this House considered, contempt for our paper boys and paper girls around the country.

What we have got here is another example of bad process in this Government. It is taking away the voices of our elderly and their families, who should get to have their say on this. As I mentioned in my first reading speech, we should hear from the other side too, because I did see a press release out from Martin Taylor from the Aged Care Association. We should let him have his say as well. But, no, this is going through under urgency, under dodgy process. No one gets to have a say on it, but this is the way the Government wants to do the business on this. This is the way the Government wants to do business on this, on a very, very important issue that is facing our nation.

This is another example of a lack of leadership for this country. We were looking for leadership in terms of growth, in terms of how we create jobs, and in terms of how we look after our elderly. What do we get? What do we get? We get tinkering around the edges. It is the low-hanging fruit strategy from the Government: let us steal a little bit from the paper boys and the paper girls, let us take a little bit off our elderly. We will not tell them about it; we will just thrust it upon them in a very dodgy process in this House. Let them have their say. Let them have their say on this one, because the 170 elderly people in New Zealand whom this is going to affect surely should be able to have their say. And the 610 in 2015-16 should be able to have their say as well.

💬 Denis O’Rourke: And their families.

And their families. They are taking money away from some of our most vulnerable citizens in this country. They are people who have paid taxes all through their life, they have done the right thing, they bought a house, and they have built up their assets, and this is how the Government treats them. This is how it treats them. Do the right thing and make sure that you give these people their say, and give the other side a say too.

💬 Hon Maurice Williamson: Do the right thing and sit down.

You should stay sitting down, too. I am sorry, Mr Assistant Speaker, the member should stay sitting down. But, again, this bill is another example of lack of leadership. They have a crack at the oldies, they have a crack at the youngies, and they are probably going to have a crack at everyone else in between. But we have not found that press release yet.

I seek leave to table a document titled “Health receives largest increase in spending” embedded within which is a single-line reference—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! We first want to know the source of the document.

The source is the Hon Tony Ryall.

The ASSISTANT SPEAKER (Lindsay Tisch): Is this in the public domain?

Well, it is hard to tell. It is hard to tell.

The ASSISTANT SPEAKER (Lindsay Tisch): Is this on a website?

It is on a website.

The ASSISTANT SPEAKER (Lindsay Tisch): Well, we are not going to entertain that.

It gives me great pleasure to speak on this Social Security (Long-term Residential Care—Budget Measures) Amendment Bill, because this is a responsible bill, this is a realistic bill, this is a fair bill, and this bill certainly ensures the sustainability of long-term residential care in New Zealand with the changing demographic that we have.

💬 Hon Trevor Mallard: Rubbish! It makes no difference to long-term residential care.

And there we have Trevor Mallard saying “Rubbish!”—and how absolutely typical this is of Labour over there, who undoubtedly are in “Cloud Labour Land” once again.

💬 Hon Members: Get the lines right! It’s “Planet Labour”.

Well, “Planet Labour”, as well. Those members have totally forgotten about the global recession, they have totally forgotten about the Christchurch earthquakes, and they have totally forgotten about the unpredictability of the situation right around Europe and elsewhere. They are determined to spend more, to tax more, and to borrow more if they possibly can. That is what they would do. Only last week I was overseas with their former leader the Hon Phil Goff, and it just does bring back to me the absolute reality of how lucky we are here in New Zealand with responsible government, with stable government, and with enlightened government, and that is what this is all about.

We have heard from this tawdry Labour Opposition that this bill has been kept secret. But this measure has not been kept secret from the sector. Government Ministers briefed the sector just prior to the Budget, and neither the Aged Care Association nor Grey Power have put out press releases against this measure. I think it is very important that, indeed, the Opposition does realise this.

It is important to realise that from 1 July the change will take place whereby the Government will begin adjusting the asset threshold for rest home care subsidies at the rate of inflation. It is because it comes in on 1 July that it is important that we have urgency at this stage of events. We will be using the Consumers Price Index, because that is a realistic and rational way to ensure that there is an appropriate adjustment.

I looked back at the Hon Ruth Dyson’s speech when she introduced the bill in 2004, and, of course, somehow she plucked out of the air a $10,000 increase that was going to continue on to 2025. The reality of that is that in 7 years for a single person this has increased from $45,000 to $115,000—more than doubled. It has by far more than doubled and that is just unsustainable. In these times it is quite unworkable and unrealistic.

