Families Package (Income Tax and Benefits) Bill

Mōrena e Te Whare. The House in committee is resumed for further consideration of the Families Package (Income Tax and Benefits) Bill. When the committee suspended last night, we were debating Part 1. The Hon Grant Robertson had the call, and he has 55 seconds remaining if he would like to take a call.

Mr Chair, the best 55 seconds of your day is coming up right now. The Working for Families tax credits are being extended by clauses 48 to 51 and clause 55 of Part 1. This will bring 26,000 families into Working for Families in the 2018-19 year, and then another 39,000 families in by the time this part of the package is fully rolled out. So to finish this part of my contribution, Part 1 of this bill introduces a Best Start tax credit that will make a massive difference to the 65,000 newborns born in New Zealand every single year. It will continue to be rolled out, targeting in years 2 and 3 those on middle and low incomes, and we will extend Working for Families. This part of the bill is a critical part of our families package.

Thank you, Mr Chair. I’m intending to make a few contributions around Best Start today, but some of my questions at the outset—I just want to understand the proposals a little bit better. Before I ask these questions of the Minister of Finance, I just want to state categorically upfront that every MP, no doubt, in this House wants to make sure that all families in New Zealand are in a position to look after their children in the best manner they can. So, with that in mind, I’d like to understand a little bit more about these Best Start provisions and particularly around the figure of $3,120 and why the amount has been set aside in clause 22(MG 2).

I think the issue—I referred to it last night, and I actually asked the Minister last night about why that figure was adopted in the bill. He rather—if I may say, with all due respect—glibly referred to a couple of reports that he underpinned the assumption to adopt $3,120, namely the Children’s Commissioner report and also the Dunedin Multidisciplinary Health and Development Study, which, no doubt, shows a lot of information around the benefits of supporting children at an early age. I don’t think there’s any dispute about that.

But that wasn’t the question—that wasn’t the question. The question is not whether young children should be supported; the question is: why $3,120? Why not $3,000? Why not $5,000 or whatever? So the question is: what was the evidence? What was the basis or rationale for that figure? Bear in mind that this Best Start package is worth $1.4 billion over the next 4 years or, in other terms, 25 percent of this total Families Package that the Labour coalition Government’s putting forward. The first thing is: is the $3,120 consistent with the Labour policy, the Greens policy, and the New Zealand First policy? Where’s the rationale for all this? Is this a figure that’s just suddenly being plucked out of the air?

But the other thing, and I did refer to this last night, is that when you look around the world for other examples of where these types of proposals are being put in place, of course, Australia, being our near neighbour, is a classic example. As I noted last night, when the scheme was initially put in place in Australia, it started at $3,000 and then it was progressively increased to $5,000 before it was scrapped by the Labor Government in Australia in 2013-14. One of the issues that led to that scrapping of that scheme after just a few years was that the mechanism—and I’m going to ask another question about that separately, but the issue was that the actual assessed cost of having children, undertaken by the renowned Henry tax review, showed that the cost was substantially less than what was in the scheme. That led to one of the reasons why the Labor Government scrapped that scheme, as I said, and reverted to the more traditional families package they have, although it’s termed slightly different in Australia.

So here we are in New Zealand. We’ve got a Labour Government adopting this Families Package, which we know failed in Australia, but, underpinning it, we do not know the basis of the $3,120. It’s easy. I’ve looked on Google and I’ve looked at a number of cases in New Zealand and overseas about the costs of raising children, and, of course, it varies quite substantially. Particularly in New Zealand, it showed quite a large difference between those on a low income, and what they’re prepared to and have to spend on their children, and what it does for wealthy families. Again, that’ll raise another question we’ll talk about later.

But one of the most common things, the most agreed thing, when you look at the cost of raising children, the single conclusion that you can draw is that the cost of successive children reduces over time. So I am absolutely keen to understand what analysis underpinned the Minister of Finance’s reasoning to pay the $3,120.

Thank you very much, Mr Chair, for giving me the opportunity to take a call on this stage of the bill. I want to raise a few questions that perhaps the Minister of Finance will be able to answer and address in due course, around this Part 1 of the bill.

Firstly, I want to focus on the calculation of children lifted out of poverty and the various numbers that have been pushed around as a result of the Best Start approach and also the increases to Working for Families. As we know, most of the increases to Working for Families were done by the previous Government through the original Family Incomes Package. Of course, the accommodation supplement changes were a very significant part of alleviating poverty, and that was also done by the previous Government. The calculation—I assume that we’re using the same database that was used at the time—was that it would lift 50,000 children above the OECD definition of 50 percent of median incomes by 1 April 2018. So, effectively, that was to happen straight away from 1 April 2018 as those things and the lifting of the low-income tax threshold took place at that time.

Labour have talked of a couple of numbers that they say their package will address, but the dates are quite different. Now, obviously they weren’t going to achieve anything by 1 April 2018 because it doesn’t start by 1 April 2018, but then they talk of achieving 88,000 by some point in 2021, I think, which I presume is 1 July, or 30 June 2021. But that actually, of course, includes a number of things that are occurring or are predicted to occur at the same time as this package beds in, particularly, of course, the continuing lift in incomes, and the increase in employment and so on that has a significant impact. So we’re not actually comparing apples with apples in this case, and I think—and the Minister might choose to address it at some point—the Minister’s listed another number, which is 71,000, which is apparently going to apply at some point in 2019. So, again, we see we have a continuum of numbers. We have our number of 50,000, which was going to apply from 1 April next year. We have a 71,000 number and an 88,000 number three or four years hence.

So from 71,000 to 88,000 presumably applies to both parties’ packages, because the income and the employment continues to rise in the economic situation that is being laid out both prior to the election and since the election. Then, on top of that, the National Government had scheduled a second Family Incomes Package in 2020, which would target—as was said before the election by Bill English—another 50,000 young people at that time. Of course, we now know that Mr Robertson has no money for that—he actually doesn’t have money for lots of things—to be able to repeat the same programme of his in 2020.

💬 Hon Andrew Little: You had none either. It’s all on the never-never. It’s all you ever do.

Perhaps Mr Little could start by taking his pills. So we have an issue of comparison, and, actually, if you do the comparison properly, it is more than possible, in fact, probable, that the National Government’s programme would lift more children out of poverty than this Government’s programme—more children out of poverty. So that’s something that we will want to continue to unpick, because if I may get into the mechanisms by which that’s done, it’s not immediately clear how providing three thousand and something dollars to people on very high incomes actually helps alleviate poverty. And I do want to address that part of the calculation because the lifting of the threshold of Working for Families also doesn’t actually target that group of people at the lower end who are affected by poverty. So you look along the list and there’s not much in that package beyond what the previous Government was doing that is actually going to contribute to alleviating child poverty—the stated aim of the Government.

I think that’s one of the issues that this side has with the package: it doesn’t appear to be well-designed or coherent compared to the stated objective of the package. That’s something we need to focus on, I think, in this House. We will submit over the course of the day other things that may achieve more—other things that may achieve more—for poverty. For example, one of the things that the Government is cancelling in this part of the bill is the lifting of the bottom tax rate—the bottom tax threshold—from $14,000 to $22,000. That could hardly be described as a hard right move—lifting the bottom tax threshold from $14,000 to $22,000. You couldn’t actually turn around and say that that’s a really nasty thing focused at the top end of society. That’s literally trying to improve the rewards for work for people who actually get the least money from work.

That’s the bit I don’t understand. How is it that this Government has forgotten the link between work and income? Actually, this Government has, after stating how important it was to lift the linkages, to improve the linkages between work and income, to get more working people to have the opportunity to see more from their work—the first thing they do is take away some of that linkage, some of that improved linkage. They take away the improved tax rates for people at low levels of income and they take away the tax benefits for people on median incomes—for the sort of people that Andrew Little used to represent back when he was a unionist and cared about them. Those people are missing out through this package and they have—

💬 Hon Andrew Little: You’ve done nothing for them. They saw their wages going down.

Well, you’re definitely doing nothing for them, Mr Little. You’re doing less than nothing for them by cancelling the tax threshold changes that would improve their lives. Cancelling those—that’s less than nothing that the new Government is doing for those people, less than nothing. That’s actually what this committee has to face today: we are dealing with a package that, yes, provides more money to a group of people—and Mr Robertson is fond of saying it’s 70 percent of a certain type of family arrangement. Fine; but what about the people who don’t qualify? They are not just being left neutral; in the course of this day we are planning—if the Parliament agrees to take money off those people from 1 April next year, we are literally saying to those people, “No, your work does not qualify you for more.” We are saying that those people shouldn’t have more.

So we will be presenting some alternative options to the Government through the course of the day when we say, “Actually it is important that you recognise that these people are moving into higher levels because of bracket creep, because their incomes are growing.” I mean, median incomes have gone up around $10,000 since 2010. I know it’s not something that the Government likes to concede—

💬 Hon Andrew Little: But it’s just not true.

But it’s true, actually. Well, Mr Little, I suggest you go and digest some statistics books for breakfast, which would have a dual benefit: you’d learn something and we’d have a quieter time in the Chamber while you’re digesting the books. But that $10,000 means that people move into higher tax brackets and they end up paying 30c in the dollar, and, as we discussed last night, people on the median income are now paying around $800 or $900 a year more tax than they were six or seven years ago, and this Parliament needs to address that.

The failure to address that—if we walk away today having undone an attempt to address that—then, effectively, the Parliament is saying to those people “Your work is not valued. The way you live your lives is not valued, because we’re not actually valuing your type of living arrangements—whether you’re a single person, a young couple starting out, you’ve got grown-up kids and you trying to pay off your mortgage and perhaps support one through starting their own small business or whatever, then we don’t value that. The only thing we value is this narrow group over here, which we all value.”

Actually, the previous Government has done most of the work of lifting children out of poverty. This Government has just added a little bit to it and rebranded it. It’s a bit like the housing programme: rebranded it and called it their own. That’s what they’re doing.

But we need to address this fairness issue and we need to address this issue of balance across the different groups in society, because everybody’s worked to deliver the strong economy that this Government has inherited and they all deserve some say and some benefit from it in terms of their lives.

Mr Chair, I think it’s appropriate that that Parliament does take a reasonably long period of time to discuss this particular part of the bill—the parts that are going to be proposed for insertion in the bill—and then, ultimately, the next part. The bill itself is one that New Zealanders need to understand a lot better, and beyond the headlines that I think have been quite skilfully created over the last 12 to 24 hours or so. Essentially—essentially—this is the Labour Party rebranding what is already in the law when it comes to the Families Package.

I just need to respond, if I may, to the interjections made by the Hon Andrew Little and Mr Greg O’Connor. So, working in reverse, Greg O’Connor is over there saying, “All your mates don’t pay tax. They don’t pay tax.” Well, firstly, I think that apart from that being a dreadfully prejudicial statement to make and, essentially, a nasty and envious, envy-based statement, the reality in this country is that the vast majority of tax is paid by the higher-earning part of the tax base, and if it were not for the extraordinary revenue picture, I say to the Hon Andrew Little, then this Labour-led Government would not have the funds necessary to enable this package.

The fact is there is a very stable and sound economy working in New Zealand at the moment and providing significant revenue to a Government, and it is this Government that has decided that, somehow, those who are contributing most to it are the ones who should be punished the most. So all of those people out there who have no children under the age of 18—young people who are trying to save up to get a first home, essentially—get absolutely nothing out of this package. What is being overturned is a law that was saying to all New Zealanders who are in work that it was a good thing that those people kept more of the money they earn. Therefore, it was a pretty minimal tax reduction for those people, but it was significant in each case because it allowed them to do those things like save for their first home, or whatever it might have been, in addition to the efforts they were already making.

That goes as of the passing of this bill, and where it goes to is a suite of payments that are being touted as universal but that—as one of my colleagues will explain later in the morning—comes with significant terms and conditions. We all hear those ads on the radio that sound great and say, “Let’s get along to one of these appliance places”—or wherever it might be—“and buy at a hugely discounted price.”, and then at the end they say, “T’s & C’s apply.” Well, this is very much the case with the programme that’s been laid out. Mr Robertson sits in the Minister’s seat, smiling away, knowing that he’s got fine print all through this thing that won’t work well for a lot of people.

So, going back to the fundamental question here about the—no, no, there are lots of fundamental questions. The fundamental question I want to have addressed, as Mr Bayly has already raised—and has had no answers on this—is: how did the amount for the Best Start get selected? Why is it not a round number? Why is it not a higher number? Why is it not a lesser number? How is it that the magic number—well, there he is. He just says, “I plucked it out of the air and decided to put it on the bit of paper.” When you look at the Treasury advice that was given on this, then of course all they say is, “Oh well, that’s the number, because it was part of Labour’s 100-day programme.” Now, that is a justification, apparently, for this huge expenditure.

Couldn’t there have been a mention about the fact that it is believed that it will help young couples as they get established as a family, having been single prior to that time, or as they bring a new child into their family? Those sorts of justifications might be a good thing to see, to know that this Government works on a little bit more than just—as we saw from Mr Robertson’s gestures—plucking all sorts of things from the air.

So as we progress through the morning, I hope that we do get answers to that. I think the bill can be enhanced by some of the parts that the National Opposition will be putting on the Table. They will all reflect what our policy is, and I’m sure—[Time expired]

Thank you, Mr Chair. Well, what a cheeky and quite confused lot we have over on the other side. For a start, we had a contribution yesterday that suggested that a strong Labour Government enabled these benefits to be increased, that all of this $5.5 billion package was due to the fantastic governance of the three-way coalition Government. What a lot of nonsense. What a lot of nonsense.

The funds that are available to be distributed to those in need are a direct result of the previous National Government building surpluses over time, which are enabling and giving the privilege to Mr Robertson to distribute hard-earned taxpayers’ funds to those that need it most. But they haven’t done that. They haven’t even done that. They have not distributed to those that need it most.

The Best Start tax credit is available to anyone who has a newborn child—anyone. And look at them: they do not like that point. Finance Minister, can you answer this question: why are you giving this money unnecessarily to those that do not need it? Why is that? The reason I heard the Minister say earlier is that it is because it’s needed. It’s needed.

It’s very expensive, and I know it is very expensive, to have kids—I’ve got plenty of them. I’ve three of my own, and I picked up three on the way, so I know the cost of having children. I know the cost of having children, and I can tell you, Mr Robertson, it is not the zero- to three-year-olds that are the most expensive. It is certainly not the zero to threes that are the most expensive. Mr Robertson, if I could have more kids—and I can’t; well, I could, but it would mean a reversal—but if I could, and if I did, I would not need the tax credit. Thank you for the offer, Mr Robertson, but I do not need it, because I earn $160,000 in this place, and it is just ridiculous to suggest that we here, if we have newborn kids, need this money. So it’s not needs-based, as the Minister suggested in his last contribution late last night; it is a universal benefit that is absolutely unfair to those that do need it most.

So my question is, why not take it from those that don’t need it? I don’t know where you might want to cut off the threshold—is it the average wage or the median wage? Willie Jackson might know the difference between those by now; I’m not sure. Or is it $79,000, which is a number that’s also somewhere in this bill? Why not cut it off at some point and give it more to those that need it most?

It’s interesting that we’ve been talking about universal benefits. The Labour Government is voting against, essentially, a universal tax credit of $1,060. They’ve cut it, right. They’ve cut it. So they’re against the universal tax credit—and it’s fine to take that stand. I’m against the universal baby bonus. But the difference is that the baby bonus is taking money from people who are hard-working Kiwis and giving it to people who don’t need it. Hard-working Kiwis—1.2 million of them—are not benefiting at all out of this package. They pay tax and they, essentially, will be giving their hard-earned tax money to people on high incomes. That’s not on and that’s not fair. The fairness in the universality of the $1,060 is that it is their money. This is what the Labour Government’s forgotten—that it is the taxpayers’ money that we’re dealing with here. Hard-working Kiwis, $1,060—why can’t they keep it? Why are they not able to keep it? Why should they not be keeping it?

I’d like that question asked as well. Of course, we’ve talked about the universality of the free tertiary education—another problem.

The CHAIRPERSON (Adrian Rurawhe): That’s not in Part 1 of the bill.

Yep, fine, fair enough. My main point here is the universality—[Time expired]

Thank you, Mr Chair. I want to talk about the muddled—quite frankly—elements of unfairness in the targeting that is in Part 1. Before I move on to that, I’d just like to make a comment on comments my colleague the Hon Gerry Brownlee made when he suggested that Mr Robertson had plucked figures for Best Start out of the air. Well, I’m very sorry, Mr Brownlee, but I don’t think it was the air that Mr Robertson plucked those numbers from.

Also, Mr O’Connor was making a comment about—which I think was a scurrilous accusation, but none the less. He was making allegations that, through rebates at university, the rich were getting a far better deal for their kids and were rorting the system. Well, if that is the case—and I don’t actually believe it to be the case, but if it is the case—how could that member, in good conscience, and in supporting and representing the good people of Ōhāriu, and if he actually believes that, how could he possibly stand with a Government that’s going to give one free year of tertiary education for everyone, irrespective of income and circumstances? I suggest that that man have a single standard for his behaviour, not multiple standards.

This bill does some targeting in some areas, and lacks targeting in others. For instance, the Best Start payment itself is not income tested for the first 12 months. So whatever you earn, if you are Bob Jones—and he may well be still capable of fathering another child—you would get the Best Start payment. The Rt Hon Bill English, I’m sure, is capable, and he would also get that payment. So that, in that sense, is universal. All you have to do is have a child. What your individual circumstances are don’t matter. But then, in Part 1, the Government is making some targeting choices that I want to talk about, because I believe very strongly that they are deeply unfair, and, quite frankly, unfairly discriminative between people in different circumstances.

So the nature of Best Start is that, even within that first 12 months, if a parent is receiving paid parental leave, they will receive the paid parental leave instead of the Best Start credit. At the end of paid parental leave the Best Start credit will then continue through until three years of age, but after 12 months is subject to some income testing. Well, not all new parents are in circumstances or are desiring to take leave. Some of them see work as part of the appropriate circumstances for themselves and for their families when they have a newborn child. For some years, the parental tax credit has been available for those families. It was some years ago that it was eight weeks; the National Government changed that to a 10-week eligibility. Well, this Best Start is going to replace that entirely. So we increased the value and the duration of that—it’s now worth $220 a week for up to 10 weeks, as a credit. This Government—this mean-spirited Government—are replacing that completely with a $60 a week payment.

So basically, if you are a new parent or a family and you determine that what is right for you or right for your family is to remain in work, then the Government is saying you get almost nothing—that you are of less worth to them than a parent or a family who chooses to take Government-paid leave. I think that’s absolutely disgraceful, quite frankly. I think they are passing judgment on the circumstances that are for individuals and families to determine, and they are, effectively, saying that your choice for one set of circumstances makes you more valuable and worthy to this Government than if you remain in work for that period of time.

Clause 17 makes a very simple change to the Income Tax Act 2007, which basically says that if you have a child after the end of June next year, then you are not eligible for parental tax credit. So they’re basically saying that Best Start will replace it—you’ll be on 60 bucks a week instead of 220 bucks. That is quite significant for families in those circumstances. It’s only a 10-week period, so I have questions for the Minister of Finance that I want to ask—and I’ll seek another call—and that is: why? Why do you treat these—[Time expired]

Thank you very much, Mr Chair. After half an hour of fairly repetitive contributions from the National Party members, I thought I’d respond to some of the questions that were asked—and they have all been pretty much on the same theme, which is around the question initially of Best Start and why the figure was set at $3,120. Well, that is $60 per week multiplied out for the year. Mr Brownlee was concerned it needed to be a round number; that number of $3,120 emerges from a round number of $60 per week.

