Estimates Debate — Social Development and Employment, and ACC

Thank you, Madam Chair. It’s a great pleasure leading off the debate for the 2023 Estimates for Vote Social Development, as the chair of the Social Services and Community Committee. I want to acknowledge, first and foremost, the hard work of all involved, in particular the officials and our clerks who have done an extraordinary job. Using a theme-based approach, we’ve produced a wide-ranging report, which can be found on the Parliament website, based on four areas of work, which I’ll now outline.

The Ministry of Social Development (MSD)—we examined the portfolio of social development and employment. The Minister, the Hon Carmel Sepuloni, attended the meeting and spoke on the effects of COVID. She focused on programmes to support getting people into work—these included Flexi-wage, job expos, seminars, and our wraparound model of support. We heard 90 percent of the people who enter work under Flexi-wage stay in that role or move to other employment. We heard that 25 percent of beneficiaries entering work had been on a benefit for one to three years. Young people and upskilling was discussed, involving the earn and learn model. The Training Incentive Allowance to help people better manage financially was also discussed. The Minister spoke about benefit numbers forecasts for 2022-26 from Treasury, the context of COVID, global events, and the economic forecast indicating an increase in jobseeker support benefits.

The Minister said that MSD would continue to work hard to beat Treasury forecasts, and the best time to support someone into a job is when they have just come out of work. Jobs assistance for beneficiaries was discussed, with intense case management helping to get more people into work, supporting people to get their driver’s licences with a multi-year investment of $86 million. Child support payments for sole parents would now be passed on from IRD to solo parents, increasing their income by an average of $24 per week. Dental grants increased from $300 to $1,000, including for non-emergency dental work.

Beneficiary debt was discussed, and we heard that the Parliamentary Under-Secretary to the Minister of Revenue, Dr Deborah Russell, was leading work to ensure a consistent approach to owed debt and this would be a MSD, Inland Revenue, and Ministry of Justice project. We heard about beneficiary fraud investigations, writing off debt to MSD, and assistance with debt management. Finally, emergency housing and the cost of living in those houses was discussed. We also asked about children in emergency housing and learnt that the average stay was 14.5 weeks.

The youth appropriation—partnering for youth development has a $19 million allocation. The Minister, the Hon Priyanca Radhakrishnan, spoke about supporting young people affected by COVID and with complex needs, the annual youth survey, increasing equitable access to youth development services and participation. The Hive and Youth Parliament were also discussed.

Next is the report of the disability sector. I want to acknowledge that this is a significant shift and the Minister for Disability Issues, the Hon Poto Williams, is now responsible for three appropriations totalling $2 billion. Namely, we heard roughly 24 percent of New Zealanders live with some kind of disability. Budget 2023 includes a new policy initiative to establish a new ministry. I want to acknowledge the Hon Carmel Sepuloni for her work to bring the bill to the House and for the handing over of that piece of work. We heard that there are few comparable jurisdictions in the world that have a dedicated Government agency for disabled people. The Minister acknowledged that this establishment of Whaikaha work was credited to the disabled people who have advocated for themselves for several decades.

Finally, we heard from the Minister for Seniors. The Hon Ayesha Verrall spoke to the appropriation of $4.3 million. We heard of the better life strategy, about the newly appointed Aged Care Commissioner and a series of other initiatives promoting positive outcomes for seniors, the aged-care sector, alternative housing for seniors, preventing elder abuse, the Dementia Action Plan, and seniors in business.

In closing, the Social Services and Community Committee recommends that the appropriations for the year ended 30 June 2023 for Vote Social Development be accepted.

Thank you, Madam Chair. I understand the new format in terms of a series of questions back and forward across the committee of the whole House, and that’s the model I intend to follow. I just want to start by putting on record that the total Vote Social Development appropriation is just shy of $44 billion. I accept it’s a significant Vote that we are discussing in this first component of the Estimates debate for 2022-23.

The first series of questions I would like the Minister to answer are specifically around employment and social outcomes support, and, of course, we’ve seen a drop back from the estimated actual last year to the estimate this year. My questions include: of the initiatives that are funded under this category, which of the initiatives and what percentage of the funding is targeted to those who are on benefit long term—i.e., longer than one year? I’m talking about job seekers in total.

