Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill

I move, That the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill be now read a first time. I nominate the Social Services Committee to consider the bill. As part of our 2014 election manifesto, we committed to extending the Youth Service approach. We said that we would extend it to 19-year-olds and to many other 18 and 19-year-old beneficiaries who are at risk of long-term welfare dependency. This Government is committed to supporting young people to make positive transitions into adulthood. We know that when young people have the right supports from the Government, society, family and whānau, they can make this transition successfully. However, when young people do not have the supports at the right time, it is much more difficult to make that positive transition. Problems can become entrenched and difficult to shift later on.

This Government introduced the Youth Service in 2012 to support some of our most vulnerable people to get an education, to have a better chance of getting a good job, and to live full and successful lives. Youth coaches currently support about 3,000 young beneficiaries to get back into education. These coaches also get involved in other aspects of a young person’s life, including help with budgeting and health concerns, and, depending on their needs, sometimes just some plain old parenting for teen parents. Early findings from the Youth Service show that it is having a very positive impact on many of these young people and is helping them to turn their lives round. Over the year to March 2014, 70 percent of the youth payment recipients were able to live independently rather than moving on to an adult benefit. At the end of March 2014, 87 percent of young parent clients were engaged in some form of education; 43 percent gained National Certificate of Education Achievement (NCEA) credits in the first year compared with 20 percent of their predecessors. If we look at just the numbers, 18 and 19-year-old youth on jobseeker support will spend an average of almost 13 years on a benefit. Nineteen-year-old parents are likely, on average, to spend almost 18 years on a benefit. The outlook for them and their children is not bright, and this Government believes in them, wants them to succeed, and recognises that they just might need some extra help and support.

That is not to say that everyone who comes on to a benefit at a young age remains on a benefit. In fact, of the 18 and 19-year-olds who left jobseeker support because they found a job, 67 percent did so within 6 months of first coming on to a benefit, and we celebrate that. So this bill reflects the Government’s commitment to doing more for those young people who are the most likely to remain on a benefit for a long time. It focuses on better education for some clients and training or work for others. Teen parents face many disadvantages, which is why we are extending the eligibility from 18 years to 19 years so as to make sure that we cover all of our teen parents. A 19-year-old parent whose spouse or partner is an older beneficiary will be referred to the Youth Service and will receive the same support as their peers. They will have a youth coach, who will help them to focus on their education and gain better parenting and budgeting skills, including being money-managed. For many teen parents, this will allow them to continue to receive the Youth Service for another year, because recent figures show that 66 percent of the 19-year-old sole parents support clients had previously received Youth Service support, so it simply makes sense to reduce the bureaucracy for this group and keep them on the Youth Service.

This bill also reflects the diverse needs of 18 and 19-year-olds who do not have any children, and it will allow the Ministry of Social Development to target more intensive support to those 18 and 19-year-olds most at risk. The ministry can determine their chance of gaining employment in the market and refer those at significant risk to the Youth Service for support. The bill covers clients who already have existing work obligations—that is, 18 and 19-year-old jobseeker support clients and any 18 and 19-year-old partners who have work obligations. They will remain on their existing benefit. Where a young person is not at significant risk, they will continue to receive case management support from Work and Income. But those who are deemed to be at risk will be referred to the Youth Service, and the youth coach will then help them to find work or training, learn budgeting skills, and be money-managed.

Some of these young people do not have NCEA level 2. The bill allows the Ministry of Social Development to defer their work obligations so that they can study full time towards this qualification, where this is the best outcome for them, because we all know that this qualification is the minimum needed for most jobs in the workforce today and for any ongoing training and qualification. An initial estimate shows that for every dollar spent on the existing Youth Service, the taxpayer’s liability reduces by $2.53, and I expect that there will be a similar return on investment for this older cohort.

Currently, a lot of young people finish in the Youth Service on 31 December once they have completed their studies. That includes about 10,000 young people who participate in the Youth Service voluntarily. They are not on a benefit but have left school and are not working, and we commonly talk about them as “neets”. Finishing in the Youth Service on 31 December means that a lot of young people have no support from their youth coach over the holiday period, when the labour market tends to slow and schools and tertiary institutions are on a summer break. So it makes good sense for Youth Service providers to stay in touch with these young people over this time, to make sure that they are ready for their next step in the new year, and that could be to get their first job out of school or to continue with study.

To assist this transition period, and give Youth Service providers the time that they need to help these young people, the bill changes the exit date from the Youth Service to 31 March for those who finish school or a course in December. However, if the young person is completing their study at another time of year, they will finish with the Youth Service then. This is what happens currently, and we have no intention of changing that. The bill also allows young partners to be eligible to receive incentive payments. These young partners are not eligible currently, but in all other ways are treated the same as other young beneficiaries in the Youth Service. In my view, these young partners should have access to the incentive payments, which means that when they meet their obligations, they will also be able to earn an additional $10 to $30 a week.

We are taking the opportunity in this bill to correct four matters to improve the clarity of the Social Security Act and to ensure that the Government’s policy intent is upheld. It also means that the practice and understanding that has been applied to date by the ministry is validated and that it avoids any financial costs to the Crown that were not anticipated. First, it will mean that people are able to review or appeal only decisions made about their own financial assistance, not someone else’s. Where some of that benefit needs to be recovered from the partner, the partner will still be able to review and appeal that decision. Secondly, it means that the Ministry of Social Development can continue the practice of paying terminal benefits into the deceased’s account if a surviving partner or a person caring for a surviving child has not applied for these payments. Benefits will continue to start the day after a stand-down period ends—this is current practice, and the bill ensures that it continues. Finally, the bill will allow the Ministry of Social Development to pay money held on a payment card directly to a young person when they cease to be money-managed. Many of them have not spent all their entitlements. Some have saved deliberately, and they should have it paid to them.

The Youth Service initiatives previously introduced by this Government have offered life-changing opportunities for many at-risk young people. This Government believes in them. We want them to have every opportunity to thrive and succeed. I am pleased to introduce this bill, which represents this Government’s commitment to extending these opportunities to more 18-year-olds and 19-year-olds. I commend this bill to the House and move that it now be read a first time.

We had much discussion about the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill in our caucus. It is with some major reservations that we will be supporting the bill’s referral to a select committee, but we will be raising those concerns at the select committee, and today I will highlight with the Minister for Social Development and with the National Government some of those very serious concerns that we have.

I am going to start by saying why we will support this bill, or the aspects of the bill that we can support. Really, that starts with the fact that 19-year-olds will have access to the Youth Service and all the wraparound supports that come with that Youth Service. We support the idea that we put measures in place to ensure that our young people have access to—and all beneficiaries, actually, should have access to—higher-level education and have access and support to get into work. We do not disagree with the fact that our youth who are beneficiaries should have access to not only education but budgeting support, and, if they are young parents, parenting programmes. We support that. We support the fact that in here there is a very small monetary incentive, but at least it is a monetary incentive—a $10-a-week incentive payment—for those who meet their obligations. It is good to see a little bit of carrot rather than the stick that we have constantly seen from the National Government.

But as for some of the concerns we have, I am going to start with the fact that even in the purpose of the bill these young people are deemed as being at risk of long-term welfare dependency. I want to ask how the Government can assess these young people from such a young age as being at risk of welfare dependency. It is a stigma that the Government has already attached to them and, actually, it is part of the National Government and the Ministry of Social Development’s predictive risk model framework for risk of long-term welfare dependency that, actually, we are a little bit uncomfortable with. The reason we are uncomfortable with this predictive risk model is the fact that no beneficiary is informed that they are being rated in any way as being at low, medium, or high risk of welfare dependency. They are not being told that they are being rated. They are not being told what they are being rated for, or what the measures are that they being rated against; they are just being assessed. They are actually being used in some ways as research guinea pigs and they do not even realise that this has happened. I have got real concerns that that is a breach of their privacy, because when you are being ranked or rated by a Government department for anything, you at least should have the right to know what you are being rated and ranked for and what measures are in place for that.

We have got real concerns about the general culture of Work and Income. In some ways that is why we will support this bill, because our young people are getting support from the Youth Service rather than the Work and Income offices, which are providing very poor support, actually, under the National Government, not because there are not good people in there wanting to do a good job but because they are working under a framework of a toxic culture that has been created by that National Government. That is one of the reasons why we have to support this bill. If it takes our young people out of that toxic culture of Work and Income and provides them with the wraparound services and support that Work and Income, actually, should be offering, then we have no choice but to support that.

