Rates Rebate (Statutory Declarations) Amendment Bill

on behalf of the Minister of Local Government: I move, That the Rates Rebate (Statutory Declarations) Amendment Bill be now read a third time.

The bill makes a discrete and targeted change to the Rates Rebate Act to make it easier for eligible people to apply for a rates rebate. It removes the need for people to make an unnecessary statutory declaration as part of their application. Instead, they will be able to verify the information on their application form without it being witnessed. The bill also reduces the costs to territorial authorities of administering the Rates Rebate Scheme. There will be less need for home visits to applicants, saving staff time, and councils can design application forms that better suit their internal processing.

While the bill may be targeted and seem like a small change, it offers important benefits to rates rebates applicants. This bill means that a known barrier in the Rates Rebate Scheme is removed. People will no longer need to travel great distances nor experience unnecessary physical discomfort just to apply for a rebate that they are entitled to. Instead of having to find and travel to an authorised person to witness a statutory declaration, or spend time waiting in line at a council office, applicants will be able to complete their application forms on their own. We know this will be an important and welcome change for those who do not have access to easy or affordable transport options and who live a long way from someone who can witness a statutory declaration. It will also be important for the many applicants who have declining mobility or a physical disability, because travelling and waiting in line is difficult. It does not make sense to make them do this for an unnecessary requirement.

To give you a sense of how many people will benefit from this, by the end of the 2019 rating year, there were 103,000 people who had successfully applied for a rates rebate. We know that many applicants to the Rates Rebate Scheme have declining mobility or a physical disability. Research into the rates rebate application process suggests that the statutory declaration requirement is the biggest barrier for applicants with a physical disability. For example, for some bedridden applicants, council staff will come and visit the applicant in their bedroom to witness the statutory declaration. This can be uncomfortable for the applicant, and may put some off applying entirely. The changes in this bill will remove this barrier.

Some people may be concerned that this bill increases the risk of fraud in the Rates Rebate Scheme. It has been said that removing the statutory declaration requirement will make it easier for people to provide false information to gain access to the rates rebate. I want to assure the House that this will not be the case. Under this bill, there is still a legal requirement for applicants to provide accurate information to the best of their knowledge, and the same fraud prevention mechanisms are in place. Applicants that provide false or misleading information are and will continue to be committing an offence under the Rates Rebate Act. The bill is simply about removing the need for someone to be witnessed when they complete their application form.

This bill will also benefit local councils and reduce the cost of administering the Rates Rebate Scheme. Many councils have been sending staff to applicants’ homes to witness statutory declarations, particularly for those applicants where travelling to complete the statutory declaration is too much to cope with physically. This is costly to councils and intrusive to applicants. As I’ve explained before, some applicants must be visited in their bedrooms to complete their statutory declaration. This bill removes the unnecessary statutory declaration requirement and reduces those costs.

As I mentioned before, territorial authorities will also be able to design their own application forms, if they want to. This will allow them to develop forms that suit their internal processes and allow for processing efficiencies. For those councils who do not wish to design their own forms, the Department of Internal Affairs will continue to provide a standardised form.

This bill also paves the way for an online application process to be established alongside the existing paper channel in the future. It has not been possible to implement an online application process because of the statutory declaration requirement. While there is further work required to create, develop, and implement an online application process, this bill provides the legislative changes needed to bring that possibility one step closer to reality.

It is clear that this bill was needed before COVID-19 struck Aotearoa New Zealand. However, it is also clear that this bill will support this Government’s response to COVID-19. The bill will also allow people to apply for a rates rebate remotely, and it provides for a more flexible verification method that can be adjusted as needed during a similar time of crisis. This Government has made a temporary modification to allow people to complete statutory declarations remotely during COVID-19 restrictions, and the bill will ensure that vulnerable applicants will continue to be supported long into the future.

I’d like to thank the members of the Social Services and Community Committee for their scrutiny of the bill and their recommendation to change its commencement date. Of course, the select committee’s consideration of the bill is greatly supported by the public submissions, and I’d also like to thank all of the submitters who took the time to submit on this bill and provide their thoughts to the select committee.