So in that question, again, I’m looking for detail in terms of dollar value and percentage of the employment and social outcomes support. How much of that and what percentage of it is focused on supporting people who have been on the jobseeker benefit for longer than 12 months?

I’m also interested in concrete examples—because we continue to hear it—of what defines “meaningful work” and, probably more importantly, what doesn’t. We’ve also heard it a lot in the last week—the language shifted to people having a good job. So to the thousands of employers out there who have jobs that they are desperately trying to fill, I think it would be useful for the Minister, who is in charge of a nearly $40 billion Vote, to answer my first series of questions around the employment and social outcomes support, and to describe and define what is and isn’t “meaningful work” and a “good job”.

Madam Chair, thank you very much. Well, just to start, the member Louise Upston has pointed out the $40 billion Vote, and I do want to clarify that in that $40 billion Vote, almost $20 billion is for superannuation. The three main working-age benefits receive about $7.4 billion; accommodation assistance, about $2.3 billion; student allowance, $682 million; hardship assistance, $608 million; winter energy payment, $518 million; and disability assistance, $418 million. So it is important to keep it in perspective with respect to the significant amount—50 percent—that is paid towards superannuation.

There were a number of questions asked by the member. I’m going to attempt to answer them. However, I completely understand if she may need to reiterate some, because there was a lot in there to unpack.

The member asked how much from the dedicated pool of funding that is in there for employment is targeted towards specifically long-term beneficiaries or those in welfare receipt. I think the point of difference perhaps is that our view is that we can prevent and avoid long-term benefit receipt if we invest early into people that came on benefit. All of the evidence shows that when people are supported to get into employment quickly, then they are able to exit more—when they get on to benefit and are able to be supported into work quickly, then they are less likely to stay on benefit. So that has certainly been the focus for us. Particularly during COVID, I think it was around $163.596 million that was dedicated to employment and training, and that is one of the many numbers that is in front of me.

I also wanted to respond to the question that was asked around meaningful work and good jobs. The approach that we have been trying to take—which has been an approach asked for, actually, by employers—is that we match people up appropriately with work. We do have large numbers of clients showing up to things like work expos but not necessarily walking away with a job, because, at the end of the day, the business gets to choose who would be the right fit and who has the skills and capabilities to go into work. So the best jobs for our clients are the ones where they have the skills to take them up and where they are a right fit for the employer, because, fundamentally, we can’t force people on to businesses and employers, and that certainly hasn’t been the approach that we’ve taken.

Thank you, Madam Chair. I want to come back to the point the Minister referred to around focusing on people who have been on benefit short term, and just to question the decision to ignore those who had been on the benefit long term, particularly those on the jobseeker benefit long term, because we’ve seen the number of those under the age of 25 double. That number has doubled under this Government, and I want to ask the Minister about the very deliberate decision to leave behind a group of young New Zealanders who could have had the opportunity to come off welfare into work, and the very deliberate decision the Minister made during COVID to focus on people who weren’t on benefit at all, to get them back into a job, and to deprioritise—i.e., not support—those who had been on benefit, particularly the jobseeker benefit, for 12 months or more, at the very time there are employers everywhere who have jobs for those people.

Why is it that, of the funding in Vote Social Development in the employment and social outcomes area, more funding has not been focused and prioritised on a group of people that can work and want to work—many of them are desperate to work—but because they’ve been out of the workforce for 12 months or, actually, in fact, for many young people, they may never have held a job and their prospects are, or their opportunities should be, just as great, their potential is just as great, and there needs to be some very focused efforts on supporting them into employment? I’m interested in more detail, Minister, about the conscious decision, as you said during COVID, to leave those people behind and to focus on those who either weren’t on benefit or were only on benefit for up to three months.

I think I outlined it in my previous answer: this Government is focused on supporting New Zealanders into work, and our focus hasn’t deprioritised those that have been on benefit longer term. We’ve got a much more fulsome focus. The fact that we have more front-line work-focused case managers allows us to work with more clients and allows us to dedicate more time to those clients.