We have got real concerns in general about the way beneficiaries are being treated, and that actually includes our young people here. When we are talking about the $10 incentive that these young people are going to get, as I said, it is good to see a little bit of carrot, but that is not going to go far. When we look at what this bill is asking for, it is actually saying that these young people—19-year-old parents—will be required to go into full-time study or work, in some instances when their child is 6 months old. I am not opposed to young people being put into study or being encouraged to go into study or work, but there has got to be some discretion in terms of people’s different circumstances. I am unsure of whether or not Work and Income or Youth Service, or the Government, for that matter, are able to discern or use their discretion to decide when that should be or should not be used. We saw on the website when looking this up that they will be required, if there is a teen parenting unit, to go into full-time study or work when the child is 6 months old. If there is no teen parenting unit within their area, it will be when that child is a year old.

So there is a little bit of a difference here—well, actually, a huge difference—between the way in which these young parents are going to be treated compared with the 20-year-old or older sole parent who actually does not have to go into part-time work or study until, at the moment, their youngest child turns 5—but we know that the Government is looking at shifting that to 3—unless, because the Government implemented this other measure, they have a subsequent child while on a benefit and then have to go into part-time work or study when that child turns 1. So there is a differentiation here between the way young parents are being treated compared with the way that parents who are 20 years old or older are being treated. We in this House all know, whether or not we are in this situation ourselves, that it is a really hard task, not just being a sole parent but being a young parent. I want to have faith in the National Government that it will provide the supports that these young people, these young parents, need, but how can I have faith given some of the things that we have seen recently?

The Minister says that she wants to have a focus on making sure that these young people are in education, that they are in employment, and that the National Government is focused on ensuring that their aspirations are met, but the reality is, from what we have seen with people on the jobseeker support, that it has not been about helping people realise their aspirations; it has been about getting them off benefits regardless of whether or not they are going into work. We saw that recently, actually, with the Minister’s own numbers that came out at the end of March, when there were 11,696 benefit cancellations, and of those 11,696 benefit cancellations, only 2,410 of them were cancelled because beneficiaries obtained work. What happened to the rest? Well, actually, the Minister does not care what happened to the rest. Actually, the Minister said in the Social Services Committee during the estimates that it is not necessarily about going into employment; it is about going into independence. How independent can someone be if they are not only no longer in receipt of a benefit but not in paid employment? How independent can someone be? But did the Minister hear? No. Is the National Government collecting information on what happens to people when they go off benefits? No. Should we not therefore be concerned that the same behaviour, the same actions, the same process, is potentially going to be rolled out here with our very vulnerable, young people? Well, yes, we should be concerned and we are concerned, and we will be monitoring this very closely when it goes to the select committee, to try to make sure that the same things do not happen with these young people.

The Minister says she is aspirational for these young people who are on benefits. Well, I simply just do not believe that. In fact, I want to go back to the select committee where her own chief executive officer of the Ministry of Social Development, when asked “Aren’t you concerned about these people who have had benefits cancelled but who have not gone on to work?”, said “Well, they have other means.” If someone is not in receipt of income from work or from a benefit, then what does he mean by “other means”? The Minister sat there and she nodded her head like that was true. Well, they have got no income coming in from work, they have got no income coming in from benefits, and the number of those who have gone on to further study is minute. The number of those who had benefits cancelled because of the fact that they had passed away or moved overseas or their marital status had changed was minute. What are the other means that the Minister’s official was talking about? To be completely honest, we were left there gobsmacked, going: “Well, actually, how could they make money if they are not getting any money from paid work or from a benefit?”. And the only answers we could come up with were crime, possibly; begging on the street; or prostitution. Those are three examples of other means, which are perhaps what the Minister is implying when she talks about people being independent from the State. Obviously, they are independent from paid employment, because there is no information to prove that they are going on to work.

We have real reservations about this bill, but we will be supporting it to a select committee, and we will be having robust discussion at that select committee to make sure we hold the Government to account on the way in which it treats our young people who are in receipt of a benefit. Thank you.

I rise to take a call in this first reading of the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. As the chairman of the Social Services Committee, it is an honour to be able to receive this bill, because, again, it is the vision and direction of this Government to ensure that we provide every opportunity for our youth, our young people, and particularly for those who are vulnerable to, I suppose, achieve their dreams, their moemoeās, their sense of vision for the future.

The previous speaker, Carmel Sepuloni, has continually talked about the concerns. What I want to put forward, again, constantly and continually, is the sense of vision and intent of this bill, which is to provide opportunities for the future of our young people, especially those who are in a vulnerable state. One of the comments of the previous speaker was about using the predictive assessment tool in a way to create a sense of judgment, and to look at the, I suppose, long-term dependency rates and issues. I just want to make it really clear that the figures that are being used are actually by fact. They are taken as, in a sense, the average of those who are actually on long-term dependency on the benefit.

So if we look at that, here is what the figures say. If we look at the numbers, 18 to 19-year-old youths on jobseeker support will spend on average almost 13 years on benefit. That is not a judgment; that is purely a fact. It clearly states here, too, that a 19-year-old sole parent on average is likely to and will spend almost 18 years on a benefit. The outlook for them and their children is not bright, and this Government believes in them and wants them to succeed, and recognises that some of them just need some support and extra help. Again, that is not a judgment call; that is a fact.

So the question that needs to be put there is around this: in the previous Labour Government, all we saw was the benefit rates continue to increase and increase. So what are we saying? That judgment upon the leadership of a Government of a nation is in the fact of how we have treated our young and our old. So, in particular, if we talk about our young, when we saw that more and more of our young people were actually being dependent on benefits, the initiative for us was to ask what we were to do about this. That is what this bill is about. This bill is about saying simple things like this: you do not have to allow your circumstances to dictate or define your sense of destiny. In other words, we all make mistakes; we all make choices. But just because we have an increase—and we have had a decrease as of late, under the National Government—in teen parents, we do not allow their being parents to be something that will burden them and hold them back from achieving their dreams, and their aspirations as well. So, clearly, what this bill is looking at is that we want to ensure that we make sure those opportunities are available to them.

Let us just talk about that. I just want to highlight some areas of the bill that we believe head us in this direction, as well. Nineteen-year-old parents will now be eligible for the young parent payment, as the age of eligibility will now increase from 18 years to 19 years. Young parents receiving this payment will continue to have an educational focus. This is absolutely important. We have an indicator that we call “neets”—not in education, employment, or training. We know there are a number of our young people who are in this situation, as with young teenage parents. So we know what the goal and the focus is—that education is a key for their success, as well.

Not all 18 and 19-year-old beneficiaries without children will be referred to Youth Service. In particular, only 18 to 19-year-olds who are considered at significant risk of long-term welfare dependency and who have work obligations will be referred. These young people will continue to have a work focus. However, some who do not have National Certificate of Educational Achievement level 2 will have a deferral from work obligations, or exemptions from the work preparation and obligations, to be able to study full time. This part of the bill again makes recognition of the needs, at times. It allows for variance. It allows for flexibility of the needs. Again, the focus is an educational focus. The focus is to continue to have those building blocks to succeed in the future of our young people. This is different from youth payment recipients, who will have an education focus.

As with current youth services, young people who are referred to Youth Service will be required to undertake a budgeting course and have budgeting conversations with their youth coach. This is not about the sense that people may feel we are micro-managing. Yes, young people are able to budget, but there are young people who also have asked and requested that they have that support. Those who are running our teen parenting units know that the need to have support around budgeting is absolutely important. We know that under the Commission for Financial Capability—and I attended and spoke at one of the summits there. The whole issue around financial literacy is an issue and a need right across New Zealand, so it is no different here. This is not a judgment call; this is purely about saying that, actually, managing your affairs is something all of us may need some support and help with, and all this is doing is providing that wraparound support that is absolutely important to those young people in that regard as well.

The second thing, and part of the bill, is also that parents will be required to undertake a parenting course and have other social obligations related to their child’s well-being. Again, we have got a number of courses. There are courses like The Parenting Place. There is Roots of Empathy. They go right across. They are both mainstream and they are right across in other parts of our community. Again, this is not a judgment call. It comes under the aspect of social obligations. It is around providing that wraparound support.

Previously in the work that I have done actually in the community—parenting is something that is absolutely critical and a need. People just assume that once you have a child you automatically become a parent. That is not the case. We know that we need lots of support. All of us have required advice and support, which comes along from family members and friends, and sometimes we have attended courses as well. So this is no different from us, again, providing parental support to those young parents. In particular, if you think about it, young teenagers who are 16 to 18 to 19 years old are at an age where often you would sort of say they are children having children. Therefore, even more so, there is a need to have parental support and guidance to help them along the way, to be able to deal with these issues.

We are often dealing with young people who are in a vulnerable state. For no fault of their own, in many circumstances, they have found themselves vulnerable because they do not have the support that wraps around them: family and whānau and aiga who would normally be there, and friends who would normally be there. Again, I want to reiterate that this is not to be put on as a burden but simply as a means of support for our young people, for our rangatahi, as well.