So we have over there a party that is prepared, in these difficult economic times, to pluck something out of the air, and have no rationale whatsoever as to the number. Those were the days when we had surpluses, when the Government could have been using a much more prudential long-term view so as to get New Zealand well prepared for the future. But, no, it did not. It was prepared just to pluck this number out of the ether, and away it went, and, consequently, we have seen this amount more than double in 7 short years, which is totally unrealistic. So we are simply slowing the rate of increase in recognition of tight times and an ageing population. We are making sure we can afford to afford subsidising the cost of residential care for an increasing number of older New Zealanders who need it. When Opposition members talk about $4.5 million in the first year, over 4 years this actually amounts to $34.5 million. That is a substantial amount of money. Every million dollars counts. It might not to that wasteful Labour Opposition, but for us it is absolutely important. This is a responsible bill, this is a realistic bill, this is a fair bill, and this, indeed, will sustain long-term residential care into the future.

You can always tell when a member does not believe a word he is saying, particularly a member like Dr Paul Hutchison, who is regarded by every member in this House as having integrity and being honest. He had to force every single word out of his throat and out of his mouth. It was so clear that he does not believe a word of it.

Earlier in this debate we heard first of all from the Minister for Social Development, the Hon Paula Bennett, who introduced this piece of legislation, the Social Security (Long-term Residential Care—Budget Measures) Bill, in the most lacklustre, unpassionate, resentful way imaginable in the House. Then we heard from Jo Goodhew, the Minister for Senior Citizens—except when she is supporting legislation like this. Then we heard from a new member, Alfred Ngaro, that in fact National did release a press statement announcing this legislation. So what I would like to offer, again, is for one of those members, or any National member—frankly, I do not give a toss which one it is—to table the press release. It is not on the National Party website.

💬 Hon Jo Goodhew: It is.

It is nowhere to be found.

💬 Hon Jo Goodhew: It is.

The Minister is bleating away “It is. It is” Well, I am sorry, Minister. It is not.

💬 Hon Jo Goodhew: Then you’re blind.

No, I am not blind. I am able to go through the National Party website. Other people have, including members of other political parties. So I just invite the member to table it.

💬 Hon Jo Goodhew: Your colleague tried to table it before.

I would just like to invite the member to table the press release announcing this legislation, which is being put through under urgency through all stages. I want to further invite the next National speaker to explain to the 170 affected residents of residential care in New Zealand why the contract that they entered into when they entered the residential facility—which explained how much they would be entitled to keep as their assets before they were fully subsidised, or partly subsidised, in that residential care facility—is being broken. Why is the contract with those 170 hard-working, decent, honest, good New Zealanders being broken, because this bill is going through under urgency, without giving any of those residents the opportunity to appear before a select committee and say to this House “We entered a residential facility on the clear understanding that the legislation was in place and that is how we would be affected.”, but now under urgency the rules are being changed from 1 July?

I think that every single one of those 170 residents deserves the respect of having the opportunity to appear before a select committee. In fact, it would not do any harm if members of the select committee actually went to a residential care facility and listened directly to those residents. But we have not had that respect shown to any older person in New Zealand. What we have had is older New Zealanders being described as a problem, being described as a burden, and being described as a critical part of the financial crisis. If saving $4.5 million by taking money out of the pockets of current rest home residents is going to save New Zealand, then National has quite a lot of fronting up to do about the actual financial position we are in. Taking $4.5 million from 170 residents in residential care is what this bill is going to save in the next financial year. That is out of $94 billion that the Government is going to spend. How can saving that amount of money ensure the long-term sustainability of the asset-testing regime? It is just nonsense.

The fact that the Government is ramming this legislation through under all stages, under urgency, without giving one single member of the public the opportunity to have a say, shows just how ashamed they are of this legislation. I bet that not one single backbench member went into their caucus briefing on the Budget on Tuesday knowing that this legislation was going to be introduced. I challenge any single National backbencher to tell this House that they knew, in advance of their caucus briefing on Tuesday morning, that this was what they were going to be signing up to.

💬 Hon Trevor Mallard: Not one.

Not one single member of their caucus knew in advance of the caucus briefing on Tuesday that they were going to have to put their name on the public record to this legislation being rammed through under urgency for no good reason. Not one single member of their backbench knew it. What about after the caucus briefing? I want any single National backbencher to tell this House that they knew, after the caucus briefing on Tuesday, that this legislation was being introduced under urgency and being taken through all stages.

💬 Hon Trevor Mallard: No, not one.