I’d also like to thank the service innovation lab within the Department of Internal Affairs for their contribution to this work. The service innovation lab ran an online application trial with several local councils throughout 2018 and 2019. The analysis part of this trial identified the statutory declaration requirement as a barrier, not just for the development of online applications, but for existing paper applicants, as well.

I’d also like to extend my thanks to those councils who participated in and provided their time and expertise to this trial, including the Tauranga City Council, Auckland Council, Wellington City Council, Hutt City Council, and Kāpiti Coast District Council. The work of the service innovation lab and these councils has been an important contribution to this bill.

This bill represents another change this Government has made to improve the Rates Rebate Scheme. As well as removing the unnecessary barrier, we’ve enabled retirement village residents to access the Rates Rebate Scheme like other households and ensured that winter energy payments are excluded as income for the purposes of the Rates Rebate Scheme. I commend this bill to the House. Thank you, Mr Speaker.

I rise to lead the National Party’s contribution to this piece of legislation. We are opposing this bill, not necessarily for the reason that the Minister, Hon Jenny Salesa, has just outlined in terms of some efficiencies, but really for the opportunities that have been lost in this piece of legislation. Statutory declarations have been used as a requirement to ensure that the information given to the council and then given on to the Government for funding is accurate and real and that people are entitled to the rates rebate that has very generously been given by several Governments to people to help with their costs.

Rates are a significant burden for our elder generations, and many of them end up, in many ways, asset rich and cash poor. The Rates Rebate Scheme was brought in to try and deal with some of those anomalies, and generally it’s worked pretty well. In my previous role, we were very active and sent officers out into the community to meet with people to get the forms filled out. We had open days and people came. I do want to just reinforce one of the benefits of doing that, for the Minister, because one of the greatest risks that a lot of older people face is social isolation. One of the things that I found in my previous role was, actually, when we went to people, even if it was because we had to give a statutory declaration, they often appreciated the visit, the interaction, and all the things that went on with that. Often, council staff found other things that could be of assistance to that person in that home. So while I understand the reason to try and reduce compliance costs and to stop people seeing a barrier, there are really other benefits that come from the system as it operates currently.

If you look at some of the submissions that were given to the select committee, particularly from the likes of the Productivity Commission, who have a view that the Rates Rebate Scheme should be abolished fully and replaced by a rates deferment scheme—in other words, the rates are sort of set in a buffer as a deferment. That is because they don’t believe the Rates Rebate Scheme is necessarily fair in who it targets, in what place, and by what amount.

But one of the important findings from the Productivity Commission was in their view, the Rates Rebate Scheme wasn’t advertised enough, wasn’t promoted enough, and wasn’t simply put out there. So the notion that somehow you can send some forms out or send an email to somebody and they’re going to apply online is, in my view, slightly naive. A whole lot of people—my own mother included—would actually need help in getting the Rates Rebate Scheme. She doesn’t qualify, I don’t think, but she would need help—she couldn’t do it herself. So there is a requirement for an agency to help people complete this, and many councils do that. Most old people that I know in that space that require this appreciate that support.

There is also a risk here—and I’m not saying it’s a great risk, but there is a risk that people don’t necessarily tell the truth, and that a statutory declaration generally makes people think before they go down that path. But in the departmental report—and the select committee looked at this—we did ask the question whether the IRD could share information with the Department of Internal Affairs (DIA) to make sure that there was an electronic way, for want of a better word, of making sure that the income that was given was real, based on the income tax provisions. Now, what came back was that the definition of income in the Rates Rebate Act is different from that from the Income Tax Act, and for a meaningful contribution, the Rates Rebate Scheme would have to be taken from DIA and put into IRD. That’s one of the opportunities, in our view, that has been lost. What we have now is no statutory declaration requirement, online applications, filling out a form that’s sent to you, and very little checks and balances in the mix.

Now, I accept that most people who are getting the rates rebate will be normal, law-abiding, good citizens, and the risk of fraud is possibly lower than in other parts of society necessarily. But what we do need to make sure is—and we got no satisfaction, to my view, during the committee of the whole House stage that there was going to be any more monitoring or understanding. It was simply from the department: “No, we think everything’s going to be all right. If we find something, we’ll do something about it.”

