Budget Measures (Financial Support for Newborn Children) Bill

When the Committee was suspended last night, Jacinda Ardern had the call. She has about 2¾ minutes.

Is that all—2¾ minutes remaining? Oh, right, so technically I have up to an extra 5 minutes if I am lucky. I thought it might—

💬 Hon Trevor Mallard: It’s another 15 minutes, actually.

Well, I think I managed to clock up 40 minutes last night, so I am still waiting for the Minister in the chair, the Minister of Labour, to match me call for call in this debate.

I thought it might be helpful to recap on where we were in this debate last. We are in the Committee stage, obviously, and last night we debated Part 1 of the Budget Measures (Financial Support for Newborn Children) Bill, which talked about the extension of paid parental leave. The extension from 14 weeks to 18 weeks was basically all that Part 1 did, despite the Minister talking about the extension to eligibility. That is not what this bill is doing.

💬 Hon Simon Bridges: It’s coming.

He says it is coming. That is interesting. Last night the Minister went to great lengths to make a claim about Labour’s comprehensive paid parental leave policy and Best Start policy, which is quite a significant package, fully costed, fully stepped out, and based on consultation with the sector. He claimed that the policy work had not been done, yet here we are debating a little bit of a change to paid parental leave—just one simple change from 14 to 18 weeks; it is just a little bit of what the Government announced—because I suspect the policy work has not been done. That is my very big suspicion. Why would I expect that that might be the case? From what I was reading of the regulatory impact statements last night, some of the briefing papers were not actually being churned out by the Government until last month. So my strong, strong suspicion in responding to what the Minister has said is that perhaps some of it was done in a bit of a rush.

That brings me to Part 2, which we have only just begun debating, and I am sure it will be a comprehensive discussion this morning. Part 2 contains the changes to the parental tax credit. Very simple changes are made in that part. They are changes that the Minister—again, I am astounded by the statement—said are extending support to people who got nothing from Labour. That is an absolutely unbelievable statement made by the Minister in the chair, because there have always been losers in the system that we currently have. Labour’s policy was clearly focused on trying to plug those gaps. So let us look at who those losers are and how that has changed, because the parental tax credit was always about supposedly plugging that gap.

We have roughly, give or take, 60,000 births in New Zealand per annum. Of those births, we know that roughly 40 percent tend to be eligible for paid parental leave. Why is that? Under the existing criteria, which have not changed yet, you have to be in a job for a particular length of time, you have to be working for a certain number of hours—there are a number of criteria that often preclude people’s eligibility. The Minister has changed those criteria a bit and I applaud him for that; it is good to see. But out of that change, what did the Minister say? Was it roughly 1,200 or 1,400 people affected by that change, give or take? Again, that is not a massive extension of the eligibility, then, for paid parental leave. It is good but not too significant.

Jenny Shipley in the 1990s recognised that that gap existed, and she brought in the parental tax credit. It is not for everyone. Not everyone who does not get paid parental leave automatically then receives the short-term parental tax credit. Let us be really clear about what the parental tax credit is. It is not the family tax credit; that is part of Working for Families, which Labour brought in, cuts across the life of a child, and is income tested. It is not the in-work tax credit, which is meant to be a payment to cover the extra costs of being in work when you have a family. It is the parental tax credit. At the moment, after these changes, it will be for 10 weeks. It used to be at a rate of $150. Under these changes in Part 2, it will be $220 for that 10-week period. So it is roughly $2,000 for a family.

It sounds like everyone who does not get paid parental leave is going to get that—not so. In fact, the eligibility criteria are going to narrow—not yet in this bill; I believe that is yet to come, is it, Minister? I imagine that might be a revenue bill, perhaps. The criteria are going to narrow. So who misses out? Students miss out. The reality is some people might say “Well, if you are studying, why are you having kids?”. There are people in many varying circumstances who might be in study at any age at the time that they may fall pregnant. Life happens. The fact is that in New Zealand 50 percent of our pregnancies are unplanned—life happens. It is about making sure that when it does, parents are well supported to give their child that best start in life. When people are unemployed, it might be the most temporary of unemployment. They might be transitioning between jobs and be temporarily on jobseeker support. They are not eligible for this extra support. They might be in a situation where their relationship has split up. As dire as it sounds, there are relationships that fall apart when people find out they are pregnant. It is a major stressor in relationships, and it happens. If they happen to then have to seek sole parent support, they are not eligible either. You could say that these are individuals who actually are probably in the most precarious of situations—potentially our most vulnerable families—and they are excluded from the parental tax credit.

