KiwiSaver Budget Measures Bill

I am very glad to speak to this bill because we are firm in opposing it. We believe that this is a bill that is stealing from the future of New Zealand. We heard David Shearer in the previous contribution read out something from the Financial Services Council that talked about robbing the kids’ piggybank to go down to the pub to buy a beer. That is the organisation that Jenny Shipley chairs. That is an organisation that is independent of this House, and it can see clearly that this bill steals from the future.

My first suggested amendment is, of course, to the title. I think that this bill should be called the “Stolen Futures Bill” because it is a bill that is stealing from future generations. In New Zealand we have a capital issue. We have had a capital issue for a long time. Treasury, in the 1970s, had somebody sitting at a desk trying to work out how to ensure that we had more savings. It still has people sitting at desks trying to work out how we can get more savings. Here we have the Government in a panicked measure—in a panicked measure—trying to balance the books because it has broken another election promise. It was the No. 1 election promise in all of National’s pamphlets—“We will get to surplus in the next Budget”. It is a broken promise.

Those members are trying to patch that over. They are trying to make it look not too bad, but, actually, there is a billion dollars’ difference between how things looked last Budget and how things look now—a billion-dollar black hole has opened. Their way of getting there is not by reversing any of the early tax cuts they made when they gave the top 10 percent 40 percent of the value of the tax cuts. No, they did not consider doing that. What they said they would do is take out of the hands of future generations, out of the hands of children, a $1,000 KiwiSaver kick-starter. That is what constitutes vision now from this Government. That is what constitutes vision. That is the big idea in the Budget—“Let’s take 1,000 bucks off the kids.”

Well, that is shameful. That is no future. That is a “Stolen Futures Bill”. It is not a bill that should simply be called the KiwiSaver Budget Measures Bill. That is an Orwellian description of what is going on here. We know that this is National hitting the panic button, saying that it has failed to get to surplus for the seventh time in a row—in contrast to Labour’s nine surpluses in a row—and, with that, it is taking from the pockets of children. As I have said, the Financial Services Council is saying that this is money taken out of kids’ piggybanks to buy beer at the pub. Well, that is a pretty clear picture. That is the stolen future. That is what it looks like for Kiwi children and for Kiwi workers.

Australia, which does have a decent savings set-up for retirement, has got $1.3 trillion in the bank. That money is waiting for small-business people to come along and invest to build the economy. In New Zealand, if Muldoon had not shut down a similar scheme, we would have had hundreds of billions of dollars. National Governments before this one have lacked vision, and this one is in the pattern—this one is in the pattern. That is why we are opposing this bill. It should be called the “Stolen Futures Bill”.

I want to also suggest that it could be called the “Robbing Peter to Pay Paul Bill”. In this Budget the Government has brought in some measures to help those who are at the hardest end of things. Of course, the Government made some big cuts in the 1990s, and this, in real terms, certainly will not compensate for those. The Government has done some good in the Budget, and we want to acknowledge that, but we do not think that that good stuff should happen at the expense of those who are just a couple of rungs further up the ladder—those who are working hard, struggling to get ahead, and having money taken out of their pockets so that this Government can get to an imaginary surplus, which it will never get to if it does not have a vision. It will never actually get there if it does not have a vision.

The Government is reliant on commodity price cycles. It has failed to diversify the economy. It has failed to get to the target of 40 percent of exports, which it set for itself. Exports are now below 30 percent, and they are dropping. They have dropped from last year and are projected to drop further in the year ahead. That is because the economy as it stands currently is built on immigration and the money flowing in for the earthquake recovery. That is not the way to build an economy. Successful economies overseas have diversified. They have not robbed Peter to pay Paul. They have not taken money out of kids’ pockets. They have not taken money out of hard-working New Zealanders’ pockets in order to try to achieve an imaginary surplus.

The third title that I want to suggest might be more appropriate is the “No Vision Bill”. The reason I think the title “No Vision Bill” is appropriate is that that is exactly what this bill shows. This bill shows no vision. This is a Government that has no plan. It has panicked. If we needed any evidence of that, we could turn to the regulatory impact statement prepared by Treasury. Paragraph 1 says: “This regulatory impact statement has been prepared by the Treasury in consultation with Inland Revenue.”; paragraph 2 says: “The advice was requested in advance of Budget 2015 and therefore has been prepared urgently.”—urgently. This was a quick fix because the Government was out of pocket; it was heading for deficit again. The Government did not even get to surplus, but it thought it would have a go at robbing the pockets of hard-working New Zealanders, middle New Zealanders, in order to try to get close. Well, the Government has got egg on its face.

Then if we skip down to paragraph 4, we see: “The analysis has not focussed on the effect of policy options on national saving as was the case with the KiwiSaver policy changes announced with Budget 2011.” The Government was short of time. It could not even assess what the impact of this was going to be. That is also stressed in paragraph 5 of the five paragraphs on the front page of the regulatory impact statement, where it says: “There has been only limited consultation because of Budget sensitivity and a likely behavioural response.” Treasury understands that incentives matter. This Government does not seem to get that. It claims to be economically literate, yet it does not even understand the advice provided by Treasury, which says that if there is no incentive, people will not sign up.

If we needed a clearer example of that, it is provided in the Inland Revenue Department’s final summary evaluation conducted over 7 years of the scheme—over 7 years. It is estimated that this scheme has caused additional savings of 36 percent. That is 36 percent of savings in New Zealand that would not have happened otherwise. KiwiSaver has initiated a savings culture, and that is thanks to the Labour Government’s vision back when the scheme was started. Thank you, Dr Cullen, is what members should be saying from those benches opposite—thank you, Dr Cullen. The reasons New Zealand has savings are, of course, the Cullen fund and KiwiSaver. All that these people can do is chop KiwiSaver. They have made eight cuts to KiwiSaver. It is a Budget of no vision, and this is a bill of no vision. It should be called the “No Vision Bill” or, as I suggested earlier, the “Stolen Future Bill”, or the “Robbing Peter to Pay Paul Bill”. There are many other names more suitable than the name the bill has been allocated.

I want to ask members opposite to examine their consciences. I wonder how many of them took the $1,000. I wonder how many of them took the $1,000 for their KiwiSaver schemes—how many took the kick-starter—and how many of them are now going to have constituents coming through their doors, saying: “How come it was good enough for you? How come, MPs, how come, Ministers, how come, National Government, it was good enough for you to take the $1,000 kick-starter, and then pull the rug out?”.

We know that in the next 4 years, half a million Kiwis will miss out on this $1,000 kick-starter. Many of them will be on low wages. Many of them will be in their first jobs. They will be on $15 an hour, working part-time, because $1 an hour counts as being employed, under this Government. They will be saving $2 a week if they are lucky. A thousand bucks in your bank account is a good incentive. When you go up to $1,002 or $1,004—it may sound meagre to those National members, but a thousand bucks is really a lot of money to people who are struggling to get by and who want to start thinking about their retirement. Starting out with two bucks in your account or four bucks in your account is pretty demoralising.

These guys are prepared to take that away. They are prepared to say they are going to rob Peter to pay Paul. They are prepared to give up and admit they have got no vision for New Zealand’s future. They are taking money from those who are just one or two rungs up the ladder, in order to try to look like they are doing something for the hard end of town. But they made the cuts in the 1990s. They are the ones who actually caused the issues they are trying to cover over now.