So our side of the House would probably be supporting this bill if it had gone the whole hog, it had looked at data matching with Inland Revenue, and it had changed the provisions to make Inland Revenue responsible for this, because that would have been a very easy thing to do. In fact, it almost could have been automated, because if Inland Revenue knew all your financial details, they could pretty much—like they do with tax—make that arrangement through that process, and people could automatically get it, rather than an opt-in provision.

So as the Minister said, over 100,000 people are getting the rates rebate. A combination of more publicity, a combination of people reaching out to people, and a combination of making things easier will no doubt make a difference. But what we’ve simply done—and I regard it a little bit like the census. The census is “Let’s go online. Let’s be more hands off.”, but we’re going out to a population that is not necessarily comfortable doing everything online. Often it needs family members to help fill out the forms. In my experience, council officers, even though it is a cost to them, have brought real value to that community by providing advice and information. As I’ve said previously, often they found other issues in that household.

So we are worried on this side of the House for two reasons. First of all: without a statutory declaration and without a data-matching regime, there is an increased risk of fraud for a small number of people in this scheme. Secondly, the issues that the Productivity Commission raised when they said that this whole scheme should be abolished was not that this type of support is not warranted—it is, and I support that—but it was, “Is there a better way of doing it?” In our view, rather than just tweaking and taking out statutory declarations, if we actually transferred this over to IRD, used the proper data-matching, then it probably could have been done with minimal input from local authorities. If somebody was eligible, they would receive it and it wouldn’t be an opt-in provision. In our view that would have been a better solution. So in our view we are simply tweaking around the edges by taking away a statutory declaration, which is a pretty important provision. For that reason, we’re opposing the bill. Thank you, Mr Speaker.

Thank you, Mr Speaker. It’s actually an absolute pleasure to rise and take a call on the third reading of the Rates Rebate (Statutory Declarations) Amendment Bill, because it was a bill that the Social Services and Community Committee considered. We heard from a number of submitters. And, given that it’s a third reading, can I just at the outset acknowledge the Minister for the work that’s gone into the bill to get it up to where it is today, officials who helped members on the select committee, and submitters who took time out of their day to give us their view as well.

Now, as has been said before, this is a bill that makes actually quite a small change, in a sense, to the Rates Rebate Act to make it easier for those who are eligible to apply for a rates rebate—well, easier to apply because they don’t have to go and make a statutory declaration, as the Minister said. We know from the research into it that the application process is actually—one of the biggest barriers to it is the requirement to make a statutory declaration. And this bill requires that need.

Now, the previous speaker mentioned that it potentially, then, opens the process up to fraud. I refute that because, although there seems to be some concern from across the House, really, there is still a legal requirement for applicants to provide accurate information to the best of their knowledge and the same fraud prevention mechanisms that exist today will exist when this bill is passed, as well. Applicants that provide false or misleading information are, and will continue to be, committing an offence under the Rates Rebate Act.

So really, this bill is about fairness. It makes the process that much easier for those who want to apply for a rates rebate, especially those who have mobility issues, for example, can’t travel all the way to get a witness for the statutory declaration process or can’t wait in line, as well. It makes it easier, it reduces costs for our local territories, it allows local councils to tweak the process to suit the needs of their people, and, at the end of the day, it also stands up to the fraud provisions that are currently in the bill. I commend this bill to the House.

Thank you, Mr Speaker, for the opportunity to take a call on the Rates Rebate (Statutory Declarations) Amendment Bill. The member who just sat down, Priyanca Radhakrishnan, has tried to paint this piece of legislation as quite a rosy piece of legislation. In fact, it’s actually a very small piece of legislation making very minor changes. As my good friend and colleague Lawrence Yule said, essentially it’s tinkering around the edges without actually focusing on some of the issues which could be looked at in regards to our rates rebates system here in New Zealand.