They will also be eligible for incentive payments of between $10 and $30 a week for meeting these obligations or for 6 months of participation in education and in training. We believe this is important. This is the same as for existing participants, and it is expected that fewer young people will be on long-term welfare dependency. Again, I want to reiterate our intent as the Government. We make no bones about that. We are unashamedly saying this: we want our young people to move off that sense of dependency and into an opportunity where they can be self-determining for their future and for their direction as well.

I want to make some comments around Youth Service. This becomes quite important because although we talk about the social obligations, the benefit wraparound support that we have, we also want to talk about the initiative of Youth Service. In 2014 the Youth Service evaluation showed that Youth Service is having a positive impact on helping young people on a benefit to be independent of welfare support. It is also reducing benefit liability. At the end of March 2014 the number of youth payment recipients moving to a working-age benefit dropped eight percentage points, from 38 percent to 30 percent, compared with previous young beneficiaries. We see that this is a positive thing. I know that the previous speaker talked about how we track them and what we should do. We know that this has been a long-held tradition for many years, and that this department’s role of responsibilities, as stated in its statement of intent, is very clear. It is to provide the opportunities to move off the benefit and into some form of work. That is where its roles of responsibilities lie. We believe this is important.

The last point I want to make is that Youth Service has been very successful, with 86.5 percent of participants engaged in education, training, or work-based learning at the end of March 2015.

We look forward to this bill coming to the Social Services Committee. As the chair, I look forward to also hearing the submissions. We think they are important, and, yes, we are up for a robust debate. I want to reiterate very clearly the direction that both the Minister for Social Development and this Government are taking. Our belief is this: the longer our young people, who are both vulnerable and at risk, stay on a benefit and are dependent on a benefit, the less likely they are to achieve their dreams. The vision that is held by this Government, by the Minister, and by those of us who are part of the caucus is very clear. We want to provide every opportunity available so that a young person’s circumstances do not have to define their destiny, so that they have the opportunity to achieve their dreams into the future. I commend this bill to the House.

It is a pleasure to rise and speak to the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill at its first reading. This is a bill that Labour is prepared to support through to the select committee and one that we will be very interested in hearing submissions on, because we do have reservations about supporting this bill. As with many of the bills that this Government brings in, it has some good aspects and it has some very dubious aspects. This is another one of those bills that has both things going on with it. For us, we will be weighing up where the benefits come in and what is best for our society and our communities in total.

The part of the bill that we can readily support is the extension to 19-year-olds of the Youth Service and the wraparound benefits and supports, the additional educational opportunities, and maybe the additional $10 that is tagged with that, although sometimes that seems a little laughable. But none the less I guess we prefer the incentive type of approach to the punitive sort of approach that this Government is wont to take with regard to people who have fallen on hard times and have very difficult issues that they are grappling with. The mode of operation of this Government is to blame the victims and to blame people who have the least opportunities in their lives. I guess, from that perspective, we are pleased to see that there is more of an incentive-based approach with this bill.

However, the part that we are very concerned about and that we will want to explore through the select committee process is the idea that young people—and most of these young people will be parents of young children. I guess the reason why I am keen to speak in this debate is that many of those people will in fact be young women. They will be young women. The vast majority of people being subjected to these mechanisms will be young women with young children. So the idea that they are going to be put through some kind of risk-rating process fills me with dread.

The reason it fills me with dread is that I also happen to be Labour’s ACC spokesperson. Have we not seen the shambles of risk rating under this Government when it comes to motor vehicle ACC registration levies? That is the sort of mentality that is going to be applied potentially again, but this time to people. I just want to rehearse, because this is a significant part of this bill—I just want to remind the public what transpired when the Government recently applied this risk-rating approach to motor vehicles. It has been an utter shambles. It has turned out to be utter chaos. The Government has got the risk rating wrong of at least 24 makes and models of cars, and that has been discovered in just the first 3 weeks of the scheme being implemented.

The reason I raise this is that if the Government can get it so wrong with something that is relatively straightforward actually, and that is the safety of vehicles, then when it comes to assessing and doing risk rating on people’s lives, how on earth is that going to go? Will it turn out to be the slow-motion car wreck that that Government has proven to have brought about in the area of ACC?

💬 Hon Anne Tolley: How embarrassing.

Yes, it would be embarrassing, Minister. I agree that the shambles that has happened in ACC has been absolutely embarrassing for the Government. What I am saying to the Minister is please do not visit that embarrassment on our young people. It is actually the same model. It is that idea that there is an actuarial kind of assessment that can be made and that it is going to be a perfect science. In this instance, it is not going to be applied just to motor vehicles. You know, that is bad enough actually, because that affects people’s payments for car registrations. But in this instance this is going to affect young people’s lives, and the tags that they carry with them throughout their lives, due to that Government’s idea that you can just apply an insurance model, an actuarial kind of assessment, and deem someone to be at high risk or low risk of being a beneficiary.

It gave me great cause for concern when I heard the previous speaker, Alfred Ngaro, use that model to tell us that apparently 18 to 19-year-olds who are on a benefit today, on average, under the Government’s assessment process, will be on a benefit for 30 years. On average?

💬 Carmel Sepuloni: What? He said that?

That is what he said. That is what he said.

💬 Jono Naylor: 18 years—you’re not listening.

No, he said 30 years.

💬 Jono Naylor: No, he didn’t.

Well, go and have a look at the Hansard. Did he get it wrong? He said 30 years. But, again, this fills me with dread, because if members opposite are going to make those mistakes in first reading speeches about using this risk-assessment tool, how wrong are they going to get it when they actually roll it out and apply it to people’s lives? And what evidence are they using to make these decisions? I think all of us, hearing that figure, know that this cannot possibly be true. For an 18 to 19-year-old today, on average, if all of them are going to end up being on a benefit for 30 years, it means that some of them must be on a benefit for 60 years in order to balance out the ones who are going to be on a benefit for 1 year. That is just an extraordinary claim to make. It is an extraordinary claim to make.

So I think that these are the reasons why we will be putting a lot of scrutiny on this bill at the select committee stage. This is the tool that the Government is going to use to make an assessment of how low risk or high risk people are at the tender age of 18 or 19, and therefore what their future is going to look like—how bleak it is going to be or not. Given the Government’s record in using risk-rating models in other settings, it is something that we will take a lot of notice of.

💬 Jono Naylor: I can’t believe you’d compare our young people to motor vehicles.

Well, the member says you cannot compare. I think that is a really hopeful statement from him. He is hoping this will not turn into the slow-motion car wreck that the ACC levies has. I understand that, because if I was in his position, I would be deeply embarrassed about that as well.

💬 Hon Todd McClay: But you’d be in Government if you were in his position, so carry on with your speech.

Well, what I am pointing out here is that they might think it is funny that it has happened to people paying their ACC levies on their motor vehicle registrations, but when it comes to putting labels on young people about what their future looks like, then the Government needs to be very, very careful. We know it is already prepared to label a lot of our primary school children as failures when they are just 5 or 6 years of age. This is another extrapolation, perhaps, of that whole idea that you give people these labels based on goodness knows what data and what information. We know that that can harm them for the rest of their lives, so we will be looking into this very, very carefully.

I also want to raise the issue that my colleague Carmel Sepuloni raised. That is the issue about the people who come off benefits. Where do they go? The Government does not seem to want to know. I have not seen these figures myself recently, but Carmel Sepuloni talked about roughly 12,000 people coming off a benefit, but only—was it 2,600—

💬 Carmel Sepuloni: 2,410.

Only 2, 410 people found their way into a job. So what has happened to the rest of them? What is that—about only 28 percent?

💬 Carmel Sepuloni: 20 percent.

About 20 percent of them are finding their way into a job. What is happening to the other 80 percent? Is this the reason—

💬 Hon Anne Tolley: Your figures are wrong.

Well, these are the figures of the Minister herself. These are the figures. She is getting very agitated. I think it is because we have hit a really important point here. What is happening to the rest of them? Is this the reason why the food banks in every town and every city in New Zealand have got more clients? Is it that they are coming off the benefit, all right, and the Government is saying: “Well, isn’t that great?”. Well, if they are ending up at the food bank, no, it is not. If they are ending up sleeping on the street, no, it is not. If they are ending up being in the endless stream of people who are coming into MPs’ offices saying they cannot afford their housing any more—

💬 Mr DEPUTY SPEAKER: I am sorry to interrupt the member but her time has expired.

It is an honour and a pleasure to rise and speak to the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill in its first reading. It is a bill that I will be wholeheartedly supporting.

Members across the floor still do not get it. If we go back to the 2008 Salvation Army state of the nation report, it said that for all its increased expenditure, the Labour Government did not increase social progress by 1 percent. Fast forward 6 years, the Salvation Army’s state of the nation report last year reported that there was a reduction in child poverty and there was a reduction in the number of people presenting to food banks. We asked the Salvation Army why there was that reduction in child poverty and people presenting to food banks, and it was because of job creation—job creation. They still do not get it.

