Child Support Amendment Bill

I am grateful for an opportunity to speak to these introductory clauses, clauses 1 to 3. The title of the bill, the Child Support Amendment Bill, is something that I think could do with amendment. Certainly in the form that we have just passed it as a Committee, it reflects poorly the actual nature of the bill. It suggests that it is a “Child Support Amendment Bill”, which would be implying, or could be taken to imply, that it is aimed at supporting children. In fact, as we have canvassed in the debate at some length and in some detail and as we have noted, it is likely to be, if anything, less supportive of children than the existing formula, and it has a number of other burdens as well. I have a number of competing titles to offer. I shall leave it to the end to tell you which is my preferred title.

First, I wish to talk about the “Missed Opportunity for Vulnerable Children Bill”, because that, in some ways, quite accurately describes what we have in front of us. We had an opportunity in the Social Services Committee to amend the bill, which Labour supported to the select committee so that it could be amended for the benefit of children—so that we could actually put children at the heart of this legislation, so that their well-being and their development could be the thing that we were focused on in passing this legislation, in line with the United Nations Convention on the Rights of the Child which we have signed up to, in respect of looking out for the interests of vulnerable children. We saw in the select committee that that attempt to bring this into the core of the legislation and to bring it in in a way that did not encourage litigation but that was actually being very clear that the priority here was children was defeated in two separate votes. I suggest, then, that the “Missed Opportunity for Vulnerable Children Bill” would be a more apt description than the “Child Support Amendment Bill”.

The Child Support Amendment Bill’s title, I guess, is technically aimed at telling you we are amending the current child support arrangements. That much is strictly true, but it is a little misleading because of the words “support” and “children” being brought in there, when, in fact, what we are doing is undermining the system that we have got. We are making it less transparent. That takes me to my next suggested title, which would be the “Child Support (Transparency Removal) Bill”. This bill has got a new and more opaque formula. This is what we are introducing here in this bill: a new and more opaque formula that makes it more difficult for those with children, liable parents and primary caregiving parents, to calculate how their future arrangements will pan out. We know that the current formula is very simple. Families can work out what their future liabilities are going to be. They can plan towards them. Now we have a bill that is far more difficult to understand in terms of the formula calculation.

We have been told by officials that they will need to upskill so that they can also brief parents on the likely obligations and responsibilities they will have. That will be an ongoing task, certainly with the turnover in the Inland Revenue Department in recent times. That is a department under stress, as we know, running a 20-year-old computer system to collect our taxes, with a dropping revenue base. We know that that department will continue to have high turnover. It will continue to need to train its own people to train the users of this formula, and, therefore, it is a step back in terms of giving parents the transparency to plan for future liabilities. So that is why it should be a “Removal of Transparency Bill”. That is one thing that is very clear here with this new opaque formula that is being introduced.

Another possible title for consideration is the “Child Support (Further Disadvantaging Women) Bill”, because this bill very clearly puts more burden on to the primary caregivers, the majority of whom we know are women. We have seen data for this in the select committee that makes it very clear that an increased burden will fall on women who are the primary caregivers, who usually are the most vulnerable in these situations. I generalise a little, but I think it is fair to say, from those who come through the electorate door and those whom we see as constituency MPs, that women are often particularly vulnerable in these situations, and particularly where poverty and stress are involved. This further makes those women more vulnerable, and so therefore we could have a title around the further disadvantage that this bill will generate for women.