The issue that the member opposite referred to was the issue around fraud. That is an issue that we have raised consistently on this side of the House, and whilst acknowledging it may be a smaller issue, by removing the statutory declaration, this bill does, in some regards, open up the ability for there to be increased opportunity for fraud and reduced legal oversight over the Rates Rebate Scheme. This is a scheme which does cost taxpayers millions of dollars every year and it is important that there is oversight, the ability to monitor this information, and the ability to ensure that those who are entitled to receive the money are the ones who are receiving it.

The question does need to be asked over how much additional administration is now going to need to be put in place by local government and by other Government institutions to ensure and monitor the information and the accuracy, now that there is a lower legal threshold which is being imposed by this piece of legislation as to those who are qualified and the application process.

The member opposite talks about how this is going to make things so much easier, but fails to actually mention that people still have to go through the application process. All this does is simply remove the requirement for a statutory declaration. But this small piece of legislation will be the catalyst for a large increase in the number of people actually making an application, a large increase in the number of people who do qualify actually making an application and receiving the rates rebate.

As my colleague Lawrence Yule referred to, there are much bigger issues that could have been looked at in regards to our rates rebate system: solutions put forward by the Productivity Commission, where they recommended looking at different ways that this could be managed, whether that was around a deferred payment or integrating this into the tax system so as to ensure that those who are qualified are automatically able to receive their rates rebate, or the tax system being able to look at all the relevant information and knowingly being able to ensure that those who do qualify are given the rates rebate for their rates bill.

This piece of legislation in many ways embodies a lot of what this Government has become well known for, which is simply tinkering around the edges and failing to actually address the real issues and trying to claim some form of success along the way. Well, I challenge members on the other side of the House as to whether this is a moment where they can stand in this House and claim that after three years in Government this is something which is going to be the catalyst to support New Zealanders, older New Zealanders, those who do struggle with paying their rates bills, or whether this is simply just a tinker and a little change and a talking point which they’re going to try and use on the campaign trail to justify their continued existence in Government—it does seem to think it’s going to be the latter—when they could have used this opportunity to actually make some more decisive, more long-term changes based on what the Productivity Commission had provided and is providing through their report.

The National Party does not support this piece of legislation. It does not address the real issues, and we do not support particularly the loosening of the criteria around the system whereby statutory declarations do provide a much higher legal system, rather than an honesty-based system, which this bill does put in place.

Thank you, Mr Speaker. I rise to offer New Zealand First’s continued support for this Rates Rebate (Statutory Declarations) Amendment Bill.

As has been well traversed, this bill removes the requirement for the statutory declaration when applying for a rates rebate, and 102,000 Kiwis applied for this rebate. It’s an incredibly important mechanism to help our lower income and particularly our seniors. Some 79 percent of the users of the scheme were seniors.

I had a young guy come up to me last weekend, actually, that I think encapsulates why this is a good bill. He’s a guy that worked for Kiwibank, and he was pitching for the SuperGold card to have photo ID because he said that there’s so many of our seniors coming to the bank, they no longer have a driver’s licence, they no longer have a passport, and he often cannot help them because they haven’t got the required ID. He has to send them out the door. I think that is an absolute example, and I’m sure that happens around some of these statutory declarations.

Lawrence Yule talked about the seniors struggling online and his mother, and I think my mother—if you’re watching, Mum, I think it’s fair to say that you would, and you bred me so I’d probably struggle to do it online as well, being famously technophobic. But a lot of our seniors, and Tracey Martin talks about this a lot as the Minister for Seniors, are actually very savvy online. The witness to that is the SuperGold card and the new app, which has had massive uptake. So I think we shouldn’t underestimate how advantageous that will be for those particular seniors that are technologically savvy.

So New Zealand First has no issue at all with supporting this. We think it’s a good, sensible bill. Simeon Brown pointed out it’s probably not the biggest bill that’s gone through the House, but it is an important one for those 102,000 people that it would’ve supported last year and will support this year. New Zealand First supports this bill. Thank you.

Thank you very much, Mr Speaker. The Rates Rebate (Statutory Declarations) Amendment Bill—there’s not much to it, let’s be honest, and I sort of almost feel obliged to fill in a few gaps, really, so bear with me, please, as I do that.