This bill is not about the money; it is about supporting vulnerable young people through education, through training, to get into employment that will get them into independence, and that will get them to where they want in their lives. It is giving them a vision. It is giving them a hope.

💬 Carmel Sepuloni: They’re not doing it for any other beneficiary.

They still do not get it. Their second-biggest loss was in last year’s general election. The voters gave us their opinion. What they wanted is a National Government that cares for the people; a Government that cares for the working people and listens to them. We are a Government for the working people.

We spoke yesterday in the general debate about the strong economy. We have a strong economy, strong economic growth, and strong economic management. But that is only half the story. The reason we have that is we want to improve the social well-being of the people in New Zealand. Look at increasing free general practitioner visits to under-13s. Look at the educational achievement results that we heard today. Look at some of those core planks of that Budget 2015, a plan that is working. We gave 3,500 Kiwis more access to social housing. That was a bill that that party voted down, New Zealand First voted down, and the Green Party voted down. We gave, through the Support for Children in Hardship Bill, vulnerable families, low-income families, and the most deprived $12 to $25 a week. New Zealand First members voted it down. They are not putting New Zealand first; they are putting their own party first.

Now, after focusing on young kids going to GPs, on their educational achievements, on the Budget reforms for social housing, and also on the Support for Children in Hardship Bill, we are, quite rightly, focusing on our young adults—the future of New Zealand. What this bill is about is transitions. Transitions are important in our lives. We transition from being a child to a young adult and to being an independent and productive adult. That is a very key part of anyone’s life course as they go from a child to a young adult and to an adult. It is quite right that we put policies in place to support people transitioning them through the life course.

If we take a social investment approach—and that is what this Government is doing—we know that if we can focus on the most vulnerable and give them the resources, it will make them more productive later in life. This was a key part of the Government’s 2014 welfare manifesto, where what we want to do is reduce benefit numbers and to reduce those numbers by 25 percent.

In 2014 there were 295,000 people on a benefit, and we want to reduce that to 220,000. We know that we can reduce the long-term investment of dependency by $13.5 billion. That is a huge amount. If we look at the current Trans-Pacific Partnership agreement, that reduction will surpass anything that we will make through a free-trade agreement. Not only should we be generating new income for this country through free-trade agreements but we should also be reducing expenditure. It is not just making a small Government; it is making big communities. That is what we need to do, and to reduce the number of customers that we are serving here for the State.

When we look at this vulnerable group—I was amazed when I looked at some of the statistics at how vulnerable this group of young people whom we are going to be working with is—38 percent of these young people have been victims of domestic violence, 76 percent of this group of young people whom will we will be focusing on have had emotional neglect, and 5 percent have been homeless or victims of sexual abuse. We know through the developmental approach that when young people experience this range of abuse and neglect, it plays out in such things as the classroom and in high school. We know that a lot of these young people whom we are working with have experienced educational difficulties and have not attained as high a level as they can in education. So it is quite right that we are putting services together that will wrap around these young people, keep them in education, keep them in training, and support them into work.

If we look at previous attempts at this—just paying a young person a small benefit and putting them straight into a low-skilled job—that did not give them anything that they needed. All it did was to perpetuate their problem and not give those young persons any skills that would take them forward.

A great asset and resource of this bill will be in allowing this group of young people up to the age of 18 and 19 to now access the Youth Service. We know that the Youth Service is working. There is a lot of research that has come out currently that shows that by the end of March 2014, four out five enrolled in the Youth Service were engaged in education, training, or work-based learning, in either a full-time or part-time capacity. We do have to get the balance right. At the end of the day we are giving these young people payments and we need to ensure that they are using them correctly.

When we give these young people payments to put them into education, training, and employment, the payments are partly distributed through redistributions that will cover their accommodation and utility costs, payment cards so that they can buy food and groceries, and an in-hand allowance. But they have to live up to expectations. Again, an important developmental stage for young adults is to understand expectations of them in their community and in their society. So for those payments they will have to engage in training, education, and employment.

If we look at the social housing reforms with wraparound services, if we look at people with mental health issues—with wraparound services—there is a whole range of social groups that can get targeted support. With the developmental age of young adults that we are dealing with here, that will be targeted support that is age-specific to the needs of young people and the issues they are working through at the time. It is great to be part of a Government that is thinking about the people of this country and the support that they need at all life stages, as they go through the transitions of life.

One thing I would like to highlight is how smart this bill is. If we take the concept of allocative efficiency, and if we look at the total expenditure along the life course, we know that if we invest in certain points of the life course, then that will cause a reduction in expenditure in another part of the life course. If I take my own background in mental health, we know that if we work with young people from the age of 0 to 3, when their personality is being formed, and with young adolescents when there are issues around early psychosis—if we front-load the resources and services at that end, we know we reduce the number of people entering services later in life.

This is very much the same. We have heard the Minister say that one dollar spent at this stage reduces a future liability—

I am sorry to interrupt the member but his time has expired.

I am pleased to take a call on the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill on behalf of my colleague Jan Logie. The Green Party will not be supporting this bill, largely because of the quite paternalistic attitude that it takes towards young people. When this Parliament has debated the drinking age in the past, the argument was made, and it was accepted, that if you are old enough to be sent to war, to get married, and to have children, then you should be allowed to drink. It seems inconsistent, then, if you are allowed to do all of those things, that with parents under 20 the State sees itself as being able to impose significant obligations on those young people in order to access social security. So, because of the paternalistic approach, we are not supporting the bill.

The bill amends the Social Security Act, and its main purpose is to extend the ability to access Youth Service provisions to all 19-year-old beneficiaries with children and to 18 and 19-year-old beneficiaries without children who are considered at significant risk of long-term dependency. But these youth services involve significantly more social obligations and more social control by the Government over young people. We certainly support, for example, young people having access to education and the wraparound service that is provided there, but some of the other obligations include attending regular meetings with a provider to discuss activities, spending, and budgeting; having key bills paid directly out of the benefit; using a payment card; and being restricted to $50 a week in cash, unless the young person can prove that they deserve more.

As Carmel Sepuloni has noted, there is a two-tier system in relation to young parents, because the obligations on young parents to return to full-time education, training, or work are much harsher than they are on adults over 20 who are receiving a benefit. So, in our view, these provisions in the bill are quite discriminatory on the basis of both age and family status. They take a patronising approach to the provision of social security for young adults. The assumption that the Government seems to be making is that young people are incapable of managing their own financial and personal affairs.

So although one of the requirements on young parents is that they enrol their child with a primary health organisation—that is, obviously, something that should be encouraged, when it is being encouraged in a supportive environment. But when such decisions are tied to the potential loss of benefit income, we do not think that those obligations are appropriate to put on 18 and 19-year-olds, because it is creating the basis for quite a punitive regime rather than a constructive and supportive one. It is also suggesting that young people aged from 18 to 20 are not able to take important life decisions themselves without reporting to someone else. It is suggesting that they sit around and that they are unfocused without the threat of sanctions, and so that paternalism is at the heart of our objection to this bill.

We in the Green Party certainly want to support young people who are disadvantaged. We want them to have the same opportunities as others, but we do not think that the way this bill goes about it, by restricting life choices and removing control over key life decisions, is in any way desirable for 18 and 19-year-olds. They are adults, and it is patronising for the State to seek to control their decisions in the way this bill does.

Certainly, with the youth services concept—everybody has talked about it as wraparound services, and there have been some good stories that have been reported back around the country, but we have also heard some stories that worry us. We have been told of dairy owners who are charging young people $100 to get $50 cash on their payment cards. We have been told of young parents in teen schools who believe that they are potentially in breach of their obligations if they tend to their children and settle them while they are in class. We have also been told of parents having their incomes sanctioned for spending too long away from their course, to attend a tangi. So that is the sort of paternalism and the sorts of examples that we are concerned about.

We have also got quite serious concerns about forcing single young people up to the age of 20 into a model with quite onerous accountability, based on the State’s identification of them as at-risk young people. That is being done, as the regulatory impact statement makes clear, using a behind-the-scenes formula. It is likely to mean that some young people will be identified as being at risk, and that they could have a friend who is the same age and in the same circumstances, but they have got a slightly different profile and so they get dealt with by Work and Income while the other one gets directed towards Youth Services.

This sort of situation, where you get assessments of people being made by a State agency, who are then put into separate streams and receive different services based on the State’s assessment, is quite risky in terms of alienating people from Government processes. And it is at risk, too, of arbitrary and unfair decision-making. We do not want a system where people feel that they are being stigmatised, that they are being labelled, and where they potentially become quite resentful and mistrusting of the Government. When you look at the regulatory impact statement—

💬 Hon Anne Tolley: Unbelievable.

The Minister says it is unbelievable. But the regulatory impact statement says that it “… makes a number of distinctions based on age, family status, and other risk factors …”. That leads to 18 and 19-year-olds who are identified as being at risk of long-term benefit dependency being treated quite differently from 18 and 19-year-olds who are not considered at risk. [Interruption] The Minister says that is right, but she cannot see that this is a huge infringement on human rights by having the State determine which category you fall into and therefore which services you should have access to.