We wonder whether the Government will ever get to surplus. It probably will eventually—it probably will eventually—but not through any vision of its own. The Government has made promises to get there sooner. It has so mismanaged the economy. It has failed to diversify in the good times, it has failed to promote new business opportunities, and here once again the Government is depriving the country of the opportunity to save and to have capital depth, and to encourage businesses so that businesses can access capital in those big KiwiSaver funds to promote New Zealand’s economy. The Government does not seem to have a vision for the economy. All it is focused on is breaking promises. John Key said: “We won’t put GST up.” It has gone up to 15 percent. “We will get exports to 40 percent.”—that has not been done. “Pushing out the $7,000 wage increase for employees”—the Government is breaking promises.

Kia ora and thank you, Mr Chair. I will take just a short call on the KiwiSaver Budget Measures Bill—just around the title of the bill. New Zealand First would like to offer some more appropriate alternative titles. Let us start with the “I’m All Right Jack Bill”. This is a Government that has forced beneficiaries into budgeting services, so that they can better manage the little amount of money that they have, and so they must go into budgeting services when they go to seek food, because they are so desperate. This is a Government that does not understand the maths of its own Budget. This is a Government, a member of which stands up and says: “I actually can’t make the numbers work.”, and yet this is the bill it has put on the Table. Also, the reason why “I’m All Right Jack Bill” would be a better title for this piece of legislation is that every member in this House has a substantial contribution from the taxpayers of New Zealand to their KiwiSaver accounts. How about we did not have a look at cutting that. How about that, instead of taking this incentive from the everyday New Zealanders who require it, and from the young people who are going to come into the workforce ongoing? To say that people are not going to sign up to KiwiSaver ongoing just does not make any sense, when we continually have young people growing up and joining the workforce. For goodness’ sake! Think it through before you bring legislation to the House.

Here is another one. Here is another title: the “Chop Our Nose Off to Spite the New Zealand Public Face Bill”. No matter what, we are going to get into some sort of—an artificial—surplus. I will take a bet with you, Dr Clark. I will take a bet. I will bet that this Government will not reside on those benches long enough to get into a real surplus—a surplus that is actually real. You and I—a bottle of lovely red wine that my husband produces. If I lose that bet, it is on you. Here is another title that we might like to consider: the “KiwiSaver Blind Ideology (Surpluses At All Costs, No Matter What It Does to the New Zealand Public) Bill”. How about that? Listen to the maths. I actually noticed that there was silence for a moment there when Fletcher Tabuteau, who knows what he is talking about, went away and did the maths. Mr Woodhouse has not done the maths, and neither has any other member on the backbenches. I would actually suggest that it was very interesting that Mr Bishop remarked how many members of the Government benches there were down here today in the daylight, actually talking or being around here for this very important bill, as they stripped away an incentive from the New Zealand public, from the young people who are going to come into the workforce and are going to join that scheme. So I suggest that the New Zealand public go and have a look at 8.35 p.m., 9.35 p.m., 10.35 p.m., and 11.35 p.m.—go and check out Parliament TV from last night and just tie that in with the comments that Mr Bishop made earlier today.

Here is another title: the “KiwiSaver (I Don’t Know What I Stand For But My Whip Told Me To Vote For It) Bill”. This is what we have here. This is actually an incredibly important piece of legislation that has major downstream effects for the New Zealand family, whether it be through the economy side of the New Zealand family or for each individual New Zealand family, or each individual New Zealand worker. There are downstream effects of this, for money flowing back into New Zealand and New Zealand being able to invest in itself, the New Zealand family being able to back itself with its own money as opposed to seeking overseas money. This Government is very good at saying that New Zealand needs more investment. We agree. We would like to see New Zealanders being able to back themselves, and long term this is exactly what this fund has done. But not only has this Government decided to strip away the incentives at the start of the scheme for any young person who wants to join up, it has decided that you can now rip your contribution out. Instead of the purpose the scheme was made for, you can rip it out and go and buy a house with it. So, basically, what the Government has done with this bill is, again, it has removed its responsibilities and its obligations to manage the economy wisely. It has decided that it is going to put this back on to the New Zealand public, and the New Zealand public needs to be aware of it.

This is where the Budget spin starts to become unravelled, because although the National Government in its Budget on Thursday proclaimed that it was going to do something for New Zealanders who were feeling left behind, for New Zealanders who were struggling to get ahead, the reality is when you break it down, when you get through the spin, this Budget actually penalises those people some more.

So let us look at some real examples of real people who might be affected by the changes in this year’s Budget, and let us take someone who is on an unemployment benefit for the average amount of time. Bear in mind that despite all of the rhetoric, people are typically on the unemployment benefit for less than 6 months at a time. You might not know that when you hear the rhetoric about the unemployment benefit, but the average person who has one is on it for less than 6 months.

So let us assume that they are on the unemployment benefit for 6 months and they have children. They would benefit by about $650 from the changes that the Government has proposed to increase their benefit. Let us say that they then get a job and this is the first time in their life that they have a job with sufficient income to sign up for KiwiSaver, they lose a thousand bucks. That is the reality. So the National Government gives them $650 with one hand and takes $1,000 off them with the other. That is the reality. Break down the spin, go through it, and then you work out that actually they are not going to be better off; they are going to be worse off under the Government because it is giving a small amount with one hand and taking a larger amount with the other. That is the reality, and there are everyday New Zealanders who will be in that position.

When members on the other side of the House talk about beneficiaries, they only ever talk about the people who are on a benefit for a long time and they neglect to tell the public every time that the vast bulk of New Zealanders who rely on some form of benefit do so for a short period of time. It is a stop-gap measure for them when they find themselves in hardship, and this Government neglects to tell the public about that. It is happy to stereotype people living on benefits, when actually the vast bulk of people who are on a benefit are on a benefit for a short period of time. They will be penalised by this because they will lose the opportunity to get the $1,000 KiwiSaver kick-start, and I think that is wrong.

I think it is wrong that somebody who signed up their child to KiwiSaver on Wednesday gets $1,000 and somebody signing them up on Friday does not. That is simply unfair. It is unfair that the Government did not signal this. It was never promised in its manifesto. So New Zealanders had the comfort of knowing that at some point in the future, if they found themselves in a position to join up to KiwiSaver, that kick-start would be there. Had they known, had the Government had the decency to give them warning, they could have signed up and got the $1,000 kick-start. The Government knows that, because if it did not we would not be here under urgency backdating this legislation to Budget day and robbing all of the New Zealanders who are not in KiwiSaver of the opportunity to sign up and get the $1,000 kick-start.

Let us just be clear here. The people who are in KiwiSaver now are more than likely to be in middle and upper income brackets. It is the people in the lowest income categories who struggle to get into KiwiSaver, and yet that is something that I know they aspire to. Aspiration used to be something that the National Party was proud of. Now, if someone is on a low income and aspires to be in KiwiSaver, they are kicking them in the guts by taking away the $1,000 kick-start that middle and upper income earners benefited from.

This is another kick in the guts to people on low incomes and to future generations of New Zealanders. To the tertiary graduates, who will be leaving university or polytech or their apprenticeships and moving into full-time, fully paid employment for the first time, signing up to KiwiSaver—they have lost the $1,000. And, of course, we know that tertiary students continue to be hammered by this Government as well. It is simply unfair.