Not one single National member was told about this legislation in advance of its coming in. I guess what you could conclude from that is that older New Zealanders should not feel too bad, after all. Yes, they have had the rules around asset testing changed, yes, the bill is going through under urgency, and they will be totally denied any opportunity to have their say about whether or not this is a good move, whether it is justifiable, whether it is fair, but they should not feel too bad about that, because not one single National backbencher knew about it, either. They clearly did not have a say. No wonder Alfred Ngaro was so embarrassed about speaking on behalf of it! The member used to be highly regarded in Auckland in the social services sector, but that regard is rapidly disappearing and, I think, quite tragically.

I think it is an embarrassment to the process of Parliament that when we have the opportunity to say this is an issue that requires the urgent attention of the House and therefore we will extend our sitting hours, and we will all stay in Wellington away from other work that we would normally do on a Friday, the process is being used to cheat our older New Zealanders out of the money that just yesterday they could have looked up in the legislative framework—in the statute book—and seen what they would be entitled to. They have now had the rules totally changed. A number of those people are already in a contractual arrangement with a residential provider. They cannot change that arrangement. In just over 1 month the rules will be changed. I think that is an embarrassment. I think the process is a breach of the goodwill of Parliament. I think the Minister for Senior Citizens, the Minister for Social Development, and the Minister of Health should be ashamed of themselves.

I want to first of all make some remarks in response to the contribution from Dr Paul Hutchison. Dr Hutchison’s contribution to the debate indicates, I think, that perhaps like everyone else in New Zealand he has been left a little flat-footed—and the remarks from my Labour colleagues may indicate why—about what this Social Security (Long-term Residential Care—Budget Measures) Amendment Bill does.

He appears to suggest in his contribution that the change is merely a cosmetic one. He draws our attention to the reasonableness of CPI increases—in fact, missing the point that actually what this bill represents is a fundamental change to the State’s policy in relation to asset-testing thresholds. Actually, we are moving in this bill—which will not be subject to any submissions at all from the public—to a regime in which the current threshold is frozen in real terms. That is what we are doing. We are freezing the current threshold, and that is a change from a policy that has been in place since 2004 of actually progressively rolling back the threshold. That is not just a cosmetic change; that is a fundamental change.

As Ruth Dyson indicated, it is a change that older New Zealanders, I believe, are entitled to have been consulted about, because, actually, if there is one thing that older New Zealanders ask from the State, it is some certainty on which to plan their affairs. Effectively, they had been made a promise about the asset-testing regime that would be in place at the point that they might need residential care, and that promise is now being gone back on. That is what the Government is doing with this bill. Sadly, Dr Hutchison does not seem to understand that that is what is being done. Most New Zealanders will have woken up this morning not understanding what is being done. I just hope that through the process of this debate we can actually raise with them what is occurring and the fact that, tragically, they will not have a say on it. They will not have a say on it.

Dr Hutchison suggests there is support for the changes being made. The weak basis for that claim is that he has not personally seen a press release from Age Concern or Grey Power about it. Well, I have not seen their press releases, either, but I did hear Roy Reid, the National President of Grey Power, on Morning Report this morning around a quarter past 6 saying that he thought it was a very bad idea, and talking about asset testing as a discriminatory act against older people. That is the Green Party’s view also. That is the Green Party’s view—that asset testing for aged residential care is discriminatory on the grounds of age against a group of New Zealanders who actually, if anyone is entitled to it, are entitled to security in their old age. “What is there more important in Christianity than to be our brothers’ keepers in reality? Why should people not have security in their old age, or when they are invalided?”. That was Michael Joseph Savage, from the parliamentary debate on the introduction of the Social Security Act in the first place. Indeed, that cuts to the very heart of this issue.

Finally, Paul Hutchison refers to this bill as being a responsible bill. Well, I would say it is not responsible. I would say it is responsive, but responsive not to the needs of New Zealanders but, rather, to the need of the Government to be able spin the health budget. Because the spin is all about $1.5 billion extra for health—health being the big winner from this Government’s Budget. Well, it is a struggle to figure out exactly how the Government has reached that $1.5 billion number, but it seems to be the total cost over 4 years of what have been announced as new initiatives. Well, that is a cost, it is over 4 years, and it is not about the revenue. So, yes, it is true; it is true that the Government is intending in the Budget that the Minister of Health, Tony Ryall, has trumpeted with the press release that is on the Beehive website—and I see that members from the National Party have been displaying it on their iPads—to spend that. It is true that that is the total cost of those new initiatives. But the fact is that in a Budget that at its top line is supplying just $288 million more in Vote Health—and that is barely 2 percent of the Vote Health budget—as an increase, that increase is probably not enough to cover even the cost of inflation in health, let alone the growing population and let alone the growing population of older people with increased needs. So, actually, the increase from last year to this year in Vote Health will not even enable the sector to stand still. Just to be able to try to stand still, the sector will need to be cutting health services. That is the only way that the sector will be able to do that.