I think this is a really important point to make, because the extension that the Government has made is in the length of time of the parental tax credit and to the amount but not to who receives it. That has always been one of the biggest downsides of the parental tax credit. It was a little bitsy thing that Jenny Shipley came up with that predominantly tends to go to families where, for instance, parents are staying at home to raise existing children but are under a certain income rate. Those tend to be the families who are receiving the parental tax credit and families who already have children when another one is on the way, if members would like the longer-form explanation of that. Those tend to be the ones who are falling into those eligibility criteria.

The Minister has also said, though, that the criteria are going to change. At the moment, yes, the parental tax credit is not universal outside of people on benefits. It is abated. It is income-tested. The income testing is going to narrow now; that is what we have been told. It is not what we are debating yet, but it is going to narrow. That basically means that if you are currently eligible for the family tax credit—you are roughly on that kind of income range—then you are going to qualify for the parental tax credit. That is the rough guide that we have been given by the Government. That means that there are some families who often miss out on any kind of support from the Government. They do not feel particularly wealthy, but they are not going to get anything now.

It is great to have an opportunity to speak on Part 2 of the Budget Measures (Financial Support for Newborn Children) Bill. It is a bit of a mouthful and it does not necessarily indicate how little support there is for newborn children, but, still, it is a step in the right direction—a small step, but a step in the right direction none the less. This part is the part that deals with the parental tax credit. I note that this morning the Prime Minister was having breakfast with the Child Poverty Action Group up in Auckland. Well, I hope that he is honest and I hope that he is upfront with the group, because it will not be fooled, by the way; it is a very smart organisation. I hope that he is clear with the group that he has failed to give financial support for newborn children and the most vulnerable and the poorest of families, because that is, in fact, what has happened.

In fact, the Child Poverty Action Group issued a press statement this morning pointing exactly that out. It says: “Unfortunately the 2014 budget offers little else to assist the 205,000 poorest and most vulnerable children in NZ, who fall below the very low 50% poverty line.” That was a press statement issued this morning from the Child Poverty Action Group. It is absolutely right that Part 2 bears this out. It is interesting that the vehicle that National has chosen is the parental tax credit, because that parental tax credit is very targeted but, interestingly, does not target the lowest income people. It excludes the children of beneficiaries from having any support in this way. It excludes the children of students from having support in any way. It excludes the children of people who are on ACC payments from having any financial support at all. So I think it is quite misleading that the bill title says “Financial Support for Newborn Children”, as if it is for all children.

It, of course, is not, and National, with its Cabinet club mates, has moved to specifically exclude the people who are the poorest. [Interruption] It is kind of interesting, because every time we talk about financial support for children and parents, National gets really rowdy. It gets very rowdy and angry, actually. It is really surprising that this continues to happen.

💬 Mike Sabin: I’m always angry.

I could understand it—well, Mike Sabin says he is always angry, but, in fact, he is at his most angry when we talk about financial support for children. National members find it very difficult to understand this concept.

I do want to support the amendment to this part in the name of Jacinda Ardern, because it shows a huge gulf and a huge difference between the approaches of Labour and National when it comes to financial support for newborn children. Under Labour’s Best Start policy every child will benefit.

💬 Simon O’Connor: No, no, no.

Every single child will benefit. Well, Simon O’Connor says: “No, no, no.” He is a little bit right. The people who earn more than $150,000 will not benefit from the $60-a-week Best Start payment under Labour, but they do get the early childhood education component and they will get paid parental leave. They will get extended paid parental leave—a much more extended parental leave—under a Labour Government, by the way. But every single child will benefit from Labour’s Best Start package.

💬 Simon O’Connor: Oh!

It is true, Simon. I know that National does not like that. It does not like the idea that all children will benefit, but that is a fact of Labour’s Best Start package. Jacinda Ardern’s amendment would mean that all the children who miss out under what National is doing in Part 2—

💬 Hon Anne Tolley: All means all.

Well, if Mrs Tolley would, you know, stop yelling and screaming—

💬 Hon Anne Tolley: Tell the truth.

She is saying “Tell the truth.”, and I am—all of the children who miss out under National’s package will get $60 a week under Labour’s. It is not only $60 a week for the first year for those children who are missing out under what National is proposing—and they are from the poorest families, by the way—but that goes on until the child’s third birthday under Labour’s Best Start policy. That is for the poorest families in New Zealand. Is that not the issue that really needs addressing? Well, finally, there is silence from National’s benches. Finally, while I am on my feet, there is a little bit of silence, because National members do not want to answer that question.