One of the key principles in the regulatory impact statement is also that the liability for the Crown to have to pay for future welfare services for these people is a major determinant in the Government’s decision making around the bill. So it seems to be based on the Government saving itself money in the future rather than actually delivering and embracing a social security system. We want to support human dignity and human rights, and not have this categorisation process that has the State intervening to cut across people’s ability to make decisions about their future when they are aged over 18 and when elsewhere they are considered an adult in terms of being able to drink, to go to war, to get married, but not according to the Ministry of Social Development and its categorisation.

In the Green Party we want jobs for everyone, and we are not about beneficiary bashing the way this Government is. Making it harder for people to live on a benefit will not somehow magically create jobs for them to move into. The welfare “deforms” in this bill will increase inequality and it will make it harder for people to live on a benefit. That is going to compound the challenges that are faced by people who are unemployed and by disengaged young people, and it will undermine the ability of parents to take care of their children.

We cannot support this bill, because it is the Government’s thinking that if you make it hard enough and tough enough for beneficiaries, if you introduce enough work tests, and if you threaten them with enough sanctions, somehow jobs will magically appear that they can move into. We know and the Government knows that it does not actually work like that in the real world. Officials have told the Government that, but the only response that it has developed in this bill seems to be a paternalistic one where the State is making critical life decisions on behalf of people aged 18 and 19 who are old enough to make those decisions for themselves.

We know that there are good providers, but we also know, in terms of youth services, that there are some problems that have arisen, and that we do not want to see the privatisation of social security that this bill is extending. That is another one of the reasons why the Green Party is opposing the bill. Thank you.

I seek leave to make a personal explanation.

The ASSISTANT SPEAKER (Lindsay Tisch): Leave is sought to make a personal explanation on what matter?

I was challenged by the Minister for Social Development on some numbers I used earlier.

No, no. Those are debating points, and the member has a chance to debate them. During the course of a debate a member can put their arguments and they are disputable, but a personal statement is where something has been said that you take offence to, as opposed to the material. Just to correct numbers, though, is a debating point.

💬 Hon Annette King: You didn’t give her a chance to say what she was going to talk about.

The ASSISTANT SPEAKER (Lindsay Tisch): I did. She told me what she was going to do.

I seek leave to table some information that confirms the numbers around benefit reductions that the Minister said were incorrect—parliamentary written question No. 4740 and parliamentary written question No. 6927.

The ASSISTANT SPEAKER (Lindsay Tisch): Is this in the public domain?

Yes, but the Minister—

No, that does not matter.

It is my pleasure to rise on behalf of New Zealand First—[Interruption] It is my pleasure to rise on behalf of New Zealand First in support of this bill, but we do have—[Interruption]

The ASSISTANT SPEAKER (Lindsay Tisch): Order! Look, I would like to hear Darroch Ball.

Thank you. It is my pleasure to rise on behalf of New Zealand First to speak on the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. We will be supporting this bill through to the select committee because there are a few questions that we would like to flesh out and some concerns that we would like to hear some explanations for. But, fundamentally, the bill itself—and the purpose and the intent of the bill—is a good one. At the moment we have got youth who are on young parent payments eligible from 16 to 18 and on the youth payment from 16 to 17. The provision of the wraparound services for the youth is obviously a good one. The extension of that, on the face of it, and the intent and purpose of that is very good. So that is why we are supporting it, but I will get to the issues and questions shortly.

With those youth who are on those payments, I have worked with some of them throughout my previous career. I was in the military in the army and I worked with Limited Service Volunteers, and a few of them were on those payments. I also worked with the youth in the community, and most, if not all, of them were on some sort of youth payment. Also, to some extent, when I was a secondary school teacher I could see those youth who would be moving on to those payments. So I have got a little bit of context about what those struggles are for those youth and the need for the wraparound services that this Youth Service does provide them and the benefit of being able to extend the ability to be on the young parent payment or the youth payment itself.

I would just like to mention first what the intent is and why New Zealand First agrees with it. Going to the departmental disclosure statement, it is extending the existing Youth Service to “all 19 year old beneficiaries with children, and 18 and 19-year-old beneficiaries without children who are considered at significant risk of long-term welfare dependency.” New Zealand First agrees with that. The Youth Service provides wraparound support to young people with the aim of reducing long-term welfare dependency. That is obviously a good thing, and New Zealand First supports that intent of the bill. As a result of this extension, 19-year-old parents will have obligations for full-time education leading towards National Certificate of Educational Achievement level 2, budgeting courses, youth coaching, and going on parenting courses. If they meet all the obligations, they will get a $10 incentive every week and they will be money-managed.

But the position we are coming from is that this is just another form of an ambulance at the bottom of the cliff. So if we are looking at the Youth Service, those youth who need the Youth Service, youth payments, and youth benefits needed to get to that stage to begin with. If we are looking at extending that, is that solving a problem or is that just making the ambulance a little bit bigger at the bottom of the cliff? So one of the questions that needs to be answered by the Minister—and, hopefully, that will be fleshed out during the select committee process—is what are the reasons behind why those youth are getting to that stage in the first place? One of them is obvious. We have got very high youth unemployment. We have had consistently high youth unemployment for some years, and especially in the regions. We have got high youth unemployment in the regions, and that lends itself to higher beneficiary numbers in the regions, and especially with our youth.

But obviously it is a complex situation. We have got problems with the ability for these youth to have a proper education or fit in within the formal education system. We have got the job creation. Where are the jobs that these youth will be going into if they are not in any formal education? And where are the training opportunities? So the Government can talk about the “neets”—the youth not in education, employment, or training—but where is the solution? The solution is not another ambulance at the bottom of the cliff, extending an existing service that catches those who are in need. The answer definitely is not to make it mandatory, with mandatory provisions put on those youth who do take up the benefit. By making it mandatory, it is an indirect admission that there are failures elsewhere in the system that is failing these youth. Not only do the youth not have the opportunity to make those proper decisions—so that they would not need to be on the benefit—but those options are not out there and readily available for them to choose in the first place. So that is one of the concerns for New Zealand First.

Another of the concerns also has already been brought up by the Labour members, which is the risk-predicting tools. One of the main reasons is that it has the potential to discriminate against some youth and it has the potential to pigeon-hole some youth, when there is no need for that to happen or to occur in the first place—unjustly and unjustifiably. A lot of the time throughout the debates in this House, we have Government members standing up and saying that one of their principles, one of the aims, in all of their policies is to ensure the maintenance of equitability and fairness. But with the predictor models and predictor tools and risk-predictor tools, there is a leaning towards going away from equitability and away from fairness. We have got to remember also that by extending this out—we have got 18-year-olds and 19-year-olds. They are not children. They are not minors. These are adults who are being pigeon-holed and cubby-holed, and they have the potential to be stigmatised and they have the potential to have labels placed on them.

What I would like to go on to is actually going into the regulatory impact statement, which talks about the risk modelling. It says that “Through risk modelling, MSD can determine which young beneficiaries have the highest risk, and would benefit the most from the Youth Service.”, and that risk modelling is “used to target services to those most in need. Risk factors for long-term benefit dependency include, but are not limited to: low education levels; benefit history; previous contact with Child, Youth and Family; and parents or siblings with a benefit history.” So, firstly, it is including but not limited to. So who decides what those criteria are and how those criteria or boxes are going to be ticked? What we will have is the potential to have, for example, two 19-year-olds who are receiving two levels of different types of service, and that will be dependent on only those criteria, and those outcomes are dependent, obviously, on the use of the risk-predictor tool. So, for example, one would be getting a $10 extra bonus a week if they maintain the obligations, and the other will not. Where is the equitability and where is the fairness in that, and who decides?

We have also got a couple of issues with the investment approach in itself. The regulatory impact statement indicates that it is actually too early to accurately measure the reduction of average years on the benefit and that it is not possible to isolate effects of the Youth Service interventions from other influences to date. So on the one hand we have got the regulatory impact statement saying that there is not enough data, there is not proof, but then we have got the Minister for Social Development and the National backbenchers standing up and saying that this is all working fine, and that the Youth Service is doing a great job. But where is the data, and where is the evidence that they are going to use for the investment approach?

We have also got some advice and some opinions on the bill from the teen parent units. At the moment the teen parent units—there is no comparison between this Youth Service payment and the teen parent units. In order to be consistent with the intention of the bill, the Government must look at the existing eligibility-age range for young parents attending teen parent units, because this bill currently excludes the 19-year-old parents to whom the bill extends the Youth Service and identifies as likely to spend an average of 18 years on the benefit in a lifetime. Currently, young parents need to be enrolled before they turn 19 in order to be eligible. This is in conflict with the extension bill.

