Income Tax (Universalisation of In-work Tax Credit) Amendment Bill

I am pleased to take a final call on this Income Tax (Universalisation of In-work Tax Credit) Amendment Bill from our side. I have had time to reflect on contributions from members opposite to this particular bill and this debate. I must say that when it comes to child poverty, members who have spoken on this bill have not displayed any compassion or understanding or empathy for the plight of poor families bringing up young children in this country. They have not done that at all. In fact, members opposite in the debate 2 weeks ago were actually quite disparaging of the plight of the poor. Effectively, they pathologised that poverty through their comments, and I think that was a pretty nasty thing to do. Government members were effectively saying that there is nothing more that can be done for the 270,000 children who live in poverty, making New Zealand’s performance on this score one of the worst in the world. We are entitled to draw the conclusion that apart from punitive measures, which the Government has taken in the last 4 years, it is just not interested in this particular area. Instead of taking the opportunity to reflect on the reality of these lives of quiet desperation—because that is what it is; many of these families live lives of quiet desperation—Government members, instead of talking about it, have actually gone on the attack in the debate and indeed in other debates concerning this subset of the population.

David Bennett’s contribution to this debate reached probably even lower than the lowest, which is usually reserved for Maggie Barry—apart from the last speech, and I will acknowledge that. [Interruption] Well, if the cap fits, wear it. That is saying something. For David Bennett the provisions of this bill were communism. That is what he said. Although I doubt he could accurately define the concept of communism, he went on to interject that $60 per week will not make any difference to the lives of these poor families living in poverty. Clearly, David Bennett was not listening at all to what the Green members were talking about. Both Metiria Turei and Jan Logie actually gave examples of what the experience was. Metiria talked about empty lunch boxes in schoolbags—$60 would go a long way. Teachers are desperately seeking funds for kids’ breakfasts. There is increasing illness and kids desperately looking for food in places where animals look for food. Yet those were the disparaging comments that he was making. Jan Logie also talked about the poor being left out, not being able to go on school trips, feeling the shame of having no spare resources, lacking warm clothes, and living from week to week.

So this is the empathy of the members opposite for the poor in this country, the most vulnerable. For these families, Mr Bennett, $60 a week would go a very long way. Of course, it will not go a long way for him, because for him it is only a meal at a reasonable, mid-range restaurant. But for these families it makes the difference between living and really being miserable. Paul Goldsmith in his comments on the bill invoked the spectre of assistance to these families as destroying the human spirit. Which century is this guy from? The Charity Organisation Society was a long time ago. Assistance, he said, was like a narcotic. I say to Mr Goldsmith that he cannot hide from these images he created during the debate, regardless of the fact that the quote was from someone who should have known better. But by quoting these lines he associates himself with the images that this work conjures up.

This bill actually is a good bill. It really addresses the most vulnerable, and the Government shows a lack of regard. Imagine a family with very little resources bringing up young children, and young children are our future. Yet the Government is miserable enough to say that we cannot give them that—they will have to get a job and will have to do something else. Where do members opposite get their knowledge from? What about the poor in Maungakiekie? What about the poor in Waitakere? What about those people? Have they not gone and seen them? Have they not talked to those families? Yet they come here.

The other point I want to make is that for these children this period of development is the most important there is. If we mess up during those early years, age 1 to 2, all the research shows that they are on a downward path. But that Government and the members who spoke on this bill are quite happy for that to happen, yet they privilege their own; they privilege the rich through tax cuts. I think they have taken a miserable position, and it will come back to haunt them. They could have at least shown an appreciation and voted for this bill to go to the select committee. Thank you.

I want to thank all of those who have spoken in support of the Income Tax (Universalisation of the In-work Tax Credit) Amendment Bill over the last few weeks and are voting to send it to the Social Services Committee. I understand that 60 members of the House tonight will vote in favour of the bill—very nearly a majority of Parliament. It is not quite enough but a good start, and better than we have seen in the past. I want to thank also all of those New Zealanders who have supported this bill in their various ways, and supported the campaign to end child poverty.

The Green Party has long believed that the in-work tax credit is unjust. The reasons for keeping it in its current form are facile. Worse, they damage individual families and children by trapping them into poverty, and damage community cohesion by creating an arbitrary and unreal separation between those who work and those who rely on a benefit. It is unjustifiable.

I recently saw two graphs showing the trend of child poverty from the mid 1980s to today from both Australia and New Zealand. The New Zealand graph is unsurprising. Child poverty rose radically during the late 1980s and into the 1990s, particularly during the National Party’s vicious attacks on beneficiaries. Child poverty reduced slightly in the 2000s with Working for Families, but it remains worse now than it was in the 1980s—that is, a greater percentage of children now live in poverty than did in the 1980s. In Australia over exactly the same period of time, in a similar economy and culture, the rates of child poverty have continued to decline and decline. The two images of New Zealand and Australia child poverty rates are vastly different, because they tell two different stories about how children are valued in the economy by the political decision makers.

In Australia there is a comprehensive set of child-related payments of significant amounts. The payments are for the children and they apply to a family regardless of whether a person is in work or on a benefit. Australian families get something like NZ$330 a week for two children aged between 5 and 13, and more if the youngest child is under 5. If the child is newborn, families get a one-off payment of A$5,000 to help cover the costs.

In New Zealand the same two-child family is subject to highly complex and discriminatory criteria for Working for Families. They get something like $216 a week for their children only if they satisfy hours of work criteria and are not on a benefit. If they are on a benefit, or have simply lost work, they get only $156 a week. Low-income parents with a newborn in New Zealand who do not meet the stringent requirements for paid parental leave get, at most, an extra $1,200 parental tax payment. Parents who are on a benefit get no extra financial assistance at all for their newborn babies.

In New Zealand families with children have been deliberately stripped of decent income support either through benefit cuts, deliberate wage-reduction policies, or by discriminatory Working for Families tax transfers that value some families over others. The name “in-work” for this particular child payment is simply a justification to deny the child payment to New Zealand’s poorest children. In doing so, the Government saves itself some $450 million a year. The accumulative loss of income for low-income households since 2006 is $2.5 billion. That is $2.5 billion that is money taken from the mouths of New Zealand’s poorest children.

These are political decisions. Solutions to poverty are absolutely determined by political action to put children at the centre of the Government’s economic decisions to value their dignity and security by guaranteeing the essentials: decent benefits, good wages, and affordable homes. No provision of services or charities can eliminate poverty; it can only help ease the worst effects, and that is desperately needed. But child poverty is a political issue. Child poverty is an economic issue. The Green Party proudly puts children at the centre of its political and economic decisions. We ask that this Parliament does the same. I commend this bill to the House.