The point I was trying to make earlier is that we do want to get in there early to support people. We know that the longer they stay on benefit, the more likely they are to experience loss of confidence. At the same time, there are a number of people who are on benefit who experience a range of challenges, and we’ve spoken about them in this House, whether it be that they don’t necessarily have the skills for the jobs that are available in their area; whether they don’t necessarily have the ability to be able to transport themselves to the jobs that are available—which is why we announced at Budget the $86 million, I believe, to go into driver licences. There’s also a number of people that are on benefit that experience some type of health condition or disability, including, in some instances, mental health, and so there are a range of challenges that people come with, and we need to meet them where they are at, and to ensure that we’ve got the front-line case management to be able to provide that support.

The other point I do want to make, when we speak about job seekers: the assertion that is often made by the other side of the House is that they are all doing nothing. About 10 percent of those that are on jobseekers benefit are actually working in some way—part-time, perhaps, and still claiming a benefit. A good example of this is a woman who contacted me the other day to say that she had had grade four brain cancer and used to be a teacher, is not able to do that anymore because of the impact that the treatment has had on her. She is able to work part-time, but she is still in receipt of a jobseeker’s benefit. Now, I absolutely endorse the fact that that particular person—and there are many others like her—is only able to work limited hours and is continuing to claim the jobseeker’s benefit. But that doesn’t mean that she’s a failure in any way because of that.

Programmes like Mana in Mahi have a number of people on them who are on benefit when they go on to the programme. The remainder are people who are actually deemed to be disadvantaged in a tight labour market and potentially at risk of coming on welfare. So the point is that we believe, on this side of the House—and I think our Budget and the programmes that we’ve put in place demonstrate this—that we need to get in there early, particularly with our young people, and sometimes it’s before they even come on benefit, to avoid a situation—and I’m not going to say just long-term welfare receipt—where they don’t get to realise their potential in the employment market.

Thank you, Madam Chair. I entirely agree with the Minister that the focus of the welfare system should be to support people to fulfil their potential, which is why I continue to be concerned about the very conscious decision that I have in written question answers about the focus on those either not on benefit or up to three months as opposed to those long term on benefit.

And I want to ask the question of the Minister in terms of the programmes and initiatives that are funded in the employment and social outcomes support area, rather than more generally in benefit payments. Specifically, whether or not the consideration has been given to the length of time that a young person, if they go on to a benefit under the age of 20, will spend on a benefit, whether focused efforts could have been prioritised in that area.

And also ask a question about what preventative initiatives have been funded in Budget 2022/23, which is of course what we are debating in this appropriations debate, to reduce the number of children being raised in benefit-dependent homes, which, at the moment, sits at one in five.

A range of things in there again. One of the best initiatives, I think, that we have actually reinvested in that will avoid our children being raised in homes where they are reliant on a benefit is actually reinstating the Training Incentive Allowance that was cut by the previous Government. It’s one of those initiatives where the science backs it—if we support women in particular, because the vast majority of them are women that take up that particular support, to upskill and train, particularly with higher-level degree or higher-level qualifications, not only do we increase the chances of that woman being able to get a job where she is able to increase her earning capacity but the science also tells us that it is more likely that there will be a positive impact on those children’s academic performance as well. So it’s one of those science evidence-based initiatives that we have invested in, and it’s something that I’m very proud of. And we’re seeing great results—I announced that, in the last two quarters, we’re nearly seeing 3,000 take up the Training Incentive Allowance that we’ve reinvested in. And I think that, in the next couple of weeks, we’ll be able to announce some even better numbers.

Thank you, Madam Chair. My final question in this part of the debate, because I know there’s a lot of areas to traverse, is a question that I’ve had from the dozens and dozens of community organisations that I’ve met with over the last 18 months. And their questions are—for example, in Taupō at a workshop, recently: 1,293 job seekers and every single one of the organisations supporting people into employment were shocked. They were shocked at that number. They had capacity to work with them, support them, whether in mental health, whether specialising in working with women returning to the workforce, working with young Māori, or working with young people. Why is it that there were 1,293 job seekers in Taupō, massive capacity in the community organisations, waiting times on the phone of one, two, and three hours trying to get through to Work and Income? There’s capacity in the system, Minister. Why aren’t you using it?