On top of that, we have got a whole series of new initiatives from the Government. Well, all of those new initiatives—$434 million in the first year—will have to be funded by cuts elsewhere in the health sector. That is not how it is being spun by the Government, but that is the reality when the Budget is not even being increased by enough to cover inflation, let alone demographic factors and let alone these new initiatives. So the only way that the Government is able to put more money into elective surgery, for example, or more money into rheumatic fever, or more money into cancer services is to take that money from somewhere else in the health sector. Sadly, in this bill we are seeing the machinery behind one of those sources, because one of the places that the Government is taking money from to be able to fund those new initiatives and the demographic change in demand is older people. It is from older people. Actually, that is the point.

So what Mr Hutchison says—that this is a responsible Budget—is completely wrong. It is responsive to the Government’s need to find revenue sources to fund its extravagant promises in health and its extravagant spin around health. That is reprehensible because the cost of doing that—and members have referred to the year 1 contribution that this measure will make of just somewhat over $4 million—the amount of money that the Government will peg back by going back on its promise to older New Zealanders, over time will increase. In the fourth year it is something like $16 million. Sure, it is not a lot in the face of the health budget, but what it suggests is a Government that is so desperate to be able to support its spin about health spending and about the $1.5 billion in new initiatives that it is prepared to claw back even that promise that it made to older people.

There are big issues—there are big issues—in aged residential care. The Green Party and the Labour Party in the last term of Parliament produced a report about what some of those issues are. They are things like ensuring quality of care. They are things like ensuring equitable wages for the work that is done in that sector. And they are things like ensuring the dignity of older people and reflecting the dignity of older people in the type of care that they receive and the type of regime to which they are subjected. In this bill the Government further undermines the dignity of older people by creating, once again, a discriminatory regime and entrenching that regime. That is not what older New Zealanders deserve. Older New Zealanders deserve that security in the evening of their days, as Michael Joseph Savage first promised in the 1930s, and that is what this Government ought to be living up to and is not.

It is a great pleasure to rise to make a short contribution on the second reading of the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. But before I go forward with this speech I would like to just respond to something Ruth Dyson said. I would like to say that unlike the Labour caucus, this caucus on this side of the House does not leak like a sieve. We do not actually comment about things. We have discussions, but we do not actually leak like Labour.

Demand for long-term residential care for older people is increasing, and this important bill will make sure that the aged residential care subsidy is sustainable into the future. That is the important bit—that it is sustainable into the future. We need to make sure we can pay for it in the future. The number of New Zealanders aged 65 and over will exceed 1 million by the late 2020s, compared with half a million people back in 2009. In fact, the number of people over 75 years of age is forecast to double by 2033. From 1 July the Government will begin adjusting the asset threshold for rest home care subsidies at the rate of inflation. To me, that is actually a good thing, because unlike the rhetoric that the Green Party and the Labour Party—the members opposite—have been saying, what this change really means is that 30 percent of people receiving rest home care who pay the full price of their care will do so for a little longer—on average, it will be for about 8 to 10 weeks—before the lower rest home subsidy actually kicks in. The asset threshold for the aged residential care subsidy will increase from $210,000 to $213,000 for single people and for married couples where both are in residential care.

This is a responsible bill. This is a pragmatic bill. I commend it to the House.

Before I call the next member, I have been informed that this is to be a split call between members of New Zealand First. The members participating can determine how much of the 10 minutes they want each. I will ring a warning bell at 2 minutes from the end of the 10-minute call.

New Zealand First is not supporting this bill, the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. Yes, we are not supporting this bill. What next? Paula Bennett decides to take away the SuperGold card to provide funding to pay the accounts manager for KiwiSaver? That is what is going to be next.

How demoralising, how disgusting that we show our gratitude to our elderly by forcing their hand to sell off their hard-earned assets in order to feed the welfare reform, which should be called welfare destruction. These welfare reforms are doomed to disaster. How senseless is the current Government, which has decided that the elderly of New Zealand must take out loans in order to pay for care. Because that is what this is all about. We might as well slam the elderly into urban ghettoes. That is definitely going to happen. This new housing scheme, which is incorporated into the welfare reforms, is sure to see South Auckland turn into a dumping-ground—it might as well be. The zero Budget means zero chance for both younger paper boys and girls and senior citizens. It has been made very clear that basing the threshold on a volatile CPI means that the threshold will always be vulnerable to change. The elderly lying on their deathbeds will be forced to wait on their assets either to depreciate or be sold off, just so that they are cared for. Somebody needs to tell that to the National Government. Funnily enough, we will now be asking our elderly to sell off their life insurance and savings and take out loans, just so that they can be provided with care.

