Support for Children in Hardship Bill

I move, That the Support for Children in Hardship Bill be now read a first time. I nominate the Social Services Committee to consider the bill. At the appropriate time, I intend to move that the bill be reported by 3 November 2015.

The Support for Children in Hardship Bill and the Budget package it supports represent the next step in this Government’s strong and continuing programme to tackle material hardship for children in low-income families. Introducing this omnibus bill under urgency will allow the greatest possible time in select committee while ensuring the bill can be passed into law by the end of the year to be implemented from 1 April 2016. The bill amends the Social Security Act, inland revenue Acts, and the Education Act, delivering key components of this Government’s $790 million Budget package. The provisions in the bill build on the firm foundations this Government has laid down by creating a strong economy that supports more jobs and higher incomes for working families, by setting clear targets for public services to address root causes of material hardship for children, and by continuing our welfare reform’s unrelenting focus on work, ensuring those who are able do all they can to find work, helping themselves and their children get ahead.

Welfare reform is working. In 2010 we introduced part-time work obligations for parents on a benefit with a youngest child aged 6 or over. As sound management saw the economy strengthen and job opportunities grow, we extended this obligation to include beneficiaries with a child over 5 years of age. The results are clear. Since 2010 there has been a 19 percent drop in the number of people on sole parent support benefit. That means there are 16,500 fewer people on sole parent support, resulting in the lowest sole parent benefit numbers since the 1980s. This bill seeks to extend and accelerate those gains. It mirrors the growing and strengthening economy and labour market by expanding work obligations for beneficiary parents. From 1 April 2016 they will be required to start looking for part-time work when their youngest child is 3 and 4 years of age. This is a time in which both parents in the majority of two-parent families are in part or full-time work. Our expectation and aspiration for those on benefits should be the same. This will see another 18,000 beneficiary parents brought into the part-time work obligations group. This is where case management focused on work is the strongest and where additional resources have been provided through the Budget package.

We also know that there are important benefits for children attending high-quality early childhood education by 3 years of age, which is why this Government provides for 20 hours of early childhood education. Research shows us that children in more vulnerable families, including beneficiary households, have the most to gain. Alongside this change, the bill amends the definition of part-time work within the Social Security Act. Currently, part-time work is defined in the benefits system as being work that averages 15 hours per week. From 1 April 2016, this bill increases that to 20 hours per week. At 20 hours’ part-time work, most beneficiary parents will be better off, and off benefits, thanks to a combination of earned income and increased tax credits. Increasing the part-time work obligation to 20 hours a week means a greater attachment to the workforce. In addition, most sole parents working 20 hours or more a week will be better off with a mixture of wages and Working for Families tax credits than they are on benefits. This is a strong incentive to leave the benefit altogether.

Flexibility will be maintained regarding the exact hours of work, to take account of individual factors and particular job opportunities. We know, however, that the costs of childcare can lessen the rewards of employment for many low-income working parents, including beneficiaries moving into work. With this in mind, the Budget package introduces a new, higher rate of assistance for up to 50 hours a week of childcare or out-of-school care focused on helping the lowest-income working families. The significance of this change should not be underestimated. It is delivering an average gain of over $23 a week for each family. The childcare increase in the Budget package will be delivered by amendments to regulations rather than requiring amendments through this bill.

Turning now to benefit rates, on 1 April 2016 core benefit rates for each beneficiary household with dependent children will increase by $25 per week on top of the CPI increase that year. This is the first lift in core benefit rates since 1972 for beneficiaries with dependent children. This will deliver some of the rewards of a strong economy directly to New Zealand’s lowest-income households and the 194,000 children within them. The bill amends the schedules of the Social Security Act that set out benefit rates, enacting the increase to core benefit rates for families with children on 1 April 2016 and, where necessary, creating specific rates for households with one or more children where none exist now. A similar increase will be made to allowances for students with dependent children, both to ensure that the children of low-income students share these gains and to reward students’ efforts through study, rather than creating an incentive to move back on to a benefit. This increase to student allowances will also occur through regulations and will also be in addition to the consumer price increase.

The core of the package and the bill is balancing more assistance and expectations for families with children while out of work, with increased financial support to enter and stay in employment. We know that working families with children can struggle, often as they enter work, and their combined incomes are low. That is why, with our childcare and tax credit changes, over $300 million within the package is focused on ensuring that work pays for low-income families with children and that their incomes lift, helping to ensure they can meet the needs of their children in a way we all expect to.

Tax credit increases from 1 April 2016 for working families with children will provide $12.50 a week more in the base rate of the in-work tax credit, delivering that full gain to families earning $36,350 or less a year. It will also provide families earning more than $36,350 a year with an increase in their in-work tax credit, which could be less than $12.50 depending on their exact income, and provide an extra $12 a week to working families who earn less than $27,000 a year and are receiving the minimum family tax credit so that, combined with the in-work tax credit, these families’ weekly incomes are increased by $24.50. Together, these changes will benefit over 203,000 low-income working families and their 383,000 children.

To ensure that taxpayers’ investment is well targeted to lower-income families, the bill at the same time increases the abatement rate for Working for Families payments by 1.25 percentage points and advances the timing of future changes to abatement rates and thresholds. A final provision in the bill, as with every other major benefit and tax credit change, provides a backstop that can cover exceptional circumstances and any unintended consequences due to the complexity of the tax and benefit system. Taken together, this bill and the Budget package it supports will mean that almost every low-income New Zealand family with children will be better off.

I commend the Support for Children in Hardship Bill to the House.

There are many reasons why various members of Parliament come into this place or enter into politics. Child poverty has always been one of my main motivations, and it is helpful, perhaps, in that regard, that child poverty is one of those issues that are man-made. If we are looking for an issue where the Government absolutely can make a difference, it is an issue like child poverty. But how to make that difference is the question that those who are interested in this area grapple with. Well, helpfully, the evidence—the numbers; the whole picture that is built out of those statistics—tells us exactly what we as politicians need to do. That is what makes this area so frustrating. There are 260,000 children in need, and we know exactly what we need to do to help them. I would liken it also, perhaps, to knowing where there might be a site of frequent car crashes—where there are continual accidents because there is a blind spot. You go begging to the Government to fix the blind spot. Well, today the Government has put up a sign.