Labour’s Best Start policy—and I challenge Simon O’Connor to say this is not true—gives at least $60 a week for the first year to all families earning $150,000, because those families who are entitled to paid parental leave get even more than $60 a year for that period. So it is at least $60 a year. And then the very poorest families—for those low-income families earning less than $50,000 per year—will get $60 a week until that child’s third birthday. Those families earning up to $70,000 a year will get a proportion of that $60. I really do want the Minister to take a call and explain—

💬 Mike Sabin: What does it all cost, Sue?

Look, all they can see is the cost. They cannot see that it is an investment in children. Is that not National through and through? They just see children as being a cost. This Government cannot see that that is the real way to a brighter future in this country. It is always in deficit mode—it is always in deficit mode. From the time that National got into Government, it has increased the country’s debt. It has delivered deficits. It has got the slimmest of surpluses this year, and you would think it had never happened before. Well, there were 9 years of surplus under a Labour Government, and that is what there will be from next year on when Labour returns to Government, as well, because it is Labour that knows how to deal with the issues that the Government is trying to deal with here—the parental tax credit.

Clearly, under a Labour Government there are many more opportunities for jobs. Unemployment was at the lowest levels in the OECD under the previous Labour Government. Under this Government, we have slumped to about 15th or 16th place in the OECD rankings for unemployment. So these are the real issues that need addressing.

In Part 2 the Government is, instead, just trying to pick and choose some winners amongst children. By using the parental tax credit, it is casting the sorts of judgments that we see time and time again from National. Those members are very, very good at judging other people’s families. They are casting the judgment that the children of those less fortunate than themselves are not worthy—they are not worthy of this financial support for newborn children. That is what they have called this bill, yet they are using Part 2 to deliberately exclude the neediest of those newborn children—the most needy.

I am looking forward to hearing the vote on the amendment put forward by Jacinda Ardern. It does reflect the very comprehensive policy, and I do want to take issue with what Minister Bridges said, albeit last night, because I did not get an opportunity to respond at the time. He said that his Government has done all the policy work in this area. Well, I can see that what it has done is look at the very comprehensive work done at the Social Services Committee through the very good Labour Party bill that extends paid parental leave to 26 weeks, and it has cherry-picked a bit of it. And then, with regard to the part that it does need to do some more policy development on, it clearly has been lazy and has not done the work, because if it had, its proposed—proposed—extension to eligibility for paid parental leave would be in this urgency motion today, and it is not. It is not being debated. So, clearly, the Minister has not done the policy work that he claims to have done—he has not done it—and it will be interesting to see whether that bill gets introduced before the House rises in July. I am not sure that we will see it this side of the election, and then I think the New Zealand public would have cause to ask themselves why that is not happening before the election.

Part 2 will be supported by Labour because it is a little bit of improvement, but it is not a lot of improvement, and it does make some really worrying judgment calls about National judging which children are worthy of the support and which children are not. Under a Labour-led Government, that will change. There will be $60 a week made available as financial support for newborn children—all newborn children—and that will be coming in next year. So the New Zealand public would be wise to look in detail at this. I know that the New Zealand public understands which side of the House it is that really understands the needs of children.

I rise to speak to the Budget Measure (Financial Support for Newborn Children) Bill again, and follow on from some of our discussion last night. First, I do need to note how disappointed I was last night to see the proposal to extend paid parental leave to 26 weeks voted down. It was, I think, a real shame for all the families in New Zealand who have access to paid parental leave. So, to talk specifically to Part 2 of this bill, the Green Party really supports the vision of having every single child thriving in this country, and we believe in making an investment in our children and our families. We believe that that investment would pay off manyfold for many years for this country. We, along with many in this country, are deeply concerned about the levels of inequality that we are now living with in New Zealand. Those 285,000 children could be living in poverty—

💬 Hon Anne Tolley: I raise a point of order, Mr Chairperson. I know that we have had a wide-ranging debate, but I do think that we are on Part 2 and this speaker should really attempt to talk to the bill.

💬 Hon Trevor Mallard: I actually listened to the last sentence that the member spoke before she was so rudely interrupted, and it was directly on this part of the bill. If the Deputy Leader of the House listened to the debate—

The CHAIRPERSON (Eric Roy): Order! The member should not use a point of order to attack another member. I think the point is well made. I have been listening very carefully, and we are on the amendments to the Income Tax Act—that is, Part 2. Some discretion is given to draw an analogy and example. I have listened very carefully. I am kind of reluctant to interrupt members, but if members do not want to debate Part 2, then that is inviting the Committee to determine whether or not it wants a closure. That is the kind of discipline around how this stuff works, all right?