I think this is a very important point that the member raises. There is a very important balance to strike between the outsourcing of contracts to support people into employment, and then the responsibility of the Government agency to provide some of that support themselves. I want to refer to the Welfare Expert Advisory Group’s work and report. When they consulted with people for the purpose of informing our welfare overhaul, overwhelmingly people were saying that they were not getting the employment support that they needed through Work and Income.

As I’ve said many times in this House, those supports have been run down under the previous administration. Financial hardship had gone up, but also, actually, staff resourcing was inadequate. And so when people were going in to get their financial hardship support or their income support, the natural place where they should also be able to have a conversation about work, quite often they were not able to do that, because there was no longer the capacity, because the investment hadn’t been made. What we did was straightaway rectify that and year on year, from 2019, have continued to bolster that.

I get a lot of positive comments from businesses, from industry, out there telling me how much they appreciate things like the work broker support that they get through the Ministry of Social Development (MSD). MSD works hard with that work broker support to match the right client up with the right employer because—this is another good point—employers don’t want us sending people to them that are not ready, that don’t have the skills for the job, that don’t have things like a driver’s licence, if it’s required. And so the trust that has been built between MSD and industry and those businesses is actually really important. They need to know that when we send them clients, it is an appropriate match and that it’s going to not only work for our clients but it’s also going to work for the work broker.

Now, I’m in no way undermining the work of organisations that provide employment support, and we continue to fund them as well. But it’s not an either/or; it’s an and/and. We need both and we need to make sure that we strike the right balance. We don’t want to be outsourcing what we can currently do in this space where clients are going to come in anyway. And so I think, as a Government, we have struck the right balance.

I do also refute the comment made by the member about the one- to three-hour wait times. I think that the most recent update that I received was that it’s actually between 12 and 26 minutes. There are peak times when people will ring through and then, actually, it may take a little bit longer. However, it certainly isn’t anything like the member has described. I will say, perhaps, going back to when we were in the depths of COVID and people required more support, of course the wait times were longer then, but it is not a consistent thing. So I’d hate for this House to think that that is the norm.

Thank you so much, Madam Chair. I’m keen to ask about the use of benefit sanctions, and I think it’s fitting, considering we’ve just come off a general debate where that was a really strong theme. I know we still have a sanction regime in place, and the sanction regime ends up having a really deep interaction with the need for things like hardship grants, based on the fact that it cuts people’s income—whether it’s 100 percent or 50 percent.

So I’m interested in knowing, from the Minister’s perspective, what she believes the purpose of the sanction regime to be in relationship to supporting people engaged with the welfare system and/or meaningful employment.

I’m also interested in understanding what she believes the interactions between the use of sanctions and the need for hardship grants to be, because I note that if we take away someone’s income—whether it’s 100 percent or 50 percent—and they’re already on the breadline, then they need more hardship grants. I’m just interested whether any modelling had been done the ongoing use of benefit sanctions and increase in hardship. I note the comments from Beneficiary Advocacy & Information Service, one of the welfare advocacy groups, that noted that benefit sanctions result in either crime or hungry people. And, you know, that would apply, I believe to the current sanctions regime. So I’m interested to know her reckons on that.

I also wanted to understand whether she had any projections on whether she expects the warrant-to-arrest sanction to continue on an upward trend. I know in previous debates, we’ve traversed the use of that sanction, and she’s been on the record of this House, I believe, saying that the sanction doesn’t work and that she doesn’t agree with it. So I’m interested to know whether she expects it to continue to rise.

I’m also keen to understand whether she has any evidence of the impact of the warrant-to-arrest sanction to justify the continuous use, particularly noting that the Minister referenced the Welfare Expert Advisory Group; one of the key recommendations there was overhauling the sanctions regime and removing, basically, most sanctions. So really interested to see how she foresees that use going forward.

Thank you to the member for those questions. We have not removed all of the sanctions or work obligations that are currently in place. In my mind, they need to be used sparingly and there needs to be honest attempts to communicate with clients before sanctions are enforced in any way because of the serious implications of a sanction being used. That was certainly my expectation of the ministry; they still are there, but they are a last resort, as opposed to being something that you wave over people.