Let us be clear that any extra support that is going into the homes of vulnerable families is absolutely welcomed. This side of the House welcomes the fact that the Government has today—in my mind, really, for the first time—genuinely acknowledged that there is severe hardship and poverty in New Zealand. But now that it has acknowledged there is a problem, it has an absolute obligation and responsibility to do more, because that is what the evidence tells us we need to do.

The first thing we know from the numbers—the measures of persistent poverty—is that the longest period of time when hardship is experienced in a child’s life is actually when that child is first born. That, we also know, is the most critical time of a child’s life. Instinct will probably tell you that that hardship is most often going to be the situation of sole parents. It is harder for them to go to work because they are the sole caregiver, and that poverty generally lasts for 3 to 4 years, in those earliest years of that child’s life. So, yes, giving those families an extra $25 a week is a good thing, but let us also be realistic. For a family with one child, $25 is great. What about families with two children or three children? That payment is per family, not per child. This is the point the Children’s Commissioner was right to make. It is, ultimately, roughly enough for a large pack of nappies for a week.

In the Labour Party, we looked at the evidence too. That is why, when we developed the Best Start package, we thought that we needed to give those families $60 a week, that we needed to give that per child, and that we needed to make sure it lasted for at least the first 3 years of that child’s life. That was what Best Start absolutely did. It was targeted, but it was more generous. That is what the evidence absolutely told us to do. In the Labour Party, we also recognised that that is one part of the picture. The second part of the picture is that there are families in poverty who are working. This Government has said persistently that the way to get out of poverty is to get into work. If only that were true, but that is not what our economy is delivering for New Zealand families. Two out of five families living in poverty are in work.

Not all work is born equal in New Zealand. Not all work is decent work. Not all work means that families are free from the burden of poverty, and that is why we absolutely needed a Government today that acknowledged that—that looked at the evidence from the Growing Up in New Zealand report, which said that some families are working multiple jobs just to survive. In part, this bill potentially exacerbates that problem. Yes, the Government is giving a bit of extra support in welfare for families, but it is also placing extra work obligations on parents of children—no longer at the age of 5, but at the age of 3. That does not acknowledge the reality for many of our sole parent caregivers. Finding a job is one thing, but we must point out that in this Budget there is nothing about creating work.

Last year 41 percent of jobs in New Zealand were created by whom? Small businesses. They get nothing in this Budget. If you want to help families to find work, then help the people who create the jobs that they move into. Finding jobs is one thing, but making sure that those jobs are paying decently is another. Also, making sure that the hours that you find in those part-time jobs fit in with your early childhood education care is another question entirely. Part-time work is often at hours that are not family and child - friendly. Again, we need to be realistic about the kind of environment that these parents are going to be operating in. Labour has serious reservations about this element of the bill, and this is exactly what we will be looking at in the select committee.

It is also about the bigger picture. The evidence has always said that to tackle child poverty, you need a plan. In the wake of this Budget, the Children’s Commissioner has today said that this extra payment, although good, does not constitute a plan. A genuine plan that really wants to fix child poverty would make housing affordable. We know it is a fact that some families are using 50 percent of their income just to make sure that they have a roof over their heads, and sometimes that roof is damp and it is cold and it is crowded. If we are genuinely addressing child poverty, we need to make sure that housing is affordable and available to those families. That should have been part of the plan.

We need to make sure that health care is genuinely accessible. Some of these families are experiencing such dire circumstances that even though it might be free for their child to go to the doctor, the parent who is meant to take them has debt at their local clinic and so does not go because they know that they will not be able to get an appointment before paying their debt. I have heard of stories of families who have lost their jobs and whose kids have contracted scabies. Although they have managed to go and get the treatment for them, they cannot even afford the hot water that is required to do the hot-water wash to rid the family of that affliction. Poverty is a vicious cycle, and it never affects just one part of a family’s life.

We would also be making sure, if we had a genuine plan, that we address the hidden costs of education and make it accessible. Labour was committed, and remains committed, to a full whole-of-Government plan. We have a bill in the ballot called the Child Poverty Reduction and Eradication Bill. It is all about making sure that the Ministers for housing, education, health, social development, and finance all have responsibility for a package that deals with child poverty. For us, Best Start—that $566 million package—was only one part of the picture, and for this Government, this bill should be only one part of the picture.

One extra thing: on child poverty, a critical difference between us and this Government is that we are willing to put in place the target. We are willing to put a number to how much we are committed to reducing child poverty by. Why has that Government not done it? I know, from having done numbers for ourselves, how hard it is to genuinely lift a family out of poverty, and this measure today will not do it. It just will not, and we will report on how much we do on that target in every single Budget.

I leave my final words for the place where this all started for me. I talk a lot about having spent a few years as a child living in a town called Murupara. The people in Murupara who found themselves in hardship found themselves in that place, ultimately, because their region and their town were dependent on forestry. In the 1980s that industry was absolutely gutted for them. That was what ultimately drove the poverty in that town. A measure like this today will not solve that problem for the people of a town like Murupara. We need, ultimately, an economy that works for everyone and that gives people hope. Today the Government acknowledged that we have a problem, but, sadly, it did not fix it.

I rise to take a call on the Support for Children in Hardship Bill in its first reading. As the chair, I look forward to the bill coming to the Social Services Committee, a very hard-working committee that looks forward to the debate, to the deliberation, and also to hearing the submissions. It is always good to speak after the member Miss Ardern. She commented about the blind spot in regard to poverty and the intention coming to this House. I remember in the 2014 elections at one of the debates around poverty, she was challenged about the fact that 142,000 children were still in poverty during the time of the Labour Government. Her response was this: “It was a job unfinished.”—it was a job unfinished. So although the talk is about children in poverty, there was a job that was unfinished by the Labour Government, which talked about that. When talking about figures, it is interesting that those members are talking about that now.

The issue about a plan—this is a plan. As the Minister of Finance said, this is a plan that is working for our children in hardship and for our families as well. How do we know? Well, we can talk about ours—and I will in a moment—but in its state of the nation speech, A Mountain All Can Climb, out of the 22 indicators, the Salvation Army gave us the thumbs up on 14 of them. I just recall, at a glance, that with regard to child poverty, it was thumbs up for reducing it by 2 percent. With regard to children at risk, there was a reduction of 15 percent. I could go on. There were 15 indicators by the Salvation Army with regard to the reduction of child poverty.

