Social Security Amendment Bill

Thank you very much, Mr Speaker. I rise to speak on the Social Security Amendment Bill. I rise as the member of Parliament for Southland and also as the chairperson of the select committee that has heard submissions on this bill. I want to take the opportunity at the outset to thank the members of that committee for the hard work on hearing many submissions and considering the evidence and considering the material brought before us and reporting back to the House. I wish to also take the opportunity to commend the work of the committee clerks and advisers and to thank all the submitters who did submit to the committee. I also should take the opportunity just to acknowledge the 98 percent of beneficiaries in New Zealand who take personal responsibility and are compliant with the obligations that are asked of them. I also want to acknowledge and thank the taxpayers of New Zealand, who support those who find themselves in difficult circumstances and need to rely on the Government for a period of time for a benefit and, therefore, from the hard work of the taxpayers of this country, who support that. That is a part of the social contract that New Zealand has had for a very long time, and I think something we can be proud of is that we have a system in place to help those who fall on hard times for a variety of reasons and to assist them.

This is a relatively simple bill. It has, however, unfortunately, been misunderstood by many, including members of the Opposition, and I want to take the opportunity in this speech just to clarify a few things. Evidence indicates that employment and suitable work generally leads to improved incomes and is associated with better health and wellbeing for individuals and their families, while unemployment is associated with a range of negative outcomes. I’m speaking here from the report that the committee had before it. I do really question whether some members have read that report or understood that report, but I’m going to go through a number of elements of it so that others can understand this and, hopefully, have that information available to them.

There is a cost to Government of benefit receipt. Currently, at the time of the report, the cost of paying benefits to working-aged people was forecast to be $9.341 billion in the 2024-25 financial year. That’s just a bit over $9 billion of paying benefits to working-aged people. The Government has introduced a target to have 50,000 fewer people on the jobseeker support benefit, reducing from 210,000 people that are on that benefit as of March 2025 to 140,000 people by December 2029.

The current regime of work-related sanctions has been in place since 2010—2010. We have heard, frankly, some quite outrageous comments from the Opposition saying this is a mean Government that is placing sanctions on beneficiaries. The regime of work-related sanctions has been in place since 2010. It was there for the entire six years of the last Government, who did nothing to change that. This Government is putting in place non-financial sanctions, an alternative to financial sanctions, that can be applied rather than taking money from beneficiaries. As opposed to taking away something from beneficiaries, it’s adding an option so that they don’t have a financial sanction, which is currently the only option in place and was the only option in place during the six years of the last Government. That’s a really important point that hasn’t been understood by many, including members of the Opposition.

Hon Carmel Sepuloni: Come on, Joseph! You’re the one who doesn’t understand.

JOSEPH MOONEY: I’m going to go through this report because I don’t think the member speaking on the other side of the House has read it.

The traffic light system is designed to provide more transparency and clarity to beneficiaries about whether they are complying with their obligations. If benefit recipients continue to meet the obligations, they will not be sanctioned. Just bear in mind that 98 percent of beneficiaries are compliant with their sanctions; there are 2 percent who are not. We want to make sure that they understand what their obligations are and that they will comply with them. They’re relatively simple. The intention is for the non-financial sanctions, which this bill puts in place, to be less punitive than the financial sanctions, which have been in place since 2010—less punitive. Members of the Opposition would be well reminded to communicate that clearly rather than to try to claim it’s something that it’s not.

The application of non-financial sanctions at the red level of the traffic light system will expand the tools available to the Ministry of Social Development (MSD) to provide an alternative to what are currently called grade 1 sanctions, which are financial sanctions. The introduction of these traffic light colours is a communication tool so that benefit recipients can get a clear indication of their current compliance with the obligations and associated system changes. This will also help enable welfare system settings that reinforce expectations to work where appropriate and will lift economic outcomes of people and their families through exit into work.

There is a place and time for people, for various reasons, to be on a benefit—for reasons of health, reasons of family circumstances, and reasons of loss of employment—but there are so many opportunities from being in employment; there’s so much to be gained from that. There’s so much mana to be developed from that where there are opportunities available to people, and on this side of the House, we want that opportunity to be available to people.

Income support does provide people with protection against life shock, such as job loss. However, to ensure that they return as quickly to work as possible, they have obligations to take steps to prepare for and search for work, and they need to understand what those obligations are. There are also opportunities to improve the understanding of benefit recipients to look for—their obligations—to work.