The National Party hated KiwiSaver from the beginning. It was a package of measures that John Key called communism by stealth. Let us not forget that. When Working for Families and KiwiSaver were introduced by the last Labour Government, a Government that, I should remind people, produced nine surpluses in a row to National’s seven deficits—when we used those surpluses in the good economic times to introduce KiwiSaver to save for the future, to boost family incomes through Working for Families, to reduce the burden on students by having interest-free student loans, John Key railed against those policies and called them communism by stealth.

National hates KiwiSaver and that was absolutely evident from the very first moment it became Government. What did it do? When National first became Government it cut the member contributions. That was cut No. 1. It then cut the member fee subsidy of $40 per annum. That was cut straight away. It cut employer contributions. This all happened straight away. National halved the size of KiwiSaver straight away in its first Budget and it ceased to provide the employer tax credit. Those four cuts were all made in its first Budget. Those were the first of the KiwiSaver cuts made by the National Government.

But then the Government came back in 2011 and it had another go. It halved the member tax credit in that year as well. This was yet another cut. And then it made further cuts to KiwiSaver, and now this is the latest one. Eight cuts all up this Government has made to the KiwiSaver scheme since it came into office.

This is a Government that hates KiwiSaver. Yet Bill English knows in his heart of hearts, and they all know in their heart of hearts, that New Zealand still has a savings problem. Anybody looking at the wider set of New Zealand’s accounts knows that we are spending more than we are earning and that that has been the case for a very long period of time. KiwiSaver was one of the measures introduced to try to curb that, to try to get New Zealanders saving more. It was a good measure and it still is a good measure, and I am pleased it is still there. But we should be looking at getting more people into KiwiSaver and putting more money into KiwiSaver, because it is a key part of making sure that New Zealanders break even and make ends meet.

We heard a lecture from Nick Smith about the Opposition not being able to get their numbers to add up. This Government has not managed to get its numbers to add up for 7 years, because if they did add up we would not be in deficit. For 7 years its numbers have not added up. The Government has been in deficit every year. What does that mean? It means borrowing. National has been borrowing every year that it has been in Government. It has been contributing to the problem of New Zealand as a country spending more than it earns. We have to deal with that, and Bill English knows in his heart of hearts that that is a challenge for New Zealand. So why is it that time after time he comes to the House and proposes cuts to one of the few things that we are doing that is designed to turn that round and to increase our savings rate?

Then, of course, we have got the Government saying: “Well, actually, you can cash up your KiwiSaver for your first-home deposit.” That was something that the Labour Party has supported as well. But is it not sad that we have reached that reality now where New Zealanders, even if it they cash it up, cannot afford to buy a first home? Those in the middle-income brackets who can, are having to face a trade-off between saving for their retirement and buying their first home. I think that is a tragedy. I think it is a short-term stop-gap measure. It is good—it is a good way to get people on to the property-buying ladder, but long term we have got to look at other things. We have got to look at ways that people can own a home and save for their future. Furthering KiwiSaver by making sure that there are good incentives to join, by making sure that we are increasing contributions to KiwiSaver—whether it be through Government contributions, employer contributions, employee contributions, and the like—will all make New Zealand a richer country in the long term. Instead, what we are seeing with the current Government is that it is content to manage things for today and not plan ahead for the future.

So many of the things in this year’s Budget are designed to create the illusion of doing something, but they do not. When you break down the spin, when you look at it, they are not actually helping the people they claim to be helping. I want to just reiterate that point that I made, that for somebody who is moving off a benefit and into work, if they have been on a benefit for 6 months—which is about the average time that someone is on an unemployment benefit—they would have benefited by $650 through the increase in benefits, and that is great. I think that they would enjoy that and I think that they would find that as a welcome relief. But when they finally get into work, and they finally get to join KiwiSaver for the first time, they find that not only is that $650 taken away from them but another $350 is taken away as well because they lose the $1,000 KiwiSaver kick-start that they otherwise would have got. That is the reality. So let us break down the spin. Give a small amount with one hand, take a larger amount with the other hand—that is the reality of what the current Government is doing.

KiwiSaver is a good scheme. The kick-start has resulted in a whole heap of people joining KiwiSaver. Removing the kick-start penalises people who, for whatever reason—

💬 Joanne Hayes: I raise a point of order, Mr Chairperson. The member is not even addressing the clause—the title.

The CHAIRPERSON (Hon Chester Borrows): The debate on this clause is wide ranging. It will continue to be wide ranging for some time yet. When we get into the other clauses they are much narrower, and so that will be enforced most closely.

💬 Hon Michael Woodhouse: As I understand it, there was no leave sought for these clauses to be taken as one question, and traditionally in the Committee stage of the House the title part of the bill is at the end of the Committee stage, not at the start, which does, of itself, form something of a wind-up. But in this situation we are debating clause by clause—

114/7—read it.

💬 Hon Michael Woodhouse: —and my understanding is that that requires the member to stick to that clause.

The CHAIRPERSON (Hon Chester Borrows): I do not need any further help with this. In spite of the unlawful interjection, I do draw the member’s attention to Speaker’s ruling 114/7. Because there was no select committee process on this bill, the convention is that this is a wide-ranging debate. It will continue to be, no doubt, for both sides of the Chamber who may want to seek the call. Chris Hipkins has 20 seconds.

Thank you, and I intend to use every one of them. I will be very brief. KiwiSaver is a good scheme. The kick-start was a good way to get people in it. We should not be penalising people who are not in it now but who aspire to join it. We should be encouraging them to join KiwiSaver. It is wrong that the Government is taking away this kick-start, and it is wrong that it has not foreshadowed that it intended to do so.

Just on the point of order that was just mentioned before by Mr Woodhouse, I think I will start with the naming of this bill. I think this Government loves to use acronyms that confuse most of us out there in the real world who understand what the real world is about. I have got an acronym here that I think sums up this piece of legislation: the “OMG YOLO #nofuture Bill”. I know everybody back home, the younger ones particularly, will totally get what I mean, because this bill gives no future to our New Zealanders who need this future the most.

I have many times stood up in this Chamber and said that New Zealand First is not in the game of opposing bills that the Government puts forward if they make sense. If there is any sense to a piece of legislation, New Zealand First will support it.

💬 Matt Doocey: Sit down, then. Sit down.

Just to that, Matt Doocey, let me say that we supported the Telecommunications (Development Levy) Amendment Bill yesterday because that makes sense. On this bill, however, we could not even get a furthest, widest-ranging view to conclude that this is good for the future of New Zealand. This bill is absolutely against what this country should be standing up for—the people’s future.

In 2006 the Labour Government came up with the KiwiSaver legislation, which gave Kiwis a $1,000 kick-start incentive to get them thinking about their future. I took advantage of that, and I am sure everybody on the other side of the House took advantage of that, even if they were not in politics, because it made sense to. It does not matter what compounding interest rate you are going to be using there, Mr Bayly. Whatever that is, whether you want to make it 5 percent under your calculations and say it is going to be only $24,000, or whether we are going to be using 10 percent—and, let me remind you, 10 percent is conservative at the moment, when the AMP KiwiSaver investment scheme is averaging out at 16.8 percent at the moment.