So there are a few questions that come out and there are a few concerns that New Zealand First has that we would like to have answered and robustly discussed at the select committee. At this stage we will be supporting the bill through to the select committee and I look forward to discussing it there. Thank you.

The next call is a split call. Todd Muller—5 minutes.

I rise to speak for a few minutes on the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. Well, what an extraordinary last 15 minutes we have had to endure here. Firstly, there was the speech from Ms Moroney. Fortunately, I managed to catch only the last 4 minutes of that, and I would have to say that those 4 minutes will last me a lifetime. Her critique of our social investment model and our actuarial approach to identifying a full-term cost of social welfare in this country was some of the weakest analysis that I have heard in the 10 months that I have had the privilege of being the MP for the Bay of Plenty. I am sorry, but you are caught in a time warp. The fact that you think that the way we help people in this country is to just throw money around with gay abandon—I am sorry. You need to actually get close to people—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! [Interruption] Order! I do not need to get close to people.

No, that is probably true, Mr Assistant Speaker.

Ms Moroney, I would suggest that in getting out of this House and actually talking to people, you might actually get some reality around what is happening out there. Your analysis was weak and feeble. You need good data. Ms Moroney, you come from a party that has a philosophy of throwing money around without data, without an understanding of where that should go, and here we have a Government that is focused on finding the information and then delivering that investment to the people who need it most.

Then we had to sit through 10 minutes of the Green Party accusing this Government of being paternalistic—saying that we should not be providing support for 18 and 19-year-olds was the most extraordinary thing, quite frankly. Again, I would ask the Green Party members to get out of their little theoretical bubble and actually go and talk to some of these service providers who are actually out in the field and providing the services to these young people. They tell us—and they told me when I was in Tauranga talking to EmployNZ only a few months ago—that the one key thing that they want this Government to consider is to extend this Youth Guarantee scheme and the youth services from 16, 17, and 18-year-olds up to under-20-year-olds. Why? Because it works. And those who oppose it on purely ideological grounds have lost the argument. You have lost the argument, I am sorry. You have lost it because the people who are benefiting from this Government’s focus on ensuring that we have education and budgeting and parenting advice for those who need it are the ones who are actually helped. It is their families and their communities that are supporting this Government, and your party is on the wrong side of it and you will see that over the next few months.

Can I please say just a few words to acknowledge the Minister for Social Development, Anne Tolley. Again, in stark contrast to what we have heard on the other side of the House, here is a Minister who actually gets out of Wellington, who actually goes and talks to the agencies—Government and non-Government agencies—that are on the front line of complicated and difficult and systemic issues. She listens to them and understands what actually works. She hears them and says: “Yes, you have a case. This is a platform that is working and delivering, and, yes, this Government will stand behind you and expand the youth services from 16, 17, and 18-year-olds to include 19-year-olds, and that will deliver real benefits for people and real benefits for families.”

For those particularly in the Green Party who argued that somehow actually providing budget support and parenting support to those young people is paternalistic, I say, again, that you are not close enough. The Green Party is not close enough to that reality, and I specifically put a challenge out to the Green Party this afternoon for its members to go and talk to those providers and go and talk to those who are currently benefiting from this service. What they tell us is that this is a huge help for them. These are people who were falling through the cracks. These are people who are not in our education system and who have been identified, and services and guidance and support are being wrapped around them to enable them to participate in this society into the future. This is a Government that cares, this is a Government that is focused on delivering results, and it is one I am hugely proud to support. I look forward to this bill being debated through the select committee. Thank you.

I call Stuart Smith—5 minutes.

It is a pleasure to speak on the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. I am going to focus a little bit on jobs, but before I get to that—this bill is going to extend youth services to all 19-year-old beneficiaries with children, and 18 and 19-year-old beneficiaries without children considered at significant risk of long-term welfare dependency.

Youth Service provides wraparound services and support with the aim of reducing long-term welfare dependency in the future. As part of that activity, these beneficiaries will be required to undertake youth activity obligations, and that is important. These people are in a position where they have been identified as likely to be long-term beneficiaries. They need to get out and enjoy life with other youths in a proper way. That is what this obligation will do.

They will also be required to undertake full-time education leading towards National Certificate of Educational Achievement level 2, undertake budgeting courses, and have ongoing budgeting discussions. That is really important. When you go and talk to family budgeting services you realise how that really small step can make a big difference to people’s lives and how they can get themselves saddled with a lot of debt, really just because of a lack of planning at the front end. So that is really important. They will also undergo parenting courses and activities to support good parenting, and they will receive $10 a week if they meet those obligations.

There has been a lot talked about jobs, and people speculating that there are not jobs out there. Well, in 2011 there was a Government forecast of 171,000 new jobs being created over the next 4 years. But we are actually going to make 193,000 jobs. That is 22,000 more jobs than we forecast—just under 200,000 jobs. There are jobs, and the forecast from 2015 out to 2019 is 150,000 new jobs.

To illustrate what that really means at the sharp end, I was talking to a contractor in my electorate who was desperate to employ New Zealanders. He is a recognised seasonal employer and he would love to have Kiwis so that he can have long-term people in there to help supervise. But the difficulties of getting people are really quite stark, so he is working with Work and Income. He came over to this side of the strait to the lower North Island and sought out and interviewed people. He wanted to initially employ eight workers. He interviewed 22, and he was so impressed with the standard of the young people he was interviewing that he decided to double that and employ 16, and he took those 16 people back over to Marlborough to work. The reason he came to the North Island is that that piece of water—Cook Strait—is quite a barrier for those people.

The idea is to get those people out of their environment, and, with all of the services that are being provided by Work and Income to help these people and ease them into work, it is really working. Out of those 16, four have since dropped off but he has now got 12 people—that is 50 percent more than he went over initially to employ—and they are working, and working out well. But it does take time, and those wraparound services that are part of this bill are there to help those people get through that initial stage of learning good habits around work. It is about changing behaviour. It is about resetting values, and so on.

I was really disappointed with what I heard earlier, particularly from the Green member. I thought she was better than that. She would have those people stranded on a benefit for the rest of their lives, damning not only them for the rest of their lives but their children and their families, and that is really sad. We are much more ambitious for those people and we are not just telling them to do something; with this bill we are actually giving them the tools to achieve it themselves. When you see those people—the change in their behaviour and their values, and their pride in themselves—it is worth every single penny. I commend this bill to the House. Thank you.

I rise to take a call on this bill because it is one of the issues that our constituents at Manukau East come to see us about on a daily basis. Labour supports the referral of this bill, with reservations, to a select committee. We strongly support the wraparound services that encourage higher education with appropriate childcare assistance, and we also strongly support extending the Youth Service to all 19-year-old beneficiaries with children.

Labour only supports this bill going to a select committee at this time, though, and I would like to share some of the concerns that we have about elements of this bill. Young people are the future of our country. Our young people are currently suffering, though, because they are having to deal with housing that is way too expensive, they are suffering from poor educational outcomes, and they have high rates of unemployment and very few pathways into jobs. In fact, 40 percent of our total unemployed in this country right now are young people, which is way, way too high.

Unfortunately, some of our young people, particularly Māori and Pacific young people, are going to end up in prisons. Given the fact that prisons have been highlighted in the last few days, it is not my wish—and probably not the wish of any other member in this House—for any of our young people to end up in prison. The majority of the young people whom this bill will apply to are most likely to be Māori and Pacific youth and those who will come from low-income families.

Earlier on today my colleague Mr Ngaro stated that we all have choices. I agree—as adults, we all have choices. However, for many of our young people, the choices that are available to them are limited in comparison with the choices that other young people from more affluent households actually have. Our children have no choice about being born into, or growing up in, child poverty—as another example. This Government, however, has a choice. It can choose to ensure that every child—that every single young person—in this country has the same opportunities, regardless of their socio-economic status. The Government also can choose to address and to measure child poverty.

The Government, in considering the predictive risk modelling that this bill is actually proposing, has been considering it since 2012. The Government later modified the predictive risk modelling and then decided to test predictive risk modelling, but only to enhance front-line decision-making about cases of suspected child abuse. According to Professor Vaithianathan: “Predictive risk modelling may be used to enhance the decisions that Child Youth and Family makes on the frontline. But that will be after abuse is suspected—worlds away from the proactive model the research team proposed which can identify children at risk early—more than two years before it occurs—and can allow for preventive support and intervention.”, which these can actually access.

What this bill proposes is worlds away from the proactive model that the research team proposed, which can identify children at risk early so that these issues can be addressed much earlier on. Beneficiaries are being rated within the Ministry of Social Development’s predictive risk model framework for the risk of long-term welfare dependency, but they are not being told that they are being rated or, indeed, what the grounds of this rating is actually based on. They have a right, I believe, to this information, and they should be given a chance to ask questions and the opportunity to challenge the assumptions that are being made about them. They are, effectively, being researched without any information on how the research is being undertaken, the way in which information might be used, or the implications that it could have on the supports that they are likely to receive.