💬 Lawrence Yule: You do that, Penk—you do that.

I’ve been encouraged to do exactly that—thank you, Lawrence Yule. Rates are a necessary evil. I think if we accept that services that we expect to be provided by local government need to be funded in some way, and if we accept that, pending a more sensible way of collecting such revenue or at least a different way of collecting such revenue—I shouldn’t speak above my station—then in the meantime, we’re stuck with rates. We’ve got them as a method that is clearly established in this country for supporting and funding the work that territorial authorities—aka councils—and local government in general perform.

So if we accept all that, and we accept also that there is the need for a regime where we have a rebate such that New Zealanders who are on a lower income or perhaps have a fixed income, perhaps relating to a time of their life or other circumstances such that they can’t pay the full rates—fair enough, and, indeed, I don’t think anyone is suggesting that that shouldn’t be the case. So what we’re really looking at in this bill is a question of whether it should be necessary to prove—one ratepayer, one resident, as compared to another—that they are not required to pay the full set of rates that their neighbour is. So that’s a reasonably serious matter as far as it goes. It’s justifiable, but it should be justified, and the current mechanism we’ve got for that is by way of statutory declaration, the good old “stat dec”, as they’re known on the street.

So we’ve got a system that, so far as I can tell, works pretty well. I don’t say it’s perfect—nothing in this life is, without getting too philosophical about it. I think we can say that there are other probably more pressing problems in the world of local government, let alone the world in general, that we could say we would attack before we turned our mind to different ways of attesting one’s qualification for a rates rebate. So I haven’t particularly been convinced by arguments—and I say this with all due respect to Mr Patterson of New Zealand First, but the problem of a person who is unable to prove that they are the appropriate recipient of the largesse that is the Rates Rebate Scheme, that’s a more fundamental difficulty for that person than the existence of the current legal framework, where we have someone sit down and sign in front of someone else to say that that’s so.

I’ve done extensive research into this bill, by which I mean I looked on the website just before I came on. I’ve read the whole thing as well, but luckily, that didn’t take long because there’s not much to it. But having actually gone to no more nor less trouble than looking up on the website to see how one does this currently, there’s a form one fills in, and to be honest, it’s not the hardest of all Government forms. We all, sort of, roll our eyes a little bit at the paperwork; I certainly do—confession time—but, you know, to be honest, it’s not the worst of them, and I think if you can save several hundred bucks by doing that, I think that’s a reasonable step to be required to take. To turn up and sit down in front of a lawyer—you know, I know that’s not always the most pleasant thing to have to do, and I say that having been one, of course—or a member of Parliament; again, guilty. But anyway, that’s all that’s involved, and I really don’t think that it’s particularly helpful for us to be occupying ourselves too deeply in circumventing that. So my attitude is that as expressed by colleagues, and I don’t think I can get much more excited about it than that.

💬 Ian McKelvie: Mr Speaker?

Ian McKelvie.

💬 Matt Doocey: Oh, look at that! Off the sub bench—impact player!

Just as well I got up quickly, wasn’t it. We heard earlier on tonight from Stuart Nash that if you’ve been involved in a business, you’re an expert on all things. Well, I can assure you that I was involved in this funny business of local government for nine years and I don’t know anything about it at all!

But one thing I do know is that local government has to set rates. They have to charge rates and you get a rates bill in the mail. The thing about this business in here is we set the taxes. You never get a tax bill. You just get it nicked off you before you get to see it, so you don’t understand you’re paying the tax bill. That’s the difference between the flak that we get for setting tax rates and collecting cash to run the country and the challenge that local government’s got, setting a rates bill and then having to send the bill out to collect the cash to run local government. The Rates Rebate Scheme is one of those tools that this Parliament has given to local government to ease the burden for some people who struggle to pay rates.

The challenge, of course, is that in this country we don’t have enough income as individuals to pay the bills that we need to pay to survive. And we see that with things like rates rebate provisions, with things like Working for Families—all sorts of tools that the Parliament has instituted to enable people to pay their bills equitably. The accommodation allowance is another one of those. It would be much more preferable if we earned enough money not to have to make these kind of distributions—I suppose, for want one of a better word—from Parliament.