I know this because I have just changed mine into a bit more of a dynamic fund. It is getting 10 percent, so it is going to give you a heck of a lot more, even if it is $100,000—that is, $145,000. You are taking money away from Kiwis. It is short-sighted for the future of New Zealand. I have to say, Mr Bayly, that you justify it by saying that even $23,000 is not enough. I dare say that when you retire at 65 years old, $23,000 will go a long, long way.

We have heard from people emailing and calling us over the last few days. I would love to say I had got some faxes, but we do not have fax machines anymore. We have actually moved into the 21st century.

💬 Iain Lees-Galloway: Really?

I do not do the fax thing, no, Mr Iain Lees-Galloway. My father does, and if he could, he would send me smoke screens. He does not even text. The point is that we have had Grey Power come and speak to us with some serious, serious concerns. This population that we are currently living in is like an hourglass population. There is a very, very bulbous population of ageing people at the top, a very, very skinny working class of people—those who are of the age to work—and a very, very large bulbous group of young people coming into the workforce.

The point is that we should be thinking long term now. I know, Mr Matt Doocey, that you are trying to create your perfect life there, but this is a very serious curve that we are talking about—[Interruption]—and I apologise to the people at home who just got an earful of me hitting the microphone. But, seriously, if we do not start thinking about the future and get this Government to rethink this legislation and the way that it votes, we are going to have this population, who are now currently working, starving on the streets with very, very little money to support them. I am sure, Mr Chair, that you have got some investments that would make—

The CHAIRPERSON (Hon Chester Borrows): Do not bring me into this.

I apologise. The point is that if we do not think about the future of our New Zealanders now and bring this legislation back into the fold, then we are going to have some grave concerns for the future. I had a phone call from a gentleman who is a constituent in Tauranga. He has also contacted the local Minister from Tauranga to put his concerns forward. He was right in the very stages of signing up his three children aged 4, 6, and 9 years old to the KiwiSaver programme—we are talking about filling out the forms to get them sent in. But this retrospective piece of legislation, which takes effect going back to Thursday of this week, stops his ability to get his children signed up. In fact, just last week my wife and I were talking about the same thing for our three young children—that we should be thinking about getting them signed up.

How many New Zealanders are missing out because of this quick fire from the hip? The Government is shooting down the legislation, pulling the carpet from underneath their legs, and not giving them the time they require to ensure that they have the means to put that into place. Two years would not be unreasonable. When you look at all the legislation that is coming through now and the 2 to 4 year time period for the implementation of the legislation, that would not be unfair. In fact, there is an amendment on the Table in the name of Mr Fletcher Tabuteau that actually, if it could get support, might be a little more palatable than cutting the legs off before we have got the chance to actually speak to it. We strongly hope that this Government reconsiders this motion. To that end, we understand the fiscal constraints of any Government. This Government, with its bad budgeting over the past 7 years, is clearly having some issues with getting the books to balance up, so we understand that some cuts need to be made. But it is a zero-sum gain. When you are giving $25 a week to the people who need it the most—and, hey, look, at the end of the day, a little bit helps; I do not think it helps enough, I think GST off food would help far more of our poor, starving, and impoverished people than giving them a $25 a week handout. Taxing food, to me, is just obscene. But at the end of the day the Government has given that, and well done for that, but taking away from their future is absolutely crazy thinking.

I would like Government members to reconsider what they are doing there, because if they even thought about looking after the fiscal constraints and reducing the $1,000 kick-start to even $500 in 2 years’ time, we could probably understand that—decisions need to be made. But what about the uncollected taxes? Again, I will give credit to the Government where credit is due: in the latest Budget it has just put $74 million to increasing its ability to actually go out and get the tax that needs to be collected. Twenty-nine million dollars, 40 percent of that $74 million, is going to specifically target those people who are using their housing schemes, their residential properties, and that will increase the tax collected.

The rest of that money should be going into corporate tax evasion. The very wealthy in this country—we are talking about people who have got hundreds of millions of dollars—are gloating that they pay only 12 to 15 percent tax when the rest of us are paying more than our fair share. And why should we not pay our taxes? We owe it to society. The money that at the moment is sitting in the red is about $7 billion—$7,000 million in uncollected taxes, and if this Government spent some of that money to go and collect, we could actually afford to do both—$25 a week as well as a KiwiSaver kick-start. It makes good economic sense for the now and it makes good economic sense for the future.

We do not support this bill in its current form, and we would like to see this Government change the way it is thinking about the future of New Zealanders. Thank you.

I would just like to take issue with my own colleague Chris Hipkins, because towards the end of his speech he said that KiwiSaver is a good scheme. Let me tell you this: KiwiSaver was a good scheme. It was a good scheme in 2006, when Michael Cullen had the courage to set up a far-reaching scheme with a vision for the future. But what has happened? All we have seen under this Government is KiwiSaver get cut, cut, cut, cut, cut. Eight cuts we have heard of today.

There was the minimum member contribution cut. That has been taken. The member fee subsidy—that has been cut. The employer tax credit—that has been cut. Compulsory employer contributions—they have been cut. The member tax credit—that has been cut. And now the $1,000 kick-start—that has been cut. We have a member on that side of the Chamber saying they will still be able to get $521 in annual payments. I just query how long before that $521 a year is also going to be cut. The KiwiSaver scheme has been absolutely gutted.

The Government lacks vision. They lack courageous policy. The KiwiSaver policy was far-reaching. It was going to help our generations into the future, and that is why I say that this bill should be named the “Dismantle Our Children’s Future Bill”. It is just dismantling the future so that people can scrape by in the present. It is doing nothing at all to look after future generations. This is terrible.

We had Nick Smith sitting over there. He was throwing figures around, facts and figures. He is trying to make himself sound intelligent, and then he says that New Zealand is the first country to get into the black. I was sitting here, and on Thursday I am sure I heard the Minister of Finance say that we are still in deficit. I am positive that is what I heard. Two days later, Nick Smith is standing up and saying we are in the black. He does not even know his colours, let alone his figures, and that is why I resent that party over there standing up and saying that this side of the House does not know what we are talking about when it comes to the economy. It is an absolutely shameless distortion of the truth to hear these people say that they know what is good for the country.

National has absolutely gutted KiwiSaver. This bill should be called the “Money-Go-Round Bill”, because all it is doing is taking from this side and giving it over here. There is absolutely no long-term vision. This is just about living in the present. The difference between our side of the House and that side of the House is that we do not only live in the present; we live in and think about the future. We think about the future and our kids, and we know that there are going to be more good moments in the future, not just living here and thinking about this moment in time, just to make ourselves look good in this moment in time. It is about thinking about the future.

Working for Families was thinking about the future. And, as we have heard, John Key was the man who said this is communism by stealth. That party over there is taking credit for our policies. That party over there is taking credit for what this side of the House did, those years ago. KiwiSaver—those members are saying there are 2.5 million people on KiwiSaver. And it is just more popular than ever—well, it is more popular because it was a courageous policy from this side of the House, and now National members are taking credit for it. They live in the past; we think about the future. They are taking credit for what the last Labour Government did in 2006. That is because Labour always thinks about the future. Labour thinks about what we are going to do to make the country better off in the future. These guys are just worrying about the next Budget.