As this bill comes to the House, I say it is a good bill. Can I commend the Minister for Social Development, the honourable Minister Tolley, for the work that she has done to put this together. Can I also acknowledge our previous Minister for Social Development, the honourable Minister Paula Bennett, who is here as well, for the work that she has done and for the leadership that she has taken for us as well. It was great to hear from the Hon Te Ururoa Flavell, and this is what he said. He said that it has taken almost 43 years—in fact, back to 1972—since the base benefit rate was actually increased. Under a National Government, that is what has happened. What is it doing? It is doing this. As the Minister has said, there is a vision and a plan for reducing hardship for children, and that is what this bill is intending to do. It has a theme that I think is really important. It is this: your circumstances should not define your destiny. I think that is very important.

Part of the amendments in this bill, which is an omnibus bill, are around the Social Security Act of 1964. If I quote from the Act, in Part 1, which is its purpose and intent, there is section 1A(a)(ii). It indicates that the purpose of the Social Security Act of 1964 is “to help people to find or retain paid employment;”. Section 1A(ca) says it is “to provide services to encourage and help young persons to move to education, training, and employment …”. I mention these because I think it is important for the public to know that the bill at hand is in line with the intentions, the purpose, and the principles of the Social Security Act, which are to provide opportunities for employment for those who are actually in need, as well. We know that employment lifts our families out of hardship. We think that is important. The bill is a balanced mix of greater work expectations. Two-thirds of children are living in hardship and we think that that is important—80,000 are in sole parent families, hence the reason why this bill is focused on that. We know that nine to 10 of those children are from sole parent families, and we think that that is important as well.

So we think that this bill will go to the select committee. We look forward to the submissions. The benefit rates, we think, are going to be quite important news to our communities. Can I finally just conclude my remarks briefly, because I think this bill is due for its reading and its referral to the select committee, by saying that the comments that are made about children in poverty are often made about Māori and Pacific children. It concerns me that in our communities, a stigma is created by the Opposition about that when there is all the talk, there is all the rhetoric, but there is not the plan to be able to make a difference. I believe that this bill and its intentions will absolutely make a difference to those families that we are talking about.

💬 Jacinda Ardern: Now, you’re just not telling the truth, Alfred.

I look forward to this bill. I look forward to the debate, even if Ms Ardern returns to the Social Services Committee as well. I think that this is going to be good news for our communities. I look forward to the discussions and the submissions, and I commend this bill to the House.

I just want to start by talking to some of the points made by the former speaker, Alfred Ngaro. No one at all—at all—on this side of the House today has referred to, or stigmatised, Māori and Pacific with regard to poverty. It was he who decided to bring that up. In fact, we are talking about children in poverty more widely. It does not matter what ethnicity they are. We are talking about children in poverty and the obligation and the responsibility that we have here, not just the Government but the entire Parliament, to make sure that we are responding to the needs of children in poverty. Even just looking at the title of this bill, the Support for Children in Hardship Bill, I cannot help but say we all need to remember that these children come from households with caregivers who are also experiencing hardship. When we talk about supporting these children, we do need to be talking about how we can support the people who are looking after them to take them out of hardship. We, of course, support any measure that will put money into the pockets of New Zealanders experiencing hardship—New Zealanders who are our most vulnerable. However, this bill does come with conditions that could have repercussions and those are the repercussions that I want to talk about today. Those are the things we need to think about and consider as we look to push this bill through.

Labour is concerned about the implementation of the proposed work obligations on parents. It is not that we do not support parents going out into the workforce. It is not that we do not think that it is a good thing for parents to be out in the workforce. It is just that when you are saying to parents that no longer is it that when their children are 5 years old they have to go and look for part-time work, it is at 3 years old, then there are repercussions. We have heard widely in the media lately that there are real issues with things like accessibility to quality childcare arrangements, accessibility to quality early childhood education. Unfortunately, many of the areas where we have people living in hardship are the areas where those people have less access to quality early childhood education. When you put these parents in the position of having to, being forced to, go out to work when their child is only 3, then you are also forcing them, possibly, to put their children into substandard childcare arrangements, into centres that they are not comfortable with, into centres that they are not sure about the quality of, and that is something that we should be concerned about. No parent should be forced to put their child into an early childcare centre if they are not sure about the quality that will be provided there to that child.

The support that will be required for these particular parents, particularly sole parents, to actually get into the part-time work that will suit their circumstances is quite immense. These parents need part-time work that fits within particular hours because of the childcare arrangements that they have. They may have an older child who goes to school from 9 to 3. They may want to fit it into that time frame—it makes sense. They may need flexibility, more flexibility in their work, because of the fact that we know that the younger the child—any parent knows this—the more likely they are to get sick, particularly when they are going to early childcare centres. Things just tend to float around. So they are going to need work that will give them that flexibility. They are going to need work that will, hopefully, be secure and give them the money that will ensure that they are actually going out of hardship. But what really concerns me is that here we have this move to push sole parents out into work, increasing the obligations around work, but at the same time what we see in this Budget is an actual $91 million cut to the job seeker budget. So here we have higher expectations on these parents, but then a cut to the support that they will be getting from the State to actually get into the work that they are required to take up.

I can only presume that the $91 million cut to jobseeker support, which is in this Budget, is because that Government thinks that the total number of beneficiaries is going down. But we have seen research around the future of work, around the increasing issues we are going to have for security in work, around the changes in the nature of jobs that are out there, and the fact is that, actually, we may see more and more people going in and out of employment because of the changing nature of work. So to cut $91 million from the job seeker budget when the Government is extending the obligations on sole parents around working, as well as the fact that we know that moving forward there are real issues with regard to the future of work and the security of work, is actually a little bit negligent, I think, of that Government. To say that work is important, to continually rattle off the importance of work for beneficiaries, but to cut $91 million from the job seeker budget is a little bit irresponsible of that Government.

We support the idea that an additional $25 will be going into the pockets of beneficiaries every week. It is not a lot of money to many people here in this House, but to beneficiaries it will make a little bit of a difference. But we do need to refer back to the policy that we had, leading into the last election, where we actually had committed to putting in an additional $60 into the pockets of beneficiaries with children under the age of 3. That would have made much more of a difference. As my colleague Jacinda has said—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order!