💬 Andrew Bayly: Well, what’s the basis for 60 bucks?

That was assessed as an amount that would be a useful additional contribution to the outgoings of New Zealanders. It needs to be balanced against other requirements within the Government’s budget, and the $60 is the accurate balance, Mr Bayly, of what we do to make sure we can improve the lives of New Zealanders.

So, yes, the Best Start payment is universal for the first year—to respond to the questions that were asked about that by Mr Bayly, Mr Joyce, and Mr Brownlee. The Children’s Commissioner’s Expert Advisory Group on Solutions to Child Poverty recommended a payment for children in the early years of life with a maximum amount in year one for everyone. So we’re using—

💬 Hon Steven Joyce: But why? It’s not enough just to say they said it.

Well, on this side of the House we believe that actually bringing experts in and getting evidence from experts is a good way to make policy, and so we have drawn our conclusion from there.

Mr Joyce and Mr Bayly all raised the question of the difference in terms of the number of children lifted out of poverty, and I do want to respond quite specifically to those questions. So just to get it absolutely clear: 71,000 children—

💬 Hon Steven Joyce: Ah! Why didn’t you put that in the press release?

—will be lifted out of poverty in 2019, representing a reduction of 44 percent. The comparable number, for Mr Joyce’s benefit, in the package in the Budget 2017 Families Income Package would have had 55,000 children—a reduction of 34 percent. So there’s a significant increase in there.

But there is an interesting point to note, which is why it’s important to look at what happens when the package is fully rolled out. So under the package in front of us in the bill today, 88,000 children will be taken out of poverty, representing a 58 percent reduction. When we look at what would have happened under the previous Government’s package by the time we reached 2021, we would have seen a reduced then of 49,000 children—in other words, going down—and the percentage of children lifted out of poverty would have been 27 percent.

💬 Hon Steven Joyce: No, no, I don’t trust that calculation at all.

That calculation is based, Mr Joyce, on the fact that, actually, as incomes rise you have to do a little bit more. So let’s be absolutely clear, comparing apples with apples exactly, using exactly the same measure—when our package, which is covered here in this bill, is fully rolled out: 48 percent reduction, 88,000 children lifted out of poverty. The previous package, when fully rolled out: 49,000 children out of poverty, 27 percent. So to answer the questions asked, a demonstrably better package across the board.

I want to respond to Alastair Scott’s questions that he asked, essentially about why the decision has been made in this part to reverse the tax cuts and focus more on children. Well, that actually is a philosophical decision. I absolutely own the fact that that is about this Government’s desire to improve the well-being of children. We have focused this package on families with children. I absolutely understand that members on the other side of the House may not support that, but that is the decision we have made because we want New Zealand to be the best place in the world to bring up kids, and we will redirect resources to be able to support children. So I congratulate Mr Scott on seeing that difference and identifying that difference, and that is my response to his question.

We had a series of repeated questions from Brett Hudson that built on questions that have already been answered around why Best Start is universal. We should be proud that we are returning to a benefit like the family benefit that many of us grew up with—universal in year one, and then means-tested on in years two and three. This is a proposal supported by evidence.

Thank you very much, Mr Chairman. I notice that the Labour Government has called it a “Best Start” package, and I think it’s because they haven’t had one themselves, so they’ve had to come up with a name that helps. But I’ve got a few questions that I’m keen to ask today, and it’s to do with taxpayers, because I’m standing here today on behalf of the taxpayers in my electorate who get nothing—nothing—from this package.

I’d like to speak in favour of an amendment in the name of the Hon Steven Joyce, who is proposing an amendment to the tax rates to increase the bottom threshold from $1 to $14,000 for a 10.5 percent tax rate to $20,000. Those who don’t have children—those who are just earning income and don’t have any responsibilities, or any children—get nothing from this package. What I am arguing for today, and asking the question, is: when will inflation and tax creep be addressed by this Government—when? They have removed the tax cuts that National had put in place in this year’s Budget, which were to address the issue of bracket creep to ensure that people aren’t having money taken off them because of inflation.

This mini-Budget could be called “spray and walk away”, because they’re taking money off hard-working New Zealanders and just spraying it around the place—giving money here, giving money there, and then walking away. But people who have been paying taxes are getting nothing out of this.

In 2010, people on the median wage paid $7,325 in tax; they now pay $8,020. Under National’s changes, that would drop to $7,210. And I’m not talking about rich people here; I’m talking about people on the median wage of $50,000—$50,000. Now, if you think those people are rich, I think you need to have a bit of a reality—Mr Chairman, I apologise. I shouldn’t bring you into this debate, and I do ask that you accept my apology. Please forgive me as a new member. Members opposite, if they think that $50,000 is a large wage, then I think they need a bit of a reality check and to maybe spend more time talking with some of their constituents. In 2010, people on the average wage were paying $9,137 in tax; now they pay $10,972. With National’s changes, that would drop to $9,912. When is this issue of bracket creep going to be addressed?

The other issue is: why not give a tax cut rather than having a complicated independent tax credit? Why not give a tax cut so that people don’t have to go through a complicated process where they have to apply to get this? We know the statistics: 60 percent of people in total were actually making this application. So what you’re seeing here—

💬 Hon Member: Wrong—80 percent.

Oh, is it less, is it? [Interruption] Sixty percent.

What we know is that a large proportion of people who were entitled to this tax credit were not applying for it. So why not give these people a tax cut by increasing the bottom rate, the bottom threshold, and ensuring that they can get that automatically, that it’s a fair, simple system, where they just simply don’t have that money taken off them in the first place, rather than have to file a return and go through some complicated bureaucracy, to then go through this.

But that’s what the other side like. They like complication. They like inflation. They like bureaucracy. All it does is it means the Government holds the money back, rather than giving the money to people who earn it, who work hard, and who have worked hard and continue to do so, so that they can support their families. They can then make the choices as to how they want to spend their own money.

On this side of the Chamber, we believe that those who work hard, those who are seeking to get ahead, they deserve to have a tax cut. They deserve to not have inflation constantly eating away into their pay packet. They can then make the choices as to how they wish to spend that money in their own lives. Thank you.

Thank you, Mr Chair. I’m delighted, at last. Can I just say what an eloquent and intelligent contribution that was from a very capable new member of Parliament. Well done, Simeon Brown.

I was delighted, a moment ago, to hear the Minister of Finance take a call, but I have to say it was a very churlish call. I don’t think there’s any doubt at all that so far this morning what members opposite and those who are listening, either on their radios or televisions, will have heard is a very wide range of intelligent contributions across a whole breadth of topics relating to Part 1 of this bill. That is really impressive.

One of the things that’s been particularly notable is that, apart from Mr Robertson, we have been treated to a barrage of interjections while my colleagues have been making these intelligent points, and yet none of them have actually been seeking the call. So I would say to them, particularly those members opposite who, just seven months ago—just seven months ago—were voting in favour of the measures that the National Government was introducing in our tax measures of Budget 2017, “What has changed?” [Interruption] I look forward, Mr Patterson, to seeing you get up and explain how New Zealand First’s position has changed so much.

In his contribution, Mr Robertson, who seems to be having a little bit of a problem at the moment, actually failed to acknowledge most of the points that have been made this morning. A number of questions have been put to him, and I want to pick up on a question that was raised by my very fine colleague the Hon Amy Adams last night, which he certainly hasn’t given any attention to at all. That is, how on earth can this Government justify reinstating the independent earner tax credit of $520 a year while at the same time removing from a far greater number a far greater sum—approximately double that sum—which we have already legislated for? And now this Government is proposing to take it away from those New Zealanders who were really looking forward to it, and were appreciative of it—they clearly felt that way because they voted for it when they went to the polls in September.

I want that Minister of Finance to please explain that, and I also want to put to him a particular issue. He and I both represent urban marginal electorates. So, Mr Robertson, I would assume that the voters of Wellington Central and the voters of Hamilton West have quite a lot in common on this. I want to ask Mr Robertson, how many New Zealanders were not claiming the independent earner tax credit? That’s number one. Then I want to ask him how many of his Wellington Central constituents contacted him or wrote to him or came to see him after the Budget in May, to say, “Oh, this is appalling that the National Government is getting rid of the individual earner tax credit.” I can answer from the point of view of Hamilton West. The answer was not one. I can ask my colleagues, “How many of your constituents came to you with that?” Zip, absolutely zero.

What we can actually say is that a huge number of New Zealanders were not claiming the independent earner tax credit. Most of them didn’t even notice that it had gone and, more importantly, they were benefiting from the tax measures that we had put in place, which a large number of New Zealanders are now going to lose, despite this Minister of Finance claiming that this is a families package. It’s a “devil in the details” package, and it’s actually mean-spirited.

As we’ve already pointed out, this is the man who’s stealing Christmas from a large number of New Zealanders. I would implore him to recognise the fact that hard-working New Zealanders, particularly those on lower incomes, really needed that assistance and welcomed it. Many of them went to the polls and voted for it. It is just extraordinary that this Government, for ideological reasons, has decided to get rid of something—even though the Greens, and I’d be interested to know whether the Hon Julie Anne Genter or Chlöe Swarbrick are going to explain why it was such a good idea seven months ago, but now, no. Now it’s got to go.

As I say, Mr Patterson, and anyone else who might be here at the moment from New Zealand First, ought to be able to explain to us this complete about-face. When they spoke in the Budget—and let’s remember, it did create quite a bit of tension with the Labour Party. The Labour Party was saying, “Hey, hold on, you guys. You’re our mates. You can’t do that.” And they were saying, “Well, of course we can, because it makes sense. It’s a good idea. New Zealanders need it.” And we thought: well, good on the Greens and good on New Zealand First at that stage, for actually putting their kinship with the Labour Party to one side in order to support a measure that was really important.

Sir, I look forward to the Minister, when he next takes a call, explaining some of those things. But I also send out this challenge to all the members opposite, not one of whom has yet sought the call, to stop all the cackling and the barrage of interjections while members on this side are speaking, and actually stand up and explain how you’ve come to these very inconsistent positions.

Thank you, Mr Chair, for the opportunity to speak in the committee stage of the Families Package (Income Tax and Benefits) Bill. I tabled several amendments to the bill last night. Two of those relate to the abatement rates for the Best Start tax credit package—one of which is to align it with the family tax credit abatement rate, and the second is to align it with the top personal tax rate of $70,000, which is, of course, the rate at which you become a “rich prick”, according to Dr Michael Cullen.

But I want to focus my comments this morning on my other amendment, which relates to clause 22, new Subpart MG 2(3) of the bill. It discusses a person’s eligibility for the Best Start tax credit after the death of a dependent child. The bill as drafted at the moment cuts the eligibility for the tax credit less than a month after the death of a dependent child. I’d like to think that most members in the House wouldn’t have been through such a tragic circumstance as losing a child. Fortunately, I haven’t, but I’m conscious that my parents did go through that. It is, I think it’s fair to say, an all-consuming period of somebody’s life. It is one of the most traumatic things that a family can go through.

So my amendment is proposing to increase the period that a person can continue to receive that tax credit from four to eight weeks. I accept it is a very small change. I’m not going to pretend that it will bring any comfort to any family, but what I hope it would do is extend out that period for a little bit, for a few weeks, just to give people the opportunity to take some time to rearrange their circumstances from that initial period of the tragic circumstance of losing a child.

I would like members to consider it seriously. It is a very small change. I just want to, I guess, get across to them that it won’t make life easier for people but it will just remove that additional headache. I guess we’re fortunate that we don’t have a lot of infant deaths in New Zealand. I did some research last night. In 2014, there were just 331 infant deaths registered with Births, Deaths and Marriages.

💬 Sarah Dowie: Still too many.

It’s still too many, as my colleague Sarah Dowie says. Interestingly, there is an unfortunate ethnic breakdown. Māori and Pasifika are far too over-represented in these statistics—7.2 per thousand for Māori and 7.1 percent for Pasifika.

💬 Simon O’Connor: How much?

7.2 for Māori and 7.1 percent for Pasifika, which is 1.5 times the rate for New Zealand European families.

So, look, it is a small change, but it will have a material impact—more, I think, for Māori and Pasifika families. Also, as members would imagine, there is an unfortunate correlation as well with socio-economic deprivation, where the infant death rate is much higher in more deprived areas than in wealthy areas.

So, look, it is a small change. I do hope that Government members and, in particular, Minister Robertson consider it. I’d like to hear his thoughts on it, perhaps, and also members opposite. I also understand that one of my colleagues will be taking a call on this amendment as well. I would like members to seriously consider it, and I thank the Chair for the opportunity. Thank you.

Thank you, Mr Chairman. I am very pleased to take another call in this Part 1 debate, because there are a number of matters that we still haven’t had a chance to address, and I want to talk to some of those this morning in this call.

And, to begin with, I want to put a question to the Minister in the chair, Grant Robertson, which I raised during the second reading debate, and, of course, this is our opportunity to now ask the member to address that. I raised in that contribution the incongruity and the seemingly inexplicable reason for the matter that my colleague Mr Falloon has just been talking about, which is where the Best Start abatement rates have been set in this legislation. Mr Falloon has just talked very wisely about some changes he’s proposing, but the question I have for the Minister—and I think he needs to take a call and explain—is why we have these odd thresholds set, like a $79,000 threshold for the abatement to start on the Best Start payment for years two and three, and also this very, very odd abatement rate of 20.8 percent. And, look, the use of abatement rates and thresholds is, obviously, a well-known and well-used tool, but these seem to be very, very inexplicable levels to have set them at.

I raised that question in the second reading debate because, actually, bringing in complexity to the tax system is something that we’ve always tried very hard to stay away from. And when you introduce a very odd, unusual, and unprecedented level, there has to be a reason for it—surely, otherwise you wouldn’t do it. And when I made the comment in the second reading debate, the Minister nodded and said, “Yes, there were very important reasons for it.”, and so I think now is the appropriate time for the Minister—and he’s nodding again now. So we will look forward to hearing from him a detailed explanation of why it is there is a 20.8 percent abatement rate, as opposed to a more predictable and expected rate.

I’d also like the Minister to talk to us about why the baby bonus starts to abate at $79,000 where the other abatement rates in this legislation are far more usually around the high $30,000s to low $40,000s. So I’d be interested to know why this baby bonus, which is universal in year one, when it does start to abate, abates in such a strange and unexpected way, and I look forward to the Minister explaining that to this committee.

I want to talk about an important aspect of the changes in this legislation, and how they change the law that’s currently on the books, and that is around the timing of them. You have now a period—or we will have, if this bill passes—where the tax cuts that are legislated, which the National Government put in place in the 2017 Budget, will be abolished. So from 1 April, taxpayers will now not get the extra $1,060 a week in their pockets that they would’ve got, and yet, the changes in this legislation don’t take effect until 1 July.

So I’m interested to hear from the Minister, again, why it is that for those three months, the Labour Government is quite contented to see people going backwards. And, if they were so keen to replace our tax changes with a different package of assistance and they were true to their word that this was simply replacing one form of benefit with another, why don’t they start on the same date? Why is the Labour Government leaving every taxpayer of New Zealand substantially worse off for those months of April, May, and June of next year? I think those are important issues that really do speak to the very real world effect of this legislation on the people of New Zealand, which the Minister does need to explain to this committee, and I will look forward to him taking those calls.

I started talking about some of the abatement rate changes, and that is something I want to come back to, because there are some, again, very incongruous approaches in this legislation that make a significant difference, and one of our jobs in this committee stage is to really explore those so that the beneficiaries of any of these entitlements understand why they start losing money when they do.

There are a number of amendments on the Table in my name that speak to this very point, and I want to take a little bit of time to address the rationale for those changes and to talk to the committee about why I believe that those changes are sensible. The amendments in my name around the abatement rate changes really relate to the family tax credit. Other members in the committee have discussed and are proposing changes to other abatement thresholds, but the abatement thresholds and rates and timing for the family tax credit are what I’ve focused some of my attention on in this set of amendments.

They are ensuring that we have, first of all, a much more smoothed effect, because, actually, as a parent you know that there are costs that go with parenting. And the way the family tax credit system works is that there is one rate paid for the eldest child, and then there is a lower rate paid for each additional child. Now the changes that National had put in place and had legislated for said, “Look, we’re not going to penalise families if their eldest child is a certain age and then give them more when they’re older.” Actually, the National Party, when it was in Government, was of the view that that eldest child rate should apply irrespective of the age of the eldest child. I don’t see any good reason why the eldest child rate would apply at a higher level for children over 16 and not for children under 16—for the eldest child. I can tell members of this committee—and many members of this committee will know themselves—that many of the costs of having children are actually particularly noticeable in the first 16 years of their life. As the children get past 16, in fact, often they’re out working and providing some income for themselves and funding some of their costs, and, actually, as a parent it’s quite a good thing to be encouraging them to be contributing in some way, however small.

So our view—and the one that my amendments reflect—is that when you have this eldest child rate, it shouldn’t be discounted if the eldest child is under 16. The National Party, and the National Government under our changes, had made sure that the eldest child would get the highest rate going, irrespective of whether they were over or under 16. I’d like to hear from the Minister why he thinks that that eldest child rate—a family should be penalised if their eldest child is younger. So, actually, that’s making it harder for families with younger children.

We’ve heard a lot from members—well, we haven’t heard a lot from members from the other side in this debate at all. But, you know, in the first and second reading debates, when they had to take calls, they were keen to tell us how this was all about supporting younger children, and yet, in this family tax credit space, the way that the Labour Government has set up the abatement rates penalises those with younger children.

Now, we think that’s crazy. Our changes were very clear that the rates would be paid for the eldest child and then for subsequent children irrespective of their age. But in the framing we have in this legislation, we’ve gone back to penalising younger children in a family and letting them get to those top levels only when the children are older. I don’t see any good rationale for that. We’ve certainly heard none from the Minister in the chair. The amendments that I’ve put up—and there are a number of them; I see the Clerk doesn’t appear to have used a numbering system but a time system to refer to them, but members have them available. I have a number of amendments in my name that relate to the various aspects of the bill that are in clause 55, inserting changes to new section MF 4G(4) and MF 4F(8) and (4). And the reason for the number of different references is, obviously, because of the point I made earlier, which is that this bill differentiates between people missing out for those first months before the 1 July changes kick in and then the rates from there.

So those are the points that I really want the Minister to respond to. Why do we have these strange, odd, complicated, and seemingly incomprehensible abatement rate thresholds and rates for the Best Start grant? Why has the Labour Government and the Minister in this bill chosen to give less money to younger children and more money to older children in the family tax credits? And why—and this is an important one—has the Government, if this is about retargeting the National Government’s tax cuts, chosen to have families missing out entirely for that three-month period between 1 April, when our changes would’ve kicked in, and 1 July, when these changes kick in?

It doesn’t seem to fit with the narrative. If the narrative is actually replacing one for the other, why don’t they start on 1 April? If the narrative is actually about helping children with young families, when we know the costs are the greatest, the pressures are the highest, and incomes are often lower, why is the Government penalising those families by removing access to the higher rate of family tax credit and providing eligibility for that only when the children are older and the families, almost always, are actually in a better financial position as the years have passed?

Those changes seem completely at odds with the Labour narrative, as does the very fact of replacing many of our universal tax cuts, which they say are too universal, with equally universal benefits. So I do implore the Minister to explain to us how his narrative makes sense and why he has left every taxpaying New Zealander worse off over the period from April, May, and June of next year.