Actually, to carry on exactly from what I was saying about our concern around the levels of inequality in this country, the parental tax credit, which we are debating in Part 2 of this bill, will directly feed into that inequality in this country, which for us is just a shame. It is symbolic of the ideology of this Government, whereby it will offer token lollies to people. That will make a difference to some families, and I am not underestimating that. Seventy dollars a week for middle-income families in this country will make a difference, and that is why we are supporting this provision. However, by purposefully denying this parental tax credit to beneficiaries, to people receiving ACC, and to those receiving student allowances or pensions, it will actually also increase inequality. The group that is in the most need is getting nothing from this provision in the bill, which is why we are putting forward an amendment to this bill, which I hope others in this Parliament will support, to ensure that this extension to the parental tax credit will be available to every single family in New Zealand, because we care deeply about inequality.

I would also like to note that in some of the discussions around this provision in Part 2 of the bill, the Child Poverty Action Group’s analysis of this issue has noted that the Government appears to have a blind spot when it comes to the needs of children and beneficiary families, and we agree with that. We have heard that quite clearly from some of the interjections from the Government side of the Chamber last night and again today. I do want to remind this Committee of some of the drivers in the need for people to require income support. The primary driver for it is either a loss of employment, which is something people have no control over, or it may be disability, and we have not brought down the barriers to employment for people with disabilities, or it can be domestic violence, which is something that we are supposedly all together on in this Parliament in fighting. So to discriminate against those families, and to deny them this extra money to be able to help cope in those early days after the birth of a child, does not seem consistent to us with the values of an inclusive society.

I would also note that the Child Poverty Action Group has looked at this analysis and it has also said that although it looks as though families are going to be getting extra money, and it will increase on annual terms for those families who are able to get it, so that they will now get basically about $2,200 from this provision, up from $1,200—so it is an extra $1,000 in total for those families to cope with those extra financial costs of a new baby—it is urging the Government, as are we, to extend those payments to families who are currently excluded. In the words of Susan St John, it is unfair that the new mothers and their newborns who are most in need will get no help from these measures, which are funded by the taxpayer.

For me, that is one of the things to remember. Our tax money is our collective expression of our values as a country. Together we have so much more resource and we can make a huge difference in the lives of these families at virtually no individual cost to us, actually. When it all comes together, it is a tiny amount from me and a tiny amount from you that will make such a huge difference. I really believe that New Zealanders do want children and babies in beneficiary families—those who are leaving violent relationships, those with disabilities, those who have lost their jobs—to have as good a start as anyone else. That is what is in front of this Committee today: the opportunity either to give kids the best chance in every family or to entrench inequality. I am really hoping that this Committee will reflect on its values, reflect on the foundations of this country, and come up with a solution that says “Yes, we believe every child deserves to thrive, and, no, we do not support entrenching and building inequality in this country.”

I would also like to just note that this provision of the bill has been specifically noted by the Government as part of its families package of $500 million, which sounds like quite a lot and is a significant investment. But it is worth noting for the country that this is over 4 years, so that is actually only $125 million a year, and this provision is actually an increase of only $15 million a year, I have been told. So when we are thinking about the relative value—

💬 Hon Trevor Mallard: 13.

—$13 million; thank you, Mr Mallard—and how much this Government is really valuing families and children and wanting to support them, I also remind them that $1 billion is now being spent on servicing the interest on the debt that this Government got us into because it chose to cut taxes for the wealthiest in this country. To me, that needs to be said. I want to support and give affirmation to the Government for good initiatives, and we will do that at every opportunity, but this does need to be put in context. The question needs to be asked as to whether this fundamentally reflects our values. Will this deliver on a country where every single child has the ability to thrive? We are giving all our weight to that vision.

Sadly, although we will be supporting this, because it is something, unless this Committee extends it to every single family, and particularly to beneficiary families, I do not believe that this initiative will deliver what our children deserve.

I will take just a short call on Part 2 of the Budget Measures (Financial Support for Newborn Children) Bill. I actually just need to ask the Minister of Labour directly whether he could explain part of the regulatory impact statement. If we were not under urgency for this bill—and I am not quite sure why we are under urgency for the bill, because nothing happens from tomorrow, when we pass it, for quite some time—it would go to a select committee, and I would be able to ask the officials for clarification. I am absolutely happy for any member of National to jump up and explain this if they can, please. I am absolutely happy for anybody over there on that side to explain this for myself and, therefore, for the parents who are receiving Working for Families. I would be grateful.