—the $25 extra that these beneficiaries will be receiving will actually not even come close to taking them out of poverty. When Government members talk about addressing the hardship, when they talk about addressing the poverty, we actually need to see, as the Children’s Commissioner has said, a real plan, not just a few sticky plasters. This is really what it is. It is not even a packet of sticky plasters. It is one sticky plaster that is going to come off the scab and then there is nothing to replace it and nothing is actually better.

We acknowledge, and are very glad with, the Government’s announcement that National has finally acknowledged that Working for Families lifts incomes, and it has continued with Labour’s sensible economic policy. What did they call it at the time? When we introduced Working for Families, when we were in Government, National referred to it as—

💬 Hon Members: Communism by stealth.

Communism by stealth.

💬 Hon David Parker: John Key.

John Key himself referred to Working for Families as communism by stealth. So it is heartening to know that eventually National has come round to the fact that it is Labour’s policies that are responsible, that are effective, and that actually are all about good economic management of this country.

I just want to refer back to the fact that we are talking about parents being obligated to go out to work. So they will be required to put their children into early childhood education from the age of 3 so that they can take up that part-time work. I just want to say that when it comes to early childhood education, when it comes to the arrangements around supporting sole parents, it was Labour before the last election that proposed extending the subsidy for early childhood education to 25 hours a week. It was Labour that wanted to extend the provisions around parental leave. It was Labour that wanted to introduce a $60 a week Best Start payment for children under the age of 3.

So I do want to acknowledge that, yes, it is a surprise, as the Children’s Commissioner has said, that National has done this, that it has decided that $25 extra a week for a beneficiary is a good thing, but, as the Children’s Commissioner said, this is a surprise but it is not a plan. As my colleague Jacinda has said—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order!

—Jacinda Ardern has said—this will not effectively address the issue that we face of child poverty. It will not necessarily address the issues that the 260,000 children who are living in poverty in New Zealand are faced with every day.

We will be supporting this bill. We have reservations about this bill, particularly with regard to the obligations on sole parents to go out to work—not work in general but just the extension of the work obligations—but because of the fact that it does put a little bit more money into the pockets of beneficiaries, we will be supporting this bill.

It gives me great honour to rise and support the first reading of the Support for Children in Hardship Bill. As a first-term member of Parliament and hearing my first Budget, it was one of those moments where time just seemed to stop. There was plenty of time to soak in all the news and all the information. I think today will be a definitive point over the next year, over the next 2 years, and over the next 3 years. What I mean by that is that this Budget has proved that the National Party is the working people’s party. We are out there working for the people of New Zealand, but we are listening to the people of New Zealand. Why I know that we are the working people’s party is that we have created over 194,000 jobs since 2011, and we will go on to create tens of thousands more. That is important for this bill because we know that job creation reduces child poverty.

The Budget announced a $790 million child hardship package. Working families who earn less than $27,000 will get a $24.50 increase to their Working for Families payment every week. That is 4,000 families. This National Government is the working people’s party. Families earning $27,000 to $36,350 will get a $12.50 increase to their Working for Families payment. That is 50,000 families in New Zealand.

When I campaigned last year I met many people who were voting National for the first time. They had voted for Labour all their life but they knew that we were working for New Zealanders and we were listening to New Zealanders. We are delivering better jobs and better incomes. They said to us to support the most vulnerable. That is why for beneficiary families—how much time?

💬 Todd Muller: Keep going.

We are increasing the benefit by $25 every week. That is 110,000 families. I know that when we look back, we will know that we have worked hard for the working people of New Zealand and we have listened to them.

I am proud of this National Government, which is working hard for the working people of New Zealand. Thank you.

I would like to start my speech on this bill by paying tribute to sole-parent families on a benefit who are struggling to do the best for their children, who are parenting alone 24 hours a day, 7 days a week, and who are struggling to be able to put food on the table and feed their children. I acknowledge their children, all too many of whom do not have a bed of their, who do not have enough to eat, who are surviving on sandwiches because some days that is all that is left in the budget at the end of the week, who do not get Christmas presents or birthday presents because there is not enough money in the family budget to be able to pay for them, and who cannot afford schools trips. I really want to acknowledge those children. I want to acknowledge the New Zealanders who have been fighting for years and who have been raising their hearts to the Government to stand up to change this situation. The well-being of our children is the soul of our country. When our children are suffering, we are suffering as a country. So I want to acknowledge that fight and all those people who have forced the Government into this measure, which is the first time that benefit rates have been increased since 1972.

The Greens have been raising issues of child poverty for over a decade now. We are passionate about changing this reality because we know it is possible. Although we are hearing from the Government that this is the first time since 1972 that benefit rates have been increased, the Government is admitting the fact that it cut the benefits in 1990 and that we are still not even returning, with this increase, to the level they were at in 1990. For most families, this $25 is not actually $25, because this $25 will be eroded by cuts to the accommodation supplement and the temporary additional assistance supplement, which many families are using just to get by. So the $25—which is the cost of, say, nappies for one child—is not even going to be that much extra in the hand for all too many of our families. So when you think of those children who are going without shoes, who are going out without raincoats, who are going without school trips, and who are going without birthday presents and enough food to eat, we know that this is not the answer. The Greens will support this bill because it is something. Those children need something, but they deserve a whole lot more than this.

I also really just want to raise a very real concern that we have with this bill. It is another example of the Government giving with one hand and taking with the other. What this bill will do is require parents with children who are just 3 years old to go out and look for 20 hours a week of work. Sole parents, who are doing the job of caring for their family alone, are now going to be expected to be working for a minimum of 20 hours a week as well as providing for the needs of their children. We know that that may actually mean a reduction in their incomes because of the abatement on the benefits. It will work out to, I think, about $2.20 an hour extra, if they are getting $15 an hour in those jobs. We know most of those jobs, sadly, are at very minimum wages. That is, actually, probably not going to cover the cost of travel, childcare, or the clothes that are expected to be worn in that job—let alone the extra needs of those children, to compensate for not having their parent there. I really want to say that although we are hearing a lot in the House about how we expect you to work if you can work, the Green Party believes that caring for young children and children with complex needs is work. It is something that we value and that we believe will pay off in the long term for the entire society if we support it.