The Rates Rebate Scheme doesn’t account for the people that are most in need with respect to rates. The accommodation allowance does some of that, but that also doesn’t account for it entirely. And one of the challenges that we get in the rental situation, particularly with some of the legislation that’s been introduced in recent years which has, effectively, forced the cost of rentals up, is that the rates bill and the rental situation is quite a significant contributor to the cost, but the person who’s paying the rent has no ability to get that rates rebate back. So it’s not an equitable scheme.

It certainly does play a part for those people who have a small freehold house in suburban New Zealand primarily and don’t have sufficient income to get past the cap. So that’s the issue with the rates rebate. I don’t think it’s sufficient or adequate. It’s very difficult, however, as it has proved over the years with numerous reviews of rates schemes and how we might charge people and how local government might raise income—it’s very challenging to find a better solution, and we always talk about the better solution, but it’s not always evident.

In the course of the discussion on this, of course, the New Zealand Productivity Commission talked about the ability to have a national rates postponement scheme, which I, frankly, think is verging on evil. Because what effectively happens in that situation is you eat up your income or you eat up your equity, and the problem we’ve got—and I don’t know the exact figure, but I know when I was 30 my life expectancy wouldn’t have been much greater than what I am now. But I sure know now that I hope I get a few more years. The problem with the rates postponement - type schemes in this situation is that they eat up equity and you could well outlive your equity. That’s the reason I don’t like them. I think they creep up on you from behind. So I certainly don’t like the alternatives in that respect.

I do think it’s a shame that this bill’s come to the House and deals with a very, very small segment of what is quite a large challenge. Were it to be given more thought and more time, we could have introduced a rates rebate amendment bill which would have come up with a much better proposal than this one has.

The other thing is, I’d just make the point very quickly, that most people—well, not many people nowadays come into the council office and pay cash. But I certainly remember not that many years ago sitting in the foyer of a council building—because it’s not a bad thing for a mayor to do, to go and sit in the foyer of a council building when people are paying their rates, because if you want to get a complaint, you sure get them there—and watching the number of people that paid their rates in cash. It was pretty significant. But back to the point I was going to make, and that is the fact—

💬 Andrew Bayly: That’s why we shouldn’t get rid of cheques.

That’s right, Bayly. That’s quite right. Well, cheques, of course, are very valuable for—

💬 Andrew Bayly: Yes, particularly for older people!

—those who can still write them. I don’t even have a chequebook—ha, ha! But back to the point, there’s often nowadays—in fact, in all of the six councils in my part of New Zealand, in the Rangitīkei electorate or that verge into the Rangitīkei electorate, they all provide JP services in the council building on at least one or two days a week, and some of them more than that. So a lot of the issues that this bill tries to address are actually overcome by councils anyway.

The other thing that happens to people that are looking to claim rates rebates is a lot of them are older and they love to have a chat with someone. And if they can go down to the council and have a chat with that JP that’s helping them to do stuff, or doing whatever they do, that makes a much better day for them. It brightens their day, gives them something to do. I did listen to the point that was made on the other side of the House earlier about the people that can’t leave the house easily to do this sort of thing. That is a bit of a challenge and this bill does help to address that.

But we don’t support it for all the reasons that particularly Lawrence Yule outlined earlier in his speech. I think it’s a shame this bill wasn’t given a much better airing and given a lot more thought before it was introduced to the House. Thank you, Mr Speaker.

Kia ora e Te Mana Whakawā. It’s a privilege to give a very brief contribution to the Rates Rebate (Statutory Declarations) Amendment Bill. At the end of 2019, 103,000 people applied successfully for rates rebates. This bill will make it easier for those people to receive their claim. I commend this bill to the House.

I commend this bill to the House.

Thank you, Mr Speaker. Just a very short contribution from me as well, which hopefully will draw some applause. This bill, obviously, will provide efficiency and cost reductions and remove unnecessary burdens. I commend it to the House. Thank you.