Five hundred and twenty-one dollars a year—I would say that is going to go from KiwiSaver, in the next Budget. And we are going to have the ninth cut to the KiwiSaver policy. National is just making things worse for the future. It has absolutely no idea about how to make the lives of our children better off. This is a panicked, knee-jerk reaction—

This is our opportunity in this part of the debate on the KiwiSaver Budget Measures Bill to talk about what we believe this bill should be called. The most obvious thing, from my perspective, is that if this bill were really speaking the truth, it would be called the “Widening Intergenerational Inequality Bill”. It feels like Groundhog Day, for me to be in this Chamber yet again debating another measure to cut the savings base for New Zealanders in this country.

💬 Chris Bishop: It feels like that for you? Goodness me.

I still remember, Chris Bishop, my very first Budget in this House, when that National Government made substantive changes to KiwiSaver. I remember vividly walking outside to the Noes lobby and seeing Michael Cullen sitting on the couch there with this absolutely devastated look on his face. All of the work that the Labour Government had done to build up savings in this country, to make sure that New Zealanders had a nest egg that meant that they would not just scrape by on a pension but have quality of life in their old age—in one fell Budget, that Government gutted it. I remember that Budget to this day. National has done it eight times since—and that is just during my time in this House. That is not to mention what National did under Muldoon to devastate the potential that we had in New Zealand to have a massive savings base.

We talk about the gap between New Zealand and Australia—that is when that gap started. The Australians made the sensible decision to have a decent superannuation scheme across the entire population, and we had that opportunity under Kirk. But, once again, National demonstrated its short-sighted approach when it comes to savings, and it gutted them. They absolutely gutted them. Everything that we have been doing since then has been to try to regain that ground. And, again, here we are, with another demonstration of the fact that that Government is absolutely disinterested in what it is doing for future generations. It is not just savings. It is housing, where we have a generation of renters. It is education, where student loans are mounting for the next generation. And it is even things like climate change.

If that Government wants to prove that this bill is not about intergenerational inequality, that it is not about their having more than what the next lot will get, I challenge just one of them to stand up and say that they did not take the $1,000 KiwiSaver kick-start themselves. Because that is what we are cutting today. We are cutting something that I would almost guarantee every single one of the MPs on that side of the Chamber took up. We did—we did. We put it out there and said that it was for everyone who joins. Did that side of the Committee do the same? I challenge just one of them to say that they did not, because if all of them did, then they are absolutely depriving everyone else of something that they benefited from. I also challenge members on that side of the Committee to stand up and tell us—give us a guarantee—that they did not tell their kids to sign up before they took it away, as well, because that is what we are debating today. This bill will stop anyone else from getting that $1,000 kick-start contribution, which we know so many would have taken.

In my short time available, I also want to point out that this bill starts from the time that the Budget was passed, and, yet, how long are we waiting for $25 a week to go to beneficiaries? It is not happening until next year. So we take immediately and we leave everyone else to wait until they can gain that kind of small amount of money.

This is a bill that should be renamed the “We Choose Sticks Instead of Incentives Bill, because this bill was always about incentivising people to join KiwiSaver. But we know that that side of the Committee never wanted people to join. And where is the evidence of that? Well, I have got a little article here from the New Zealand Herald, dated 1 March 2006. When Michael Cullen introduced the idea of KiwiSaver, he said that it was his aspiration that 25 percent of workers join it, and things like the kick-start contribution were there to motivate people to do that. What was the National Party’s response to that? The National Party members’ response to that was to say that they thought he was dreaming. They said in 2006 that Michael Cullen was dreaming that people would join up at a rate of 25 percent. Well, how many do we have now? We have 2.5 million people in this scheme. That Government never wanted Kiwis to have KiwiSaver.

I have to say we started off this morning with a very spirited debate from the members opposite defending the indefensible. I have to say it was such a good start that the Minister who is in charge of this bill, the Hon Todd McClay, did not know he was in charge of it and tried to move it in somebody else’s name.

We have had to listen this morning to National members sitting opposite crowing about how great they have been to beneficiaries, and the payback is because they are going to take it off KiwiSaver. They said: “We are the first Government in 43 years to give money to beneficiaries.” What they forget is that they were the first Government in 43 years to cut the benefits to beneficiaries—to cut the benefits to beneficiaries. They have forgotten about Ruth Richardson and the “mother of all Budgets”. That has all been glossed over. When we brought in Working for Families, that was communism by stealth! Have they got rid of it? No, they have not. They just fiddle around the edges of it. When we brought back income-related rents, which helped those on the lowest income, they opposed it. When we brought in 20 hours of free early childhood education, they opposed it. The one that I really like, because we have had to listen hour after hour to Paula Bennett speaking on it, is that we kept the training incentive allowance to help people get off the benefit, but she took it for herself and then canned it. This is another example of National members taking what they can for them and taking it off others. That is exactly what is happening with KiwiSaver today.

I wonder whether National has any idea of how many people under 18 have signed up to KiwiSaver. The latest figure we have got from 2013 is 352,600 young people under 18 have signed up to KiwiSaver. So we have got young people signing up. Why were they signing up? Not because they were necessarily in work; most of them were not. They signed up because they had the incentive of the $1,000 that was going to be there for them to build on when they became KiwiSaver contributors. They had the $1,000.

What National has forgotten is that there are going to be more babies born. It is just a fact of life. There are going to be about 60,000 children born every year in New Zealand in the foreseeable future. They might have wanted to join up to KiwiSaver. Maybe their parents might have liked to join them up to KiwiSaver. I challenge the members opposite—just one of them—to say that they did not sign their children up to KiwiSaver. Well, I wonder whether the member himself took the $1,000 for KiwiSaver. Would he like—[Interruption] He cannot remember. Well, that is always a sign that you did. So he cannot remember.

💬 Hon Michael Woodhouse: I did.

Oh, he did take it. So why would the Minister in the chair take $1,000 for himself and deny it for future generations, for our kids, for those who have not yet joined KiwiSaver? It is a pretty mean-spirited approach.

Government members say we have to do this to pay for the beneficiaries. Are we not generous? Well, just go back and think, National members. If you had not given billions of dollars away in tax cuts to the wealthiest, which included everybody in this Committee, you would have money to give to beneficiaries, you would have money to invest into our regions in New Zealand, and you would have money to invest in jobs. But you saw that you ought to give it to the top 10 percent of New Zealand, and then we did not have the money for beneficiaries. We did not have the money for health. We did not have the money for a whole lot of things.

I wonder whether the members opposite can remember the promises their party made in 2008. I have to say, you are meant to believe the word of a Prime Minister. The Prime Minister then in Opposition said National would retain the policy. There would be no radical changes to this policy. There were eight cuts to the KiwiSaver scheme in the 7 long years National has been in Government. That is one for every year, and that is on a solemn promise that National would not change this scheme radically. I have to say, I would actually rename this bill the “Fess Up to Chicanery Bill”, because that is exactly what this is. The Government makes promises and then breaks them. It tells the people that it will do one thing and then it does something quite different.