As a society, we have no concept yet of what the consequences are going to be in 20 years’ time of a generation of adults, as they will be by that stage, who have not had time with their parents, who have been in the care of strangers for so many hours a week, and whose parents have lost out on the opportunity to participate in Playcentre, kōhanga reo, or other family-centred childcare movements that have provided so much to our communities and so much in terms of growing knowledge around parenting for those families and our children. We have no concept yet of what the consequence will be of separating parents from their children, as these kinds of policies are doing. I think it really, really requires from this House and from the public some deep thought about this issue.

The Green Party will certainly not be supporting this bill past the select committee stage unless this changes, because our children deserve at least one parent who is able to be there for them in those early years. They deserve that ability for attachment and security. Again, as is my wont, I will remind this House that the indications are that of sole parents, 70 percent are probably leaving violent relationships. Think of the needs of those children and that woman—typically—to resettle themselves, to recover, to actually bed in and get well and move on in their lives, and think about whether that is actually possible while they are juggling the care of their children and working 20 hours a week. I would say, from my experience of working with women in that situation, that for many of them it is not possible, and the needs of their children will suffer. That will put many women in a situation of feeling as if they are conflicted enough to go back into a relationship that is not safe.

This bill raises many, many concerns for us, as a party and as a House. Also, I really want to mention that while we are being told the Budget will also offer increases to Working for Families, it is a little bit more complicated than that, in that the change to the abatement rate without changing the abatement threshold will result in a family with one partner working being worse off than they currently are if their annual income exceeds $36,406, or if they are getting $17.50 an hour. An extra 2c-per-hour income for those people will eat up the entire $12.50 increase in the base rate for the in-work tax credit component of Working for Families. With incomes still well below a living wage, those people will actually be worse off under this proposed Working for Families regime. So we are being told by this Government that it has suddenly got the message, that everyone’s lobbying around the welfare of our children has got through—that the Government has got it! It is making this change to Working for Families, but, in actual fact, it is such a marginal change, and within that change some families are actually going to be worse off.

I am pleased that this bill is not passing through all stages under urgency, because there certainly seems to be enough in here that we need to look at really closely. To conclude, I really want to go back to the fact that we have over a quarter of a million children living in poverty in this country—between 60,000 and 100,000 without decent shoes, without enough to eat, without Christmas or birthday presents, or without warm clothes or a bed of their own. Those children need us to fix this problem, and, sadly, this bill will not fix this problem.

It is a pleasure to rise on behalf of New Zealand First to address this bill. We will be opposing the bill for a couple of very good reasons. Before I get into the reasons why, I would like to go back to the actual speech that the Minister of Finance gave today.

💬 Delivering Better Public Services: put aside, for a second, the actual Public Service targets that this Government has, which it established in 2008, which have never been independently reviewed, and which I have asked both Minister Tolley and the Minister of Finance about having reviewed and have been refused. Put that aside. There is a quotation here from a speech given earlier today, which I would like to share. I think it gives a definite perspective to the priority that this Government has. It goes like this: “We’re willing to pay a bit more upfront to get real, sustainable change, and in doing so we can generate significant long-term savings for the Crown.” In the same sentence, in the same breath, we have Mr English purporting that the intent of his bill is to have some real, sustainable change for the future, but in the same breath he is mentioning the long-term savings for the Crown. And that set up the theme of his speech today, under delivering Better Public Services for this country. Because in every single sentence he said, in every single paragraph, the Budget was about cost-cutting, it was about saving, it was about dressing up the real needs and the real changes that need to happen to solve child poverty—one of the major priorities that he said the Government was going to have—into cost-cutting measures and long-term savings for the Crown.

I would also like to give a little bit of perspective to this bill and to the speech that Mr English gave today by using a little bit of a measuring stick. In regard to the child hardship package, which recognises lower-income working parents, the total package is around $240 million in each full year. The measuring stick that I would like to use is the flag referendum, which will cost just under $30 million. That is more than 10 percent of the total that this package is going to cost each year. Where is the priority of this Government? He goes on to say that the Budget also provides a new operating fund of $36 million. We have got a flag referendum of just under $30 million: where is the priority of this Government in dealing seriously with child hardship? We have new funding for the existing Children’s Team that he was talking about. It gives an extra $23 million. That is even less than what is going towards the flag referendum. So where is the priority that Mr English purported he had for solving child poverty, for giving more to the needy in our country? New Zealand First says that it evaporated as soon as he opened his mouth.

The questions that came out of both the bill and the speech that was delivered today were, first of all: why have these changes occurred? Was it because there was a need for them to occur? Was it because the Government can now afford for them to occur? Or was it because the Government really has no choice but to make those changes now? What rolls out of that is: why has it taken 7 years in Government for these changes to occur? Increasing the minimum benefit levels is a step in the right direction, as we have heard from a couple of my colleagues in the House already. But the step that has been taken—is it enough? Of course, it is not. New Zealand First believes that there should be a minimum social floor that no one should fall below. It should not be a reward. It should not be a punishment. That is what is happening at the moment. That is what this Government delivered in the Budget speech today. The benefit should be a safety net. It should be strong, it should have integrity, and it should have the ability to not allow people to slip through and live in poverty. That is what is happening right now, and that is what will happen even after these Budget changes occur. The Government has the absolute responsibility to not allow supported poverty to occur. That is what has been happening, and that is why it will continue to happen with this Budget.

The Minister also talked about investment in the front end, and I would like to quote: “We’re willing to pay”—like I said before—“a bit more upfront to get real, sustainable change”. But what this is is plugging the gap. We have heard about a plaster over a wound, but this is plugging a gap with the minimum amount of financial assistance. This is addressing the symptoms; it is not addressing the causes. New Zealand First believes that the major priority should be investing in the front end, before individuals need to end up being caught by that safety net. The priorities should be investing in our youth and our young people, especially unemployed youth and young people. That is the front-end investment. The KiwiSaver kick-start contribution is an example of front-end investment, and that is now gone. Job creation for our young people is front-end investment, and that is now gone. What we have here is a carrot-and-stick approach from this Government. It is quite simple: the number of unemployed youth is at one of the highest levels that we have had. It is steady and has not changed over the last 7 years that the National Party has been in Government. Unemployed youth will become unemployed adults. And as the Minister himself said today, two-thirds of all children in material hardship are living with a parent on a benefit. That is the end result. That is the symptom. So why is this Government concentrating on the end symptom and not the cause, and not on investing in the real front end of this issue?