As for Tim Macindoe, Alfred Ngaro, and Mike Sabin, it would be interesting to see whether those members would give up their houses or their pay to pay for elderly residential care. There are a lot of elderly in Manukau. There are a lot of them from where Alfred Ngaro comes from. How hypocritical is this Government giving this Budget the theme of—

💬 Tim Macindoe: I raise a point of order, Mr Speaker. It is a longstanding convention in this House that you do not use that particular word to describe other members.

💬 Mr DEPUTY SPEAKER: I was communicating with the senior Opposition whip, so I missed it, but I will take the member’s word. I am not sure what it was, but do not do it again. [Interruption] Yes, that word is inappropriate.

Assets include prepaid funeral schemes. Well, say goodbye to them. The elderly will not be able to die with dignity. No, it is more important to let them struggle to live. That is what this is all about.

It is obvious that the National Government has been sitting on this announcement for quite some time. It knew about it well in advance. The welfare reforms, which should be renamed “welfare destruction”, will not work. Funding has to come from somewhere, right? It has to come from somewhere. These welfare reforms have been rushed through simply to sugar-coat a non-existent job market. These welfare reforms, this welfare destruction, will have skilled Kiwis packing and off to Australia.

New Zealand First definitely does not support this bill, because it discriminates against our elderly. Alfred Ngaro and Peseta Lotu-Iiga, I challenge you to come out to Manukau, to come out to South Auckland and tell the people of the Cook Island and Samoan communities, tell the Tongan community, the Tokelauan and the Tuvaluan, what the National Government’s plan is doing, which is to take away what they rightly should be entitled to. Thank you.

Further to my colleague Asenati Lole-Taylor’s learned comments, I would like to add that our question is: where is democracy? Where is the true democratic process, where we go to a select committee and New Zealanders get their opportunity to view democracy in progress? But we have come to learn that with this Government, democracy is in short supply. When we look at this Budget—what I call a “bovine-manure sandwich Budget”—which this Government has thrust down the throats of good New Zealand families, we see that it has taken a million here and a million there from other areas, and has just thrown it in as a lubricant. But here is the kicker: it spent $120 million on marketing to isolate New Zealand families and make them think that somehow they are the only ones who do not like the taste. I would say to members like Mike Sabin and Mark Mitchell: take this “bovine-manure sandwich Budget” up north to your constituents and ask them whether they like the taste. Mark Mitchell, take this “bovine-manure sandwich Budget” to the elderly in your electorate and ask them whether they like the taste. I wonder whether the elderly, when they were overseas fighting for New Zealand, ever thought they would be coming back to this: selling New Zealand off and attacking the vulnerable and the young and the elderly.

Having to respond to the contribution of that member, Brendan Horan, about bovine infection, or whatever it was, is a wonderful place to start for the member for Taranaki - King Country. I would suggest that he needs a dose of either milk fever medicine or some bloat oil. I am going to try something novel in this debate: I am going to refer to the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill that is before us, and speak in support of it.

If you pick up the bill and just read the general policy statement, it states: “This Bill amends the Social Securities Act 1964 to change the amount of the annual increase in the applicable asset thresholds used in determining the amount residents in aged residential care have to contribute to the cost of their care. Current increases of $10,000 each year in the thresholds are replaced with Consumers Price Index (CPI) indexation of the thresholds.” From listening to our opponents, the presumption is that there must be going to be an increase. When you have a listen to the general comments from our opponents, they are about the National Government reducing the tax on the rich, and they are about the National Government not taking into account those who are vulnerable in society. What I would suggest is that the levers that the National Government is going to use have a far greater opportunity to reduce the Consumers Price Index increases every year than any other particular measure you have seen from a Government in recent times has done. By doing that, there is a high probability that the increase for those in long-term aged residential care could be less than $10,000 per year. Injecting a bit of fact into the debate occasionally is, I know, new and novel, particularly if you are on the other side of the House, but I thought that might be worthy of mention right now.

This is a sensible measure proceeding from the Budget, and I look forward to it progressing through the House.