Point 5 of the regulatory impact statement says that to receive the Working for Families payments “a person must be at least 16 years of age and also meet residency requirements. The amount of payments depends on the number of dependent children aged 18 or younger that are being cared for; the age of the child being cared for; the total family income; where the family income comes from; and any shared care arrangements.” I would pick up the note that this is a parental tax credit. If it is a parental tax credit, it does seem strange as to why the circumstances of the parent matter. If there is a philosophical statement there that we support parents through a parental tax credit, why does it matter what the financial circumstances of that parent are? So it would be great if you could just explain that first part.

Point 7, however, says—and I read it last night, and I really would like somebody from National to explain it—“The FTC and IWTC are currently abated at 21.25 cents in the dollar when annual family income exceeds $36,350. The PTC is also abated at 21.25 cents in the dollar; however the amount of the abatement is calculated against 56 days of annualised income, rather than a full year’s worth of incomes; this creates an effective PTC abatement rate of 3.26 cents. The MFTC is abated dollar for dollar until a family’s income reaches $21,216 after tax.” If the Minister would like to jump up and just clarify that paragraph, that would be great. Mike Sabin, have a go at it—no problem. But then we shift to the departmental disclosure statement, and this part on page 3 under the statement “Parental Tax Credit”, which reads—

💬 David Bennett: Tell us about your man, Denny.

You will not be able to answer it if you do not listen, Mr Bennett. The statement reads: “The Bill increases the maximum amount of Parental Tax Credit (PTC) payable”—[Interruption] Can you hear me, Minister? I am sure it is a little bit loud. You might not be able to hear the question.

💬 Sue Moroney: I raise a point of order, Mr Chairperson. I am not that far from the speaker. I am really struggling to hear her over the rabble of the National Party benches, and I would like you to call them to order. They have been doing this throughout this whole debate, and I think it is time that they actually let the speakers be heard.

The CHAIRPERSON (Eric Roy): Yes, well, having been present for a few debates across this urgency, I would have to say that it has been a fairly energetic debate from both sides, and I am not sure it is any more appropriate now than it has been at any stage. If you want the Chair to intervene every time on either side, well, we are happy to do that—

💬 Hon Trevor Mallard: No.

The CHAIRPERSON (Eric Roy): Order! I am on my feet. Look, this is the highest court in the land. There is a standard of decorum that I would like to see us embrace, and members just ought to be conscious of that.

Thank you, Mr Chair. So just for the Minister, I will start that paragraph again. It is on page 3. The Minister has officials behind him who might be able to provide him with an answer. It is in the departmental disclosure statement on page 3 under “Parental Tax Credit”: “The Bill increases the maximum amount of Parental Tax Credit (PTC) payable on the birth of a newborn to $220 per week”—so it is for newborn children—“for the first 10 weeks following birth. This takes the total maximum payment to $2,200 per newborn. The higher payments apply to babies born on or after 1 April 2015.” Let us be clear: it is 2015. But it is the following paragraph that I have concerns about. It is this paragraph that I know I would like clarification on: “The Bill also changes the abatement formula for the PTC, so that is”—the English is a little bit off—“abated against each dollar of family income over the abatement threshold earned over the year, rather than over the parental entitlement period.”

The first thing I would like to do is to refer the Minister in the chair, the Minister of Labour, to paragraph 44 on page 9 of the regulatory impact statement, where it says that there is no ability to consult after the Budget Measures (Financial Support for Newborn Children) Bill has been put through because the legislation needs to be in place before November 2014 in order to have sufficient time for the Inland Revenue Department’s “systems, processes and guidance to be finalised.” I am not saying we should keep this urgency going until November, but what I would like to ask the Minister is why we are considering this under such shortened time frames. Why has this particular part of the bill—not the whole bill, but this particular part of the bill—not been sent to a select committee for a proper examination?

The paper that he has supplied to us tells us that this particular part of the bill is not urgent. It is not urgent; it could wait until November. Being realistic about elections and things, it could wait until July to go through Parliament. What I want to know, from any National speaker who is prepared to get on their hind legs, is why the Government is pushing this through when its own officials have told it—when its own officials have told it—that this is not urgent legislation.