I would also just like to mention Working for Families and families earning $36,000 a year. Low-income working families earning $36,000 a year, before tax, will get $12.50 a week extra, but what does that mean in real terms? It is just over a 1 percent increase. If we compare that, for example, with the cost of fruit and vegies, that cost has increased by 5 percent in just the last 12 months. Again, where is the priority of this Government? The restrictions that are being put in place for people on benefits are cost-saving measures dressed up as help and encouragement. With the sole parent restrictions, sole parents are, in fact, the group that is getting positive results right now. They have the highest number of exits off that benefit and the lowest number of entries. What the Government wants to do is make the sole parent benefit like the job seeker benefit. But the job seekers group has one of the worst results. Where is the logic in that? Carmel Sepuloni mentioned the impact of parents having to go back to work when their child is 3 years old and not 5 years old. Let us take a step back for a second and forget about whether that is the right or the wrong thing to do, and let us ask what the social impact is for that child. What is the social cost for that child of the parent leaving the house when the child is 3 years old instead of 5 years old? Once the Government answers that question, it will also see the priority that it has when dealing with child poverty and with the needy and the vulnerable in our society.

As I said, the increase in the benefit is part of the solution; it is not a plan and it is not the answer. I am looking forward to discussing this bill robustly in the Social Services Committee, but at this stage, New Zealand First cannot support this bill.

What a privilege to be able to stand to speak this evening to the Support for Children in Hardship Bill, which gives effect to the hardship package that we announced this afternoon. Listening to the attack from the other side—I will tell you, earlier today when Bill English was giving that Budget speech, you could really see from the back of the House the impact that it was having, not only on this side but particularly on the other side.

Yesterday the Leader of the Opposition referenced my name in a speech and said I was “Mooller”—Todd “Mooller”. Well, it is actually Todd “Muller”. It rhymes with “muller” as in “mullet”, and the people who looked like stunned mullets as we were outlining a once-in-a-generational change were those on the other side of the House. It has been 43 years since benefits have risen, and it is this side of the House—it is this Government—that has made—

💬 Hon David Parker: Looked more like a dead fish.

Well, I am sure you will turn up with two dead fish next week, Mr Parker. It will happen. But, seriously, we have seen quite an afternoon here, and what a tremendous bill to be able to stand up and talk to this afternoon.

What a change that we can talk to. The first rise in 43 years—$25 a week for those with families on benefits and, immediately, it gets ridiculed by the other side. It is significant money and it talks of a Government that cares, and when the Government is in a position to respond to the needs of New Zealand, it does. We were handed an absolute cot-case of an economy. It has taken 6 years to get to this position, and now we are in that position to respond to the needs of New Zealanders. That is exactly what we have done, and that is the reaction we are getting. The Opposition members know it, from the reaction that is going on outside.

This is a very, very good bill. It is great to be able to talk to it—194,000 jobs since 2011. The reason I say that is important is it means there are 42,000 fewer children living in welfare-dependent homes. We are making a difference and, therefore, we can put a package like this in place to encourage those who are still yet to make that journey to be able to do it. We will stand beside them and make sure that in their hour of need we are there. We are running an economy that enables them to move from welfare to work. This Government is working, we have a plan that is working, and I cannot wait to support this bill through the various stages of the select committee. I commend this bill to the House.

It is always interesting to reflect on wealthy people’s understanding of poverty. There is a tone that I think possibly comes from greed dependency. We hear a lot about benefit dependency but we do not acknowledge greed dependency in our country, and it is quite a problem. We will be supporting this bill in its first reading to the select committee because of the 25 bucks, because we cannot deprive people of that, but there is still a misunderstanding of the issue when the scale of the problem is so much greater than the supposed plan and the supposed solution. I would rather not talk about mullets or anything else today; I would like to talk about the kids. Today is in some ways a victory for the amazing group effort out there in the community to make child poverty such an important issue that the Government was unable to deny it. I would like to pay tribute to people like the Child Poverty Action Group, Every Child Counts, the New Zealand Council of Social Services, Unicef, and many more, and the Green Party, for our leadership through Metiria Turei’s unfailing and absolutely determined commitment to make child poverty an issue that this Government could not afford to ignore in this Budget because the focus groups told it that it could not afford it.

So before we get all warm-hearted about the caring Government, let us just acknowledge that this campaign has achieved a small step. The step that has been achieved, which is really important tonight, is an acknowledgment that income matters. I have sat in this House for the last 6½ years hearing how poverty has got nothing to do with money; it is all about individuals not pulling up their own bootstraps, it is all about the failure of the education system and teachers, and it is all about people not grabbing opportunity. Anybody who has worked at the front line of inequality in this country knows that income is critical. The Government has been forced to give 25 bucks more a week after 43 years. I am not the world’s greatest mathematician but anyone can tell that that is not going to be enough after 43 years of Governments failing to lift the benefit. But we are not going to look this tiny little gift-pony in the mouth because, actually, any money in the hands of families right now is good. They need it but it is not a solution. So we would like to just acknowledge that it is not a solution; it is a tiny little step. The solutions have to be much more structural and much more generous.

If we can afford the nauseating tax cuts of several Budgets ago for the wealthiest people, we could actually afford to extend the in-work tax credit to the families who really need it. That would be a generous move. That would be a structural move. Instead of that we have got giving on one hand and taking from the other. On the one hand there is this extra money; on the other hand there is an increased obligation. An increased obligation is always a euphemism for going down to Work and Income for another ritual of humiliation. Those of us who have worked as beneficiary advocates are under no illusions about that experience. It is worse for the people who actually have to do it, but we have witnessed it, and what we have seen is desperate families, including many solo parents, particularly women-led families, being told they are failures and that they will be sanctioned if they do not get work. In this bill they now have to have 20 hours’ work a week. No amount of description of the obligation as “Oh, we’ll be flexible about this.” cuts any ice. We can sit in this House and use that language but go down to Work and Income and witness what actually happens when families with no money are forced into social obligation.