Another title that leaps out from this bill is the “Child Support (Increasing Bureaucracy, Cost, and Business Red Tape) Bill”—increasing bureaucracy, cost, and red tape for business, because this bill does increase all of those things. We have learnt, as we have had the debate, as we did in the select committee, that not all of these things had been consulted upon. This is typical. I think I made that point earlier in the debate with the paper boy tax and the various other tax grabs that this Government has done to try to fill the revenue hole that it created with the 2010 tax cuts, which went to the wealthiest New Zealanders. I remind anyone who is watching at home that 44 percent of the value of the tax cuts in 2010 went to the wealthiest 10 percent of New Zealanders, while just 2 percent of the value of those tax cuts in 2010 went to the 20 percent who are the poorest in New Zealand. Those were unjust tax cuts. The story we were told was that they would stimulate economic growth. Well, we know now that we have got a Government here that has got the worst economic growth record of any Government in the last 50 years. That Government has not stimulated the economy with those tax cuts, so it has got a revenue hole that it has been trying to fill with tax grabs. At the same time as it has been going about those tax grabs, it has been increasing red tape—it has been increasing red tape. That red tape on business is just collateral damage, as far as the National Government is concerned. As long as it talks business, it is not really concerned what happens to small business. Talk to small-business owners around New Zealand and you will see that they are hurting right now. So I will come back to the title—

The CHAIRPERSON (H V Ross Robertson): Good.

—because clearly this all lends itself to the title “Increasing Costs, Increasing Bureaucracy, and More Business Red Tape Bill”, because that is precisely what is generated by this new, more complex formula. You will see I was making a point quite relevant to the title debate.

So if we weigh up all of those options, whether it is the “Missed Opportunity for Vulnerable Children Bill”, whether it is the “Women Further Disadvantaged Child Support Amendment Bill”, whether it is the “New, Less Transparent Formula Bill”, whether it is the “Difficulty for Planning Bill”, or whether it is the “Increased Cost, Bureaucracy, and Business Red Tape Bill”, we think all of those things—I think all of those things—perhaps more accurately reflect the nature of the bill than “child support”. So I contest that those are better titles for the Committee’s consideration, but overall I want to stress that in my opinion perhaps the best and most accurate title is the first of those I have suggested, which is the “Missed Opportunity for Vulnerable Children Bill”.

We are here to debate the title and commencement of the Child Support Amendment Bill. It is an opportunity for members to draw together the overall themes of the debate in the Committee stage. The title is often the focus for that tying together of ideas. I think the bill should be called the “Child Support Almost Amendment Bill”, because it has been an almost process over the almost 5 years that this Government has been working on it. It almost created a meaningful reform, but it did not quite, and that is why we are voting against this bill.

It is a huge lost opportunity. It is a lost opportunity to address the plight—and I got this wrong in earlier contributions—of 133,000 children who are dependent upon child support. I thought there was a proportion of that total of dependants who were in sole parent families, but I now know that that is the total number of children dependent upon child support: 133,000 children. That is a staggering amount of vulnerable kids in our community and our country who are dependent upon what this Committee does tonight. The problem is that the Government is not doing enough. It is just not doing enough. It could have written the interests of those children into the law for good and always. It could have reflected the United Nations Convention on the Rights of the Child in this law, but it did not. It almost did, but it did not.

It could have restated that the overriding goal in the event of a separation is to provide for the well-being of the children of the partnership, because the adults are the ones making the decisions and the children have no choice. The adults have choices. The children are dependent. The adults created the problems. The children pay the price. So to the 133,000 youngsters who are in that challenged situation, Labour members say we are sorry. We worked hard in the Social Services Committee to bring the Government to the point where it could include their interests as a legislative priority, but National members voted against even consulting their Minister on that international best practice. I find it so disappointing that they would be prepared to march in lock step with the executive rather than represent in this Parliament the interests of 133,000 faultless, vulnerable young New Zealanders.

It could be called the “Inadequacy of Payments Bill”, as that issue is another part of the “Child Support Almost Amendment Bill”. Submitters raised concerns about the adequacy of payments because of the formula in the legislation, particularly given the fact that the baseline here is that so many of those children are living in poverty. What we do know about when families break up is that most often, despite the fact that these laws exist, the mother, who is usually the custodial parent, and the kids are the ones doing it tough. Most often the dads are able to recover financially, and find it easier to move on with their lives, because they do not have the primary burden of childcare.