The Minister for Social Development and her department ignored the most basic ethical procedure with regard to gaining information from participants, which is to obtain their consent. Given the fact that the majority of the so-called high-risk young people are going to be Māori and Pacific and those from low-income families, the question I would like to ask the Minister is: has her department taken into account how it will use this tool to rate and then to measure the cultural components of how it might affect Māori and Pacific groups? All of the young people in this country deserve a better future, as well as to have equal opportunity for everyone to achieve.

My colleague from the other side Matt Doocey also stated earlier on that this bill is important because it is about transitions and it is about supporting our young people to transition during their life course. Well, right now, too many of our young people are transitioning into “neet”—not in employment, education, or training. In fact, about 70,000 of our young people under the age of 24 are currently not in employment, education, or training. That is way, way too many, and it is an issue that this current Government should actually address.

This Government talks a lot about being aspirational. Yes, that is right—we also agree that our young people should all be aspirational—but how about ensuring that many more of our young people actually leave high school and are actually able to have literacy and numeracy skills that would enable them to get better jobs and to get ahead in life?

We, as I stated earlier on, are supportive of this particular bill, but we have major reservations moving forward with it. Thank you.

It is a pleasure to rise and take a call on this bill. It has been a pretty entertaining afternoon. We have heard people with hearing problems, unfortunately, it seems, who have been picking up wrong numbers. I am going to correct them a little bit on that. I will sort that out for them as I go through this speech.

I particularly want to talk about this programme in the context of everything else that this Government is doing. This programme, again, shows the commitment of this Government. This bill reflects the plans and the ideals behind this Government in wanting to help our young people who need help the most to be able to achieve goals, dreams, and aspirations. I am aspirational. I want to see our young people succeed. I want to see them achieve everything they are capable of doing, and that is exactly what is behind this bill. It is not paternalistic; it is empowering, and I will talk about that further as we go through.

When new programmes are introduced, as this initial programme was back in 2000—whenever it was—

💬 Fletcher Tabuteau: 2012.

2012, thank you very much. That is exactly when it was introduced. It is important, before you make any changes or tinker with it at all, that you assess these things before you make a judgment. It is appropriate. We have had some early assessment done on this programme. It has been really interesting that it has been talked about already this afternoon that perhaps we should wait until this big longitudinal study is done so that we can find out what the long-term effects of this programme are, before we do anything else with it. It just seemed bizarre to me, considering that this is a programme that is, hopefully, going to help our young people for many years to come. We should ensure that we are assessing as we go. That is exactly what was done in 2014 with this Youth Service evaluation report that was done by the Ministry of Social Development.

Let us look at some of the key findings within that. What we discovered was that in the first 12 months of enrolment in the Youth Service, young parent payment participants were more likely to gain National Certificate of Educational Achievement (NCEA) credits. Well, I think that is a pretty positive thing. I think it is important that we have things in place that are going to help our young people get more NCEA credits. Our young people, who are participants in this programme, are more likely to meet the requirements of NCEA level 2 in their first 12 months within this Youth Service. We have been able to look at that. We have been able to see that that is occurring, and everyone would agree, I am sure, that the more young people we have within our communities who have NCEA level 2, the better their opportunities are for success, the better their opportunities are for meaningful employment, the better their opportunities are for being able to raise their children in a way that they will be proud of.

It is important that we recognise that this programme has been working for our 16 to 18-year-olds. There has been a little bit of talk around this House about people being out of touch and not connecting with young people. Well, I can say that I was privileged, along with the Prime Minister, to visit one of our community service providers a month or so ago, and it was actually quite interesting to talk to a young woman there who has been a part of this programme. She was somebody who had a young child. I think she was about 17 years old, and she was working her way towards getting her level 2 credits. I thought that was fantastic, because in the past often somebody in her situation might have been sitting at home, not because they wanted to but because they lacked the support around them, they lacked the encouragement, and they lacked the resources to be able to get out and get on and move forward with their lives. But what was most encouraging about speaking to this young woman was that level 2 NCEA was not where she was hoping to stop. No. This young woman, having been in an environment where she was seeing early childhood educators working, was absolutely committed to wanting to further her studies to become an early childhood educator.

When we talk to these people, when you get alongside them and you find out the positive impact that programmes such as this are having on them, it is fantastic to hear. It is encouraging to hear and it gives us the motivation and the interest to say “Well, if it’s working for this group of people, why don’t we look at helping out some more people as well?”, which is exactly what we are doing by extending this programme through to 19-year-olds as well. I think we need to remind ourselves whom it is that this programme is for. This is for those parents who are in the age bracket that we are talking about, and we are also talking about 18 and 19-year-olds who are considered at significant risk of long-term welfare dependency.

I heard Sue Moroney talking, and the words that she used before were that we were sort of going to shift some blame on to these young people. We are not blaming them for the situation that they find themselves in, but what we want to do is we want to empower them to be able to have the skills and the education and the support to be able to get out of the situation that they find themselves in. There has been talk about putting labels on them and how this is not fair. It is a crazy situation to be in. It is like people are saying that because you cannot do this for absolutely everybody, you should not do this for some people.

What we are doing is identifying those young people whom we think are going to have the longest-term risk of being on a benefit for a long period of time, to make sure, where possible, that that is not the outcome they are looking for. There are not too many young people whom I have come across in my experience in youth work and in working with young people who have told me that their aspiration is to be on a benefit for most of their lives. It is not what people aspire to do. So we are going to put these programmes in place to help them. As with the current service, young people who are referred to the service are going to be required to undertake budgeting courses and have budgeting conversations with their youth coach.

Yes, there are some obligations on them. I think that is not a bad thing sometimes, when people do have a few obligations that they have to meet. But I think—and this is the sad part; hopefully, Sue Moroney will listen to this before she leaves, because she said that the $10 to $30 a week that they might receive was laughable—

💬 Sue Moroney: I raise a point of order, Mr Speaker. I know the member has not been here long, but the reference to someone’s absence from the Chamber is not acceptable in his speech.

The ASSISTANT SPEAKER (Lindsay Tisch): No, what he said was “before the member leaves”. He did not say that you were absent. You would be right if that were the case.

If I have caused some offence by that, I apologise. But this is the important thing that I want to draw attention to. Sue Moroney said that the $10 extra that somebody was going to get was laughable—her words. Well, I can say that when I was raising a young family while I was on the student allowance, when I spent some time in our family when we were trying to have a couple of young kids and we were on a sickness benefit, if someone had said to me “Here is an extra 10 bucks a week.”, I would not have found that laughable. I do not think that the beneficiaries in our community now would actually find it laughable to be getting an extra $10 a week. If you are struggling to get by on a week-to-week basis, when you are struggling to pay for groceries, when you are struggling on a benefit, because we all know that it is not an easy thing to do, when you are trying hard to budget—if somebody had said $10 was laughable, I would have found that insulting. I think those people would find it insulting that the member who has referred to it in that way was so out of touch—so out of touch—with the plight of the people whom we are talking about.

I know my time is almost up, but I just want to come back to this last point. This is a cost-effective programme. We know that for every dollar spent on the existing Youth Service, taxpayers’ liability is reduced by $2.53. Eugenie Sage, when she was talking earlier, sort of talked about this in a way that was, perhaps, negative. I cannot understand how somebody would think that investing now, up front, to be able to save the Government money in the long term, is negative. And she talked about it like the Government was trying to save its own money. Well, I am sorry, but we do not have our own money. The only money we have is that money that has been given to us, sometimes not particularly willingly, by the taxpayers of this country, and it is beholden on us to make sure that we invest that money, that we spend that money, in the way that is going to deliver the very best outcome for those people.

As I said earlier, I am aspirational for these young people in our communities. I want to see them do really, really well. I think they can do more, and I think that we can get behind them with these youth services. By expanding the youth services out to include those 18 and 19-year-olds who currently are missing out on the ability to be able to participate in this very, very good programme, we are helping more people. We are not blaming people; we are not looking down on people. We are empowering them, and I really look forward to us helping more and more of them. Thank you.

It is a pleasure to rise this afternoon. It has been an interesting debate, and I propose to add to it. We, as my colleagues have already stated, will support the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill through to a select committee. We do that with some trepidation and a lot of concern, but we think that the best place to examine this further is at a select committee. There are some good things in this bill and, as I have said, there are some things that we are very concerned about. My overall comment on this is that, although the age of eligibility has been increased to 19 years old by this bill, it also seems that the Government is raising the threshold for qualifying for these services.