I call Simon O’Connor.

Excellent choice. I’m very pleased—

💬 Hon Ruth Dyson: He says modestly.

Modesty—yeah, it’s maybe not a virtue. I am very pleased to take a call, but, I mean, fundamentally around all of this, it’s the classic left dynamic of bribing people with their own money. I want to reserve though—obviously, it’s not a general sort of commentary, as I want to actually focus in, rightly, on Part 1, Subpart 1, and I want to draw attention to the amendment of Sarah Dowie, the MP for Invercargill. What she’s doing here in the amendment is, effectively, putting through a bit of an eligibility criteria to do with the Best Start tax credit.

In this contribution, I’m not so interested in getting into the Best Start grant itself. Other colleagues are—rightly—taking calls and showing up the myriad of problems, particularly around how it’s defined and structured. So I want to focus in on the eligibility criteria and, in particular, this amendment of Sarah Dowie.

For those members not familiar with it, particularly on the other side of the Chamber, what the honourable member Sarah Dowie is suggesting is that any person receiving a Best Start tax credit, as referred to in amended section MC 1, shall ensure that any dependent child has attended a 15- to 18-month core Well Child check. Now, having chaired the Health Committee, I am very familiar with this programme. In effect, it enables children from pre-conception up to three years old to get elements like oral health checked and to get their vitamin K injections. There’s at least a chance or, if not, two to see their general practitioner. The Well Child checks also engage the family at large, particularly the mothers. It’s everything from breastfeeding techniques to how one sleeps with a child in bed—basically, the advice is do not sleep with the child in the bed—so what this amendment is doing is putting, I think, a very constructive eligibility check here.

So, out of this there are a number of questions that arise for the Minister. The first, fundamentally, is whether the Minister is happy to have further eligibility criteria. Is he willing to see that the—I suppose, in a sense, it’s a carrot and stick approach. In just throwing money about through this Best Start tax credit, is he willing to also provide an inducement and encouragement—excuse the very bad pun on the word “inducement”—to induce and to encourage people into some other positive behaviours. I think, and I would hope—though I would like to hear also from the Minister—that he can see the value in the Well Child check. If so—if he sees value in that check, in those actual series of checks from pre-conception to three years of age—is he willing to entertain this as eligibility criteria?

Again, I think the member Sarah Dowie has done a very good job to put down this amendment. I think, obviously, with amendments that are done in urgency, it may need to be filled out further, but that’s another question for the Minister. If he, in conception—again, bad pun—knows that things like the Well Child check criteria are good, is he willing to attach that to the Best Start tax credit, which would be an encouragement to have those parents take their child along? It’s very particular in this amendment from Sarah Dowie that it’s the 15- to 18-month core check. Importantly, the Well Child checks begin, as I say, at pre-conception. There’s a whole array of engagement week by week, so I’d be interested too—and I encourage the member who’s put the amendment to get up and speak a bit more specifically, and maybe more informatively, for the Minister as to why she has chosen this particular part. I’m not going to bore the committee by going through every element of the check, but why she’s gone for this one in particular.

The fundamental question that I think the Minister needs to address is that if he’s going to push ahead with this tax credit—as I say, throwing money about—is he willing to use this as a health opportunity? We’ve heard a lot from both him in the chair and in the wider debates from the Government and supporting members that these tax credits sit within the whole wider child poverty concept, and a big element they continually push is the health of children. So here is not only a remarkable opportunity to give money—which is effectively the people’s own money, as I said at the start—but an opportunity to encourage good healthy behaviour in, obviously, the parents, in the mum and dad.

As I say, that is part of the Well Child checks, but it’s also a good opportunity for the child, because we know if they get those vitamin K shots, if they have the little prick test on their foot, and if the family are getting through all the discussions, that’s really good for the child. I’d make the argument—which I think the Minister can address too—that those things are in some ways more important than the money. They are more important than the money. So I welcome the—[Time expired]

Thank you very much, Madam Chairperson Tolley. I am just rising again, after another half an hour of repetitive contributions from National Party members, to respond to a number of matters that have been raised, including ones that have already been raised.

I just want to deal, firstly, with the questions from Simeon Brown and Tim Macindoe around the independent earner tax credit (IETC). For the specific factual matters: in 2016, 516,000 individuals claimed the independent earner tax credit. The estimation is that there were around 79,000 people who appeared to be eligible but did not claim them at all. I have good news for members who’ve raised their concern about the bureaucracy around getting the independent earner tax credit. IRD advise us that it’s likely in the future, as its Business Transformation programme is rolled out, that, actually, the IETC will be able to be automatically included in what people do.

We’re very confident that the IETC reinstatement is something that will be, certainly, appreciated by members. I don’t really believe that the previous Government made a lot of effort to let people know that that tax credit existed for them. So well done to the 80 percent or so of people who did manage to take it up, mainly, I acknowledge, at the end of the taxable year. But certainly it is an important thing.

I do just want to let—I’m not allowed to say that. I do want to let Tim Macindoe know that—I would hate to compare Hamilton and Wellington; two quite different places for a range of reasons—certainly the voters of Wellington Central, I know, were very concerned about what had happened in the Budget package in terms of the independent earner tax credit and will be very grateful to see this restored.

In order to respond to Brett Hudson’s question, families who would have benefited from the parental tax credit are in fact still better off with Best Start—$2,200 maximum from the parental tax credit now becomes $3,120 from Best Start in year one.

💬 Brett Hudson: Not over the same period, Grant.

It’s all about when it’s fully rolled out, Mr Hudson, so that is in answer specifically to your question.

I want to acknowledge Andrew Falloon for the amendment that he’s put forward. He is raising a very important issue. The response I’d like to give at the moment to him is to just explain the rationale that the four weeks came from and just to make clear that four weeks is actually a longer extension than other Working for Families tax credits in terms of the unfortunate and tragic circumstances of the death of a child. So we’ve already extended it out here. I understand the point that the member is trying to make, and I think, you know, in a debate like this it’s easy to have a very large number of amendments that may or may not be seen to be serious; this one clearly is. I want to acknowledge the issue that the member is raising. No one in this House would feel comfortable with the idea of people who have suffered that tragic event being put under any pressure or feeling any pressure. We were attempting to recognise that by extending it to four weeks, beyond what it is for other Working for Families tax credits. But I certainly acknowledge what the member is trying to do there.

Amy Adams and, indeed, a number of other members have raised the question—and I have responded to parts of this before—around the Best Start abatement threshold. The $79,000 figure was chosen to align with the cut-out point of the accommodation supplement. So it was designed to be alongside that—that’s where the number came from.

In terms of the abatement rate, the member has highlighted the fact that abatement rates are tricky things to get right. This 21 percent figure was chosen—

💬 Hon Amy Adams: No, 20.8—20.8.

—as a precise figure, and the member should be delighted that the Government has worked so hard to get such a precise figure that balances targeting low and middle income families with minimising the impact on effective marginal tax rates. We did actually work very hard to make sure that we made this as least disruptive as possible in terms of the other tax credits that people are eligible for. So it is actually an instrument of precision. The former Minister was concerned that it was unexpected, but it is actually to be exactly precise in order to ensure that we minimise the effect of marginal tax rates.

In terms of responding to Amy Adams’ question about the eldest child rate, the bill doesn’t have a lower rate for younger children. The bill’s aligned for all children aged under 18, which actually is the proposal that National put through previously.

So there have been a number of questions asked. They are beginning to be on the same theme, which is really about whether or not members opposite support there being a Best Start tax credit that is available to all children in the first year of life, and then targeted beyond that. There is not a lot of new material coming forward, and all I can do is respond again to say that this Government is very proud of reintroducing such a family benefit.

Thank you, Madam Chair. I look forward to the first of, hopefully, many contributions today and into the night.

Look, first, I can’t help but acknowledge that all those years ago, I worked with a student union president who was very, very keen then to spend other people’s money as if it would never run out of fashion, and it’s good to see he’s remained consistent over the 20 or so years subsequently.

💬 Hon Scott Simpson: He’s still leading a student union.

Yes, you’re not wrong there, Mr Simpson. But, specifically, I would like to take some of my comments this morning to the regulatory impact statement (RIS). I have a few questions relating to Part 1 that I would be interested in having the Minister of Finance respond to. There is a theme—he talked about themes just before, in his short contribution—and the theme that comes through when you look at the RIS is very much the sense of a rushed process. Indeed, on a number of pages—and I’m going to quote them—the advice that we can see here talks to the fact that this was rushed and that there was limited time for consideration of comprehensive advice, and I have quite some concern about that. I’ll be very interested, specifically, to get the Minister’s comments on it.

On page 24, there’s a very specific comment with respect to the time frame for providing advice being limited: “the Treasury was not in a position to undertake [any behavioural] modelling” with respect to the policies. This is unusual and this is obviously listed here, and I want to understand from the Minister why that is. They also note, in a broader observation with respect to consultation, that there has been “no public consultation”—

The CHAIRPERSON (Hon Anne Tolley): I just remind the member we’re on Part 1.

—“and limited consultation”, with respect to the bill.

Now, moving specifically, Madam Chair, to Part 1, particularly relating to the changes in the family tax credits and Best Start payments, there is in the RIS some specific criteria that are required—that any new policy needs to be assessed to. I note that on page 30, with respect to the Best Start payment, the advice says that this tax credit is—and I quote—“not targeted to reduce child poverty.”

So I want to understand from the Minister how he can make the statements that he has with respect to this package, when the advice is very clear with respect to the Best Start payment that it’s not meeting one of his particular criterion. It also says—and I quote, with respect to Best Start in Part 1 of the bill—that “its abatement at 21% will increase disincentives to work for a group of families between $80,000 and $95,000.” The advice goes on to say, “The combination of abatement on different transfer payments and tax means some families receiving Best Start could face an effective marginal tax rate of over 100%.” I ask the Minister again: how can he promote a policy that has such a clear disincentive for New Zealanders as listed in terms of the advice that is in front of us?

I’m moving to the independent earner tax credit. Again, there are objectives that this package has to meet. There are three specific objectives. It is inconsistent with both of them from a policy perspective. This is very clear, on page 31 of the regulatory impact statement. It is inconsistent—reinstating the income tax credit—with two out of the three policy objectives, and partially consistent with one. I think that is a significant failure. I’d like to understand from the Minister, again, how you could be promoting a particular solution that is so at odds with the objectives that you’ve set—and that’s actually included in your own document, which we are reflecting on here this morning.

When you look at the other options that have been ruled out of scope or not considered—[Time expired]

Madam Chairperson Tolley, thank you. I rise to take a call on this Families Package (Income Tax and Benefits) Bill in the committee stage on Part 1. I suppose what tweaked my interest in taking a call was when Minister Robertson stood and made some comments, and I suppose the comment from the Hon Amy Adams was just that if we look at clause 55 in Part 1, at new section MF 4F, in regard to the calculation of instalments—the comments that the Hon Amy Adams made were just in regard to that in this process—it just seems that there is a penalising for younger children, and we’re talking specifically in regard to the amounts that are here. So if we talk about section MF 4F(4) in that calculation, the prescribed amount here is the sum of the following amounts.

Now, the Minister did talk about this and tried to explain this, but there still seems to be a discrepancy, and so I’d like to see if the Minister can take the call. Subsection (4)(a): “for the eldest dependent child for whom the person is a principal caregiver during the entitlement period,”—and I’m reading from this just so that we can get the specific detail, because it did seem that it was incongruent with what the Minister was saying.

💬 Hon Amy Adams: He said there was no difference.

So he said there was no difference. In subsection (4)(a), it is “(i) $4,822, if the child is younger than 16: (ii) $5,303, if the child is 16 or older:”. I go down to subsection (4)(b): “for each dependent child for whom the person is a principal caregiver during the entitlement period, other than the eldest dependent child, 1 of the following … [is] applicable:”—and I’m reading from this particularly because this is a point that I think needs some clarification from the Minister—“(i) $3,351, if the child is younger than 13: (ii) $3,822, if the child is 13, 14, [and] 15: [and] (iii) $4,745, if the child is 16 or older:”. Now, that clearly delineates the fact that there are lesser amounts going to those younger children, and I think that’s a—

💬 Hon Amy Adams: That’s right. They’re penalising young families.

That’s the point that we’re trying to make. The Minister got up and tried to tell us that it wasn’t. I don’t want to use unhonourable words in this Chamber, but I just would like the Minister to just give some clarity here. It just seems incongruent with what the Minister’s trying to say, and I was very specific to read that out because I wanted to sort of get some clarity around that. I know it’s a technical point, but it is critically important, as well—particularly if you then look over to new section MF 4G, and we know that the calculation instalments will extend themselves out from 1 July 2018 to 30 March 2019. So he’s explained that and talked about that, but I go back to the point in MF 4F—in that calculation in subsection (4)—where the prescribed amounts just do not seem to match up. Now, I know the Minister, in his attempt, was trying to sort of explain that it’s important, but it just doesn’t seem right. I think it’s important for the Minister, then, to give some clarity.

Look, this is not just for those in the committee. There are those that are out there—we know that the media have already had calculations that are in the Dominion Post where family income packages are being calculated now. Families are now taking into consideration: will this be the package that gives them some benefits, some gains? In fact, I know in the Dominion Post it talked about the four different types of families where there would be a certain gain from this package. So I think it’s important. This is not just clarity for the committee, but clarity for our communities, who are there. Some may be listening. There’ll be beneficiary advocates that are out there saying, “Let’s look at this package. Let’s see how, actually, it will benefit those.” I just think that even though it’s a small point and a technical point, it’s an important point. They need to know, actually, if they have younger children, whether they will be penalised because of this. It just seems that on the face of it, and in the reading of the bill, that seems to be the case here.

So I really would like to see the Minister take a call to be able to just clarify that. Who knows? The numbers may not be correct, and if he could give us some clarity, I just think that it would be important for those that are out there. I know that I’ve had calls from others that are in the community groups that are working with families that are looking at this package. Some have said, “Look, there are some benefits in it.” They can see the gains that are being made. But I think the benefits are in the detail. I think that’s really important—we need to have the member talk about that. So, again, I just reiterate, it’s really simple. It’s a small call. New section MF 4F, “Calculation … instalments,” subsection (4), “Prescribed amount”—clearly, from here, as I’m reading it, and I think as others are looking at this—I think it’s a small point but a significant point. I’d like to see the Minister take a call, answer the question, to give us some clarity in regard to this, because, on the face of it, it just seems that younger children are being penalised.

I’d like to address the amendment in the name of Andrew Falloon. It amends new Subpart MG 2(3), in clause 22, by replacing “4 weeks” with “8 weeks” in regard to when the bill, as drafted, cuts a person’s eligibility for the Best Start tax credit less than a month after the death of a dependent child.

I didn’t think I’d be speaking so soon again on something so personal, but the House will recall that in my maiden speech I referred to the death my own two-year-old son. So this is a topic that I have a very unfortunate circumstance to have such a personal journey with. The idea of cutting off the Best Start tax credit less than four weeks after the death of a child is incomprehensible to me, and I want to be very clear on what I say. The journey that you go through in the first four weeks after a child dies means that you can’t eat, you can’t communicate, and normal household functions are the furthest things from your mind. You’ve got funeral arrangements. You’ve got an incredible amount of things to think about. You’re absorbing how people are absorbing your grief. You cannot function. The idea that, in an insensitive and cold-hearted manner, you get, ironically, a Best Start in life package and in that worst start in life you get something cut off—often you won’t notice, you won’t see, you won’t understand what’s happening for your finances—

The CHAIRPERSON (Hon Anne Tolley): Don’t use “you”. Try not to use “you”—that means me.

OK. Thank you, Madam Chair. As the weeks go on—and I’m now referring to a little bit further than four weeks on; around the six-week mark—you begin to see a little bit of clear air. You’ve got things like—and this depends on the nature of the child’s death, of course—ambulance costs, medical bills, the coroner’s process, the police inquest officer process. You’ve got funeral costs and worst of all you’ve got the idea—well, not the idea—the concept, the possibility, that you’ve got to begin to pack away children’s clothes and address that very practical nature. This is all at the time—as this bill is drafted—you would have something that you enjoyed and received then coldheartedly cut off. You can’t change the death of that child, but you can show some sensitivity and some respect.

So I’ve got some questions for the Minister, and they’re really pertinent. They are: what evidence from the grief cycle is four weeks based on? Was the grief cycle taken into consideration when it came to that four-week decision? Is the nature of the death of the child taken into account? For instance, with the impact of sudden death, which was my case, you’ve got no time to adjust and you certainly won’t have time to adjust to a financial adjustment. So how was that taken into consideration? I would also like to ask that if this was at a select committee, how would this have been different? I know for a certainty that there would’ve been a whole line of parents, grieving parents, appearing before a select committee to talk through what I’ve just talked through in terms of what it’s like to handle grief in the first four weeks.

I’d like to see those questions answered. I acknowledge that the Minister acknowledged Andrew Falloon and this particular amendment, and in doing so he referred to the relationship to how other Working for Families entitlements are cut off on the death of a child. But this is different. You’re starting with the terminology “Best Start”; I’m referring to the worst start, and I would like to see more sensitivity and respect. Thank you.

I call Sarah Dowie, but, just before the member starts, can I just advise her. She has two amendments tabled. The first, on a new clause 12A, is in scope, but her second amendment, inserting a new Part 3, is out of order, as it’s out of the scope of the bill. The two defining features of this bill are income tax and benefit, and the member’s amendment is outside of those. So there is no debate on that second amendment, but the first—

💬 Sarah Dowie: The family proceedings amendment.

The CHAIRPERSON (Hon Anne Tolley): That’s right.

I raise a point of order, Madam Chairperson. The purposes of the bill actually go beyond that and they speak very clearly to giving children the best start in life. Actually, if you read through the general policy statement of the bill and the explanatory note of the bill and the objectives of the bill, it is very clear that the bill is around tax changes, benefit changes, and giving children the best start in life or a good start in life. It is an omnibus bill. It is intended to be very wide ranging and cover any number of initiatives that speak to those three purposes.

My understanding of the Standing Orders in this respect is that when the purpose of the bill provides for an area like giving children the best start in life and when we have an omnibus bill, then anything that members want to put up that speaks properly to giving children that best start in life is within scope. I think if your ruling is that it is limited only to the benefit system and the Income Tax Act, then that is a misunderstanding or a misdescription of what the purpose of the bill is expressed to be, and I would invite you to reconsider that ruling, because, on the wording in the general policy statement, the purpose of the bill is substantially wider than that, and this is a matter of some considerable importance to this side of the Chamber.

Yes, I thank the member for that very eloquent point of order. However, the bill has been quite cleverly arranged into two different themes: one is around income tax—not even particularly around the Income Tax Act, I would say, but around income tax—and the other around benefits. So any amendments that relate to those two themes are in order, but if you go beyond that, even given the description in the preamble to the bill, it is still focused on the benefits system and benefits. So that is the ruling that that is deemed to be out of scope.

I raise a point of order, Madam Chairperson. I absolutely understand and accept the Chair’s ruling in respect of the arrangement of the bill into parts, and, clearly, amendments within those parts would need to reflect the subject matter of the parts. But where you have, as you have in this situation, an omnibus piece of legislation, my understanding—and in terms of advice we have sought—is that it is entirely within the scope of the bill to insert entirely new parts. And I take your point that those two parts are arranged in those ways and are therefore restricted to those ways, but where an amendment is made to insert a new part that is within scope of the broad objectives of the bill, you are not similarly constrained to the content of those two parts. That certainly reflects the advice that we’ve had on this side of the Chamber.