It is my pleasure to speak on the second reading of the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. I was listening to the contribution made by the National member Shane Ardern, and of course he was speculating over some of the impact that this bill—these changes in asset thresholds—might have. I guess the key word there is “speculating”, because we really do not know, because this bill is not going to go through the rigorous process that we would usually in this Parliament expect a piece of legislation to go through. We do tend to use urgency, I think, often unwisely in this House, and I think this is a prime case of that. I understand that when we are talking about excise and when we are talking about things that might cause a run on the liquor stories, you may have reason for extraordinary urgency, but this is not one of those cases. So I really challenge the Minister for Social Development to share with us during the Committee stage why this was determined to be of such urgency that we denied the people of New Zealand the ability to have their say. I look forward to the Minister’s contribution on that, because I know that on this side of the House we would have appreciated the opportunity to speak with members of the public about the impact that this change would have on them, and also with the likes of groups such as Grey Power and Age Concern, which represent the interests of the people, the elderly, who will be affected by these changes.

I am also interested, from the Government’s side, in its motivation for this change, because I do not think that has come across with enough clarity. Is it an issue of sustainability? Or is it an issue of revenue? I see these as being two distinct things. Most of the changes we have debated in this House to date, since the Budget was read yesterday, have been under the proviso of revenue-gathering exercises or savings. If that is indeed the case, and if this is the best we can do, that is somewhat worrying, and we would suggest that there is still time for the Government to consider a capital gains tax. Secondly, if it is an issue of sustainability, then I think that that is an incredibly interesting point, because the impact that this will have will be very direct for the individuals it affects, but in terms of the wider fiscal spend, nominal—compared, for instance, with the impact of superannuation.

I should not need to tell the Government this, because it is set out in plain language in Vote Social Development. In fact, it states, from the Ministry of Social Development, that New Zealand superannuation accounted for 55 percent of total expenditure on benefits in 2007-08, and fell to nearly 52 percent. This ratio is at 55 percent in the current year, and is estimated to rise to 60 percent by 2015-16. Sixty percent—that might seem meaningless, but when you factor in that within 3 years the amount we spend on superannuation alone will be equivalent to almost the entire education budget, then we are starting to talk about a significant spend.

So if we want to talk about sustainability in this House, we need to start getting real about the impact that our superannuation spend is having not just on social development but on the New Zealand economy generally. In fact, by 2050, according to the long-term fiscal Treasury output—which, of course, it is required to provide, I believe, every 5 years—over $200 billion will be the amount of the shortfall. That is more than New Zealand’s entire GDP. Even Treasury is supporting a lift in the age of superannuation. It is completely disingenuous that that side of the House should try to maintain the line that we do not need to look at this issue. We absolutely do, and this is classic avoidance. This bill represents classic avoidance. In fact, Bill English himself admits that something needs to happen in this area, which puts him at odds with the Prime Minister when it comes to the age of eligibility for superannuation. In fact, it is widely known that the Prime Minister comments privately that the position is probably unsustainable, but because he has made a political commitment he is unwilling to address that.

That is not leadership, in my mind. That is not leadership. These are the hard issues and the issues that this Budget has chosen to avoid, and the result of that is this bill. This bill is a direct result of avoidance from that Government around the most significant issues. I even, just this morning, heard a Government Minister, in fact, state that the Retirement Commissioner said that this is really going to bite in 2020, so we do not need to worry about it now. We do not need to worry about it now. Again, I see that as a failure of leadership. The reason we need to debate this now is that for all of those who are under the age of 45—that may not include many people in this House—they deserve to know that there will be changes coming. They deserve to know that the system will be sustainable, and they deserve, for instance, to have the knowledge in order to be investing in their own retirement funds, because that is what we are going to need in the future: a real mixture of personal savings as well as superannuation.

But the sad fact is that most of the people my age when surveyed by the Retirement Commissioner did not believe that universal superannuation would be available to them when they retired. And no wonder, when you see classic avoidance in this House to deal with the sustainability of superannuation. We need to address it. I also think the reason we need to address it is that we need to start looking at ways to cushion any change on our most vulnerable. I do believe it is necessary that if we see a lift in the retirement age, those who are working particularly in low-wage, low-skilled, but hard working environments, which mean that it would be physically impossible for them to continue beyond a certain age, we need to make sure we cushion that, that we have the necessary policy in place that allows them to retire at a time that is fair and equitable. We need time to develop those policies and those ideas, and that is what we should be debating in this House, not this threshold change that we are debating today.

But, also, I think one of the reasons the Government is unwilling to bring this up, to date, is that it would highlight the contradictions in what it is doing currently. In fact, if this really is about sustainability for people when they retire, delaying auto-enrolment, delaying the urgency around people’s personal savings, which we know is crucial, given the outlook for the Treasury books, seems utterly bizarre to me. Our personal savings are shallow—they are shallow—and that has a flow-on effect for our wider economy. But instead of encouraging further personal savings, this is another thing that this Government, for political expediency, has decided to just waylay, and we cannot do that for ever.