I turn my attention to the regulatory impact statement. In point 87 it refers to the statistical risk model. In point 88 it states: “The risk model is purely a statistical tool so cannot include all factors that determine someone’s risk of remaining on benefit (eg gang affiliation or the presence of tattoos on the face may affect the chances of a person finding employment but cannot be captured by a risk model). However, additional factors such as these will be able to be added manually by Work and Income case managements or Youth Services providers to indicate that a young person is at greater or lower risk than the risk model might suggest.” I think that we need to examine that really closely. It relies on the judgment of a Work and Income case manager, and I think that more and more the feedback that I am getting from that sector is that the caseworkers are having to carry out the role of social workers and they are not appropriately qualified as social workers. I think it would be much better if this work were carried out by a social worker. There should not be judgment. They should be robust assessments by an appropriately qualified worker, and I think this process is flawed and it needs to be examined more closely.

I think also I am bound to ask the question, and probably answer the question as well, as to how this fits with the Government’s Whānau Ora policy. To me this is in direct conflict with the Government’s Whānau Ora policy. Let me explain. If we were applying a Whānau Ora model to making an assessment of all the benefits of these young people, you would include the entire family, and you would ask about the aspirations of that family, not make judgments based on what a young person looks like, because that is what this regulatory impact statement is saying. We are going to look at the person, and there might be some things that are not captured within this statistical risk tool, and that Work and Income worker will then make a judgment on whether that person is actually a low risk or a higher risk, and then from that judgment determine whether they will qualify to participate or be required to participate in this programme or be excluded from it.

The Whānau Ora model, the Government’s policy that I am talking about, says that it ought to be about the family’s, the whānau’s, aspirations—how you would work with just part of the whānau, in this instance. As my colleague Jenny Salesa spoke about, most of the people whom we are talking about are Pacific Islanders and Māori—a great percentage of them. Until we get to the stage—and the Auditor-General pointed this out in her report as the failing of the Government’s Whānau Ora policy—where there is communication between Work and Income New Zealand and the social services, and as part of that Whānau Ora policy, then we are not dealing with the fundamental issues that affect the members of our families. I propose to the select committee that it look very closely at these issues. They are not simple issues to be resolved overnight, and certainly not by the bill as it stands at present.

My colleague Carmel Sepuloni also raised some very valid issues, which I totally endorse. The issues that the bill purports to address I think are only partially addressed. Of course I am also bound to comment on the level of payment. It is, as Carmel Sepuloni pointed out, more stick than carrot. I think that based on the members opposite and their contributions to this debate about the future savings within this bill, surely how it is helping those parents who are required to engage in education, which I think is a great thing, to be able to do that ought to be looked at. I think $10 is at the very lowest level that you could possibly have. I suppose $9, $8, $7, or lower would be even worse, but when you think about the costs that some parents will have to pay to actually get to their educational course, $10 is not much to assist them. I think that the select committee should explore that. Also the regulatory impact statement has got some cost analysis. I have not had a lot of time to dig too deeply into it, but it would seem to me that there is enough scope within the savings that will be made. As my colleague Jenny Salesa pointed out, preventing people from going to prison is going to save our country a lot of money in the long term. I think that $10 is very much on the low side.

I think also in respect of the requirement for someone to participate in this at the age of, say, 19 years and 8 months and someone who is at the age of 20, that there is a significant difference between what is required of the person 19 years and 8 months old and the 20-year-old person, in terms of the age of their child, as to when they then have to go to these courses. I think you cannot have a one-size-fits-all model, and there should be some transition between those ages. I think that the select committee ought to look at those as well.

Those are the main points that I want to make in this debate. I think there have been some comments made that are totally outside of this bill today, and I am not proposing to add to them. But I just want to say that we are actually talking about real people’s lives—real people who matter. I can think of a whole host of constituents in my electorate who will be affected by this bill, and I want it to be the best that it can be. That is why we are supporting the bill in its first reading.

Thank you for the opportunity to speak in the first reading of the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. As the last speaker in the first reading of this bill, I have had the privilege of listening to all 11 speakers before me. What shocked me is that Labour members compared people with cars. They have compared our teenagers with cars—a very insensitive, very disconnected approach.

I come back to the bill. Currently in Part 5, sections 156 to 180, of the Social Security Act 1964, the financial support that is available to young people consists of youth benefit payments for 16 to 17-year-olds with no children who have exceptional circumstances, and then there are youth payment payments for 16 to 18-year-old parents. This National Government is working hard to reduce welfare dependency. We know that when people fall into the trap of welfare dependency at a young age it becomes very hard for them to come off the benefit. That is why we are interested in working with this age group. This bill is to help this age group by extending the maximum age of eligibility for youth services from 18 years to 19 years.

How it works is that when a person receives a youth payment, that person is automatically referred to a Youth Service provider and is linked up to a youth coach. The aim of this bill is to amend the Social Security Act to implement extensions to the Youth Service. In particular, the bill extends the existing youth services to all beneficiaries 19 years of age or under with children, and to 18 and 19-year-old beneficiaries who are considered to be at significant risk of becoming long-term beneficiaries.

Youth Service providers provide support to these teenagers to help them build the skills that are required to get into jobs. We know that our youth services are giving us really great outcomes. As per the March 2015 numbers, 86.5 percent of youth enrolled in the Youth Service were engaged in some kind of education, training, or work-based learning. This is an increase of 10.4 percent when compared with the same time last year. In terms of numbers, this is an increase of around 1,000 people, so it really is a great outcome, which shows that these teenagers are responding to the support and services that are available through Youth Service providers.

This bill is to extend these youth services to 19-year-olds. This is to provide that support, which is much needed during those years, to get back into education or into employment. We know that the pathway to success is education and work. Welfare is there for those people who really need it, those who are in real need. The general expectation is that when people go on a benefit they are continuously looking for job opportunities, and as soon as they find a job they get off the benefit. But this bill is to help those people who are at a higher risk of going on a benefit for a long period in their life.

We know that by extending these youth services the cost will go up. It is estimated that the cost of this will be somewhere between $10 million and $15 million. This is going to help about 4,000 teenagers on a benefit, which includes 1,200 19-year-old teen parents. So, yes, the cost is going to go up, but in the long run it is a good investment in the future and it is a good investment in our teenagers. This is going to save taxpayers money in the long run, as it is estimated that for every $1 that is spent on youth services, New Zealand’s long-term financial liability reduces by $2.53. We cannot have our teenagers hanging out on street corners causing social trouble, or being on a benefit, or developing mental issues because they do not know how to cope with their circumstances and they do not know how to come back on track. This is also going to help us reduce intergenerational welfare dependency, as it is a general observation that those children who grow up in families where caregivers or parents are dependent on a benefit are highly likely to be reliant on a benefit when they grow up.

The best part of this bill is that there will be activity obligations for these teenagers. That includes going back into education to work towards National Certificate of Educational Achievement (NCEA) level 2, and taking up a budgeting course that is to help with managing their money. They will have to take a parenting course as well, and they will work with their youth coach to pick a parenting course that suits their needs. As a result, if they meet all of these obligations, they will receive an incentive payment. They are subject to controlled payment, so money goes on to their card and that card can be used at any approved grocery store to buy food. Rent or boarding and the power bill are paid directly. There is an allowance that is handed to these people, as well. Another great thing about this bill is that if there is any money saved by someone on their card, that money will be handed over to these teenagers once they come off that money-management period.

In a situation where both spouses, or partners, are aged 19 years or under, they will be transferred to the youth payment, and they will be receiving youth services, as well. In the case of beneficiaries with children, they will be required to enrol their child or children with a primary health care provider so that the medical side of that is taken care of. Nineteen-year-old spouses and partners of other main beneficiaries who have children will have activity obligations, and they will be newly entitled to receive the incentive payments.

Those 18 and 19-year-olds who do not have NCEA level 2 will be assisted by these Youth Service providers to get into education and work towards achieving NCEA level 2. If they already have NCEA level 2, then they will be provided assistance to get into jobs. The Youth Service providers’ numbers show that the NCEA level 2 achievement numbers are increasing.

We know that these Youth Service providers work like mentors with these teenagers. This is like full-time mentoring, providing them help with budgeting, parenting, and also learning, getting training, and helping them to get into the workforce as well. We know that mentoring helps with social and emotional development; it also helps in the improvement of youths’ perception of parental relationships. It can also increase their chances of getting into higher education. These things all lead to increased self-esteem and self-confidence, and they do not have to rely on a benefit in their life.

These findings are consistent with neuro-scientific research that shows that the portion of the brain that is responsible for impulse control, analytical thinking, judgment, and future-orientation gradually develops throughout early adulthood. So young people in their teens do need this structure, care, support, and guidance during those years, so they can learn the skills that are required for them to get into education or get into jobs.

Generally speaking, when beneficiaries go on a benefit I do not think that they want to be on a benefit for their whole life. But once they are on a benefit for a period longer than they had originally thought, they start doubting their ability to become independent, and that is why this wraparound support is needed.

Our focus is on people. Our focus is on their better future. This bill shows that we are delivering on our promises. This is a great bill, and I support the bill. Thank you.