💬 Hon Iain Lees-Galloway: Speaking to the point of order—

I will take a point of order from the Hon Iain Lees-Galloway, but I just want to make the point that we’re unlikely to get to be voting on this, so I can give it further consideration.

I raise a point of order, Madam Chairperson. Just very briefly, you’ve ruled, obviously, so I don’t think there can be any further discussion about your ruling, but, secondly, the purpose clause, which is what determines what is in scope and is not, is very clear. There is no scope for Ms Dowie’s proposed Part 3 because it does not fit with the purpose clause. It is as simple as that. You have ruled and there should be no further consideration.

💬 Hon Dr Nick Smith: Can I speak to that point of order, Madam Chairperson?

Look, what I’m going to do is—as I say, we’re unlikely to get anywhere near a closure at this stage where we would have to vote that amendment out of order. I was simply informing the member before she spoke. I didn’t have to. I could have left it until the voting. So I will consider it further and I give the member the call at this stage.

I raise a point of order, Madam Chairperson. As you reflect—

The CHAIRPERSON (Hon Anne Tolley): I hope you’re not going to disagree with my purpose.

No, I’m not. I’m very appreciative of the fact that you’re going to consider the amendment that my colleague is wishing to advance. But in that consideration, the points that have been made both by my colleague Amy and members opposite, I would ask you to reflect on the precedent that was set in the previous Parliament around the addition of new parts. What the previous Speaker ruled was that providing they were parts that the Government could have legitimately included as parts within that bill—there should be no difference in this Parliament as to whether it is a new part that’s proposed either by the Government or by the Opposition—the test that should be consistently applied with those previous rulings of the Speaker is whether, if the Government wanted to include the part that my colleague wanted in the bill, that would meet the requirements of the omnibus bill. I do ask you, as you make that ruling, to consider on those previous rulings that were advanced by members opposite so that we’re getting some consistency about new parts.

💬 Hon Chris Hipkins: Point of order. Point of order, Madam Chair.

No, sit down. I’m not going to take any more. I will consider that, but I say to the member respectfully that the decision to rule it out of order isn’t that you can’t create a new part; it’s whether it fits within the two themes of the bill. And that’s what I will consider. OK. I call Sarah Dowie.

Thank you, Madam Chairperson, and thank you for that information. I was going to restrict my first call on this bill to Part 1 regardless, and to my amendment relating to Part 1, which was so ably talked about and introduced with the honourable Simon Connor’s contribution before. Of course, it relates to the Best Start tax credits that the Government wishes to put in place with respect to a new tax credit in the Income Tax Act 2007. My amendment, of course, relates to the eligibility of the people receiving those tax credits and relates to adding to section MC4 of the Income Tax Act 2007, and states that “any person receiving a Best Start tax credit as referred to in section MC 1 shall ensure that any dependent child has attended a 15-18 month core Well Child check.”

Look, where I’m going with this is it’s all very well to give families money, and I don’t think anyone would disagree that giving families money is, if you can be a Santa Claus, a good thing—if it is targeted and necessary, obviously, for that family—

💬 Brett Hudson: If it’s targeted.

Exactly, Mr Hudson: if it is targeted and necessary for that family, to enable that family and their children to get ahead. It’s not OK, obviously, to take money away from hard-working individuals to give to those people carte blanche. This is where I’m going with this amendment. It’s that there needs to be criteria put around these Best Start tax credits so that we can monitor the progress of children as they’re getting that money. Writing a cheque simply does not work.

So where I’m going with this is to feed it into the Well Child / Tamariki Ora programme, which is very well accepted in New Zealand. It is a universal health programme that has a number of different checks, where a mother or father and child, or guardian and child, will go to Well Child providers and they will check the progress of a child. Now, that feeds into eligibility because we want to make sure that these tax credits are being well spent and that they are making effective change in the child’s life.

The reason I’ve picked the 15 to 18 months core health check is that that is specifically looking at around about the age that a child would, generally speaking, go to early childhood education (ECE). In the system of Well Child core checks, we have a B4 School Check, and now I’m looking to extend that, more or less, to an early childhood education check.

There’s often emphasis on the very early beginnings of a child’s life, through Well Child, when the mother is pregnant, when the child is born. But this is that further follow-up, to have that check as an eligibility criteria for that final Best Start tax credit payment. In particular, that 15 to 18 month core Well Child check looks at the overall health and development of a child. Of course, it focuses on the physical. You have the hips check as well, to make sure that the child is doing well, growth-wise, and hearing and vision—so, again, focusing on, if they’re going to ECE, that they have the ability to engage in early childhood education in an effective way and to engage in that so that they start off their education in the best way possible, so that they make the most of that education and can move on to primary school with all the necessities in place to help them do well. Of course, there is a focus on immunisation and mum’s health as well.

I think that this would be a good change to the bill, to make this an eligibility criteria so that it’s not just giving money for the sake of giving money, without results.

Just for the benefit of the member Sarah Dowie, I have had a look at her amendment in detail—the amendment to insert a new Part 3. This is about enabling a male to get a paternity test to achieve knowledge of his paternity. I think that’s a pretty long bow to then link that to a benefit for when a child is born and its first couple of years of life.

I raise a point of order, Madam Chairperson.

The CHAIRPERSON (Hon Anne Tolley): I’ll take a point of order from Sarah Dowie.

Thank you. Speaking to that, Madam Chair, the way I see that new part being inserted is that the United Nations convention with respect to the rights—

The CHAIRPERSON (Hon Anne Tolley): I understand that, but to fit it within the context of this bill, it’s either to do with tax or to do with a benefit. And just because you use the term “to give the best start to a child, knowing who their father might be”, as a human right, is a bit of a long bow. But I will give it further consideration, I think. I’m just warning you.

Yes, well in all fairness, obviously, that relates to child support payments and other benefits that would be received by the child in that regard. So I would seek your clarification and your ruling in the positive.

The CHAIRPERSON (Hon Anne Tolley): We move on.

Thank you, Madam Chairperson Tolley. I’m really pleased to speak in this particular debate. The families package that National would have had very much focused on children, and particularly those that were particularly vulnerable. Sarah Dowie’s amendment, which I want to commend to the committee, is basically saying that we would expect that a parent who is receiving a Best Start family tax credit would then actually have at least the 15- to 18-month core Well Child check, and that is absolutely in line with this Government’s objectives around improving and ensuring that children get the best start in life. I do want to commend the Government on that. It is something that we absolutely have in common on this side of the House. I would say that one of the differences, though, is that we would like to ensure that any taxpayer funds are actually spent in the most effective way, and that is by ensuring that every child—every child—in this country gets the benefit of that investment.

So I want to commend Sarah Dowie for putting this amendment before the committee. We have a fantastic framework in the Well Child check. It’s allowing families to choose who their Well Child provider is, but it’s also a really important checkpoint on a child’s well-being.

I’d be really interested if the Minister in the chair, Carmel Sepuloni, could provide some really clear advice in terms of their consideration of the Well Child programme—and, in particular, the core checks—and whether or not this was considered as part of the Best Start payments. But I am very, very optimistic, given the intent and the stated objectives of the Families Package (Income Tax and Benefits) Bill. It’s very well aligned. It’s very in support of the objective of this piece of legislation. So I would be hoping that the Minister in the chair would take a call to go through this in more detail in terms of ensuring that children get the best start in life.

But I do think also, because of the other stated objective around reducing child poverty, the Well Child programme is one that reaches every child in New Zealand. So it provides the opportunity for professionals of a parent’s choice to be able to understand and perhaps identify if that family is having some challenges or some struggles, and provides the opportunity, whether it’s physical learning issues—and my colleague the MP Sarah Dowie has identified specifically some of the things that would prepare a child for early childhood education, whether it’s hearing or vision.

But also the Well Child checks are a really important part of engaging with someone else in the community—a professional—who is able to spot, you know, are there any family violence issues, potentially, in that family. Is it a family that’s struggling financially, and perhaps there is support through the benefit system that they are not getting, for example. So we do want to make sure that this is an important opportunity to connect with a family to ensure that the children in that family, through this Well Child check—this core check at 15 to 18 months—are identified, and we maximise the opportunity of making the taxpayer investment in these children to make sure that every child, and particularly those children with additional needs, have their needs met.

So I think this is a fantastic amendment and I want to really commend my colleague Sarah Dowie for putting it in. I think this is a wonderful opportunity to set children up for the rest of their lives, and to prepare them and to ensure that they are ready for full participation in early childhood education. But it’s also a really great opportunity to see if there’s further assistance that would be required for a family in order to support them in, you know, what are challenging times for families anyway, but we know that some New Zealand families have even greater challenges that they are facing. On this side of the House, we don’t want them to face them on their own. We want to ensure that those who have access to those families can ensure that they have greater protections and greater access to the support that they need in times of need.

Thank you, Madam Chair Tolley. I want to ask the Minister in the chair, Carmel Sepuloni, whether she thinks it’s good public policy for people to be worse off as a consequence of getting a pay increase or working harder. I want to draw her attention to the regulatory impact assessment, and it says this: “The introduction of Best Start and its abatement at 21% will increase disincentives to work for a group of families … [it] means that some families receiving Best Start [will] face an effective marginal tax rate of over 100 percent.”

💬 Hon Members: What?

Of over 100 percent. Now, in my constituency office, so often I meet with New Zealanders. They work in fish factories, they work in the fruit industry in Nelson, and they come to see you as a constituency MP, frustrated by the complexity of Working for Families, the accommodation supplement, and the tax system, which is made worse and more complicated by this bill. But the part that they just find unfathomable is that they go work an extra five hours a week, and then they find out they’re worse off. We are setting up a situation where when the boss comes along to a worker and says, “Look, you’re doing a great job. I’m going to give you another $5,000 a year, or another $100 a week.” , and—

💬 Hon Andrew Little: Oh, yeah? Which boss is that?

—the worker, Andrew Little, is going to say, “No, please don’t increase my wage. I’m going to be worse off.” Really? Is that what we somehow believe in this Parliament is going to make us a—[Interruption] What is the member’s objection? Does the member think that’s a good thing? Well, what happens if the boss comes along and says, “Would you like to take some extra responsibility and earn another $3,000 a year?” What this bill’s going to do is actually mean that a worker will say, “No, the Government’s going to take more money off me than what that pay increase will provide for me.”

I just remind the Parliament of the journey New Zealand’s been over. Remember the debates where, actually, members opposite in the Labour Party said that an economy would never grow when you are having the marginal tax rate of 66c in the dollar that once existed in our income tax rates? Yet what we are doing with this bill is exactly that for a whole lot of middle-income families. These are families where the combination of the average person on an average wage is going face a higher tax rate. They’re going to face a higher abatement rate for their Working for Families, and now, with Best Start, we’re going to make people worse off when they earn more, as a consequence of an abatement and tax combination that is more than 100 percent.

Why does it matter? Because this Parliament can spend weeks—months—arguing about how we should divide up the cake and how much individual groups should get, and that’s a zero-sum game. What this Parliament should be focused on is how we grow the cake, how we provide the incentives so that all New Zealanders can grow and be better off. So I want to know from the Minister in the chair why on earth this Parliament would want to pass changes in tax and entitlements that have abatement regimes of over 100 percent, where people are going to be worse off as a consequence of increasing their earnings. There is only one outcome from this, I say to members opposite, and that is that people do what is absolutely logical: not earn, not work, not contribute, not grow the economy—

💬 Hon Andrew Little: There’s the National Party, right there.

—and we are all poorer as a consequence. I challenge Mr Little, who’s interjecting: please explain to me how, with what Treasury says about the part of this bill where we are going to get marginal rates of tax of over 100 percent, we can possibly defend that as sensible policy for New Zealanders. I’m just not looking forward at all to my regular session with constituents when people come to me and say to me, “I’ve got a pay increase. I’m worse off. How can that be?” I just want the Minister or a member opposite to explain the logic of why on earth we’d want to do that.

Thank you, Madam Chair, for this opportunity. I’m taking this call to speak on Part 1, which contains the Best Start tax credit, and to my amendment, which says that “any person receiving a Best Start tax credit as referred to in section MC 1 [of the Income Tax Act] shall ensure that any dependent child is enrolled with a Well Child provider.” My amendment flows on really well from my colleague Sarah Dowie’s amendment, which is to insert another step in the Well Child provider services—that is, to have a pre-school check. We know that every child is not enrolled with a Well Child provider. By making this a criterion, I think we will be actually further enhancing the social outcomes and also health outcomes for newborns.

With a child being enrolled with a Well Child provider, they’ll get several services. As we know, at the moment there are 12 core contacts, and these contacts are about checking the child’s health and well-being and also looking at the mother’s health. So now, if my colleague Sarah Dowie’s amendment is adopted, it will become 13 core contacts. But what I am proposing is that it should become a criterion that a child or a family should qualify for Best Start tax credit only if the child is enrolled with a Well Child provider.

In these 12 core contacts that exist at the moment, there is a check-up at birth, and then there is a check-up at the first week, and then after that it is between two to four weeks, and then there is also a transition service provided for that newborn when the family is moving from the lead maternity care provider to their general practitioner. Then there are visits to check that the child’s growth and development are going well. The family’s health and well-being are also examined. The next check-up is between eight to 10 weeks, and then the next are three to four months, five to seven months, nine to 12 months, and 15 to 18 months, and that’s where we want to have that amendment, where we want to bring in that preschool check. So then there is a check-up between two to three years. The next one is at four years, which is the B4 School Check, which includes child growth and development, oral health, immunisation visits—all that is also covered in that.

By enrolling a child with a Well Child provider and making that as a criterion, what we will see is that we are not only getting what the Government believes are, by giving this $60 per week, better social outcomes for these children in these families but also getting better health outcomes. Maternal well-being is also important, and through this we will achieve better outcomes not only for newborns’ health but also for maternal well-being as well—that is, mother’s health. Physical and emotional health and well-being especially become really important in those starting days.

As the Government acknowledges that it’s important to provide the best possible start to all newborns, and especially since the first few years are really critical, it becomes really important that we don’t only look at providing more financial help but also see that we are able to provide more improved health outcomes as well for these newborns.

I know that there are some other qualifying criteria for Best Start tax credits in this legislation in Part 1. It’s not that there are no other criteria, so I would like to see this become a criterion that a newborn should be enrolled with a Well Child provider to qualify for Best Start tax credits. When I say “qualifying criteria”, as we have noted, families that are on paid parental leave, while they are on paid parental leave, will not be getting the Best Start tax credit. Another criterion that is already in this part is that if they are receiving a parental tax credit, then they will not be getting Best Start tax credits. So there are some other criteria already in this legislation so it won’t be a new thing to insert this as a criterion, which will enhance the overall outcomes that we want to achieve for newborns.

I was listening to the Minister, the Hon Grant Robertson, last night and he said that a tax credit is fundamentally based on the best evidence that we can find about what will make a difference in the lives of children, so this was his reason for bringing in the Best Start tax credit. I would like to know what the evidence is, and if, in that evidence, all the recommendations that were made—[Time expired]

Thank you, Madam Chair. I’ve been looking forward to taking this call on the Families Package (Income Tax and Benefits) Bill. I specifically want to talk to Part 1 and the Best Start package. I’ve got some genuine questions for the Minister that I would like the Minister in the chair, the Hon Carmel Sepuloni, to address.

We understand that in the first year of a child’s life, a family will receive $60 a week—$3,120 a year. This is a universal benefit. There’s no abatement applied for the first 12 months, as we understand it—except if you’re receiving paid parental leave. Now, in the last financial year, 28,400 people received paid parental leave, and that’s a lot of people in my electorate. What they need to understand is that, actually, they won’t receive that full $60 a week for the whole year. They’ll receive it only for the second half of the year, effectively.

So what I want to understand from the Minister is what the Government’s thinking around that was, especially because if you are on a sole parent benefit, you will be entitled to receive the full Best Start payment. If you are a sole parent and you’re receiving your benefit of approximately $330 a week plus a housing subsidy plus temporary additional support, that all adds up to a number of hundred dollars, probably approximately over $500; yet if you are a working mother and you are receiving the full paid parental leave rate, you’re receiving $538.55 before tax, so when you take tax off, it’s approximately $400.

As you can see, my dilemma here, and the dilemma for many working mothers, is that they won’t be receiving this universal benefit and, in fact, they’re worse off than someone who is on a benefit. So working mothers in this situation are worse off. We’ve heard a lot from Mr Robertson about how this is universal, but in reality it is actually not universal at all, and I can only assume that the Labour Party are assuming in all of this that working mothers have more money, have more savings, have more income to be able to support themselves through that first year of life. Therefore, it’s not really universal at all. You are making assumptions that there are people who have more income.

I want the Minister to explain to us why it is that working mothers, under this policy, are actually worse off. That’s where I’m coming from, because a lot of my constituents will come in and say to me, “Well, look, I’m so excited about receiving this money.” I’ll have to say to them, “Well, actually, if you’re one of the 28,400 people in New Zealand over a year’s period taking paid parental leave, you won’t actually be eligible for this.” So the universality of it all is really undermined by that. It really is actually targeted, in a way, and if that’s what the Labour Party are doing, then I would like them to explain that and explain why it actually isn’t universal. I’m genuinely interested to see why working mothers are being penalised in this instance.

The second part of my question to the Minister—Mr Robertson got up yesterday and talked about the fact that this was universal, even though it’s not, because of the fact that every family faces costs with a newborn. I would argue that working mothers on paid parental leave face those same costs. He also went on to say that there will be an abatement rate for years two and three, so it is more targeted for years two and three. He then went on to say that the first three years of a child’s life are the most important years, and yet, in this policy, he is taking the first 12 months as the most important.

But I would actually argue that the costs that you face—and I’ve been through this recently. I’ve got a five-year-old, in fact, so I’ve been through this recently. I have some recent experience in this. Your costs of having a child in years two and three are so much more than in the first 12 months because you’ve got more food, more clothing, more activities, haircuts, shoes, and potentially childcare with having to go back to work. There are so many more expenses in those years than you do face in the first 12 months. We also have to remember that in that first 12 months, if you’re a working mother, you’re getting only half of the rate, effectively. So you get half of the rate and then it gets abated when you get all of your big costs of having a two- and three-year-old. I’d like to hear from the Minister specifically around those questions, please. Thank you.

Sorry, just before I call, can I just remind new members that when you’re speaking in the Chamber, you are speaking to the Chair. So when you’re talking “you”—I mean, I was a working mother, so I do understand, but, actually, I’m not a working mother at the moment; I am the Chair of the committee. So when you’re making your speeches, just leave out the “you” and rephrase it.

I’m not going to take a long call. I just want to respond to an issue that the member Erica Stanford raised with her concern that women who are beneficiaries may be given preferential treatment over working mothers. Not the case at all—I’ve just checked with the officials. If you’re a working mother and on paid parental leave, you still have access to the accommodation supplement and Working for Families, and everything else. So in no situation would they be worse off than a sole mother on a benefit. Thank you.

Thank you very much, Madam Chair. I appreciate the opportunity to say a few words. I’ve been listening to the debate and I want to thank the Minister, the Hon Carmel Sepuloni, for finally taking a call and answering a question, because the purpose of the committee of the whole House is for us to ask questions and tease out the validity and the effects of this legislation. There have been a large number of questions asked and I want to move to a specific range of questions and I certainly hope the Hon Carmel Sepuloni will take the opportunity of answering those questions to my satisfaction.