The next point I would like to make is to jump way further into the regulatory impact statement and ask the Minister about the relative options that are set out in paragraph 45, under “Conclusions and recommendations”. I do not know whether the Minister knows, but what we know is that Cabinet and the officials worked their way through a set of options in this particular area, and the reason this option was chosen—I just want to check my logic with the Minister, because it appears to be written down here—was that it would keep people in work and off paid parental leave. Is that the objective? That is why, on the weighted choices that are set out in paragraph 45, this option won by one point—by one point—and that point came from the fact that it would keep people at work and discourage people from taking paid parental leave.

I just want to ask the Government whether that is really its objective. Is that the objective of the Key Government? Is it to say, especially to women: “We don’t want you to take up your paid parental leave, and this is a way to stop you from doing it. This is a way to save us money on paid parental leave. We will encourage you to stay at work. We will give you a pittance for a short period of time in order to not do what’s right for your baby.”? I just want to ask what sort of ethical basis we are working on. Whom do we care about? First of all we will make a tiny—not that I am going back to it, Mr Chairperson—change in one area, but then we will work really hard to ensure that you do not take it up. We will work really hard to make sure that parents do not take it up. What the document tabled in the House says is that the defining difference—the thing that made this option the weighted average winner—is the fact that it would stop people from leaving their jobs to take up paid parental leave.

I just ask members opposite whether they read this stuff. Do they read it? Do they care? Do the backbenchers ever hold their Ministers to account for the ethics of the Government? The Government is prepared to go out and pretend that it cares about paid parental leave, but then they choose the option in this particular part of the legislation that is designed to minimise people taking up paid parental leave. That option won out of those presented to Cabinet only because it was the option that most kept people away from paid parental leave. So it is designed to save the Government some money in the longer term. It is designed to reduce the options for some people to take paid parental leave, and that is the reason it was chosen. I just want to say that that is something that is absolutely disgraceful.

Moving back to the paragraph that I referred to before, we now know why the Government did not want to send this part to a select committee. Under paragraph 44, it says that it does not need to go through Parliament until November. We now know why the Government is putting it through now. It is because it was trying to sneak it through under the radar. It was trying to put it through this Parliament without us realising what it was actually doing. I just say that in New Zealand, which has a long-term tradition of being transparent in its legislation and being clear and open and obvious about the reasons why we are doing things, to take this sort of sneaky approach in the hope that all members of Parliament are like National Party backbenchers and do not read the documentation that is tabled in the House—it was hoping that we would not read it as well. And what we do know is that we do look at it.

I do not often disagree with officials in their regulatory impact statements, but the next thing that I would like to refer to, in paragraph 45, is the targeting criteria that targets “lower and middle income families”. This option comes up top in that particular area. Well, it does not—it is not the best option for targeting lower and middle income families. The reason it comes top here is that the option of targeting those who are really low-income families was excluded earlier in the paper. It was excluded earlier in the paper. I just want to say to the officials—not those in the Chamber, of course; I would not address them—who were responsible for this regulatory impact statement that giving this option a rating of four, which is at the top of the targeting of lower and middle income families, is just bollocks. It is wrong. It is not the case.

When you take out those families who are the most in poverty and do not allow them to be part of the ranking system in the regulatory impact statement on this part of the bill, then what you are doing is denying the facts of poverty in this country. It might be fashionable and it might be—I do not think it is acceptable for John Key to mess around with the facts when he is answering questions in this House, but it is absolutely unacceptable for the Public Service of New Zealand to become so politicised that the regulatory impact statements do not tell the truth. It must not pick up the standards of the Prime Minister in the denial of poverty in the way that it has here. It is the role of the Public Service to be full and frank in their advice to Ministers and this House. Although I welcome officials’ frankness as to their timing and I welcome their frankness as to the fact that this is designed to stop people taking paid parental leave, I regret the fact that they were not prepared within this statement to point out that the people who are most affected by poverty in New Zealand will miss out entirely on this measure. It is their job—it is the job of the policy advisers of that ministry—to do it.

I move, That the question be now put.

I am pleased to take a call on Part 2 of the Budget Measures (Financial Support for Newborn Children) Bill. I really start from the position where the Hon Trevor Mallard was, because these provisions actually take out the most vulnerable. What Jacinda Ardern’s amendment does is put them back in, because those receiving a benefit are the most vulnerable, the most in poverty, and it really says that that group should be included. By the process that Trevor Mallard has just identified, they have been excluded.