Let me talk about early childhood education. The Green Party has demonstrated, just by reading the officials’ briefing documents, that participation in early childhood education is not sufficient; it is quality. But now we are going to make parents with a 3-year-old look for more work while the children must be in early childhood education of whatever quality. Until we commit to the family-centred models that my colleague talked about, like kōhanga, playcentre, and kindergarten, which are losing families all the time, we are going to be putting kids into some good services and some utterly indifferent ones. If we do not listen to the Brainwave Trust about what is important to the child in its first few years, if we will not listen to the child experts, if we will not listen to the Children’s Commissioner, if we will not listen to Jonathan Boston, who said today, reading the bill, that actually a number of the measures of poverty are failed under this bill and that the $25 will not make a difference—if we will not listen to those people because we are so inside our privileged little bubble of “We’ve done a nice thing today.” then we are failing the kids of this country. Kia ora tātou.

I rise to support the Support for Children in Hardship Bill because something is better than nothing. Still, I think, in this context, we can see once again just how little value this National Government puts on parenting. I think that this bill, more than any other bill, really demonstrates this. Work, in the Government’s view, is not the very important and valuable work of raising children. That is seen as being not nearly as valuable as, maybe, a zero-hour contract for 20 hours a week. Let us be honest: for anyone who really knows, or who is in touch with, what is going on out in the community, these types of provisions, where people who are in receipt of a benefit are forced out to work—and this bill forces them to go out and seek part-time jobs from the time that their child is 3 years old—are driving a sort of employment market that, actually, most New Zealanders are embarrassed and ashamed about. It is forcing the type of labour market that sees the growth of zero-hour contracts and that sees the growth of our low-wage economy.

I come from Hamilton, and the sort of growth in jobs that we are seeing in Hamilton is that a new Wendy’s or a new Carl’s Jr has gone up—at the same time, scientists are being made redundant from Ruakura Research Centre. So we are getting rid of our high-value jobs and we are getting these minimum wage, zero-hour contract - type jobs. And these are exactly the sorts of jobs that the Government is now forcing parents into when many of these parents have made the decision that they would rather spend the time—or that they need to spend their time—with their young children. This bill does not make any differentiation for parents in receipt of a benefit who are raising children with disabilities or with special needs. They, too, when their child is the age of 3 years, need to go out and pound the streets and look for zero-hour contract work, up to—now—20 hours. I am not sure why the Government, when it required 15 hours of part-time work before, now suddenly thinks that this can just leap to 20 hours’ work without it doing anything to grow jobs in our economy—because that is the other area where this Budget fails miserably.

It is of some merit that the Government has increased benefits for families with children by $25 a week, but—and here is the but—it is a bit of a swings and roundabouts thing, because it is requiring these same parents to go out and seek these part-time jobs when their child turns 3 years old. They are going to have to pay more than $25 a week in childcare fees to enable them to do that. So there is the $25—and some—gone straightaway. So I think that although it is always good to see families with children get some more support from the Budget, in this instance, I think that we will find that this money disappears very quickly. It will evaporate with the other mean approaches that this Government is taking to cut spending in various areas.

I am speaking on this bill because I am Labour’s spokesperson on women’s affairs, and this Budget will have quite a severe impact on women and their role in parenting. I just want to make sure that the House notes that although the $25 a week in this bill is good—and we certainly support that—we have some real concerns about some of the other measures. At the same time, the Ministry for Women has taken a budget cut in this Budget. It has a tiny little budget to start off with, and there it is: women, again, not being taken seriously by this Government and having their hopes, dreams, and aspirations dashed by a miserable approach from this Government. Labour supports this bill but we think it does not go nearly far enough.

For the last 12 months, since I announced that I was going to run for the National Party, I have been approached by a lot of people asking: “Why would you be doing that? Why would someone with a degree in social work be joining the National Party? Why would you get involved?”. After today’s Budget, I do not think I will be getting those questions any more. Today, in this Budget, this Government has raised—has raised—for the first time in 43 years, the real bottom-line benefits for people with families.

💬 Chris Bishop: How many years?

43 years. The question we have to ask is: why now? I have heard that asked from across the other side of the House today: “Why now?”. Well, I can tell you why now. It is because we have been able to grow the economy over recent times. We have been able to grow the minimum wage—we have been able to grow the gap between wages and what people are earning on benefits—to such a level that we can now raise benefits without disincentivising people to go to work. That is what happens when you have got a Minister of Finance who understands families and who understands how an economy works: you can have a Government that is working hard to ensure that all of these pieces of the jigsaw fit together to make a country that works hard and that is delivering the kinds of outcomes that New Zealanders want.

We find ourselves now in a position where families who are struggling, those who are on low incomes—and we all know that there are families who are struggling in our communities—will get more money in their pockets through an increase in Working for Families. And those who are unable to work at the moment will see a greater amount of money go into their bank accounts each week to enable them to start to lift themselves out of the place that they find themselves in. That is why I am supporting this bill, that is why I am glad to hear others in this House are supporting this bill, and I look forward to discussing it with the select committee and to bringing it back to this House so that we can continue to make good progress for families in New Zealand. Thank you.

This is the Government’s seventh Budget. It promised a surplus some 6 years ago, and we have not seen it. More important, we are sitting here, after the Budget has been read, debating benefits not jobs. We would be debating jobs if National were doing its job, and it is not. What we know is: given that the Government said the rock star economy would benefit far more New Zealanders in the regions, we should be debating jobs here today, but we are debating benefits. I wish we were debating the “Child Opportunity Bill”, and that the recognition of poverty in this country meant that we would be talking about more than just $25. We would be talking about warm homes. We would be talking about jobs in our regions, communities, and small towns. We would be talking about how to support those children who are the most vulnerable learners, instead of supporting charter schools. We would be talking about how we could support children and parents who have multiple vulnerabilities and want a hand up, not a handout. This is an “Oliver Twist Budget” and we are debating $25 more going to vulnerable children. Well, we will take it. We will take it, but do not expect anybody on this side of the House to say “Thank you very much.”

💬 Chris Bishop: Ah!

Why? Because it does not fix the multiple issues facing vulnerable families and poor families out there in the community. Chris Bishop sighs. Chris Bishop sighs because he would prefer this side of the House to say thank you. In fact, the Children’s Commissioner puts it far better than I could. Dr Russell Wills himself said: “I wasn’t expecting Government to increase incomes for … children. … Let’s be clear, a one-off increase is not a plan for child poverty. … What we need is a comprehensive plan to reduce child poverty.” That comes from the Children’s Commissioner. He himself recognises that an isolated payment of $25 cannot fix all the issues. But we will take it, and we will take it because we know the hardships that are faced by many children and families in the community, in small towns, and we know that they need it.