I do think that there are mutual obligations when it comes to the welfare system. I do believe that the ministry itself has an obligation to clients to make sure that they get the support and the entitlements that they are eligible for and that they need, but I also think that there is an obligation to engage, and where that doesn’t happen—sometimes I actually worry, to be honest to the member. I worry because if there’s an attempt from Ministry of Social Development (MSD) staff to contact clients because they are due for an appointment and there is not communication back and they can’t find that person and they receive no notification of what might be going on, then it becomes very difficult to engage with that person and—I’ve said this to MSD—who knows where they are? So it is a last resort that will be applied.

Usually, and I think that member knows, the actual sanctions are actually often—and even under the previous Government—applied because of the fact that that engagement doesn’t occur and they maybe not only just missed an appointment but you don’t hear from them; you don’t know what’s happening. So for us, I think, there is a place, sparingly, to use those, and so we haven’t moved to remove some particular sanctions or, sorry, work obligations—obligations in general.

We did, and that member knows, move to get rid of two which we deemed excessive and to have a particular impact on children. Of course, that was the subsequent child policy and also section 192 which penalised mothers who were unable to name the other parent, or for whatever reason couldn’t. So those two were removed.

With respect to the warrant-to-arrest sanction, it’s certainly different from the other ones, given that there is a justice component to it. Is it on the cards in the near future to remove? I cannot say that is the case. However, we continue to review our work programme and assess the sanctions with regards to where there is a negative impact or where they are excessive—and we continue to review our work programme and look at what we may do moving forward.

Thank you, Madam Chair. This is a good opportunity to take a call as chair of the Education and Workforce Committee. I’m happy to take a call here and talk about the Minister’s Accident Compensation Corporation portfolio. The Hon Carmel Sepuloni addressed our committee on the broader themes and issues that she is working on in her portfolio. This new process, as has been mentioned before, allowed us to take a sector-wide lens to what outcomes have been achieved for New Zealand. The year 2022 marks 50 years since the ACC legislation was first introduced here in New Zealand, and we heard how the Minister has been working hard to make sure that the system assists all New Zealanders who have had an injury and to make sure that the system is fit for purpose for New Zealand in the 21st century, in particular by improving gender balance, fairness, and equity in the scheme.

This Estimates period will see the first step in this gender rebalancing mahi, with the passage of the Maternal Birth Injuries Bill, which is the first extension of the accident compensation scheme cover since 2008. Once enacted later this year, this bill will benefit up to 28,000 more women per year. With regards to making accident compensation more equitable also, our committee was pleased to hear about ACC’s work to improve outcomes for Māori. We heard about their strategy Whāia Te Tika, which aims to improve engagement with Māori and ensure that the entire scheme works well for them.

The Government is also continuing to improve the sustainability of the accident compensation scheme, and in particular its non-earners account, with ongoing investment in its baseline. As at 31 March 2022, the solvency of the non-earners account was 72.3 percent, up from the 55 percent it had fallen to before the Government made changes to its funding policy. The Minister can be proud that this change is providing certainty to children, the elderly, and other non-earners that the entitlements they receive can continue to be sustainably funded.

Budget 2022 also increased funding for sexual abuse assessment and treatment services. We talked to the Minister about what this would mean, noting that it will both increase the number of hours ACC clients spend with clinical staff and the rate of pay to those staff per hour. The investment will build the service back up to providing consistent 24/7 clinical cover over the forecast period. The Government’s 2022 minimum wage increase meant an approximately $38 increase in ACC’s minimum loss of potential earnings weekly compensation rates, but claimants had to wait three months for 1 April to 1 July to actually receive this money. The Minister addressed the committee and explained how the investment through Budget 2022 will bring forward the timing of ACC’s weekly compensation rate changes so that it is aligned with the timing of any changes to the minimum wage. So it means that all these changes can then happen at the same time. This will disproportionately benefit low-income earners and particularly in respect of loss of potential earnings entitlements for ACC’s Māori and Pacific clients.