Automated decision-making: I just want to make it clear that automated decision-making will not be used to assign sanctions. That addresses a point made by the Green Party. Work seminars, which are also another option, will provide MSD with the ability to talk to people more personally and directly and provide them with consistent messaging about their obligations. In terms of medical certificates, this raises another point: we note medical reviews are not tied to the 26th week reapplication process for jobseeker support. A jobseeker will not be required to seek another medical certificate for this process.

There’s a lot more I could go into in this report, but the key point here is that this is actually assisting beneficiaries. This is assisting them to get back into employment. I commend this bill to the House.

Thank you. I want to take issue with the suggestion that anybody in this House is thinking it’s a good thing to be unemployed. Absolutely not. In the Labour Party’s time in office, what you saw was a record level of employment, and I was incredibly proud of that. That’s what moves people out of poverty, out of unemployment, and into employment, and you’ll never get an argument from this side of the House that that is not a good thing.

We are the party for workers. We know the value of a decent job. What we also know is that, under this Government, there is a rort going on. This kind of legislation is all smoke and mirrors. We’re supposed to look over here at what is being said about these people who just can’t get themselves a job while the Government calculates how to take away jobs to reduce inflation. I can substantiate the point, as I’ve been in the House as that happened, and I’ve seen the result.

Last year, we had a bill before the House that meant that the Reserve Bank Governor no longer looks at maximising sustainable employment when balancing the needs of the economy. It was taken away, and he was given a single mandate. That was taken away on purpose. For those people who are watching this and don’t understand this, the point of it is that if you raise unemployment up, then wages drop, and inflation comes down. Real people pay a real price when that happens. They can’t feed their kids. They’re unemployed.

I want to also dispel another myth here. I have just heard a speaker talk about taxpayers and thank them. Well, taxpayers and beneficiaries are not different things. People who have paid tax all their lives end up suddenly unemployed under this Government. That is an all too common occurrence. The people in Kinleith who lost their jobs—and the Government was not prepared to step in and do anything for them—are now beneficiaries. We are never that far away from it in this country. We simply don’t have the savings. Remember back during COVID when many of us wondered what was going to happen the next day? How were we going to cope if our job disappeared? That was something that was really close to us. What’s really important in this country is that we have had a proud tradition of a safety net that is the unemployment benefit. We have had a safety net. Not every country has it, and I’ve been incredibly proud that the Labour Party has been associated with it.

Let’s also bust the myth that there haven’t been sanctions before. Of course there have been sanctions before. In every system like this, there are going to be boundaries. There have always been sanctions. If people have not met their obligations, there have always been sanctions. In 2018, the Act that we are amending today had sanctions in it. It had a hierarchy of sanctions. You could have your benefit taken away.

There have also always been good relationships between the Ministry of Social Development and our budget services, who have sent people off to get help with managing what is a very meagre amount of money and with making ends meet. Our budget services are to be applauded for the work they’ve done, particularly since they tell me that the Government has cut their funding. Since we’re creating a sanction, under this particular regime, where we’re supposed to be sending people off for money management, who’s going to do it, people? You’ve cut the money for budget services. All my community is suffering as a result. You cut the money for budget services at a time when you made people unemployed—deliberately. It’s a rort, people; it’s a rort. You deliberately made them unemployed because the idea was to bring down inflation. There are many ways to bring down inflation. This way is morally unacceptable.

We have watched this happen under this Government’s watch, and then what do we get? We get time in urgency spent passing a piece of legislation that actually paints a picture of a beneficiary as a slacker. That’s what it’s about—demonising a group of people, many of whom are our relatives or our friends. They are unemployed at the moment because of this Government tanking the economy. That’s what happened under the watch of this Government.

I was door-knocking the other day in Point Chev, and I came across a guy who’d come up from Wellington because, as he put it, the place is dead. There’s no work here. He was in Point Chev, going off and finding other work because this place is dead for a lot of people. They cannot find a job. If you’re in Kinleith, it’s much worse than being in Wellington, I can tell you, because where do you go for a job? What this Government is doing is getting on its preachy, preachy high ground. It’s preaching.

Cameron Brewer: There’s a vacancy in Mount Albert.

HELEN WHITE: I don’t think that that is a very relevant comment, and it sounds a little bit like this is hitting a nerve. I suspect that at doors in many parts of Auckland right now, the member who said that is actually hearing exactly the same thing. They’re hearing that it’s really hard to pay the bills. There isn’t any work out there. The economy’s being tanked. All of those things are true, and this piece of legislation suffers from being a complete rort. It says, “Look over here. We’ll tinker around. We’ll put a few more sanctions in. We’ll blame these people here.”

Now, don’t get me wrong; there is always a place for making sure that when we are giving out taxpayers’ money, we have proper boundaries in place. Let’s face it: we did have proper boundaries in place. We have had a regime in place for a very, very long time that serves the needs of the community, and it gets people into work. What’s the best thing we can do about getting people into work? Prioritise it. Prioritise decent work, people. That’s what we need to do.