Where is all of this coming from, then—this idea that all of this should be loaded on to future generations? It is not just in superannuation policies, it is not just around superannuation; the intergenerational inequity that this Government feels perfectly content to load on to the next generation of voters extends beyond superannuation. Where else does it go to? Well, we can name a few on this side. Asset sales. Selling off future revenue-gathering—[Interruption] I am still going, I am sorry, Mr Calder. I have not finished. We are selling off our assets—a future source of revenue for the next generation.

What about student allowances? I will listen intently to you when you do get to your feet, but, if you would not mind, I want to use these 2 minutes. Secondly, student allowances—we have now removed, in Mr Joyce’s wisdom, the ability for anyone at postgraduate level to gain a student allowance in order to allow them to contribute to our economy. This bill delays the bigger issues, and instead of dealing with them we are offloading them on to the future generations.

It is easy for that Government to talk in general terms about policy like this, but what about some real examples? I know a graduate at the moment who is studying towards helping those with learning disabilities—deaf children to learn in the classroom. She will not be able to complete her studies, as a consequence of Mr Joyce’s grand plan to remove student allowances. And I have not even started on the freeze on early childhood education funding, and, of course, the classic paper boy tax credit, which becomes emblematic of this Budget—and how emblematic of this Budget is that Government’s refusal to address the big issues. That is why this is a nickel-and-dime Budget.

It is timely, in view of the rhetoric we have heard from the other side of the House, to remind the House that this legislation, the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill, maintains the real value of assets a resident is able to retain, as the indexing of the threshold index allows. It is a sustainable protection of some of the vulnerable in our society.

Dealing with the debt that this country faces is the key to our recovery. We understand that on this side of the House. We understand that. The people of New Zealand understand that. Is it understood on “Planet Parliament”? Is it understood in “Gulag Green”? Is it understood in the land of Nod?

💬 Hon Member: Absolutely no.

Absolutely not. No glimmer of understanding from New Zealand First, either. However, we on this side of the House do know that this Government has to get back into surplus by 2014-15, and this is what we are about to do. This is a principled, pragmatic Government. I commend this bill to the House.

I call Dr David Clark. This is a split call?

💬 Dr David Clark: It is a 5-minute call.

Are the Greens seeking a call? Yes. A split call—5 minutes.

I was not going to rise to speak in this debate on the Social Services (Long-term Residential Care—Budget Measures) Amendment Bill, but I feel compelled to, given some of the aspersions Mr Woodhouse was casting earlier, in the first reading. Mr Woodhouse was casting aspersions on me for wanting the elderly people of Dunedin to have their say. He did not want the elderly people of Dunedin to have their say. In fact, he was apoplectic with rage at the thought that his own constituents—well, they are not actually his constituents, to be fair; let me say the elderly of New Zealand—should have a say on this legislation.

Old folks do deserve a say on this legislation. It concerns the assets that are in their care. They are the assets that enable them to have a sense of independence and a sense of being their own person, even as they go into aged care, and to have the opportunity to pass something on to their wider family from the hard work that they have done throughout their working lives. Those same old people also have a concern for intergenerational equity. The older folk whom I talk to—certainly, at the moment—are concerned about their children and particularly their grandchildren, as they see that their generation has many of its assets still intact but those younger folk are missing out on educational opportunities that the older folk feel should be afforded to them, because of many of the miserly changes that this Government is making around tertiary education policy right now.

So I want to challenge Mr Woodhouse to go out and perhaps have a chat to the people at the Montecillo rest home and tell them he does not want them to have a say in terms of how these decisions are made. I want him to go out and talk to the people at Ross Home.

💬 Clare Curran: I’ll go with him.

I have my colleague Clare Curran saying she will take him there if he does not know where to go. These rest homes in Dunedin have people in them who care about their own situation and care about the situation of their grandchildren—

💬 Clare Curran: Oxford Court.

—and they feel they should have a say in these pieces of legislation. Mrs Curran is offering to take him to Oxford Court as well. There we go, we have got a programme of visits for Mr Woodhouse if he wants to hear whether old people should have a say in, or have an opinion on, this legislation, which his Government is trying to ram through following the Budget because those members believe that stealing—I should not say stealing; please excuse me—taking money from the elderly and taking money from the paper boys and paper girls of this country is their most urgent priority. They do not want to have a debate about what is going on in the world outside of those easy targets. They do not want to have a debate about real people’s lives. They do not want to have a debate about the pro-growth tax measures that they could be putting through instead of this kind of grab. They do not want to have a talk about pro-export measures. In the previous bill, we saw that they were actually more concerned about putting red tape on business, and we have seen that they are just taking the money where it is easy to get.