I want to acknowledge the Minister and finish by acknowledging the new format that we have considered these entities within. It has provided for an increase in ministerial accountability and, of course, for many years in the Estimates debate we would see that the Ministers would be limited to taking one or two five-minute calls. Now the Minister, as has been seen already in this debate, is addressing the Opposition’s points very frequently. Again, this provides for increased scrutiny and we thank the Minister for her time at the committee.

Thank you, Madam Chair. Minister, I just want to ask a few questions around some written question responses. So in response to one written question, the Minister informed me that the Ministry of Social Development (MSD) has not commissioned any research into why people are becoming long-term beneficiaries since 2012. In a response to another, she informed me that MSD is not centrally recording the reasons why so many work-ready job seekers have been receiving a benefit for a year or more. To a third question, she informed me that there is no central recording of the highest education level received by beneficiaries. So my question is: does she think we may get better value for money out of the benefit system if we recorded relevant data and analysed it, rather than relying on research from the 1990s and 2000s, and do you have any plans to change the kind of data you are receiving?

Thank you to the member for those questions. I think that, with respect to the specific questions, I can’t recall them off the top of my head, to be honest. However, in many ways, some of the rationales for long-term welfare receipt wouldn’t have changed; the complexity of the people’s problems will remain the same. I think that’s pretty fair to say.

One of the issues, I will say, with regards to data, is that our system is a very old system. I’ve spoken about this before. It’s almost like operating a Commodore 64 in a digital age, and even people that maybe worked at the Ministry of Social Development 20 years ago are shocked to see that the same system is still being used.

💬 Hon Members: SWIFTT.

What’s it called again?

💬 Hon Members: SWIFTT.

SWIFTT. It is the same system. How long was that used for?

💬 Terisa Ngobi: It’s a dinosaur.

It’s a dinosaur. So there was some money in this year’s Budget to start us on a bit of a business transformation pathway. The reasons for that are so that we can ensure that we’re able to get the data as quickly and accurately and effectively as I think that member would like to see us get it. At the moment, what happens is a lot of it sticks on individual client records and there’s no kind of broader 2022-kind-of-way of being able to then utilise that data to inform things. So that’s certainly the case. The other reason for needing to do that, though, is not just for reporting and data’s sake; it’s actually so that we can make access to the welfare system more seamless for people that are needing to use it or are in it. That would include, perhaps, if we had a better system, being able to avoid the level of debt that comes from overpayments and what not. So there are multiple reasons why we do need to go along a pathway of business transformation, particularly with regards to our IT systems. I’m really glad that we saw some money to start the ball rolling on that work in the 2022 Budget.

Thank you, Madam Chair—still got a lot of contributions and questions to ask the Minister in the 2022-23 appropriations debate for Vote Social Development, given that it is a $40—four-zero—billion vote.

I want to turn the attention to emergency housing and reflect on some discussions I’ve had, both in my own electorate in Taupō and the neighbouring one of Rotorua, and the issue, of course, of the number of people who are living in emergency housing, and my questions will be specifically around the impact on a child under the age of three living in a motel. We know that there are currently 4,000 children in motels in New Zealand and the whole committee actually expressed very deep concerns about the wellbeing of children who are living in motels. But I want to specifically ask the questions from Rotorua because the feedback from the community there is that it’s now not just the wellbeing of those who are living in the motels, it is the wellbeing of the community in which those motels are located and the economic opportunities of the surrounding area that is now significantly being impacted by Ministry of Social Development’s (MSD’s) decisions and the motels that continue to be used in vast numbers and in concentration.

So my questions are specifically around any studies that the MSD have done on the impacts of child wellbeing for those that are living in motels. Obviously, the Prime Minister has led the children and youth wellbeing strategy of which housing is an issue. So I want to know specifically about work that MSD is doing around children’s wellbeing for those who are living in motels. There was an absolutely tragic environment in my electorate that, unfortunately, we had many, many warnings of before an incident actually occurred in which children witnessed the murder of a parent. So these are dire environments and I want to know what specific actions MSD is taking to support the children who are living there, the studies on their wellbeing, what the long-term action plan will be to support those children.