The first thing I want to do is to refer the Minister to the regulatory impact assessment, page 12, and this is the point that was raised earlier by the Hon Dr Nick Smith, which hasn’t been answered by the Minister in the chair, and I hope she will. This impact assessment says, “The introduction of Best Start and its abatement at 21% will increase disincentives to work for a group of families between $80,000 and $95,000.” So I want the Minister to tell me: in the research that was done, how many families sit in that bracket? I would have thought most low to middle income families, two parents working hard, will probably sit in the bracket of a gross household income coming into that house of $80,000 to $95,000. If that’s so, what this document is saying is that there will be a distinct disincentive for those people to work harder. How’s that going to lift the productivity of this economy? I don’t think it’s going to.

I note now we’ve got a relief Minister in the chair, so my question to the Hon Iain Lees-Galloway is for him to explain to us how many families sit in the bracket noted in the regulatory impact assessment as people who will be worse off by the introduction of the Best Start payment. Not only do I want to know how many families are worse off, I want to understand the rationale from this Government—from this Labour - Greens - “Mr 7 percent” New Zealand First Government—

The CHAIRPERSON (Poto Williams): Order!

I want to understand the rationale for why—

💬 Hon Scott Simpson: Actually, 5 percent.

Yes. Anyway, we’re not into percent—the only thing I want to know is the percentage of taxpayers who sit in this bracket and will be worse off. The encouragement will be for them—as the Hon Dr Nick Smith said, when they’re offered a pay rise for additional responsibilities, when they’re asked to do further work, their abatement rate will exceed 100 percent. That’s an incredible position for any Government to put people into.

The second point I want to tease out is clause 47, “Income Tax Act 2007 amended”. I take it that that is the clause that takes away the tax package that was passed in May this year by the previous National-led Government—so confirmation of that. Then I want the Minister to tell me what discussions occurred between the coalition partners as they brought this legislation before Parliament, because I take the opportunity of reminding the committee that only seven months ago New Zealand First and the Greens voted for a provision they’re now apparently going to vote to take out. There doesn’t seem any logic to me that two rather small parties in this Parliament—

💬 Hon Scott Simpson: Very small.

Very small and getting smaller, might I add, Scott Simpson—getting a lot, lot smaller. I want to know why those two parties were supportive of a package to help 1.2 million New Zealanders yet have now come forward today to support a package that, I calculate, helps—perhaps, if I believe Government figures—750,000 New Zealanders but, as I have identified in my earlier part of this contribution, significantly disincentives probably the majority of low to middle income partners within a relationship working hard to better themselves for their own children. I’d be grateful if the Minister would answer the questions.

Thank you, Madam Chair. I wanted to—just continuing my questions of the Minister—go back to the comments that were made by Erica Stanford, in particular, because I think the Minister in the chair at the time misunderstood the point that she was making. The point that she was making was that if somebody is on paid parental leave, why should that family forfeit their Best Start payment. There’s been no adequate explanation of why there should be such a discrimination against a parent that is working, as opposed to one who is not. I think the Minister confused it. The Minister in the chair confused it at the time around a discussion around benefit or not. That wasn’t the point. The point that my colleague Erica Stanford was making, very, very clearly, was that if somebody is receiving paid parental leave, there is absolutely no reason that we on this side of the Chamber see that they should not also get the Best Start payment. That is an absolute discrimination against working parents in this country, which I think is outrageous.

I’m really hoping—I’m hoping that that was just an error, that it was a mistake that was made, and I’d like the Minister to give due consideration and to answer the question: firstly, was it deliberate or not; and, if it was, what was the rationale and the reasoning behind it? From this side of the committee some of my fantastic counterparts have spoken who understand the challenges and the costs associated with being a working parent, and if there is going to be a universal entitlement of $3,120 a year—universal means universal. So I’d like the Minister in the chair to explain how something can be universal but they’re not, and discriminate against working parents.

I want to then also reflect on some of the comments that my very, very able and capable colleague Dr Parmjeet Parmar has introduced in two of her amendments. The two amendments also relate to the Best Start payment, because, you know, on this side of the Chamber we do recognise that families should be supported, which is why our package focused on Working for Families and people keeping more of what they earned. But let’s just focus on the quality of this Best Start payment. Our party believes that in terms of the quality of the spend—and the total spend of the Best Start package is quite significant—then, in terms of two elements, there should be two elements added to the criteria for receipt of that Best Start tax credit.

The first is enrolment—enrolling a newborn with a general practice or a primary healthcare provider. There is a significant amount of detail in the amendment that my colleague Dr Parmar has put forward, and I would really encourage the Minister to ensure that he gets adequate advice on this, because this is really critical in terms of children’s well-being. It’s an important amendment that deserves full consideration, and I’m fairly confident that the members of the Government will be supporting this amendment.

The second part of the criteria for receipt of the Best Start tax credit is that the dependent child is also enrolled with a Well Child provider. The Well Child provider is, of course, of the family’s choosing, so there’s no specific requirement in terms of who that provider is, but it is absolutely critical. It fits perfectly with the stated objectives in the bill, which are around the Government’s focus on ensuring children get the best start in life. I want to commend them for their focus. We agree with that. We agree with that, but we agree that this amount of money that’s being invested—collected from taxpayers up and down the country—actually should come with some degree of confidence that the money is being spent well, and in the best interests of every child, in every family, in every town in New Zealand, which is why I really want to commend the two amendments from Dr Parmar. I would specifically invite and ask and request the Minister in the chair to answer questions to the committee about these particular amendments, because I think they are really, really important, and it would be helpful for the Committee to hear the answers.

The other point that I want to make for those that are watching this debate live, or that are watching from home—

💬 Hon Scott Simpson: Or listening on the wireless?

—or listening on the wireless, as we like to call it—is that at this part of the debate, the committee stage, it is absolutely critical that we get answers from Ministers. This is in urgency; there is no public opportunity to raise issues—no scrutiny. This is the only opportunity, so it is absolutely vital that the Minister in the chair gives fulsome answers, gives sufficient detail to enable quality debate and scrutiny. I know that the senior Minister sitting in the chair will be able to answer the questions that I’ve asked, that the Rt Hon David Carter asked before me, that my colleagues Erica Stanford and Dr Parmar have asked, and Sarah Dowie before that. These are questions that deserve answers.

This is the only opportunity in this House for us to scrutinise this legislation on behalf of New Zealanders. Because it’s in urgency, even though this doesn’t come into effect until July next year, the public don’t have the opportunity to scrutinise this and provide their own feedback. So they are relying on this side of this House asking questions of the Minister in the chair. So there is a high expectation that the Minister in the chair will answer those questions to provide that clarity so that New Zealanders can ensure—the 36.6 percent that voted for the Labour Party—that there is sufficient scrutiny of this particular piece of legislation and ensure that Supplementary Order Papers that are very well drafted, and that raise very real concerns on behalf of New Zealanders, are answered.

Let’s not forget that this is actually about the well-being of children in New Zealand. They don’t have a voice in this Parliament, so we bring it for them. And, as I said before, I commend the Government for their objectives. They are fairly broad in terms of the objectives of this legislation: to target social assistance to improve incomes for low- and middle-income families with children and to reduce child poverty, and to ensure that children get the best start in life. It does, then, put a high level of responsibility on the Minister in the chair to answer in detail the questions that not only I have asked but my learned colleagues on this side of the House have asked.

I know the Minister has been taking notes, and we are looking forward to the answers. In particular, I want to come back to where I started in this particular contribution, which will be one of many today: the contribution around the clear discrimination between those parents who are receiving paid parental leave and why the Labour-led Government have decided that if a parent is getting paid parental leave, they are not entitled to the so-called “universal” Best Start payment.

I am quite fascinated, given that parties that support them, whether that’s New Zealand First or the Green Party, who are also supporters of paid parental leave, would allow this huge discrimination and would really make sure that those who are working, families that are producing their own income, working hard to do it—some of them are the very same low- and middle-income families that are stated as one of the objectives of this piece of legislation. So why? Why? I want to know why there is discrimination against working families in this so-called universal entitlement—$3,120 a year. They are excluded from it. It is not included for those parents that are working and on paid parental leave. Now, it doesn’t matter whether they’re male or female, whether it’s the mother or father, or whether it’s a father and father, or mother and mother: this is about equity.

Now, I have heard that side of the House debate for hours and hours and hours about equity. This is your golden chance. This is your golden chance, to the Labour-led Government, to provide equity for parents across the board, of every income level, whether they are working or not. Remove the paid parental leave requirement, and that discrimination against them, and say that if it is universal then it should be universal across the board for every parent, for every child in New Zealand, regardless of what their parent is doing in terms of work or not. In Opposition, that side of the House constantly banged on about why should you discriminate against someone who is in work and someone who isn’t. This is your golden opportunity to right what is clearly a wrong in this piece of legislation, and to remove the discrimination—[Time expired]

I move, That the question be now put.

I’d like to follow on with a couple of issues and also underline Louise Upston’s point about how important this debate is, because I think what we’re learning through this debate is a couple of things. One is that, actually, this is a marginal lift on the previous Government’s package—if that—a marginal lift. Secondly, the package is not well-thought-through at all. There are some things in here that will either get fixed now or get fixed later. This is the reality of it. I actually think the public of New Zealand deserve these things to be fixed now, because they are sending some very bad signals.

First, I’d like to ask the Minister in the chair, Iain Lees-Galloway, a particular question in relation to a contribution by the Minister of Finance, Grant Robertson, earlier today. Mr Robertson came up with some numbers about how many children would get above the low-income measure of 50 percent of median household income. Mr Robertson suggested that the number was 71,000 versus the 50,000 of the previous Government’s package, rising to 88,000 by 2020-21. Well, I would like to refer the Minister in the chair to page 21 of the regulatory impact assessment, which is the officials’ view of the world. Table 2 of that document appears to say that the reduction in number of children in low-income households from this package additional to the Budget 2017 changes is actually 12,000.

💬 Hon Louise Upston: How many?

Only 12,000 more. Now we’ve been told it’s 20,000; we’ve been told it’s 38,000, and the officials are now saying 12,000. Actually, I do think we need a number that the officials back up in this regard, in relation to Table 2, because this I do believe is the apples-to-apples comparison that the Government has been saying it’s giving us, and obviously hasn’t been giving us. Unless I’m misreading this completely, it appears to be fairly black and white and says that going above 50 percent of median household income the number is 12,000. So I’d appreciate a response from the Minister in the chair on that.

The more substantive issue that I was referring to is this concern that Nick Smith has raised, rightly, because it is again quoted in this document on page 12, about marginal tax rates and Treasury’s warning that some families will face effective marginal tax rates of 100 percent. Now I actually think it’s not good design if families face effective marginal tax rates above 50 percent, or even 60 percent, and certainly not 80 percent, but we are going to have some families that, effectively, get less money in the hand if their income goes up. It’s 100 percent effective marginal tax rate. That doesn’t make sense.

Now one of the reasons we’ve got this problem is because we’ve set up yet another entitlement in the spaghetti of entitlements that New Zealand is developing, and we need to stop doing that. We need to stop adding more entitlements, because, actually, we have an entitlement now, if we want to provide to more parents with young children—it’s called the Working for Families tax credits. So why don’t we just add money to that entitlement and then you don’t get this problem of abatements of different packages at different times, which all add on top of each other to give these very high, effective marginal tax rates.

I have proposed to the committee another amendment in this regard. I have proposed that, rather than introducing the Best Start payment, if the Government thinks that this is the right thing to do—and we could debate the amount of money, and we would continue to do so, and we’ll debate what should be required of people to get this money, and my colleagues have put forward some excellent amendments in that regard. But I would like to propose that, actually, the smartest thing to do, if you think this is the right amount of money to provide, would be to provide it through the Working for Families package, and then the abatements could apply in the normal way. Now, if that was the case, it would simply involve adding back in, for children less than three, a particular rate of payment.

And again, if the Government wants to proceed with the exact amount as is in the current baby bonus, well then, that would be providing $8,734 a year to parents with children under three, and then that would abate progressively as we went. I think that would be an elegant solution. It’s the sort of solution this House should debate properly, and I look forward to that debate as this discussion continues. Thank you, Madam Chair.

Thank you, Madam Chair. I’m very grateful to be able to take another call. I must admit I sought it a little bit more vigorously this time because I was so pleased a few moments ago, before the Hon Steven Joyce spoke, to see that the Hon Ruth Dyson, with all of her experience, was seeking a call. Boy, it’s well past time for members opposite to start answering some of the questions—the very important questions—that members on this side of the House have been putting forward all morning. Frankly, we have not been getting answers, and I want to implore the current Minister who is in the chair, Minister Lees-Galloway, to start engaging in detail with the very significant questions that members on this side of the House have been putting forward.

I was appalled when the Hon Ruth Dyson considered putting forward a closure motion, because Part 1 of this bill is a very substantive measure that, as the Hon Louise Upston articulated so eloquently a few moments ago, is not open to any further public scrutiny—not going to select committee. This is the one opportunity that members of the public will have to hear the rationale behind some of the measures that have been put forward.

I strongly echo the suggestion that’s just been articulated by the Hon Steven Joyce. One of the real problems that you have with a package of this nature is that rushed legislation is often fraught with risk, and in Part 1, I think, it is clear that there are all sorts of anomalies and inconsistencies that are going to lead to chronic unfairness, which will affect those who, presumably, were meant to benefit from Part 1. So I want to commend all of my colleagues behind me for the very intelligent range of amendments that we are putting forward, that we are wishing to hear answers to and if the Government is not going to support them. Part 1 is a very significant measure, and there’s a whole range of things there.

I’d like to just return to the independent earner tax credit, because I asked the Minister of Finance a question earlier, and he gave me a fairly glib answer, but I have to say he didn’t actually answer it in detail. I was making the point that none of my constituents—not one—had contacted me to express concern about the fact that the independent earner tax credit was being removed.

💬 Hon Members: Nor mine.

And my colleagues on this side are all echoing the same thing. So I’m, frankly, incredulous at the idea that Mr Robertson was contacted by a whole lot of people. He certainly didn’t put a figure on it, and I’m sure that there were very good reasons for that. The question remains: why would you reinstate the independent earner tax credit at $520 when, at the same time, you’re taking away more than double that amount from a much greater number of people?

The other thing, of course, is that we had legislated—and this bill will take it away—for everybody who would have been eligible for that tax reduction to get it. They wouldn’t have had to go through a convoluted process. With the independent earner tax credit, of course, they have to go through quite a significant process, and many of them have been totally unaware of it and have never done it.

In the departmental disclosure statement, we read the following: “A person cannot claim the independent earner tax credit if they, or their partner, are eligible for a Best Start tax credit. This is achieved from defining a Best Start tax credit as a Working for Families tax credit in section MA 8 to the Income Tax Act 2007. The eligibility criteria for the independent earner tax credit already excludes people eligible for Working for Families tax credits.” Even if I’d read that a little bit more slowly, I doubt whether there are many people who are listening to this particular debate who would have understood what that all meant and how they could personally benefit from it. That is why it is incumbent on this particular Government, at this time, as they’re rushing this bill under urgency, to explain the rationale for something that is actually so inconsistent that it borders on being ludicrous.

I want to commend, as I say, the colleagues on this side of the House for their many significant amendments. I will be strongly supporting Sarah Dowie with her amendment—

💬 Brett Hudson: What about mine?

—because a well-targeted—ha! And Mr Hudson’s—and Mr Hudson’s. I will be supporting all of my colleagues’ amendments; it probably won’t come as a great surprise to them to hear this. But I just wanted to mention one or two, because a well-targeted credit can make really significant difference to those who are most in need in our country, and in that, I presume, all members of this committee are united. What we really want to do, and what we were doing through our own Budget in May of this year, is try once again to focus assistance on those who most need it. I would have thought that the current Government, who claim that they represent many of those people, would have been only too pleased to support us in that. But instead, no—we’ve had no indication yet (a) of how they’re going to respond to most of our amendments, or (b) whether they even understand the rationale behind them.

I make the point: I am so proud to be part of a really cohesive Opposition that is putting forward substantive amendments to this bill. This is not frivolous opposition; this is serious, wide-ranging debate on a number of measures that will make a very real difference in the lives of those people who this bill is supposedly meant to impact.

Why—why—are we not hearing any response at all? Surely this is the opportunity, this is the moment. These are the people who have, for the last five weeks, wasted parliamentary time on a whole range of measures that had unanimous support in the House, to the point where they filibustered and voted down their own closure motions, and yet now, when they have an opportunity to stand up and debate something of substance—something that actually makes a real difference to those New Zealanders—they are utterly silent. It’s a disgrace. It is a disgrace, it really is, and I think that the members opposite should be hanging their heads in shame. I really want at least one of them to stand up now and answer one significant point that has been made.

I thank the members for their questions. I’ve just taken some time to get some advice from officials, and I will do my very best to answer some of the questions that have come from Opposition members.

A couple of members asked about the statement in the regulatory impact statement that some families could theoretically face tax rates above 100 percent, so in effect—[Interruption] Would members like to hear the answers or not? Some families could, in very unusual and specific conditions, find themselves with an effective tax rate of more than 100 percent. The Rt Hon David Carter asked what our best estimate is for how many families might be in that position. To date, we have found no one who would be in that position. So our best estimate right now is zero families would be in that position.

💬 Hon Steven Joyce: Why’s it in the paper?

Well, the member interjects and asks: why is it in the paper? Because, as an open and transparent Government, we want to acknowledge that there is a theoretical possibility, and we’re happy to include theoretical possibilities. We’ve done our best to see if the theory actually applies in practice and, to the best of our knowledge, the theory does not apply in practice. So I hope members appreciate that answer.

Members have asked if it is intentional that the Best Start payment is not available to parents who are receiving paid parental leave. Yes, it is intentional. The reason for that is that people are already receiving a Government payment—paid parental leave—that is significantly greater than the Best Start payment.

💬 Hon Louise Upston: In absence of work.

The good news of course, if members are interested in listening, is that people who do not currently qualify for paid parental leave and get nothing now receive the Best Start payment of $60 a week.

Mr Joyce asked: why don’t we just roll this into Working for Families? Well, I give a similar answer: not everyone qualifies for Working for Families—not everyone qualifies for Working for Families. So we are ensuring that families who do not currently qualify for Working for Families, including many families who are not in work, actually get the $60 a week payment. So that is the answer to that question, Mr Joyce.

The other question that Mr Joyce asked was—there is a table that has a different estimate of the number of children who will be lifted out of poverty to the number that was used by the Minister of Finance. That is quite straightforward: different departments have used different forecast assumptions. Now, Mr Joyce, as a former Minister of Finance, will be well aware of this—that different departments will use different assumptions—and that’s why that number is different. I thank members for their questions, and I hope those answers help.

Thank you very much, Madam Chair. I would like to start by asking the Minister, Grant Robertson, a question. Why does he keep talking about the family benefit, when his Best Start tax credit is a very shabby, thin version of that type of proposal? He’s been singing the praises of Best Start, and evokes the old family benefit. He’s talking about the universal payment to all babies, to help all families.

I have to say, that sounds fantastic. Even the Salvation Army has been endorsing it as a fabulous universal initiative. But who has read the terms and conditions? Who has read the small print? Well, I have and it is nothing—nothing—like the old family benefit. In fact, it is an enormously restricted payment. Firstly, it’s not universal, and I have to pay credit to Erica Stanford for bringing this up. Not all babies are equal, under this. Every baby, I believe, should get this tax credit. Every family should benefit. But, under this legislation, everyone will, except if you are a working mother—except if you are a working mother with a premature baby. Can you believe that? Working mothers are being discriminated against, and a working mother who’s entitled to parental leave.