And worse than that, the system that we have had—which is only partially, only almost addressed by this bill, which we cannot yet support—has locked out parents who may have had the best of intentions but were unable to keep up with their payments and have then been slammed with penalties that have locked them out of the system. Too many of them have left huge holes in the hearts of their kids and ruined their own lives by fleeing the country. It is a human tragedy on a vast scale. This Parliament could have almost fixed it, but it did not—

💬 Hon John Banks: A late leadership bid.

—“Mr Dotcom”, it did not. It did not.

There is no pass-on mechanism in this bill. It could almost have fixed the problem of pass-on, but it did not. The select committee was confronted by extensive international evidence that liable parents—international best practice is very clear on the point that, where parents know that the finance that they are providing goes straight to the children, they are more likely to pay it. They are more likely to meet their obligations. That has also been set out very clearly in the Labour Party’s and Green Party’s minority views in the select committee report. We hope that the public and the courts will have regard to those minority views. The adequacy of the payments is not strong enough.

National members say that—this has been their overriding rebuttal, I suppose—this bill is not about child poverty. Well, hello! For 133,000 New Zealand children this bill represents their lifeline. Because if it was not for this bill, they would be entirely dependent on the taxpayer, whom this Government says it is thrifty and frugal to protect. It cannot have it both ways. This bill contains a $42 million extra price tag to the taxpayer and less money going to mothers and dependent children. It is a conjuring act of such stupidity that it is hard to credit that it took 4 years to get there. So no wonder we cannot support it.

The implication for women of this “Child Support Almost Amendment Bill” is that as, on average, women earn less than men, they are more likely to be the primary caregivers, they are more likely to be vulnerable, and they are more likely to struggle in a post-separation environment, many women will be worse off as a result of these changes.

It was almost a reform bill in the sense that the Government almost had the opportunity to come up with a formula that people could actually understand, but it did not. This House has not. It has come up with a formula so opaque that I am told it took an extensive whiteboard session with multiple explanations by officials to the highly qualified members of the select committee, who after a while could almost grasp it. If it took a bunch of tertiary qualified members of Parliament half a day to get their heads around an arithmetic formula—even investment bankers like the “Earl of Ōtāhuhu” over there—then it is no wonder that parents would find it extremely difficult to see their way clear to voluntary arrangements that would protect their families when the counterfactual requires a crystal ball to stare into to be seen.

Thirdly, it is an opt-out system replacing an opt-in system. That matters because it was almost an amendment that could have protected natural justice, but it was not. And it was not, because this bill requires people to be proactive in telling their employers why they cannot have access to their personal financial details. It should be the other way round. Every working New Zealander knows it should be the other way round. Our personal information should be private until and unless we choose to make it not. Otherwise you get the Paula Bennett phenomenon where people’s personal Government-held information is put in the public domain for the purpose of suppressing dissent, and that is a shame. That is almost as good—and I may be slightly tangential to the title of this bill—as the Prime Minister’s memory when he has meetings with casinos. But we will not go there in this debate.

The adequacy of the Inland Revenue Department’s computer systems is the next issue with this almost amendment, because if we could almost get the community’s head around the formula, if we could almost see our way clear to the interests of the children, and if we could almost protect the women of the country, the Inland Revenue Department’s computer could not deliver, because it needs $1.2 billion worth of upgrades.

Finally, this was almost consistent policy making. I say “almost” because my mind is drawn back to 2005, when Judith Collins said writing off debts sends the worst possible message to absent liable parents, and 2007, when she demanded that action be taken against parents so that they are stopped at the border if they have an outstanding liability. Then she went further, because she does not like being too subtle, apparently. She supported making avoiding child support an arrestable offence, and now the Government is writing down penalties. Almost consistent.

I move, That the question be now put.