This is a good amendment and I think if the Government was sincere about addressing the most vulnerable, it would agree to this particular amendment because those on benefits at this time require this assistance. I have not heard an argument from the Minister of Labour. Maybe he would like to take a call to explain to us why those receiving a benefit are excluded. If that provision was put in, I think that would satisfy this side of the Chamber.

Then I want to speak also to the other amendment that Jacinda Ardern has proposed, and this is to increase the parental tax credit to $3,120 from $2,200, because that actually does begin to put it within striking distance of the Best Start programme. This actually does relate to the Best Start programme that Labour proposed. It is quite interesting. When Labour proposed Best Start and tried to address this, there were howls from the Government benches that this was the baby bonus, this was a bribe, and they pilloried it. They did not have anything positive to say about it. I believe that this was when the Government started to think: “Oops, we have made a mistake.”

When Sue Moroney’s bill was before the Government Administration Committee, a very large number of submitters came forward to say that these are the kinds of things we need to think about. When the Government saw support for these kinds of provisions—which Sue Moroney’s bill was talking about—that is when it started to think about paid parental leave and the changes it is making here.

Prior to that, the Government had no idea. The Minister of Labour earlier, when he took the only call he has taken so far, said that this was a very carefully thought out series of policies. That is unbelievable—absolutely unbelievable. This Government has been absolutely driven to consider paid parental leave and the tax credits that we are talking about in Part 2 of this particular bill. The Government did not think about it before and it had no idea.

The Government realises that there is a demand from the public, and it is Sue Moroney’s bill that has forced the Government to look at this. What the Government is doing now is not doing the job well enough. The first part increases paid parental leave by only 2 weeks next year and by 2 weeks the year after. It is a pittance—60,000 children this year and 60,000 children next year will miss out.

So where is the sincerity of this Minister and this Government in trying to address this problem properly? They are not sincere about this. This is simply something the Government has been forced to do, something it has put in the Budget, and it is now trying, under urgency, to pass this bill. The bill has got lots of faults.

This side of the Chamber supports families. This side of the Chamber supports mothers, particularly at the time when children arrive. This is why the 26 weeks’ paid parental leave was so important. It gets us towards a minimum standard. The reports are legendary. The Families Commission report, recommending about 13 months, was a very well-thought-out piece of work. It brought every piece of knowledge that was available around the world, in this particular area, and all the assistance available, thought it through, and put in place a 7-year programme. New Zealand could have transitioned very, very systematically and programmatically to have a decent paid parental leave system, to give our children the best start possible.

But what this particular bill has done, and what Part 2 is doing here, is just only playing at the edges of it. This questions the sincerity of this Government. This questions the extent to which it really is interested in paid parental leave. I think of all of the quotes that were read out by earlier speakers around what National Cabinet Ministers and National members said about paid parental leave. I think an honourable member said that it was a travesty. I think this is where their real heart is. For them this is a—

I move, That the question be now put.

I rise to take a short call in the Committee stage on Part 2 of the Budget Measures (Financial Support for Newborn Children) Bill. We have put forward an amendment to attempt to extend the parental tax credit to not just the extensions that are included in the bill but to all families, particularly those who are on low incomes—the lowest incomes—those who are on benefits, those who are students, and those who are currently excluded from this scheme.

Every family suffers the financial burden of a newborn child. There are costs associated with it. They include things like the equipment—cots, prams, and nappies. Each of these stresses is felt by every family that has a newborn. So those tax credits for the first 8 weeks, or, in this case now, 10 weeks, makes a significant difference. But it makes more of a difference for those families who are the poorest, because they are less resilient.

In respect of this part of the bill and these provisions around the tax credit, this Government, by excluding the poorest of our families, those who are on benefits, is punishing the babies of the poor. It is basically saying: “We will start your life out by discriminating against you.” This is unacceptable.

This morning I attended with several of my colleagues in this House the post-Budget breakfast that was put on for us by the Public Health Association and the Child Poverty Action Group. They had done an assessment of the Budget. One of the things they said was that this Budget does nothing to raise those 285,000 children out of poverty. What they said was that “The real value of Working for Families continues to decline because of failure to properly index payments, rising abatement rates, and a reducing threshold, so fewer people are being able to access it. It is worth less because the cost of living is rising.” I was alarmed to find out from one of the speakers this morning that New Zealand has the second lowest wages in the OECD countries, just above Iceland’s. That is shocking. How can people rise out of poverty when this is the situation and this Budget does nothing to alleviate that?