We know, also, that there is a group of them—and that’s impacting their ability to attend school. That will have a lifetime impact unless significant action is taken to address those children’s needs and wellbeing. So what is the immediate action? When will there no longer be children living in motels? What science and research has been done on the impact of children under three? What is the remedial action to support these young children to get into school? What percentage of the housing support budget is actually going to the people that are living there and, in particular, the children?

Again, a lot traversed there and I’ll do my best. We don’t want to see any children living in emergency motel accommodation. No one does, and no one would pretend that it is in any way, shape, or form the ideal or even close to, you know, OK. However, what we were left with when we came in was an under-investment in housing and a demand that couldn’t be met. We had increased homelessness and so we have set about a very ambitious building programme with the aim to build 18,000 public houses. And I think we’re about 10,000 done already to meet the demand that is out there.

In the meantime, we inherited the emergency housing system that was set up in 2016 in response to the homelessness issue that had arisen at that time. What we have moved to do to ensure that the families are getting the support that they need—because when we took this on, there were no supports in place or consistent supports in place for people that were in emergency accommodation—was to ensure that all of those whānau are under intensive case management, that they are not only engaging with the Ministry of Social Development (MSD) on whatever their emergency housing accommodation situation is but are engaged with the MSD with any of the broader needs that they may have during that time that they are in there.

For Rotorua specifically, between MSD, the Ministry of Housing and Urban Development, and stakeholders on the ground in Rotorua, they moved to a contracting model so we could ensure that people were appropriately in cohorts that were appropriate with respect to where they were staying. In particular, we had our minds turned to the needs of whānau that had children and wanting to make sure that if they had to be in emergency accommodation, then it would be appropriate emergency accommodation for the parents and their children. So that has happened in Rotorua.

The Minister of Housing, Megan Woods, who has much of the responsibility for this, because I do need to add that as the Minister for Social Development, my responsibility is for the emergency housing special needs grant, so I think I’m speaking a little bit outside of my delegations here—we have also commissioned a review to be undertaken of the emergency housing system, keeping in mind that it was really set up on the fly. And that’s not a criticism at all. It was the previous Government; they responded to the need at the time. But we inherited an emergency housing system that wasn’t thought through, that was a response to the homelessness that they were seeing. So now we’ve commissioned a review so that we can look at how we can do that better.

The absolute, fundamental thing to this is that we actually do not want to see people in emergency accommodation at all. However, despite the pace we have been able to build public housing at and despite the pace or the conditions that we’ve been able to change to support private developers to get those houses built, we’re still in a situation where we don’t have the housing that we need. And so there will be the review of the emergency housing system. We are expecting that our officials will be reporting back to us in October. We set the parameters with regards to what we expect to see and, at that point in time, we hope to have more comprehensive answers for that.

Just a very brief contribution instead of questions. Just picking up on the use of sanctions and the Minister’s comment regarding them being a tool to get people to engage with the welfare system. I just wondered whether the Minister thinks it’s effective to, effectively, deprive someone of their basic income to get them to engage, and whether she thinks that there could be other interventions? The feedback on the ground has been that—and as a former welfare advocate on the ground—when people are not engaging with Work and Income, there may be other underlying issues such as transient housing and ill mental health. I just wondered whether the use of a sanction as a tool to get people to engage actually could be having perverse outcomes, such as just worsening people’s mental health or transient housing.

The second question was: whether she would consider the warrant-to-arrest sanction an excessive sanction, considering the lack of—I can see the Minister being slightly distracted, but just want to know if the warrant-to-arrest sanction is an excessive sanction in her view?

I rise as the Chair of the Finance and Expenditure Committee to recommend to the House that the appropriations for the year beginning—

Order! Order! I’m trying to determine what is the best course to proceed, because, in my view, we as a House have been set an almost impossible task of fitting in a strict time frame which actually doesn’t fit the Order Paper. So I’m trying to figure out the best way to proceed. The only way I can proceed is that now we have the availability of the Minister of Finance, who will be with us until 6 o’clock. So now I just have to say a few words.

We now come to—well, I’ve said, we have the Minister of Finance. And I now give the call.

Finance