Yes, give them parental leave. We all sang and danced about that. But, actually, if you’re entitled to parental leave, that’s your entitlement; ah, ah, your baby’s not good enough—

The CHAIRPERSON (Poto Williams): Can I just remind the member that paid parental leave is a benefit and it will be applicable to Part 2. We are talking about Part 1.

This is absolutely critical to Part 1. This is where the legislation is—

The CHAIRPERSON (Poto Williams): I just encourage the member—we’re not to talk about paid parental leave, which is part of Part 2.

I beg your pardon. But the reason that these working mothers can’t get this Best Start payment is because they’re getting parental leave. So that’s why it’s connected. So, again, I’m encouraging everybody to read the terms and conditions, to read the small print.

The other thing that is interesting, when you think about the family benefit, is that the family benefit was truly universal. The family benefit went for 18 years. No wonder it added a bit. This one is not even universal for one year. After one year, only a small number of families will be able to get it to three years. So the old family benefit was totally universal—18 years. This one is not universal for even one year, and then only for a very small number of families in the second and third years. So it’s absolutely nothing like it.

So I would like to ask Grant Robertson why he’s talking about this. I don’t think you can take his statements at face value. I absolutely think parents should look into this and make sure that they understand what’s being said in the papers. I also think, when you look at other areas as well, you need to read the terms and conditions and look at the small print. I think some people are going to be bitterly disappointed that this bill is not delivering what they expected, and certainly not delivering what they could have had under National’s plan.

These people, these working mothers, are probably the ones that won’t get the payment in the second or third years. These working mothers are probably the ones that have also lost the $1,000 a year that they would have got under moving the tax thresholds.

So I don’t think this policy is what it’s cracked up to be and I don’t think the public know. I’m really advising all parents to look at the terms and conditions. I take offence that working mothers, who have got a tough road to hoe when they’ve got a new baby—working mothers, who are contributing to our society, who are out in the workforce—I take offence that they have been discriminated against. They, of all the people in our communities who should be looked after, are being discriminated against by this Government, and it’s not good enough.

I move, That the question be now put.

Madam Chair Williams, thank you very much. I just want to start with a comment that was in response to a question to the Hon Grant Robertson. He said that he is proud that we are returning to a benefit. He said, “New Zealanders should be proud that they are returning to benefit.” That is the disgrace of this legislation here today.

I think the Hon Louise Upston and the Hon Nicky Wagner and others have exposed what a problem we do have in this legislation, how it discriminates against working women, how it doesn’t encourage people to go out there and work, and how it is a piece of legislation that the Labour Party is putting forward to return people to a benefit and a life of dependency.

Just looking at that last example, which I think the Hon Louise Upston explained very well, about how a working mother would not actually get the Best Start payment—that is a disgrace, for this legislation to take away that opportunity for that working mother. If it is going to be a Best Start payment that is going to be universal, why is it not for the person in that exact position? Why do they lose it because they are working and have made that conscious choice? And that—

The CHAIRPERSON (Poto Williams): Could I just ask the member—I just want to seek the indulgence of the committee. I’ve heard several arguments that are very similar, and I’m looking for some new arguments in this debate.

💬 David Seymour: Hello?

The CHAIRPERSON (Poto Williams): This is part of a—no, that’s not appropriate. I’m looking for less repetition and some new material to come into the debate.

💬 Hon Steven Joyce: I raise a point of order, Madam Chairperson. I appreciate your concerns, but I must say that there has been a lot of substantive new material raised in just recent times. In fact, Minister Lees-Galloway has I think substantiated that by standing up and answering some questions that have been raised by members.

Now, those questions beget further questions, which I think we’ll hear in the next little while. But I have to say that in nine years of sitting in this Chamber, I don’t think I’ve heard more new substantive arguments than I’ve heard in the last 15 or 20 minutes. I appreciate the Chair’s point, which is a good reminder to members, but I would just point out that I think we’re seeing a lot of new material added, and I’m sure we’ll see a lot of new material added.

The CHAIRPERSON (Poto Williams): I thank the member for that intervention, but I do have to say that I have been in the Chair for 40 minutes and there have been some speeches that have repeated what has already been said in the Chamber. So I am encouraging members to find some new material in this debate, and there is plenty to be had. So thank you.

Thank you, Madam Chair. The last point I was talking about was the young mother and the Best Start programme. But also, young single people that actually make the conscious choice to go into work have lost their tax cut under this bill. Under this bill, the incentive is not there for those young people to go into work. The incentive for them is to seek to go on to a programme of becoming a beneficiary, which is the very point that the Hon Grant Robertson made in his replies to members in this Chamber when they were asking questions about the incentives and the dependency that this will create for families.

I also want to talk about the amendments that Sarah Dowie has put forward. That is in regard to—Sarah is in front of me. She has put forward an amendment in regard to the Best Start tax credit, Subpart 1. That would add a new clause 12A. That would, effectively, mean that any person receiving the Best Start tax credit shall ensure that the dependent child has attended a 15- to 18-month core Well Child check. That is putting an incentive in there for parents, or those that are receiving the Best Start tax credit, so there is actually an obligation of some attempt to make sure that that child has had the best start in life by actually getting that Well Child check. It is a very important part of any beneficiary regime that there is also a requirement to do something, and we’ve heard in this committee from the Ministers involved in the beneficiary areas that they would like to see and continue to see that there are requirements put on beneficiaries.

So to get the Best Start tax credit, effectively, the individual would be a beneficiary from the Government, and, therefore, there should be some obligations placed on those that do receive that benefit. Sarah Dowie has put forward a very good amendment that would require some kind of consideration on behalf of the person that is getting the benefit to actually have the 15- to 18-month core Well Child check.

I’d like the Minister to explain why the Government has not put any requirements on parents in this situation to undertake those kinds of obligations when they talk about something that is going to be for all and really is not—it is only limited to certain groups in our communities, and especially those that are on a benefit.

Thank you, Madam Chair Williams. I’ve heard one novel question since I last answered questions from members, which is the one from David Bennett regarding Sarah Dowie’s amendment. Why no requirements? Because this Government trusts parents.

Thank you, Madam Chair Williams. And now for something completely different from the ideas factory of the fifth National-led Government. I want to bring to the Minister of Finance’s attention the question of indexation of some of the tax changes and the benefit changes, because I note that the Best Start credit has provision to be changed simply by Order in Council whenever there is a change in inflation. That means that your benefits under Best Start are inflation-proofed. They are protected from increases in money supply, reducing what you can buy at the shop. If that happens, the Government’s going to give you more.

I can actually see why that’s not such a bad thing. We shouldn’t have inflation changing the real benefits that people get, because inflation is something that is completely outside the control of people in this House and of most New Zealanders. So what I’d like to ask the Minister is how did he see fit to inflation-proof the benefits that New Zealanders will receive under this bill but he didn’t think to inflation-proof the tax thresholds that people will be moving to a higher rate of taxing? Because, you see, people have been paying approximately $500 a year extra in tax every year for the last few years, due to the previous Government’s failure to index tax brackets to inflation.

💬 Michael Wood: I raise a point of order, Madam Chairperson. Questions around the indexation of tax rates had been raised 2½ hours ago in this debate.

The CHAIRPERSON (Poto Williams): That’s not a point of order.

I apologise to the member for making a slightly abstract argument, but if he keeps on listening, it might become clear to him. It is a travesty that the so-called tax cuts that are being repealed in Part 1 were not tax cuts at all. They were a change in tax brackets that merely caught up with the way that people had been pushed into higher tax brackets by inflation. More and more people were paying the top tax rate simply because of inflation. If you look at these changes—at $48,000 you are paying 30 percent. It won’t be long—in fact, it may be within the term of this Government—that someone working full time on the minimum wage will be paying 30c, nearly the top tax rate.

If we’re going to have a debate about how much money we’re going to give back to people from Treasury, if we’re going to have a debate about protecting that income—as they like to call it—from inflation through indexation, which is done in this part on the Best Start package, then who is standing up for the taxpayers who actually pay the bills to make this whole show possible? Who is giving them protection against inflation, being pushed into higher and higher tax brackets each and every year, being pushed into those tax brackets that most people never thought they would be in—with so many people now in the top tax bracket, with people on the minimum wage working full time nudging a 30c tax rate—simply because the previous Government did not index tax brackets to inflation, and this Government, in this bill, has now discovered that indexation is a good thing when they are giving away money but are not prepared to protect the taxpayer by indexing tax thresholds?

They are very conscious of tax thresholds. In fact, one of the points of this part is to adjust the tax thresholds, but they’re not prepared to index it to inflation. They’re very conscious of inflation indexation, because they’re prepared to do that with the Best Start credit, but they’re not prepared to put these two concepts together and give the taxpayer a break and some surety about their tax bill and the effects of inflation pushing them into higher tax brackets. So I’ll conclude with a question for the Minister, and it’s this: will the Minister consider adopting an amendment that would attach an adjustment to tax thresholds in line with inflation, as he has for the Best Start tax credit? Why does he protect beneficiaries of this bill from inflation but not the people who pay the bill for this bill, and that is the hard-working taxpayers who show up and make it all possible?

I want to question the Minister in the chair, Grant Robertson, on how many people with this package are going to be caught up in the ridiculous position of facing a more than 100 percent—

💬 Hon Steven Joyce: Or even 90 or 80.

Sorry? Or even 80 or 90. But I think everybody in this committee would say it is ridiculous if people, when they earn more, end up worse off.

So I just want to give the Minister in the chair a practical example. Let’s say you’ve got a teacher, they’re earning $80,000 a year, they’re living in Auckland, and, as a consequence of the generous new Government, they get an increase in their teacher salary of $5,000 a year, or $100 a week.

What this part does, firstly, is it says they’re in the top tax bracket. So out of that $100 a week, they’re going to lose $33 in tax. And then, as a consequence of the Working for Families abatement, they’re going to lose another $25 of the $100. And then, as a consequence—quite likely in Auckland; we know they’re facing rental costs—they face an abatement of their accommodation supplement of $25 per week. And then, with this Best Start, they face an abatement of $21 per week. So they get an increase in their pay of $100 a week, but the Government takes $104 off them. Now, how can that possibly be good policy? And, actually, it could be worse than that. If they’ve got a student loan, they’ll actually have another $12 a week that they’d need to contribute there, and, if we want to throw in the ACC levies, then that puts it up—they’d actually earn an extra $100 a week and the Government takes $116 a week off them.

Now, can the Minister in the chair please explain as to how that’s good policy? How would we possibly want people who are getting $100 a week extra—

💬 Darroch Ball: You’re making it up.

—ending it up—well, the member says, “Which part?”.

💬 Darroch Ball: No. “You’re making it up.” is what I said.

Oh, well, the member says I’m making it up. Is it true that they’d lose $33 worth of tax? Yes. Is it true that they would lose $25 a week from their Working for Families? Is it true, under the parts of this bill, they’ll lose $21 of their Best Start? Is it true that they will also lose $25 on their accommodation supplement? Well, if I add 33, 25, 25, and 21—that comes to 104. Do you know why I know it’s correct? Because the regulatory impact statement for this very part says—we’re warned by Treasury, “Some people will face over 100 percent abatement on their extra earnings.” Is this scenario somehow unrealistic? Well, actually, $80,000 a year is not an unreasonable income.

Now, even if it’s 80 percent, I remember debating in this House saying that having a marginal tax rate of 66 cents in the dollar completely destroyed the incentive to work, and, actually, I give credit to the Labour Government that realised that and made reforms. What I am shocked by is that after 25 years of a broad consensus in this Parliament that there needs to be an incentive to work, there needs to be an incentive for people to earn a higher income—and I just want to know from Winston Peters of New Zealand First, when did he tell New Zealanders that he was going to be taking $116 a week off somebody who earns an extra $100 a week? How is that, Mr Peters, going to provide an incentive to work? Why would you want to be part of a policy that actually is going to undermine the capacity for us to grow the wealth of this country?

The bottom line of what these provisions mean is that people have a disincentive to work. You’re going to have the ridiculous situation of the employee turning up to the employer and saying, “Hey, you know how I work 35 hours a week? I’ve worked out I’m actually better off if I only work 30.”, or the person ridiculously saying, “Hey, I don’t want the pay increase, because this bizarre Government is actually going to make me worse off.”

My challenge to the Minister in the chair: please explain Treasury’s comment that a group of families will face an abatement regime over 100 percent and why on earth would we want to do things like introduce a Best Start payment and not go with the amendments of Mr Joyce for a more sensible regime.

I move, That the question be now put.

I would like to take the opportunity to speak on a tabled amendment in my name that hasn’t been discussed in this debate. As I said before, because this is being debated in urgency, for something that doesn’t come into effect until July, it is important that there is the opportunity to fully debate amendments in this House and that the Minister in the chair will answer any questions related to these amendments.

The amendment that I’m referring to is one of equity. This is of the fact that a dependent child who has been adopted wouldn’t actually get the Best Start tax credit. The members opposite, when they were in Opposition, talked a lot about equity, so I want to know from the Minister in the chair, why it is that a child that’s been adopted—whether at three months, six months, or 2½ years—is not eligible to be supported by taxpayers across New Zealand.

💬 Hon Tracey Martin: They are—through the orphans and unsupported child’s benefit.

It is a really important question that I would like answered. This is a child that’s been adopted—a child that’s been adopted. Their parents are valid parents like any other parent in New Zealand, and I’m really hoping that the Minister for Children isn’t suggesting that a child that’s been adopted in this country has any less rights and support than any other child in New Zealand. If the Minister is suggesting that, I think the House should be deeply, deeply concerned. That means we should have a greater opportunity to debate this amendment, given there’s no other opportunity for the public of New Zealand to have their say—and I know that families who’ve been involved in adoption would have a lot to say about my amendment. I do ask for the Minister of Finance to consider it, because it is a matter of equity.

The current Government is, you know, clearly committed to the best interests of children, which is what our Government was—and 50,000 children would have been lifted out of poverty. Steven Joyce has raised some issues around, actually, the numbers being very confused in the regulatory impact statement in terms of whether it’s an extra 12, which would get us to 62, when, actually, the number of 88 is referred to, but I’ll let some of my colleagues pick that point up.

The point I want to come back to is around equity. I raised in one of my earlier comments the equity around someone who’s working and, therefore, getting paid parental leave, but this is the fact that an adopted child isn’t getting the same amount of support from taxpayers.

I want to refer to the contribution that the Hon Iain Lees-Galloway made, although his tone was incredibly dismissive in terms of the importance of a debate under urgency—I think people listening would have been quite shocked at that. The comment was around trust and around who they trust. Clearly, that side of the House doesn’t trust taxpayers, because if they trusted taxpayers, then they would accept the amendment that’s been put forward by the Hon Steven Joyce around lifting Working for Families payments, because that would enable families and taxpayers to make those decisions themselves.

Anyway, dealing with the bill, as that side of the House has drafted it, my request, and my question to the Minister, is around equity, because—and I’ll use the Rt Hon Bill English as an example—the equity is that a member of Parliament and their family on their income would get the full entitlement to the Best Start payment in the first 12 months of their baby’s life, yet a low-income family who is currently accessing paid parental leave won’t. I want the Minister in the chair to explain to me how that provides equity. How is that fair? How is that fair when we talk about something that is universal, and we talk about equity—there’s another example—and there’s no equity for the child of an adopting set of parents? My question to the Minister in the chair—

💬 Hon Ruth Dyson: We’ve done this.

—is about equity. Madam Chair Williams, I’m a bit bothered that members of the Government are interjecting about an amendment that I am speaking to for the very, very first time. It bothers me that they are not—[Time expired]

Thank you, Madam Chairperson Williams. I’d like to take up a couple of points, if I could, that were partially answered by the previous Minister in the chair. Now that we have the finance Minister back, I’d like to get him to expand on them if possible. My colleague Nick Smith raised the issue of 100 percent effective marginal tax rates, and the officials, I understand, have basically said, “There will be some; we haven’t found them yet.” I think it would be very helpful for the committee to understand other high effective marginal tax rates that might apply as a result of this package, in particular, say, perhaps in the bands of 70, 80, or 90 percent, which are very high effective marginal tax rates anyway.

I am confident the officials will have done the work to check the impact of the Best Start payment in combination with other entitlements on effective marginal tax rates, and I’d very much appreciate the Minister being able to share that information with the committee, which will give us a bit of an indication as to how big an issue these effective marginal tax rates are that the committee is worried about.

The second point I’d like to address is the tabled amendment in my name—as to why, instead of doing the Best Start payment, it wasn’t considered that the same amount of money could have been added to the Working for Families family tax credit. Now, Mr Iain Lees-Galloway suggested the reason for that was that they wanted it to be universal, and yet the objective of this particular bill is to focus on incomes for low and middle income families, so that would suggest that if the concern is for those families, then using the abatement regime of the Working for Families programme would achieve a better targeting, and it would also mean that we don’t have a doubling up of abatement rates of the type that would give us those effective marginal tax rates. It would be very straightforward to just simply, as I have proposed in my amendment, add a new band at nought to three. If that’s the Government’s key concern, as the Minister says through the Children’s Commissioner’s work, then why not do that in preference? It would be a much simpler, cleaner, and easier to understand approach than the current approach of a new package.

💬 Hon Iain Lees-Galloway: You may not have liked the answer, but you got this question answered about 20 minutes ago.

No, it hasn’t been answered, Mr Lees-Galloway, because your answer was, if I may say, given your personality, a little bit flippant, and therefore we’d like a more substantive answer, because I think it’s a very reasonable proposal.

The other point I’d like to raise at this point is these tax thresholds at the low end of—or the low tax threshold. Now, the Government is proposing to reverse the current law, which was to lift the bottom tax threshold from $14,000 to $22,000. They’re proposing to undo that, which does seem to not only cut across the objectives of the legislation but also cut across the stated policy of one of their key coalition partners—well, confidence and supply partners—the Greens, who have themselves proposed the idea of adjustments at the bottom end of the income range and around that $14,000 a year tax bracket.

So I have proposed a number of amendments that would go some way to acknowledging that that bottom bracket should be adjusted, as an alternative to the very sensible approach of the previous Government. It is a chance for the new Government to show that, actually, they’re not religiously against moving tax thresholds in principle, but, actually, they are prepared to show some adjustment for hard-working Kiwis. It is something also that the Greens could support, given that it is, indeed, their policy. I’m assuming that as confidence and supply partners, they could at the very least consider actually endorsing an amendment to the bill that provides an opportunity for the lowest tax threshold to be adjusted.

So these things are, I think, really substantive questions for the Minister. They go to the heart of some of our concerns about this particular bill. Why not do something that addresses these very high effective marginal tax rates, which occur when you have too many entitlements that all abate on people? Why not simplify the system and include the money in Working for Families—and I want a substantive answer to that, not the one we got before from Mr Lees-Galloway. And these low tax thresholds—why not adjust those?

Thank you, Mr Chair. I rise to take a call on this Families Package (Income Tax and Benefits) Bill in support of the amendment from my colleague the Hon Louise Upston in regard to Subpart 1 and the inclusion of an amendment to clause 22, after new section MG 1(1)(d), to insert paragraph (e): “for the purposes of this section, ‘dependent child’ includes any adopted child between the ages of 0 to 3 years”.