But will it make a difference? I suspect not if we require parents to be work tested when their youngest child is 3 years old. Let me share a story. We are talking about a mother who goes to kōhanga and who volunteers her time because she is worried about the type of life her child will have and she knows that getting an education will make a difference. She has to be work tested when her child turns 3. She could make a critical difference to supporting the education pathway of her under-5-year-old child if she were able to continue to be the mother that she wants to be. The bill makes a number of other changes. We will get it to the select committee so that we can identify these types of issues, which will, I think, start to unstitch some of the challenges of how to implement it.

The other thing about the bill is that it really does not address some of the aspects that are really fundamental to work. In these days and times for people who are required to be work tested—when there are no new jobs in towns and communities, and when people have to make changes to go to where there is work and they have to pay for childcare because they have got no support network of family to be able to help them raise their children—$25 will not make much of a difference. That is the reality—that is the reality. In fact, I heard a constituent say “I want to be work tested because I want a job, but, God, it’s demoralising. I go in there for my regular appointments and I have to answer the same questions and go through the same types of box-ticking tests.” She said to me: “It’s just demoralising. Give me anything. Give me a meaningful job, because I want to be able to support my children and give them more.” But the jobs are just not there.

Sue and I are both from the Waikato. We understand the realities of what is not happening in the region.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! Sue Moroney.

Sue Moroney. Sorry to my fellow colleague. We are both from the Waikato. We understand the realities. In our area, there have been more job cuts than jobs created, and the types of jobs that people are having to consider are the jobs that do not really give them certainty. This is the challenge. With the 90-day bill, being employed for 3 months is not a full-time job; it is just living from hand to mouth—hand to mouth.

This bill should go to a select committee. I am pleased that it is going there, because there are aspects of the bill that need to be looked at further to ensure that what is intended will actually make a critical difference to the lives of people. Just yesterday I was one of several MPs who were out on the steps of Parliament receiving a petition from ActionStation. I want to thank ActionStation for its efforts. It is a collective of organisations committed to putting child poverty on the agenda. It identified that far more needs to be done and that the Government needs a plan. This is an area in which those 260,000 children living in poverty will increase unless we do something meaningful and comprehensive over a long period of time. We do not want to see that happen in a country like New Zealand.

It is very important that people understand the parts of this bill that the Government is trying to implement. The other aspect is being work-ready and work tested for part-time work. I think about this provision in relation to childcare provisions and the practicalities that exist in small communities. It will be very difficult if a person has childcare provisions in the place where they live—say 26 kilometres out of their main city centre—and has to travel 26 kilometres for their part-time work. It will be very difficult to make those provisions fit with childcare and their preschool arrangements. I know. I live in a small town. I have tried to find those types of arrangements. But, more important, for people who do not have a natural family support network where they live, this is going to be an impractical type of measure, about which I think we will see many people express some concern. At the end of the day, I think if we want to support families and children, especially those who are the most vulnerable, the changes need to be able to fit them, as well as ensure that they are given a hand up and not a handout.

There are simply not enough afterschool childcare opportunities. For example, when an early childhood centre or a kōhanga finishes at 3 o’clock, in some small towns you will not get early childhood centres that can take them from 3 p.m. to 5.30 p.m. In some communities, that it is just not the reality. And where there is the opportunity to have that, you have to pay a lot of money—more than $25. Those are some of the practical aspects of what the Government is intending to do—that is, work test people to go into part-time work—and the reality of having children who need preschool education and then afterschool care. These are some really important things that the Government needs to be mindful of.

We are not going to knock the bill to the extent that $25 will not make a difference, but the issue for me is whether it will make a critical difference. I suspect not. It is a change. It is an increase. There is no doubt about that. But when you look at the real costs of childcare, the real costs to someone who has no car of their own and is using public transport to get to a job, $25 will not cover much more than an extra bit of bread and some milk, hopefully—and they are still going to have to think about other pressures.

The challenge as well, when we talk about vulnerable families—families with more than one child—is that you are doubling up on the cost of shoes, especially in winter, of warm clothes, and of kai. If we are really true to what we are hearing in the community, there are already significant cost of living pressures on families who are paying a heck of a lot—a heck of a lot—in private rentals. Twenty-five dollars is something, but will it make a vital difference? I suspect not. I do not want to look a gift-horse in the mouth and say “Pooh, pooh!” all the way through. It is pleasing to see that some effort has gone into recognising that child poverty exists; the extent of which, I challenge the Government, should not be minimised by the piecemeal approach that it is taking here today. I look forward to hearing the deliberations of the select committee and to identifying how, in fact, in terms of the implementation of the bill, it will make a difference to the lives of needy children. Kia ora.

I feel so proud to be a part of this Government, led by the Rt Hon John Key. I would like to congratulate our Deputy Prime Minister and Minister of Finance, the Hon Bill English, on keeping New Zealand on track for such solid economic growth.

It is a pleasure to take this call to support the Support for Children in Hardship Bill in its first reading. This National Government has been, and is always, focused on delivering for families and children, because we understand their needs. We also understand the importance of a strong economy, because we know that it is this strong economy, under this National Government, that is allowing us to commit this package to help children in hardship. New Zealand families also understand the importance of a strong economy.

This Budget allocates $790 million in this package, which is aimed to help children in hardship—some of those children who are in New Zealand’s poorest families. Yes, there is this additional support being provided to these children raised in these households, but at the same time we want to support families to get out from welfare dependency. We want to break that cycle of welfare dependency because we know that work is the pathway to success in life. That is why we want to get more and more people into work as soon as possible. Moving to paid work is the best way to lift more families out of poverty.

Although an increase in benefit rates will help address the concern about children whose family’s resources have been falling behind those of other households, over many years, if we compare families dependent on benefits versus families getting into work, it is clear that the financial circumstances of families dependent on benefits do not change much over time, whereas the circumstances of families who get into work do change over time. We know that in the past year 74,000 more people are in work and the average wage has gone up by 2.1 percent, whereas inflation is negligible at 0.1 percent. National is focused on sustainable growth, which is needed to support more jobs and higher incomes. I support the bill and commend it to the House. Thank you.

I move, That the Support for Children in Hardship Bill be reported to the House by 3 November 2015.

Motion agreed to.

Sitting suspended from 6 p.m. to 7.30 p.m.