I want to speak to some elements of the commencement dates in the Child Support Amendment Bill at the beginning of what will be a short address. I do think that quite a bit of thought has gone into the transitional provisions and the commencement dates, based on some of the factors that have already been pointed out by my colleagues around the additional burden on the Inland Revenue Department system that this new formula will provide. I think it is only right that we give the system time to creak under the weight of this new, complex system.

We, as the Social Services Committee, did recommend an amendment that would allow deferring the implementation of this child support formula from 1 April 2013 to 1 April 2014, and we suggested a movement of payment and penalty charges that saw it going out to April 2015. We very explicitly stated in the commentary on the bill that we consider this delay by 1 year necessary to accommodate the bill’s legislative time line, because, of course, if we were implementing it in April 2014, that would not be a lot of time from the time that it will have its final reading. Also, it was to allow the Inland Revenue Department sufficient time to prepare. I would say that was probably the weightier of the reasons.

I am also interested, based on these commencement dates, in the amount of time the department needs to prepare. That will be computer systems, but, obviously, in the bill we have also talked about the extra burden on staff—the 15 percent increase in the amount of time that staff will be spending on these new provisions. My question to the Minister of Revenue would be whether that will be coming out of baselines for the Inland Revenue Department, or whether we will be seeing an extra investment into the department to enable it to deal with these changes, because it is not like there is any capacity in many of our front-line services to take that extra strain. The Government has been very vigilant in its so-called value-for-money exercise. This basically means that the departments themselves are straining under the weight of continuing a full agenda of work, be it policy development or just carrying out the requirements of day-to-day governance, whilst also slashing back their ability to have any capacity to deal with extra things like this.

So I would be really interested if the Minister could tell us, given that we have needed to switch our commencement date by a year, given that we know it will cost $91 million to implement, and given that we know it will increase the strain on staff by 15 percent, how we are dealing with that—and that $91 million. I have not yet asked a question on whether or not that has been budgeted for, and in which budget we will be seeing those transitional provisions.

I am also interested in speaking to the title of this bill. I am always aware that anyone listening to this part of a debate in the Committee will be somewhat confused by this tradition we have at the end of the debate on a bill of then suddenly talking about random, separate names for titles for a bill.

💬 Mike Sabin: Suddenly waste time filibustering and belittling it.

There is a very good purpose for it that Mr Sabin does not seem willing to accept at this point in the debate. It does enable us to try to capture the essence of what a bill should be about. It gives us a chance to say whether or not a bill has achieved what might be the expectations of the public—the bill’s objective.

Mr Sabin is now making gagging faces. I do not know whether or not the camera has captured some of the facial expressions we seem to be receiving on this side of the Chamber.

Speaking to the bill’s title gives us an opportunity to see whether or not we have actually achieved the objectives we set out to achieve. There was a bit of debate at the beginning as to whether or not, if this bill is truly about the welfare of the child, we are achieving that through this Child Support Amendment Bill. Unfortunately, it is Labour’s contention that we do not believe we have achieved that. The focus, despite the bill being called the Child Support Amendment Bill, is very much on setting a mediation process that is based on a calculation regime for parents who are unable to resolve, outside of the Inland Revenue Department, their own payment system.

As I have already said, there is a greater level of satisfaction with arrangements that are able to be set up outside the department’s system. We know that from survey work that has been done. So is this really solely about child support? If it were, we have already contended that we would have probably seen a paramountcy principle in this bill. In a sense, then, could we almost rename it the “Child Liability Bill” because that is how it feels like we have treated kids in this bill? It is more like they are a liability—that we must make an assessment on whom the greater liability sits with—rather than the bill being about the support of the child and the welfare of the child.

I move, That the question be now put.

No. I am going to call the honourable member Dr Rajen Prasad. He was on the Social Services Committee.

Just a reflection first: there have been so many interjections from members opposite, and most of them have been quite inane. I wish they had simply taken the time, throughout the second reading of this bill, the Child Support Amendment Bill, to actually debate the issues. It would be much easier to have more respect for that point of view than when they simply chip away with inane comments and do not debate the issues. Throughout all of this, many, many questions have been posed to members opposite. Even the members of the Social Services Committee from that side of the Chamber have hardly taken any calls, yet you would think that they would.