I find myself drawn into the debate in a way I did not quite expect, simply by putting up my hand and saying that my own children are not in KiwiSaver but I am. That is fair enough. Yes, I thought, as the chief executive of Mercy Hospital in Dunedin, that all of my staff, regardless of whether they were doctors at the top end of the salary scale or our lower skilled workers, should take up KiwiSaver, but the question and the thesis we have now is whether or not the incentives have been destroyed. The simple challenge that the members opposite have made is that every single member of the National caucus should give the $1,000 back. So here is my challenge to them: if they are so principled about the changes that this Government has made, I want every one of them who are currently paying the 39 percent top marginal tax rate, when they do not have to, to put their hands up—but they oppose that tax cut. So if they can say that they refused the benefits that this Government imposed, that they were so principled that they continue to pay the 39 percent top marginal tax rate, I will pay my $1,000 back. I will write the cheque today, because what is good for the goose is good for the gander.

I want to come to Mr Tabuteau, because Mr Tabuteau is the one sensible, rational New Zealand First member who has half an ear on economics. I understand he lectured in economics, but he is very tricky about those numbers. I, like Mr Bayly, the very smart fellow chartered accountant on the National caucus, was fascinated by the use of the 10 percent rate of return. What is really interesting is that if you do get the excel spreadsheet out and calculate the future value of that lump sum, using a 10 percent hurdle rate, in the 50 years that Mr Tabuteau described, between the 15 years and 65, it is, indeed, nearly $118,000. Except what Mr Tabuteau forgot was that people have to pay tax. Maybe he does not, but that 10 percent rate of return is a gross return. We know that the long-run rate of return in investment schemes is not 10 percent, because there are hard times, not that Mr Cunliffe would have told you that when he said that we should have been borrowing to invest in the New Zealand superannuation scheme. He never said that. In fact, if he was such a genius about how to predict the market, why, in 2007, did he not trot along to the good Dr Cullen’s office, knock on his door, and say: “Guess what, Mike? I think the rates of return are going to drop. We should pull out of those equities and go into fixed interest before the super scheme plummets.”?

The simple fact is we cannot. Over 50 years there are good times and bad times. So the long-run rate of return at an after-tax pay rate of, say, a generous 6 percent in those 50 years is $18,000. It is not to be sneezed at but it is not $118,000.

💬 Hon David Cunliffe: You’re a medical doctor, not a PhD.

I am a chartered accountant, Mr Cunliffe. Here is what else he did not say. The future value of the $175 million annuity, which is the investment the Government would have to make if the Labour Opposition kept it—and that is fine; it has that prerogative to campaign on that—at the same 6 percent rate of return is $54 billion. So we take away the $18,000 future value of that initial investment and we burden those 15-year-olds with an extra $54 billion of debt because we do not have cash in the bank to pay that $1,000. We would have to borrow it. If we use the Government’s average interest rate of about 6 percent, that is an extra $54 billion burden that this Opposition would have us have. It only knows how to borrow, spend other people’s money, and tax. Just remember, it knows how to tax people but it is not so principled that it would pay the 39 percent marginal tax rate. I will get my cheque book out and I will write that $1,000 cheque when one of them—one of them—can demonstrate that they are paying a 39 percent marginal tax rate.

It is going to be a long day. I note that last night we were tired and giggly. Today I would like us to not get tired and scratchy. I can assure the members on my left that I heard their cunning and clever interjections the first 15 times they repeated them. Just remember the directions of Speaker Hunt that interjections are rare, reasonable, and, hopefully, witty. I look forward to those colourful comments through the course of today, into tonight, next Monday, or however long it takes. If you just manage to match the noise levels, speaker to speaker, I am sure we will progress very well through the business of today.

Let me start where the Minister left off. The Minister said that members on this side of the Chamber only know how to borrow. That is from a Minister of a Government that has been in Government for 7 long years and has borrowed for every single one of those 7 years. There has been $83 billion worth of debt amassed by that Government over there and it has the temerity to lecture this side of the Chamber the parties that ran the Government that got New Zealand into a zero net debt position for the first time in our history, that ran 9 years of surplus, 9 nil. That side of the Chamber cannot lecture us about borrowing because all the Government knows is how to borrow. It borrows so that it can afford tax cuts for its rich mates. That is what it borrows money for—so that it can afford tax cuts for its rich mates.

The title of this bill is the KiwiSaver Budget Measures Bill. I wonder whether any of the people who have come along and are sitting in the gallery on a Saturday morning watching this would have any idea, reading that title, what the KiwiSaver Budget Measures Bill actually does. This title tells us nothing. This Government is perfectly capable of giving bills titles that tell us what they do. We had the Anti-Money Laundering and Countering Financing of Terrorism Bill. That told us what that bill was pretty much about. We had the Crimes (Match-fixing) Amendment Bill. I think we all knew what that one was about. Even the rather dry Dairy Industry Restructuring (Raw Milk Pricing Methods) Bill gave us a pretty good hint of what that bill did. I could probably spend hours reading out names of bills but I will not do that. The thing is what the Government does is it gives a bill a title that is meaningful when it is proud of it. The Government is not proud of this bill, because it is hiding what the bill really does by giving it the driest, most bland title that would not give anybody outside of this House the slightest hint of what this legislation does.

I have got a better title. I would call this bill the “KiwiSaver Cut Bill (No 8)”—the “KiwiSaver Cut Bill (No 8)”. Because what it does is it implements the eighth cut to KiwiSaver that has occurred under this Government in less than 7 years—eight cuts in less than 7 years—although we are not that surprised because members on that side of the House hate KiwiSaver. They hated it when it was first brought in. They hate the idea of people in New Zealand saving for their future.

It was the National Government under Muldoon that got rid of the Kirk Government’s superannuation scheme. This country would be unrecognisable to us today if that superannuation scheme had remained in place. We would not be so desperately reliant on foreign capital if that superannuation scheme had been left in place. But the National Party does not think of the future. The National Party never thinks of the future. The National Party is always worried about the next Budget and the next election, the here and now. There is never a plan. It is always about how to retain power.

Why is this the “KiwiSaver Cut Bill (No 8)”? Well, cut No. 1 was to reduce the minimum contribution rate from 4 percent to 2 percent. What did the Government tell Kiwis at the time? It said: “Oh, we are putting more money in your bank account by cutting your contribution rates from four percent to two percent.” That is actually like telling someone that you have taken money out of their savings account and put it into their cheque account, and that you have given them more money. Actually, it just shows that the only way this Government can think of getting more money into people’s bank accounts is not through economic growth, is not through wage rises; it is from stealing from their superannuation scheme and putting it into their cheque account. That is the sum total of this Government’s plan.

The second cut was to the member fee subsidy—$40 per annum. That was just a little sweetener to make sure that the fees that are charged by the outfits that run the KiwiSaver accounts did not eat away too much at your KiwiSaver savings. Of course, the Government’s second cut was to remove that.

The third cut was to cap the compulsory employer contributions at 2 percent. Again, this was saying to employers that the Government wanted them to be able to hold on to more money, not through growing the economy, not through ensuring that businesses’ consumers had more money in their pockets so that there was more demand for their goods and they could employ more people and pay them well. No, it was by taking money out of people’s savings accounts and putting it into the employer’s accounts.

I also have a suggestion for the title of this bill, which is that we amend it from the KiwiSaver Budget Measures Bill to the “KiwiSaver Arbitrary Budget Measures Bill”. I say “arbitrary” because there does not yet seem to be much reasoning behind the move to remove the incentive.