I think that’s important, because I want to add to this—and I’m glad that the Hon Tracey Martin is in the Chamber, because she and I did some work in regards to the equity of allowances for kin carers, especially in regards to foster carers. So what emerged out of that was that there are a number—and this is a families package, but we know there are many different make-ups, and sometimes complex situations, of those families. So while this clause is really important because it actually wants to include and make clear in the legislation and in this package the inclusion of adopted children, I know that the Minister—who’s actually just popped out—will know that, in fact, in those—

💬 Hon Iain Lees-Galloway: Point of order.

Apologies for that. I do apologise for that comment.

💬 Hon Ruth Dyson: New member!

💬 Hon Member: Touchy. Touchy today.

Well, I did apologise for the comment. The importance of the point that the Hon Louise Upston has made is just in regards to ensuring that we don’t miss in these—they may be small anomalies, but they’re actually critically important.

There are many families that have adopted children. In fact, probably members in the House also, too, have adopted children. So why—and can Minister in the chair, Grant Robertson, answer this question—would he not want to see this? This is not an amendment that’s trying to subvert the whole intent—in fact, it’s wanting to include in the intent. So to the Minister—and I’m sure he’s a good man, and I’m sure that he will see that inside of this clause, it’s important to do that.

I want to include in that the important point that there are also other anomalies. So while we talk about the superannuitants that are here and those who will be benefiting from this, there are many grandparents raising grandchildren who have adopted children as well, and so there will be another complexity. I think it’s important that if the officials that are out there can also, too, ensure that when we’ve got grandparents raising grandchildren, and often they’re in the process of where they’re actually applying for guardianship orders—will they too, when they’ve got the burden of pressure to be able to meet the demands of raising their children, be covered in this?

I genuinely want to sort of see that the officials that are out in the backrooms—if they can actually give some assurance, give that to the Minister, and if the Minister can answer that question, because I think that’s critically important. I know Di Vivian, who’s with the Grandparents Raising Grandchildren Trust—I’ve been and had contact with her many times over. I’ve actually heard from her at times about the importance of where these grandparents, who are often late in their years, have now been burdened with the task of raising their grandchildren and have often had to suffer the costs because of that. So I’d like the Minister to ensure that the officials can actually ensure that’s there.

But, again, I’d like to reinforce the point that this point here that the Hon Louise Upston is putting forward in Subpart 1—that is very clear. I don’t think there’s any question that anyone in the committee would object to the fact of including this for the purposes of the section that “dependent children” includes adopted children between the ages of zero and three. But I would just add the other part in regards to grandparents raising grandchildren—superannuitants. It’s an anomaly that often doesn’t get picked up and doesn’t get raised, but I know that the work that I did with the Hon Tracey Martin—her and me—in regards to that, which was to include that there was equity of allowances. So all I’d ask is that there is an equity of opportunity where they too could apply for this and be eligible in the entitlement, so that they could receive that.

I’m not sure how that would actually work, because they’re in the middle of their guardianship orders that they are applying for, but I just want to make this plea to the Minister just to check this out and give them some assurance. I know that I will be taking phone calls from Di Vivian and others who are grandparents raising grandchildren and their whānau, but I’m sure that this would give them some assurance that this package actually would support them and meet their needs at this point of time as well.

So to the Minister, I want to thank you for this and for the opportunity to be able to speak on this. I look forward to his response. I also—just in the short time I have—make a request of the Minister in regards to another part, where there just seemed to be some incongruence in regards to new section MF 4F, where it was described that it just seems to be that younger children were being penalised. If you look in subsection (4) of that, it was quite clear that those who were older children seemed to be getting $4,822 in their allowances, whereas—[Time expired]

Just to repeat some of the explanations that have been given, particularly on the last points that the member Alfred Ngaro raised—which I explained in an earlier call—there is only a single child rate. It is now the same. It’s the same approach that the previous Government took.

Also, to repeat the point that there is no one that the officials can find at the moment in the situation that Dr Nick Smith raised. The Government has a commitment to undertake a review of the tax and transfers system overall as we go forward, and we’ll be able to identify any other potential things that came from arrangements that the previous Government might’ve had in place. So that question has, indeed, already been answered.

I can reassure both the member who’s just sat down and Louise Upston that children who are adopted are considered to be the dependent children of their principal caregiver, and so will qualify for Best Start, just as they qualify for other Working for Families tax credits. Again, to reiterate something that’s been said a number of times during this debate, the orphans benefit, the unsupported child benefit, and the foster care allowance have been increased to match the family tax credit changes, and those people who are in receipt of those benefits are indeed able to get Best Start—something that has been mentioned in the first reading and second reading and has also been mentioned in this committee stage.

I move, That the question be now put.

Mr Chair, thank you. I find it necessary to take another short call because I put a question to the Minister that—you know, I would say it myself, I guess—I feel is concise and clear and of interest to a large group of New Zealanders known as taxpayers. I have to say I feel obligated to raise this because in the Epsom electorate, there’s a particularly acute concentration of these taxpayers, and they feel taxes more acutely than in most constituencies.

I think they’d be justified in having an answer from the Minister of Finance, whom they pay for as taxpayers, as to whether or not they would be able to get support from the Minister and his Government—[Interruption] and Tracey Martin—and the Green Party. They would like to know: could they get support for indexation of their tax thresholds to inflation? The reason they’d like to know—and I’ll just spell it out again for the Minister, because he didn’t see fit to answer the question when it was put to him very fairly and reasonably and quite eloquently, I thought. Is it fair to expect that if he is going to index the Best Start payments to inflation, if it’s true that the benefits people get funded by taxpayers should never be eroded by inflation and this Government will protect them against inflation, then will those taxpayers also be protected against being pushed further and further into higher tax brackets?

I’ll also just repeat for the Minister, since he didn’t answer last time, that it may be of greater interest for him then he realises, because it is not just those people in Epsom that have a very acute interest in being taxpayers; actually, it is people up and down the country. Indeed, somebody working full time on the minimum wage will be getting very close by the end of this Government’s term—if it believes that it’s really going to put the minimum wage as high as it would like—to paying 30c in the dollar. If the Government gets to the end of this term and it finds that people on the minimum wage—if they haven’t been priced out of the labour market by the stupid increases as proposed by the Government, that is—are paying 30c in the dollar, so their marginal tax bill goes from 17.5c up to 30c overnight, then it is not just going to be a few people in Epsom that are worried about this tax thing; it’s going to be a lot of people—a lot of people—that support this Government.

On behalf of those people, the constituents I represent, and that long-suffering and much-ignored group in this debate—the taxpayer—I’d like to ask the Minister for a response this time. If he understands the concept of indexation, is he able to index the tax thresholds, the point at which people go up another tax rate, to inflation, the way that he has indexed the benefits? That’s all we want to know. Is there anyone in the committee at this point that doesn’t fully understand the question? I’m sure the people watching at home get it. If we can index benefits to inflation, can we index tax thresholds? Is there anyone that feels that the question’s not clear at this point? No? Everyone gets it. Does everyone understand the question?

💬 Hon Members: Yes.

Yes? Let me put it another way, does anybody not understand the question? OK; so it seems everybody understands the question. Will the Minister support my amendment to index tax thresholds to inflation? Does he value taxpayers, who pay his salary, as much as he values the people that he is giving money to? OK; I don’t think I could make the question any clearer. If there is any way I can make the question clearer, then someone give me a call. But I can’t make it any clearer. So now, Grant Robertson, you have to answer the question. You understand what the question is, so now can you get up and tell the taxpayers: will you index their tax thresholds to inflation the way you’ve protected everyone else’s benefits?

I move, That the question be now put.

Members, I won’t accept the closure motion at this point. But I will say to members that I’ve sat here from 9 o’clock till 10 o’clock, and I’ve been watching the debate throughout. There have been certain points within the bill that had been debated extensively, and simply asking a question in a new way, giving a different example, does not make it a new question. So if there are any new arguments to be had, now is the time to have them.

I raise a point of order, Mr Chairperson. I respect that it is for your judgment to determine when we take closure. However, I do want to make the point, very strongly, on behalf of this side of the Committee, that there are amendments that have been placed on the table somewhat recently that have not been debated, and there are members here that wish to do so.

I don’t need any additional help. And that would come under the category of bringing out new arguments and not going back to re-asking questions that have already been asked in a different way. Now is the time to bring that out.

I raise a point of order, Mr Chairperson. I appreciate that guidance. I think one of the reasons, though, that members are seeking to re-raise or, if you like, elucidate further on previous arguments is because these are quite substantive amendments proposed to the bill and they’re not getting any response from the Minister of Finance or any member of the Government at all, so members feel the need to continue to raise those points again and expand further in the hope that they can actually be seriously addressed. There are some very significant proposals. I’ve seen some very positive proposals that have been raised, so, perhaps, to help with the process, and I appreciate that you want to make sure that the debate brings up new material, perhaps we could address some of the material that’s already in front of us. [Interruption]

No, I don’t need any more assistance, thank you. I thank the member for his contribution. As I said before—and I accept what the member is saying, but now is the time to bring those arguments in. Kia ora.

Thank you very much, Mr Chair. I’m very pleased to—through an amendment I’ve tabled only in the last few minutes—bring a new avenue of thought in, particularly in this Part 1, and particularly addressing the question of eligibility. In this particular regard, my amendment is seeking to add a new clause 12A—so this is in relation to MC 4, and, to get to it relatively succinctly, it’s do with the National Immunisation Schedule. I’ve put down here that “any person receiving a Best Start tax credit, as referred to in MC 1, shall confirm that any dependent children have fulfilled the requirements of the New Zealand Immunisation Schedule as they relate to the age of the dependent child.”

So if we accept—and I don’t fully do—that the Best Start grant is a positive step forward and that the handing out of cash will do the trick, then I would argue, or suggest, that this is also a mechanism by eligibility to ensure the good health of that child through existing mechanisms—that being the National Immunisation Schedule. I would also make the argument, and hence why the amendment has been tabled within the last few minutes, that it’s also for the public good. So members will, hopefully, understand that we have a register from, effectively, birth right through to, actually, old age, but we’re talking about four sections of the schedule here, up to but not including four years of age where children receive various vaccinations. I for one am a very strong and ardent supporter of vaccinations. In fact, you may even go as far as to suggest that I am for the mandatory immunisation of our children, as a number of countries—I think including Australia—have gone down the line recently. I see with this piece of legislation being proposed that we have an apt mechanism via the Best Start tax credit to encourage, if not mandate, the vaccination of children.

So, fundamentally, this amendment in my name comes back to how we can constructively use the eligibility criteria for the Best Start tax credit, to ensure that the parents get their children immunised. And I’d like to put it to the Minister of Finance: does he see value in using his tax credit to bring about further individual and public good? I think, fundamentally, that this is a good idea and I’d like to understand if he sees it as such. It is possible—I don’t want to presume the Minister’s response. He may feel that this is not quite the right way to do it, and if that were the case, I would welcome a discussion, be it in this debate or elsewhere, of how we bring this about. As I say, this is a public good. We all know that the immunisation of the many protect the few that do not, but it’s also good for the child, and I suppose that’s—

💬 Hon Grant Robertson: I raise a point of order, Mr Chairperson. I’m sorry to interrupt the member, but I do wonder, and I know this amendment has only just been tabled in the House, but the issue of the National Immunisation Schedule is not covered in any form whatsoever in the Acts being amended in Part 1.

The CHAIRPERSON (Adrian Rurawhe): No. It’s my opinion that the member can speak to this tabled amendment. At the end of the day, it will be up to the committee to decide.

Thank you, Mr Chair. Look, I’m more than happy to engage in a discussion and a debate with the Minister around how the schedule works in the various Acts and Orders in Council that bring it about. It’s quite a legitimate thing in and of itself, but I think what’s really important, and now I need to absolutely hammer it home, is this is about providing the Minister and the Government with an eligibility option to obviously access the Best Start grant but also bring about some other particular goods.

So I’m really just suggesting that we enable this amendment to be considered, to be inserted in, as I say, as a new clause, clause 12A. It’s relatively simple. The legislation, the mechanisms, the regulations are already in play. I do accept that I may need to go away and provide a few more amendments to bring about how we verify this. Obviously, the parent or parents will have to verify—I assume it’s through the IRD that this is being done—but I am very aware that there are mechanisms or agreements, if you will, in place between various Government agencies at the moment. And, without going on too much of a tangent because I’m conscious of my time, the Ministry of Health already records all of this in its internal systems. So I don’t think it will be overly difficult for, say, the Ministry of Health to inform IRD that actually this particular dependent child has received all the immunisations. There are quite a number of them. If the Minister is interested, it is on the Ministry of Health website.

But, fundamentally, I’m asking the Minister not to deny that the register is there, but to say: does he see a benefit in these eligibility criteria? If he doesn’t, then why are we missing an opportunity to actually help the child simply, beyond handing money to the parents? I would hope that most members of this committee, and the Minister indeed himself, would understand the good reasoning and scientific principles of why we need our children immunised. So let’s not simply give them the money; let’s also protect them.

Thank you, Mr Chair. As this debate continues, I would just like to take an opportunity to answer some of the questions that were directed towards the Green Party about why we supported the National Party’s piece of legislation previously and the tax cuts that we’re now supporting being overturned.

I would say, and I have said earlier in the debate, that it was a really tough call for us, because we supported the increase to the accommodation supplement. We recognised the extreme need in our communities. We see the people on the streets. We see the families in cars and babies living in sheds. We knew that we had a moral duty to respond to their need. We were put in a situation of supporting that legislation because of that need while recognising that that legislation was going to take money out of our tax system by giving $444 million to people in the top 10 percent of earners—people like me. That was really uncomfortable, but we did it because we saw the need at the time.

We are really pleased, while we don’t see this legislation as a perfect solution, that, actually, we can address the need without giving people like me the opportunity to buy more lattes, because the truth is that I don’t need any more lattes. I know that people could say, well, OK, I could use that money to donate to groups I care about, and that’s true. I do that. But the truth is I don’t believe that Women’s Refuge and Rape Crisis—all those groups that are spending so much of their precious time fund-raising and trying to get me to support them should be using their time doing that. I think that the taxpayer dollar should go to towards ensuring they have the money to deliver.

Those tax cuts would have taken money away from being able to do that. I hear some people say: well, those tax cuts, I could have used that to give money to the people on the streets—all of those people on the streets that I see every day. Sure, I enjoy having the chance to chat to those people, but that is not my picture of the future of this country. That kind of Dickensian approach where I get to feel smug and righteous and great about myself because I bestow my beneficence on those poor people. I want those people to get enough through our basic way we structure our society that they don’t need to be there on the streets. That is why we are supporting this legislation, because it is turning around that charity model that was so much a part of that last Government’s philosophy.

I heard in previous speeches from that side of the Chamber that people actually like participating in fund-raising to buy crayons for their kindergarten, that there hasn’t been an underfunding of those core public services, and that people like that and they don’t want that taken away from them. But the community I live in does not have the resources for that. It is entrenched inequality between those communities where people have the time and they have the money to get out and fund-raise amongst their friends to give to their local kindy. In communities like mine where that money is not spare, if that money is put into the kindy it comes out of the money that went into the food bill to help people put food on the table. It is our duty in this House to even out that inequality. That is part of what this legislation is trying to do.

I would just briefly also like to address the point around immunisation and Well Child checks and to reinforce the message that we trust parents. We don’t believe that children will be better off by removing money from them, and they’re not going to get any better results from that.

Thank you, Mr Chair. I would like to take this opportunity to speak again on my amendment, which is to add a new clause 12A in the Income Tax Act 2007. It is to add—the wording is—“and that any person receiving a Best Start tax credit as referred to in section MC 1 shall ensure that any dependent child is enrolled with a Well Child provider.”

I feel it’s really important that we look at the full evidence when we are talking about providing the best possible start to newborns and also providing the best possible support to the family of a newborn. The Minister—and I have heard the Minister the Hon Grant Robertson talking repeatedly about the evidence—says that this Best Start tax credit is based on evidence and it is the best move to give $60 a week to these families, which adds up, and becomes $3,160—somewhere around that. If the Minister believes that amount is based on evidence, I want to ask: what is the full evidence that the Minister has seen to provide the best possible start to the families of newborns?

Another interesting thing is that the Minister also talks about the longitudinal study in Dunedin, saying that it tells us that the first three years of life are the most important in a child’s development. Yes, that is important, and the study that the Minister has cited is a very important study, because we are really proud of the work that the University of Otago is doing through these two studies, the Dunedin Multidisciplinary Health and Development study and the Christchurch Health and Development Study.

So these studies are about the overall health and well-being, which, of course, includes behaviour as well. These studies have been monitoring 1,000 babies that were born between 1972 and 1973. These studies are about full health, development, and well-being. So when the Minister talks about evidence—that he has based this payment on evidence—I want to ask the Minister: was there any evidence on health checks? Because when you talk about providing the best possible start to newborns, health definitely becomes a very important component, and health is interrelated to social outcomes. So we cannot exclude health and just talk about social outcomes.

I also want to ask the Minister about the evidence when he says that just providing financial help—just financial help—will be actually good for newborns, and we can just be assured that the social outcomes for these children will improve. No, we cannot just assume that.

There is another study, Growing Up in New Zealand, which is happening in Auckland. It started with tracking 7,000 New Zealand children before birth. So this is to see what kinds of things happen in early development and what kinds of interventions work. So I want the Minister to look at the full evidence, not look at just the evidence the Minister wants to look at to come up with this idea of giving this $60 a week payment to families of newborns. Of course, as my colleagues have mentioned before, if parents are working and they are on paid parental leave, they are excluded while they are getting paid parental leave.

Paid parental leave was increased by us to 18 weeks, and now by this Government to 22 weeks, and now it is going to go up to 26 weeks. So those families will not be getting this payment for 22 weeks now, and when that comes into effect—the increase of paid parental leave to 26 weeks of paid parental—then those families will not be getting this Best Start tax credit for 26 weeks. How is that fair? My amendment is to see that this should become a criterion—that a child should be enrolled with a Well Child provider. In enrolling a child with a Well Child provider, they are getting the full health and overall well-being check-up—not just for the child only but for the mother as well.

There are simple things sometimes that can affect the well-being of the child, and as a mother I know that really well—for example, at birth, safe sleep practices and vitamin K. These things are really important. There is the first week check, then the two to four week check, and then it goes up to four years. So there are really good, intensive checks that are available through Well Child providers, and I want to see that all these children are able to access these services, which are fully free.

I would like to see that the Minister considers this really seriously, if he’s really serious about overall well-being and giving a very good start to newborns.

I move, That the question be now put.

Thank you very much, Mr Chair. I just wanted to update members with a bit of progress. Not only have I imagined an amendment that would index tax brackets to inflation under this bill but I’ve made one materialise. It’s on the Table. If members would like to see it, it’s on the Table. It’s a pretty eloquent piece of drafting, and there will actually now be an opportunity to vote on this amendment.

💬 Hon Tracey Martin: What nice handwriting.

Well, I always said, if you want an MP with nice handwriting, vote for the other guy. But the critical thing is that this actually—

💬 Hon Ruth Dyson: Paul Goldsmith said that too.

Oh, there’s a bit of comedy in all of us, isn’t there, Ruth Dyson?

In any case, I’d just like to take members through my amendment, because it’s actually important to taxpayers. It replicates clause 21 in the current bill before us. That clause, of course, allows, by Order in Council, the Governor-General to index the thresholds for the Best Start benefit. This will do the same thing for schedule 1, Part A, section 1, table 1, column 2 of the Income Tax Act, and that is the infamous table that tells you how much tax you must pay at which amounts of income. What the amendment would simply do is allow the Governor-General, instructed presumably by the Minister of Finance, to change those thresholds by an amount corresponding to movement in the New Zealand Consumers Price Index that has not already been taken into account, rounded up to the nearest whole dollar. This is not actually a requirement—I’ve drafted this in a way that might get some sympathy from the Minister. This is not actually a requirement for the Minister of Finance to adjust tax thresholds to inflation, but what it does is it gives him the statutory enablement to be able to make such a change. Currently, he’d have to legislate.