In keeping with the theme from this side of the Chamber, I note that this bill is another missed opportunity. The title of the bill is quite important. I started my second reading speech on this bill yesterday by asking whether this bill was for child support or not. Yesterday and today, time after time, speaker after speaker has said it is not about child support. It is not about what is in the title. The title is quite inappropriate. We can ask a number of questions as to what a title including the words “child support” would actually signal. Are children placed at the centre of this? Any child support system or method would do that. Does it? No. Children are hardly mentioned except as relating to some pathway to finances or money.

💬 Melissa Lee: It’s child support.

Yes, Melissa Lee, it is child support, and I do not know what that member understands by child support. What they have been arguing is that this is not about child support. Children are not being put at the centre, and the member might have taken a call or two to actually defend it.

💬 Melissa Lee: It’s intrinsic in the bill.

Well, it is not, because the basic principles of supporting children are just not there. The interests of children are not paramount. If Melissa Lee had been listening to all the submissions, she would have argued that the title should be changed. Most of the credible witnesses that came to the select committee actually talked about children being at the centre, etc.

💬 Melissa Lee: Who are the credible witnesses?

The Children’s Commissioner, the Families Commission, the Human Rights Commission, and many others. They came to ask why children were not being placed at the centre. They argued that the pass-on system would be a much better system to actually support children. That one change, that one provision in this bill, would have convinced me that this was a child support bill, but, no, it did not happen—nowhere near it.

💬 Tim Macindoe: This is a horrible valedictory, Raj.

I did not hear that, sorry.

💬 Tim Macindoe: I said this is a horrible valedictory.

Mr Macindoe! I am surprised that that member would make that kind of statement. I suspect that the member is trying to be funny, and if he is, it was a failure. If he is trying to predict my future, then I do not know where the member is coming from. I hope that member’s own family is listening, because they would expect better of you, Mr Macindoe. And if you take a call after this, maybe the member might be able to respond to what I am saying, because the member has not responded—and parents’ privacy would have been protected.

So I agree with what this side of the Committee has been saying, that this bill is a missed opportunity. It is the “Missed Opportunity for Vulnerable Children Bill”. So the title is absolutely wrong. The title should be changed to reflect both the arguments that can be made against the provisions that the Government has come up with in this particular bill and, indeed, how it has lacked any defence of the lines it has taken.

The other side of this is that the system for supporting children has still not been developed, and we have been saying that, you know, it is amazing that here we are pushing out the dates for the implementation of this particular bill because the systems that support it have not been put in place, and in this clause of the bill, those provisions also are being argued for. So those are the comments I want to make. I hope that Mr Macindoe will take a call, or make a personal explanation of whatever kind, tonight to kind of put the record right, to see what he was talking about, because I think that would be not just the charitable thing to do, but the gentlemanly thing to do. Thank you.

I move, That the question be now put.

A party vote was called for on the question that the question be now put.

Order! Order! Both of the members know, and they have been here long enough, that you cannot interject during a vote being taken. I will repeat that it amounts to intimidation, and a member could find himself before the Privileges Committee.

I beg your pardon. I may have inadvertently cast the Māori Party votes in favour of clause 3. I apologise. Could I seek the leave of the Committee to correct that vote, which should have been two opposed to clause 3.

The member may seek leave of the Committee. Is there any objection to that course of action being taken? There is none. So they will change the vote. Honourable members, as a result of the change the Ayes are 69, the Noes are 51. Clause 3 is agreed to.

Bill to be reported with amendment presently.

House resumed.

The Chairperson reported the Environment Canterbury (Temporary Commissioners and Improved Water Management) Amendment Bill without amendment and the Child Support Amendment Bill with amendment.

Report adopted.