I just wanted to thank the Minister, Michael Woodhouse, for his contribution earlier, because it was the first contribution from a member of the Government side that actually included facts. I found that very helpful. It included actual information and actual facts. However, it simply reinforced the Government’s case that this is all about cutting costs, reducing the deficit, and so on. I wanted to pick up on one point with that, but then I also wanted to restate some of the questions that I asked earlier on in the debate, and to invite Mr Woodhouse to take another call at a later stage to respond to some of the specific questions that lead me to the idea that this is, in fact, an arbitrary bill. First of all, he mentioned the 39 percent top tax rate before. When National first came to Government it reduced taxes for the wealthiest people in society, which has left a hole in the accounts of about $1 billion a year. That would have covered the deficit, and it would have allowed us to continue this scheme.

The questions that I asked earlier that I have not yet received an answer for are, No. 1: New Zealand is 22nd of 24 OECD countries for savings. Cutting the KiwiSaver incentive reduces the savings rate. What is the plan to increase savings? The second question is: the ANZ chief economist says that removing the KiwiSaver incentive will reduce the rate of take up. What is the plan to maintain or increase the rate of take up? Three: did the Government consider leaving the kick-start contribution in place for, say, 6 or 12 months in order to incentivise those currently not in the scheme to get into the scheme, or to give people who are currently processing paperwork a chance to actually get it completed? Four: how does reducing the KiwiSaver take-up rate impact the intergenerational equity of today’s working parents paying for three generations’ worth of costs? How does it deal with the change in the dependency ratio from 7:1 today to 2:1 in 30 years’ time?

The fifth question is: the Government is reducing a short-term deficit by raiding New Zealand’s retirement schemes—again. What is the Government’s plan for long-term financial sustainability? Six: why cut the kick-start contribution rather than the member tax credit, given that we know that the kick-start contribution is the incentive that people actually know about and is the thing that actually gets them into the scheme? Reducing or removing the member tax credit would actually achieve the Government’s goal more substantially, because it is the more expensive part of the scheme, but it would leave in place the incentive to get into the scheme, which is the most important thing.

As yet, during the course of this debate, I have not heard responses to any of those questions, and that leaves me in the position of simply having to oppose this otherwise arbitrary bill.

I move, That the question be now put.

It is a privilege to speak on clause 1, I think it is, of this Committee of the whole House stage. This is an opportunity for some members on this side of the Chamber to have a bit of fun with the title. My colleague Iain Lees-Galloway has come up with a few interesting titles but mine is quite a mundane title. This bill should be retitled the “KiwiSaver (Reduction and Privilege) Bill”, and for the benefit of the Committee I am going to use the acronym to make things easy—the “KRAP”, because that is what this is. The “KRAP” is a mean-spirited bill that takes away saving opportunities from our young people. That is essentially what this bill does. The “KRAP” will basically take money from those people who have not yet signed up to KiwiSaver, and from some of our youngest and unborn children. That is what the “KRAP” does. The “KRAP” is an awful piece of legislation. When you look at the numbers, the “KRAP”, as I want it to be changed to, is not only a mean-spirited bill in terms of what it will do for the savings regime and the culture of savings in New Zealand but it is also a fiscally cynical piece of legislation. By cutting the $1,000 kick-start payment for Kiwis this Government will save about $175 million next year. The projected surplus next year just happens to be $176 million. So this is a lazy Government. It could not look to save a bit here and to save a bit there. It just takes away the KiwiSaver kick-start as part of this “KRAP”.

As part of this “KRAP” we have been, I guess, antagonising members on the other side of the Chamber as to who should pay back their KiwiSaver contribution. It is not very often that I get to stand in this Chamber and praise a member on the opposite side of the Chamber. As it stands now—of the National members in the Chamber now—David Bennett is the only one who has not signed up to KiwiSaver. He is the only one on that side of the Chamber who has not signed up, according to the Register of Pecuniary Interests. So he is the only one to whom we are not offering the challenge to pay the $1,000 back. David, you can leave the Chamber in the next 2½ minutes, and I challenge your colleagues who have all taken the $1,000 kick-start, because they are all signed up to KiwiSaver. You can leave. You are not going to be criticised here. Your colleagues who are sitting in the Chamber right now are quite happy to take $1,000, but from 21 May at 2 p.m., no one else can. That is the reality. Every member on that side of the Chamber who is signed up to KiwiSaver—then, fine; I will take that $1,000, but from 21 May at 2 p.m., no one else can. Not one person.

David Bennett, you are either principled or you might be a bit stupid, because you should have signed up to KiwiSaver. You should have signed up because it is a great scheme, which was started by the Labour Government. It is so good that 2.5 million New Zealanders have signed up to it, and that National Government is trying to take credit for it. But under this “KRAP” the Government is ruining KiwiSaver. It is ruining it, and it is not the first time. The Government has got a track record of doing this. This is the eighth time—the eighth time—that it has taken the knife to KiwiSaver. This “KRAP” is an embarrassing piece of legislation for the Government because it is trying to get it to a surplus that it will never achieve and it is ruining the savings culture of New Zealand. Why, if something is working, do you in this “KRAP” take away something that is an incentive for the 2.5 million people who have signed up to KiwiSaver? It does not make sense.

Here is the challenge again—and David, I do appreciate that you have not signed up. The tragedy for David Bennett is that he cannot sign up. He cannot sign up. The challenge to the other members of the Committee on the other side of the Chamber is that you have got $1,000 but you are now denying every Kiwi who has not signed up to KiwiSaver. You got $1,000 that at least 1.5 million Kiwis are not entitled to now. You do not have to, David; you did not get it. If you on that side of the Chamber are quite happy to sit there and pass the “KRAP”, pay the $1,000 back. Give it back. That is essentially what you should do if you have got some honour, and you want to pass this “KRAP”—give the $1,000 back. It is the decent thing to do and it is the honourable thing to do. David Bennett—good on you.

Kia ora, Mr Chair. Thank you very much for the opportunity to contribute to this Committee stage debate on the KiwiSaver Budget Measures Bill. I will talk about some alternative titles later, but I just want to provide some context for this piece of legislation. We have 4.41 million people in New Zealand and of those, 2,350,000 are enrolled in KiwiSaver. Of those people who are enrolled, 352,000 are zero to 17-year-olds. So, actually, our children have engaged in this process and are taking advantage of KiwiSaver because, like us, we want them to prepare for the future. Seventy-eight percent are not enrolled. That is 2.12 million people, but within that cohort, actually, 338,000 people have opted out. So this bill actually has relevance to 1.7 million New Zealanders—that is the 40 percent of New Zealanders who are not enrolled in KiwiSaver. I would like to highlight the fact that of those not enrolled, New Zealanders who earn under $30,000 are actually the most disadvantaged. They are the ones who have chosen not to opt into KiwiSaver, presumably because of their circumstances.

I want to take the opportunity to also highlight the Greens’ Supplementary Order Paper 81, which would retain the $1,000 kick-start contribution for those holding a community services card. Why that cohort? Because, actually, that is the cohort of low to middle-income earners who are not engaging. So it is very much about ensuring that those who are not in the system have opportunities to participate. I have been looking at the Inland Revenue Department’s report Who is enrolling in KiwiSaver?. It is dated February 2015 and it was prepared by the KiwiSaver Evaluation Steering Group. Of most relevance to me is that of the New Zealanders who have chosen to enrol, there are three enrolment types. The first enrolment type is people who enrol directly with a provider. So 40 percent of people who enrolled with KiwiSaver did so with a provider. Forty percent of people are automatically enrolled and 22 percent opt in.