This gives the Minister of Finance more power, if he wishes to use it. For example, the Minister of Finance might find himself in a time of deflation, and he might wish to be able to lower tax thresholds to protect Crown revenue. It could work both ways. There’s a lot of commentary around the world that we may be going into a deflationary period. Who knows? This amendment will fortify the Minister’s revenue against that turn of events, but it’s much more likely that he will be able to use it to raise tax brackets so that people on lower incomes don’t get pushed into higher tax brackets by inflation through no fault of their own whatsoever. Now, again, it’s not a requirement. It’s not an obligation on the Minister. It is an enablement. It means that the Minister will be able to stand up in this House and tell people whether or not he has used this power to give taxpayers much-needed relief at any time.

If he feels that he is able to justify his position in this House, in a democracy, then he’ll be able to do it, but he’ll no longer be able to hide behind the fact that he has no power to change tax thresholds, because this amendment will give him the power. He will be able to choose what sort of Labour finance Minister he will be. Will he be a “We won. You lost. Eat that!” finance Minister, such as Michael Cullen, with scant regard for the welfare of the taxpayer, or will he be a legendary liberator such as Sir Roger Douglas? It’s going to be difficult for the Minister because he has such a wide heritage to draw upon, and I want to help him make that choice with this enabling amendment, which will enable the Minister to be in control of tax thresholds. He’ll be able to adjust them by making a phone call to the Governor-General—just call up Patsy any time and say, “I’d like you to protect taxpayers by”—

💬 Hon Tracey Martin: I don’t think you can refer to the Governor-General like that. You can’t refer to the Queen’s representative like that.

Under this amendment, he will. He’ll be able to protect taxpayers from inflation the same way that he’s protected beneficiaries of this bill.

So that is the question for the Minister. If he’s not prepared to stand up and answer the question—will he support an amendment that requires him to protect taxpayers from inflation?—will he at least allow an amendment that enables him to do so? Members, the amendment is on the Table.

I rise to take a second call on Part 1 of this Families Package (Income Tax and Benefits) Bill.

💬 Hon Amy Adams: A second; gosh. Lots left.

Yes, absolutely. There’s lots left. I have taken the advice of the previous Chair and had a rejig of my amendment relating to paternity orders. So we have now rejigged that and would like that to be considered as Part 1, which goes, again, to the eligibility criteria for receiving the Best Start tax credits.

I’ve already talked about my previous amendment to Part 1, which relates to eligibility with respect to the Well Child programme and having parents check in for their 15- to 18-month Well Child core check before they receive the third payment for the tax credit, which, of course, puts in place an obligation to make sure that the money from those tax credits is well spent, that the children are getting the best start in life, and that the money is not just being sent out and spent on whatever the parents’ wills may be. It is actually designed to go to lifting children and the family out of poverty, which is the overarching aim of this bill.

My second amendment relates to paternity orders. Now, at the moment, fathers do not have the right to have a paternity order. Basically, what they have to do is apply to the court for either a declaration or, if they want to know the paternity of a child, the mother can actually thwart that test and refuse a test to be undertaken. Where I’m going with this is that I think it’s important, because under the United Nations Convention on the Rights of the Child it has been said that the child has a right to know who their father is. So this amendment goes to the heart of that, making it a criteria that if there is a question about the father’s paternity for a child, then that test must be carried out so that the child can know their father before those Best Start payments are paid out.

Of course, this has wider ramifications in regards to raising children and families out of poverty, because, of course, if a father is found to be the parent, then he is eligible for child support payments. That, then, adds to bringing more money into the family and raising the amount of poverty. But, also, it allows that child to have a connection with their heritage and it allows that child’s well-being to be better taken care of so that they know their heritage. They can hopefully establish a relationship with that father should the couple be estranged, and, again, that goes back to the wider principles of this Families Package (Income Tax and Benefits) Bill, which is talking about using benefits to raise children out of poverty and add to their well-being.

So this amendment makes it an eligibility criteria that to receive a Best Start tax credit, under new Subpart MG 1 of the Income Tax Act, they will have to comply with sections 47 to 49 of the Families Proceedings Act 1990. So that, I think, is fair enough to add to the child’s well-being to make sure that the father of the child is known, and that will allow further benefits to the family to raise them out of poverty. I think this amendment should be supported. I think that we need to look wider at these ramifications that add to the well-being of children and simply not just hand out money without there being obligations on the parent to adhere to.

I move, That the question be now put. [Interruption]

I’m going to repeat what I said before, and there are a number of new amendments on the Table. The last two speakers have spoken to tabled amendments that they have made. I am not accepting the closure motion right now, but the debate is narrowing down and I would suggest to the members that tabling new amendments hasn’t actually introduced new arguments; just it put a different way on to the Table.

I raise a point of order, Mr Chairperson. I seek your assistance. I understand that it’s incumbent upon members to bring up new arguments and that eventually the debate may narrow to a point where there’s no longer a need to proceed. However, I also understand that one of the purposes of the committee is for the Minister to satisfy the committee that there is workable legislation so that we can detect faults that might cause us all harm later on.

The CHAIRPERSON (Adrian Rurawhe): So can you come to the point, please.

Yes, I was just getting there. The question I have for you is: if a Minister, after being repeatedly asked, refuses to answer a question, what do the people have—

No, the member will be seated, thank you. I’ve listened to almost the entire debate and questions have been answered. They may not have been answered to the member’s satisfaction, but it is up to the committee to decide that.

I raise a point of order, Mr Chairperson. I just wish to seek your assurance on one matter when it comes to your decision making about seeking a closure. We have had a call from Jan Logie—

I have not accepted a closure motion. [Interruption] Be seated. I have not accepted the closure motion. I have given my reasons for not accepting it, and I have given some guidance to the committee around my decision.

I raise a point of order, Mr Chairperson. I just want to seek your assurance, when you do eventually come to make decisions, as we had a call from Jan Logie and it’s important that we get to respond to that call.

Order! The member will be seated. Members will have to trust my judgment. You are seeking my assurance. That would tend me to think that the member isn’t trusting of my judgment. It is my judgment. My judgment was that I was not accepting the closure motion.

Thank you very much, Mr Chair. I will now repeat the point I made—for the benefit of members who have already been responded to, around the Best Start criteria and what the criteria should be. And I take the point that the Chair has made, that simply introducing different versions of health checks doesn’t actually introduce new material. We have been very clear. Those matters are best dealt with through their primary legislation. This is not the place for it. It’s actually foreign to the Income Tax Act to be introducing material like that into the Income Tax Act. So that point has been made. That applies to all of the amendments, which are, in fact, of a very similar vein.

The other question that I have been asked, since I’ve been sitting here, does come from Mr Seymour. I do want to say to him, firstly, at the outset, that I have no intention of being a finance Minister like Roger Douglas. He can be absolutely confident of that question that he asked me. I also need to tell him, as I’m sure he well knows and understands, that the powers that he is looking to bestow upon a Minister of Finance in his amendment are ones that I suspect he might, on reflection, think are ones that he wouldn’t want a Minister of Finance to have. In fact, Parliament would be the best people to make such a decision, as they do now when it comes to whether or not income tax rates should be indexed.

The Government has no intention of supporting Mr Seymour’s amendment. I understand that, philosophically, it is most definitely one that he will support, but I will be interested to see if other members across the committee support an amendment like that. The opportunity to have indexation of tax has been around for a long time. Governments have not taken it up because of the restrictions that it would apply upon taxation. I think, to answer Mr Seymour’s questions, there will not be support for this, but good on him for having a go.

Thank you, Mr Chair. I just wanted to follow on from the speech from Jan Logie. I think she made some very important points that this committee needs to address during the course of the next day or so. The first thing is around the importance of this committee providing for those in most need. The Hon Jan Logie mentioned some very important needs of the people in her community. I just want to recognise some of the needs of people in other communities as well that seek to have assistance, and especially the Hamilton community, as my good friend the honourable Scott Simpson has mentioned. That relates to an amendment that has been tabled in this committee in regards to schedule 1 of the Income Tax Act 2007.

In that schedule, it seeks to change—this is an amendment in the name of the Hon Steven Joyce—the tax rate, in table 1, row 1, to 9.5 percent for income between zero dollars and $14,000. The reason I raise this in regard to Jan Logie is because there are a lot of young people that are out there that have started in their first jobs in my community—that are working. They do not have the ability to take up any of the packages that are in this bill, because they do not have children. They are hard-working Kiwis that are finding it very difficult to get ahead in their life because they are paying high taxes for other people and they do not get the benefit of not having children.

As Jan Logie mentioned in her speech, and as we reflect on, there are a lot of people in a state of need, and these people are also in a state of need. And just because they are single and don’t have children but they are on a low income does not mean that they are not in a state of need, Ms Logie. The thing is that those people need to have some kind of support from this House and this Government, and this does not happen. This amendment would give them that because it would give them that tax cut that would enable those very people to have more money in their hand, because they’re not going to get any money from family assistance or any of the tax credits.

Taking your point, Jan Logie, that we need to look after those people in most need, that community has not been represented here today, and it is not represented in the effect of this legislation that keeps their low incomes at high tax rates when we could be looking after them and giving them lower tax rates, so that they can actually look after themselves.

💬 Jan Logie: Nine long years.

Jan Logie talks about nine long years. Well, these are nine long years that those people have been waiting to get some money back in their hand so that they can get ahead. It was given to them and taken away by the Hon Jan Logie, and it has been and it will be a long nine years for them, because there’s nothing in there for those people that are struggling out there that are single and have no children.

I raise also another point in regard to a new amendment in the name of the Hon Louise Upston, and that is in regard to new section 58A. That seeks to include Better Public Services targets in the legislation. That’s really important because we need to look at all mechanisms so that we can evaluate the success of Government and the impact on our communities. Those Better Public Services targets are looking at the outcomes for low and middle income families with children, looking at reducing the number of working-age clients in point 2, the Government ensuring that 90 percent of pregnant women register with a lead maternity carer—

💬 Michael Wood: Not in the bill.

Well, it is an amendment to the bill. That member across the other side needs to look at this. This is an amendment so it is relevant to this bill, and that is what we are debating here today. They are looking at literacy and numeracy rates and also reducing the number of the children living in households earning less than 50 percent of the minimum wage. So those are very good points.

I move, That the question be now put.

The question is that the question be now put.

I raise a point of order, Mr Chairperson. We’ve had a fairly short debate on this process so far, but I want to raise with you a point relating to the amendment that has been very recently put on the Table by David Seymour, the MP for Epsom. This is a handwritten document and although—

The CHAIRPERSON (Adrian Rurawhe): Can the member come to the point of order, please.

Although he is a graduate of that very fine school Auckland Grammar School, it’s barely legible, and for the committee to be able to consider properly his amendment, I wondered if we could seek your guidance about the legibility of the handwritten amendment that’s been put on the Table—or maybe invite the member to perhaps read it out so that the committee can fully comprehend it.

💬 David Seymour: Point of order. I might be able to assist.

No, I don’t need any more assistance, thank you. I’ve read the tabled amendment. If it is ineligible, then—

💬 Hon Members: Illegible.

The CHAIRPERSON (Adrian Rurawhe): —thank you—it will be ruled out of order. I have read it and understood it. So the question—

I raise a point of order, Mr Chairperson. Less than a minute of this committee’s debating time has so far been available to the amendment that I have tabled and I would request, Mr Chair—

Order! That’s not my responsibility. The amendment arrived when it arrived, and this debate has been going for almost four hours and 25 minutes. The member had plenty of time to get that in here. I believe that members have had enough time to peruse those amendments and the question—

💬 Hon Members: Point of order.

The CHAIRPERSON (Adrian Rurawhe): There are—how many?—one, two, three, four, five, six, seven points of order all at once. Now I’m starting to think that points of order are being raised to stop the vote from taking—[Interruption] So if this is in any way trying to relitigate my decision to accept the closure motion, then there will be consequences.

I raise a point of order, Mr Chairperson. Thank you, Mr Chairperson. The amendment that came into the committee within the last quarter of an hour, I had tabled first thing this morning. I had asked the Clerk if it was out of order and nobody had advised me. I had then issued a new amendment for consideration by the committee, so I think, Mr Chair, the consideration should be that I had tabled it and hadn’t been advised in terms of—

The CHAIRPERSON (Adrian Rurawhe): And your point of order is?

The point of order is that less than a minute has been debated on the amendment.

Unless the member can point to a Standing Order or a Speakers’ ruling around that, I’m not going to accept that.

I raise a point of order, Mr Chairperson. The point of order, which I feel was unfairly considered there, is that we are under urgency and we have had limited ability to write amendments and limited ability to consider what is a very far-reaching tax bill. The right of the Opposition, under urgency, to have the ability to write amendments and have them debated is paramount. The argument that my colleague was making—who is a senior member, who has been a Minister in the past Government. She was making the point that it deserves to have debate. And this side of the House does deserve to have that right under urgency.

Thank you. If the Hon Louise Upston is referring to the tabled amendment on Better Public Services, then I’m ruling this out of order. So there will be no debate on this, OK? It’s outside the scope, sorry—outside the scope of the bill.

I raise a point of order, Mr Chairperson. The objective of the bill is clearly stated—about supporting low and middle income New Zealanders. It’s about child poverty and it’s about ensuring children have the best start in life. My amendment, if the committee would give it time to be debated, is all about measures to support—

I’m sorry. The member will be seated. The member can’t relitigate my decision to rule this out of scope. This amendment, effectively, creates a new Better Public Services Act or amends that. This is outside the scope of the bill we are debating. I go back to my call.

💬 Hon Members: Point of order.

The CHAIRPERSON (Adrian Rurawhe): Sit down. I’m warning members. If there’s going to be continuation of questioning my decision to accept the closure motion—I can assure the members that the closure motion is not going to go away. So repeatedly asking questions about different tabled amendments through a point of order will be ruled as causing disorder in the committee.

I raise a point of order, Mr Chairperson. It’s a fresh point of order and it relates to the Minister when he was last in the chair, Grant Robertson. He was replying to the honourable member David Seymour, and the Minister said he is interested in the views of the Parliament on tax indexation—

I’m sorry. [Interruption] The member will be seated. That is not a point of order, and I repeat what I said before. Please, no more points of order trying to relitigate parts of the debate and tabled amendments.

I raise a point of order, Mr Chairperson. I put an amendment on the Table about 12.20 and—

No. E noho! [Interruption] E noho ināia tonu nei!

[Sit down! [Interruption] Sit down right now!]

I have had enough of this. If anyone relitigates that decision again, they will be leaving the Chamber. The question is that the question be now put. Those in favour—

I raise a point of order, Mr Chairperson. A member of our party did not even get an opportunity to get her point of order out. I say, Mr Chair, that a member should at least be shown the respect to be able to put her point of order to you. If you wish to say she’s wrong, you may, but she has the right to assert the point of order.

That will be for the committee of the whole House to decide. [Interruption] Oh yes, it will be. It will be for the committee of the whole House to decide. When the vote is taken, the decision of the committee will be final. If they want to hear from members that have tabled amendments, then they will have opportunities to do that—if the committee of the whole House decides it.

I raise a point of order, Mr Chairperson. I actually think you have been very fair in your chairing of the session this morning, but I would make one request of you. In your latest ruling, you chose to use Te Reo, and that’s entirely appropriate, but there was not an interpretation service. So I simply ask that if the Chair is to use Te Reo in their rulings, can they please ensure the Māori interpretation is available so that we can properly respect what I think has actually been very effective chairing by the member.

Yeah, that’s not a point of order. There was a translation. And, second, when the first language obviously wasn’t working—[Interruption] sit down—I went to the second language, and perhaps that worked, and it did.

💬 Hon Members: Point of order.

The CHAIRPERSON (Adrian Rurawhe): No, I’m going to put the question now. The question is that the question be now put. Those of that opinion will say Aye, and against say No. The Ayes have it. [Interruption] The Ayes have it?

I raise a point of order, Chairperson. My first point of order is that I have the right to raise a point of order. I am the chief whip for a party that represents 56 seats in this Parliament. For you, sir, to refuse to even allow me to raise a point of order is grossly disorderly and disrespectful of members of this House.

The CHAIRPERSON (Adrian Rurawhe): So what is your point of order? Because that surely could not have been your point of order when you stood up. So what was that point of order?

I wish to make two points of order. That was my first. My second point of order is that we have gone past 1 o’clock. It is in the Standing Orders of this Parliament that there is a break for the lunch break. I was trying to raise that point of order to you before you dismissed me and did not hear me.

No. I have accepted the closure motion, and the vote will take place.

I raise a point of order, Mr Chairperson. Could I put it to you that you have lost control of the committee because of the way you’ve chaired it, and if you’re not going to allow me to speak when I have substantive things to say in response to the Minister’s constructive comments on my amendment, then there is no point in being here, and if you’re going to expel members for relitigating the point of order, we might as well go anyway.

The member will leave the Chamber.

David Seymour withdrew from the Chamber.

I raise a point of order, Mr Chairperson. This is now at a point where we are questioning the very process and procedure of the House. I submit to you that your decision not to allow points of order from this side has led us to the point where we are in a grey area, where, I assert to you, it is for you to rule, and you should rule, that we did not vote before 1 o’clock. It is only when a vote has been taken before 1 o’clock or we are in the middle of a vote that you cannot rise for lunch. We did not vote. We did not have the ability to vote before 1 o’clock or during 1 o’clock, and, therefore, the committee must break for lunch.

💬 Hon Members: Point of order.

No, I took the closure motion before 1 p.m. and the voting started before then. [Interruption] I took the closure motion before 1 p.m. [Interruption] Just one more clarification: as soon as I accept the closure motion, that is when the vote starts. So the vote clearly started before 1 p.m. Relitigating that is not going to change it.

I move, That the Speaker be recalled.

Can the member explain to the committee the exact point that she wants?

Yes—because points of order have been raised, and they have been ignored. Points of order, from any member in this Chamber—I believe there is a duty for the person in the Chair to accept the points of order, and I have requested that the Speaker be recalled.

The member can deal with concerns around points of order with the Speaker at a later time. Once the closure motion has been accepted, everything has to be relevant to that. That’s what I say to—

💬 Hon Louise Upston: Point of order.

The CHAIRPERSON (Adrian Rurawhe): Can I clarify, then, with the Hon Louise Upston: does she want to recall the Speaker about the closure motion? Because that’s not what she said.

💬 Hon Louise Upston: I want to recall the Speaker because of points of order that have been raised in this committee.

The CHAIRPERSON (Adrian Rurawhe): Then my original ruling stands.

I raise a point of order, Mr Chairperson. I’m seeking clarification from the presiding officer in the Chair that you are refusing my request to have the Speaker recalled. Because if that is the case, sir, I’m not sure that this has ever happened in the New Zealand Parliament.

Well, could I make it easier, then: the member can request to recall the Speaker on the closure motion. That is not what she said.

I raise a point of order, Mr Chairperson. I have requested that the Speaker be recalled because the presiding officer has not accepted points of order that have an impact on the closure motion.

OK, that is fine. The question is that the Speaker be recalled. Those of that opinion will say Aye. Those against will say No. The Ayes have it. The Speaker will be recalled.

Motion agreed to.

House resumed.

Speaker Recalled