We need to make sure that New Zealanders have pathways through to decent jobs, not to hand-to-mouth existences—decent work.

Hon James Meager: What’s an indecent job?

HELEN WHITE: Indecent jobs are ones that pay so little—so little—that people end up mentally ill, they end up with addiction issues, and they end up in stressed relationships where they are mean to their kids or stressed with their kids. Those are the things that happen when you don’t have decent work in an economy, and it’s got to be our number one priority. It’s not this current Government’s.

Now, yesterday, when the tax cuts couldn’t be paid for and when the Budget fell short, who was first on the chopping block? Women. Women and low-paid workers. Low-paid workers are easy pickings for this Government. They are not the people who are, necessarily, writing to the Minister. Well, they weren’t yesterday; I suspect they are today. I suspect there will be a whole lot of workers out there at the moment thinking, “This Government doesn’t have our interests in mind. It doesn’t have a clue.” It’s busy focusing on blaming people who it catapulted into unemployment for its own means. It’s focusing on blaming them rather than assisting them in any way.

I’ve heard a lot of rubbish language this week. I’ve heard that what they are doing in pay equity is simply trying to make things better and expedite the system, but the opposite is going on. It’s utterly frustrating to hear such a twisting of what the focus of a piece of legislation is. On this one, I think the same thing; I think this is about making sure that New Zealanders are distracted, that they’re blaming people, that they’re feeling resentful of people, and that they’re mythologised. I think that’s what’s going on here.

The Government doesn’t want ordinary New Zealanders to see that people don’t have work—they did last year. That is the truth. We have the highest unemployment we’ve had for four years under this Government’s watch, so when sanctimony about people who apparently have to be sanctioned even further than they are comes forth in a piece of legislation like this, I ask the New Zealand public: what is the reason the Government’s doing that? It’s so that you look over here and you blame your friend and your neighbour and you blame your kids or whatever, rather than blaming this Government for putting us deliberately in this situation because it did not prioritise the right thing. Labour will do that when it gets elected.

The Social Security Amendment Bill is really aimed at better helping, supporting, and enabling people to get back on their feet and back to work and to be able to regain that confidence in work and be able to uplift their lives themselves and to support themselves. With all that has been said and expressed, I commend this bill to the House.

Thank you, Mr Speaker. I’ve been listening to contributions from members of that side of the House for much of today on this bill, and it’s quite disheartening to constantly hear beneficiaries being characterised in the way that they have been, as people who don’t want to go to work, who need to be forced off a benefit to get into work, and who need to be sanctioned and have punitive measures put on them, making it harder for them to survive. I would genuinely just say to members opposite to try and understand the context of people who live very different lives to your own.

A recent Social Cohesion in New Zealand report—

Hon Members: Oh!

Hon PRIYANCA RADHAKRISHNAN: It bodes well for our society if people on both sides do that. Recently, there was a Social Cohesion in New Zealand report that compared various indicators across New Zealand and Australia. One of those figures was stark: 25 percent of New Zealanders skip a meal because they can’t afford it—one in four of us—compared to 13 percent across the Ditch. Yet what is this Government doing? They’ve gutted pay equity, taking money away from women workers to balance their Budget. They have diluted a law that aims to protect wildlife, and, now, this: deflecting attention by punching down on beneficiaries.

Ninety-seven percent of submitters to the select committee opposed this bill, with good reason. This is the second reading, and so I’m going to bring their voices into this debate and into my contribution. There was one that stood out for me from a 50-year-old former lawyer who had to retire due to disabilities. The disability arose from an event that happened with a gas system—no fault of this person. This person says, and I quote, “It is extremely difficult to get a supported living payment. There are some 52 pages to the application form that was necessary for me to obtain significant support, over a space of five weeks just to fill in that form.

Ongoing requirements are also onerous, and disabilities don’t go away. The requirements are onerous for someone without disabilities, and for someone who is unwell or has disabilities, that adds significantly to the burden.” It goes on to say that the process is already “dehumanising and humiliating”. Most people—in fact, I would dare to say that the vast majority of people—who are in receipt of a benefit would prefer to be working. For the most part, there is not an issue of motivation. There is an issue of availability of jobs or capability.