The rest of my speech is going to be focused on that particular cohort—the 40 percent of people who automatically enrol. These are 18 to 64-year-olds who are in new jobs with a new employer and where that job is either full-time, permanent part-time, or it has got some sense of longevity to it. Here are some of the titles that I think this bill should have, actually. If you are auto-enrolled, this bill could be the “KiwiSaver (If You Are Single and Aged Between 18 and 24, We Don’t Care About You) Bill”, because it is that cohort that is automatically enrolled.

This bill could also be called the “KiwiSaver (If You Are Māori and Pacific Islander, You Are Not Our Priority) Bill”, because, again, it is Māori and Pacific Islanders who automatically enrol. This could be the “KiwiSaver (If You Are Secondary School - Educated, Hard Luck) Bill”, because, actually, hard luck to you. You have got only a secondary school education so too bad; we are going to take this opportunity away from you.

This could also be called the “KiwiSaver (If You Are Working in Lower White-Collar Positions, Work Longer Hours to Feed Your Family) Bill”. How about we title it that? What about this one: the “KiwiSaver (If You Are Working in the Retail, Trade, and Accommodation Industry, Get More Tips) Bill”, because you have got to go and do things yourself. Obviously, this Government does not care about you. Finally, what about the “KiwiSaver (If You Are Earning $35,000 or Less in Employment Income, Be Grateful With What You Have Got) Bill”?

From our perspective, there is a lack of analysis of this piece of legislation, in terms of whom this piece of legislation is going to hurt the most. This Government likes to stand on platitudes and talk about helping people out of hardship, helping people to create a better life for themselves and their families. But this report actually proves that it does not care, that this is all about saving money, and that, at the end of the day, evidence like this, which they have, should have gone to whoever is responsible for inland revenue and you should know the impact of this piece of legislation on the specific New Zealanders who are now going to have these opportunities taken away from them. If you out there think—

I move, That the question be now put.

I call Jan Logie.

Thank you, Mr Chair, that was a great decision. I am happy to take a call on the Committee stage of the so-called KiwiSaver Budget Measures Bill, which, as has already been well canvassed, has very little meaning and conveys very little meaning to anyone.

I have several alternative titles for this bill, which I would like to explore in this Chamber. My first one is the “It’s Working So Let’s Fix It Bill” because actually we know that New Zealand has a massive problem with savings or a lack of savings. It has been much worse than what it is now. My colleague James Shaw has already mentioned that New Zealand is 22nd out of 24 countries in the OECD in terms of low levels of savings. So, in international comparisons we have a real problem and this shows up quite significantly in our current account deficit. We have seen it over time in New Zealand. The Committee might be interested to know that household savings per capita in 1992 were $752, which is not particularly high. But you might be even more interested to know that in 2006, before KiwiSaver was brought in, household savings per capita were negative $1,359. We were in a crisis in terms of household debt at that point, which is what triggered the introduction—I understand; I was not really involved at that time—of KiwiSaver. Now, since we have had KiwiSaver, the levels of household savings are up to $627 per capita, so we are not even back to the point we were at in 1992.

I have some ambivalence over KiwiSaver. I will admit that upfront because we live in such an incredibly unequal society where so many people are surviving well below the breadline, in poverty. We know that a quarter of a million children are living in poverty and we know that so many workers, the majority of whom are women, Māori, Pasifika, and migrant workers, are in precarious work, living below that poverty line as well, and that two out of five children living in poverty are in families who are working.

So, in that context, KiwiSaver is a voluntary scheme—it would be even worse if it was a compulsory one. When people are struggling to put food on the table, KiwiSaver actually exacerbates inequality in some ways because those who are earning the most are able to contribute the most and get more contributions from their employers, so their KiwiSaver savings go up. That is good for our current account deficit, that is good for our household capital accumulation, but it is not necessarily good for addressing inequality.

However, this $1,000 kick-start incentive actually is something that goes right across the board in terms of that universalism and is available to workers who cannot necessarily afford, who cannot sacrifice food on the table, to make weekly contributions for their future well-being. It is available to beneficiaries and the children of beneficiaries, whom we want to have the chance to get a leg up. So choosing this mechanism to remove this is actually the worst possible thing that the Government could do in relation to KiwiSaver’s impact on addressing inequality.

Another idea I had for this bill, following on from the rather hilarious contribution, I thought, from the New Zealand First member who suggested this could be renamed the “OMG YOLO No Future Bill”—I had to be able to say that out loud; it was a pure moment in the Chamber for me. But I would suggest that another possibility for this title could be the “Boom—Your Incentive Is Gone Bill”. Sorry, I did not manage to carry that off.

💬 Hon Member: Boom.

Boom—no, I still cannot carry it off. But the point is real. This has come out of nowhere. I have heard from people, just on my Facebook thread, who were in the process—

I move, That the question be now put.

Yes, I think there has been a reasonable amount of discussion on this and I think the Committee is in a position to decide whether or not it wants to put the question.

There have been, I understand, two amendments tabled. The first, the amendment in the name of Iain Lees-Galloway on clause 1 to delete “Budget Measures” and replace it with “Cut Number 8”, I am ruling out of order as not being a serious amendment or a serious title.

I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Hon Trevor Mallard): The member is not going to dispute my ruling, is he?

I seek some clarification. Thank you, Mr Chairperson, I appreciate your hearing this point of order. I would like some clarification about why you believe that that is not a serious amendment to the title. I dedicated probably a good 4 minutes of the 5 minutes I was given—and I was prepared to give more—to the reasons behind why that was an appropriate title. It was not in any way frivolous. There was evidence behind it. I provided that evidence in the contribution that I made. In fact, my colleague the Hon David Parker listed all eight of the cuts that that title amendment relates to in his speech on the first reading. It is not a frivolous contribution at all. It does relate to facts and evidence, and I would appreciate a serious consideration of your ruling.

OK. I will be slightly liberal and not take this as a criticism or as an attempt to relitigate, but I will point the member to Speakers’ ruling 116/6, where it makes it clear that an amendment to the title of a bill cannot be an attempt to criticise its contents. That is how—[Interruption] Mr Parker—I have interpreted this.

💬 Hon David Parker: Point of order, Mr Chairperson.

The CHAIRPERSON (Hon Trevor Mallard): I just want to make it absolutely clear to the member that he really has only one path now that is within the Standing Orders. I have made a ruling. That is not a ruling that I am able to reverse or to change. He does have only one course if he wants to change that.

I raise a point of order, Mr Chairperson. Yes—I am actually not seeking to overturn your ruling, but I am seeking clarification of your earlier ruling when you said that you could not have a point of order in respect of your ruling. I suggest that that was wrong.

Well, I can contemplate that and do not need to rule on it now. I have ruled that amendment out. I have another one that is even easier to rule on. It is one in the name of Clayton Mitchell, which suggests that we delete the title and replace it with the following: “OMG YOLO #NOFUTURE”. I am going to rule that out as not being consistent with current parliamentary drafting standards.

I raise a point of order, Mr Chairperson. May I just speak to that ruling?

Well, I just want to make it very clear that the member is not going to relitigate or criticise or attempt to have it changed, because if he does, he will be being disorderly. I think I have been pretty liberal with a couple of people on this side of the Chamber, and I am unlikely to be liberal again.