This Government is picking the winners and the losers. This Government is spending in this Budget around about 50 percent of its income—50.1 percent, I think—on superannuation, and it is a clear indication of where this Government is directing its policies. Is it, if I am going to be cynical, because people who are receiving superannuation are voters, whereas the babies of the poorest families may not vote for the National Government? I would suggest that this Government has directed these policies towards those who will vote for it, and that is why this tax credit, the parental tax credit, applies to low and middle income families, not to those who are the worst off in Aotearoa New Zealand.

I believe that we should be supporting our children out of poverty, because if we do not we all pay the costs. Those costs are things like poor education outcomes and poor health outcomes. We know that the health budget is one of the biggest that we have to deal with. It is a bottomless pit, as my colleague Kevin Hague, who is the spokesperson on health for the Greens, would say. Unless we do something to alleviate the costs associated with poverty by raising people out of those dire circumstances, then we are going to continue to keep paying for them.

It is the short-term thinking that gets me the most, I think—the fact that we are not thinking in terms of how our families will grow and how our communities will benefit if we invest now. It is a cynical Budget. It focuses mainly on those who do not need it the most.

I move, That the question be now put.

I want to pick up on a point that the Hon Trevor Mallard made around the policy development regarding the Budget Measures (Financial Support for Newborn Children) Bill. He talked about the kind of baseline information that the officials had in order to develop the policy. Well, Trevor Mallard, what I have to say about that is that when you are coming from the point of view that actually there are not 285,000 children living in poverty, when you are coming from the point of view of denying the real situation that exists in this country, and when your Government is telling you to write a report that actually misses out all of that information, of course you are going to come up with the option that the officials did as being the most useful option. Like you, I do not want to blame the officials. They are coming from a position where the Government is saying really clearly that there are not 285,000 children living in poverty and that there is nothing to see here—move along. That is the fundamental flaw in this piece of legislation.

We are looking at the parental tax credit, which is supposed to be extending the eligibility to people who were not previously eligible, but really, when you boil it down, when you look at the actual components of that parental tax credit, we start to exclude those people who are most in need. Why is that? Because people on the other side of the Chamber have got blinkers on when it comes to recognising the reality that many of our families live in.

I do want to just comment on Tracey Martin’s point. Reading through the abatement discussion is totally confusing. I have no idea what that is about. I, like you, Tracey, would welcome the Minister to stand and explain those particular parts of it.

💬 Hon Trevor Mallard: That wouldn’t help.

No, possibly it would not. We probably have a better idea of what is going on with our families than he does. I have to say that where this really misses the point is that we are not looking at children as a whole and what will benefit them, unlike our Best Start package, which looks at 26 weeks’ paid parental leave. All the good science says that staying home with baby for 26 weeks is the way to go. It is the bare minimum that we should be supporting our families through. When we are looking at free antenatal care, when we are looking at increasing early childhood education hours, and when we are looking at providing money to every single family who has a newborn child up to the earning level of $150,000, we are starting to address the real areas of need. We are saying that most of our families need that, not just a select few. Most of our families need that.

The Child Poverty Action Group breakfast this morning was called “The Loaves and the Fishes”. We all know the parable of the loaves and fishes, where a certain man spoke to a crowd and he had nothing to feed them. There was a basket of—was it five loaves and two fish? And he had to feed the crowd on five loaves and two fish. Every time he went to the basket, the basket would miraculously replenish itself. Unfortunately, the reality for our families is that they go to their basket and look to replenish that basket, but they find it empty.

💬 Dr Rajen Prasad: And this Minister doesn’t walk on water.

No, he probably does not walk on water, Dr Prasad. These families are required to produce miracles for their children every single day. They are required to produce miracles out of the barest of supplies.

I also want to talk about the name of this bill. What is it? Let us see. It is the Budget Measures (Financial Support for Newborn Children) Bill. I would like to call it the “Baby Steps When Actually Bold Steps Are Required Bill”. It is definitely not enough in terms of supporting our most vulnerable families, or even those families who just find it really tough when newborns come along. Let us face it. When you have a new baby, there are lots of stresses and pressures on you as a new mum. So maybe we could call it the “We Could Have Done What Was Asked For, But We Did Not Bill”, or maybe we could have called it the “We Gave Lollipops to Some”—

I move, That the question be now put.

Jacinda Ardern’s amendment to clause 35 is out of order as it is substantially the same as Jan Logie’s amendment, which has just been defeated.

The question was put that the following amendment in the name of Jacinda Ardern to clause 36 be agreed to:

in subclause (2)(a)(ii), replace “$2,200” with “$3,120”.