So my challenge is and remains for Mr Woodhouse to go and ask those people whether they are really happy to miss out on having a say in this regard. This bill does affect real people, and this process is simply wrong. We have a select committee process for a reason. It would allow people to weigh up the trade-offs that are being made in this bill and the very real effect that those trade-offs would have on different people’s lives. I challenge Mr Woodhouse to get out there, talk to those people, and see whether they really would rather have a say. My view is that I think they would.

Tēnā koe, Mr Speaker. Tēnā koutou e te Whare. I rise to take a short call on the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. Obviously, the Green Party will not be supporting it, as my colleague Mr Hague made clear earlier. There are a number of reasons for that, which I think he outlined very well: the problems with asset testing and why it is discriminatory.

I rise to speak on this bill with a feeling of misgiving because this bill and other Budget legislation are being rushed through under urgency. In my short time in this House I have been really impressed by the quality of submissions and the level of engagement in our legislative process by knowledgable affected citizens. I acknowledge that many of my colleagues have spoken about this already, but I would like to say that an opportunity to come to a select committee and explain how one will be affected by proposed legislative changes is not just a privilege, and it is not just an opportunity to engage in the democratic process; it is actually a really useful tool for us as legislators. It gives us essential information that ensures that there will be a robust policy that will actually serve all New Zealanders, and that we are taking into account all of the costs, all of the benefits, and all of the trade-offs.

The very, very brief regulatory impact statement on this bill, which was clearly delivered just a few days ago—not a lot of research went into it, as far as I can tell—is just another example of bureaucrats in Government departments being told to make choices about how we can find fiscal savings. That is the entire objective: how can we find fiscal savings? There is no real consideration of what the human cost of it is. Really, the only way to know that is to go out and talk to the people affected. I would like to see more of that in our legislation—that we are actually hearing from New Zealanders about how they are going to be affected.

I have to acknowledge what Ms Jacinda Ardern said earlier. We really do need to have a debate about the sustainability of superannuation, and we need to start having that debate now. Let us imagine if this National Government, for example, was going to be forced to deal with that problem, which is a problem of debt. It is interesting to hear those members saying that we are not willing to engage with the problems that we are facing, when in fact it is about choices, and some of the debt problems we are facing have been created by this Government’s choices. Although it is quite happy to spend billions on tax cuts for the rich, it is looking to find fiscal solutions elsewhere and savings elsewhere. It is not willing to have a debate about superannuation. But if National is in Government in 2020—which it probably will not be—when this starts to become a serious problem, it seems to me, by the example that has been shown today, that it would not engage with New Zealanders, not have a conversation about it, but just wait until Budget day and rush it through under urgency without any sort of consideration or advanced warning. I think that is really unfortunate. That is really all I have to say. Thank you.

I just want to reflect back on the rather bizarre and stunning contribution from across the floor in New Zealand First. The member Brendan Horan suggested that perhaps I should take what he considered to be a bovine-manure sandwich—referring to the Budget—to my colleagues in the north and ask them to eat that. Well, I would suggest to this House that that member must have been eating a few too many of those sandwiches himself, because that is exactly what has been coming out of his mouth this morning.

What is this bill, the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill, about? This is about $34 million worth of savings over the next 4 years. This is about sustainable management of long-term residential care. That is what New Zealanders care about. This Budget has been about investing in education, in 21st century schools. This Budget has been about science and innovation. This Budget has been about investing in infrastructure. This Budget has been about the future focus of our welfare reforms and our health sector. This Budget has been about investing in growth, about investing in New Zealanders while not spending taxpayers’ money to do it. That is what our colleagues across the floor did for 9 years: spend up large and do not worry about it—someone will have to clean that up tomorrow. Well, that is not good enough. This Government’s responsible Budget is for the times and it is what Kiwis want, deserve, and need.

What else is changing? What else is changing? We are increasing funding for aged residential care beds by $82 million over 4 years. There is an additional $10 million over 4 years for community dementia services; that might be very handy for that member Mr O’Rourke in the very near future, I would suggest. That is an additional $46 million on home care; that will rise next year to $57 million. This bill is about getting the balance right. It is about keeping the course and getting New Zealanders back into surplus by 2014-15. New Zealanders know it is not easy out there. They know it is not. They have changed with the times, as have we. Unfortunately, the only people who have not changed with the times are the people sitting on that side of the House, and long may that continue.