I point also to an excellent submission by the Disabled Persons Assembly New Zealand. One part of that that talks about that availability of jobs to disabled people: “The system does not recognise barriers to employment or accessibility for disabled people.” It goes on to say, “Many people highlighted the barriers to employment that disabled people face, and the emotional pressure continually being expected to apply for jobs that they cannot get.” There is, in there, an excellent quote from someone who cares for a teenager who has a rare syndrome and autism about just how difficult it is to get into the job market when you’re in that position. Many submissions talked about the money management system where 50 percent of a person’s benefit is loaded on to a Ministry of Social Development payment card that can only be used to buy certain items. Many disabled people pay 50 percent of what they get on rent. The system that members opposite are lauding will now put people in the position where they cannot pay their rent—reflect on that.

Finally, a disabled beneficiary and PhD student who submitted to the select committee said, and I quote, “I’m a disabled beneficiary and PhD student. It is clear that this bill is not actually about better outcomes for those on benefits. It’s about instituting punitive and bureaucratic measures designed to save the Government money, at the expense of those this Government is choosing to leave in financial hardship.”

This is a bill that just makes things so much harder for those who are already struggling. I even got a message from someone who is in a similar position. She says, “I’m not skipping meals per se, but I’m not eating meals either, when the kids aren’t here. Like, I’m eating a tub of yoghurt or all the beans from the can rather than making a meal. Living off the benefit I get weekly is not possible in any way, shape, or form. My life isn’t terrible because I have my house settlement to live off, but it would be if I didn’t have that. Life is hard enough. I can’t imagine trying to claw my way out of the hole I was in if I didn’t have it. I’d be miserable.” How do you build yourself up and back when you’re in desperation daily? The desperation is being made worse by this bill.

I am confused. The other side keep telling me that they are fighting for the workers, but to me, it sounds like they actually want people to have long-term reliance on benefits. They don’t understand that this legislation will not affect those who are actively looking for jobs and it will not affect those who don’t have the ability to look for jobs. We believe that the beneficiaries who are able to work should be taking reasonable steps to re-enter the workforce and that consequences should exist for those who don’t. I commend this bill to the House.

The same assertions are made from that side of the House—whenever we have a debate on social security and on the welfare system—that this side of the House wants to encourage long-term welfare dependency and that we want to encourage people to languish on benefits. It’s simply not the case, and I have to say that it’s simply not the case for any political party in this House. We all want New Zealanders who can work to be able to work. Some of us are just a little bit more in touch with the realities for New Zealanders.

I think that side of the House forget that, actually, the economy is doing poorly under their watch. People are losing jobs en masse under their watch. In fact, unemployment is at 5.1 percent now. In Auckland, it’s 6.4 percent unemployment. For Pacific, it’s 10.8 percent unemployment; for Māori, it’s up around the 10 percent mark as well. These are the same people who lose jobs during bad economic times, which all too often seem to fall under national-led Governments.

What we have here is a piece of legislation that is, again, an attempt by the Government to make it look like they’ve got the whip out and they’re coming down hard on those that have lost jobs and are on benefits. In actual fact, since they’ve been in Government, even though they set a target of reducing the number of jobseeker beneficiaries by 50,000, we’ve got over 30,000 more people on benefit under their watch. Then they come along with these measures that they say will help push people into employment, when all of the evidence in front of us, including when we look at the departmental report, tells us that many of the measures reflected in this bill have no evidence to support the argument that they will actually do anything that works. It’s disappointing, and, actually, quite frankly, it’s farcical. This is supposed to reduce the number of people on benefit, but it seems like the only strategy for reducing the number of people on benefit is to sanction them off benefit or to make being on benefits so difficult that they simply cannot stay on it.

They were given the option of setting a target of increasing the number of exits into employment. Instead, they just chose this reduction target with no regard or concern for where people might go when they leave benefit. Frankly, they don’t care. All they want is for their books to look better—even though they look worse now than what they looked like when they took them over—and they don’t care whether or not these families have positive outcomes or not. They are very clear with their objective for the bill that it is to reduce the cost to the Government by reducing the number of people on benefit. Again, this is a reflection of the fact that all they care about is the money they need for their priorities and Budget, rather than caring for those New Zealanders who have sadly found themselves out of work and needing some assistance from the State in the form of welfare.

I also want to reflect on what my colleague Priyanca Radhakrishnan referred to, and that is the numbers of people on benefit who have health conditions and disabilities. Now, many of them are not precluded from the measures in here, because they haven’t precluded jobseekers who have health conditions and disabilities. Again, they have no sense of realism for these people’s realities and how difficult it is to take up employment or, in fact, to get employed. They never seem to mention that, actually, there are a number of employers out there that are simply not willing to take a chance with people who are in the welfare system. That’s not the fault of those people who are in the welfare system.

Many of you will know I once was the Minister for Social Development. We all receive the same advice. That hasn’t really changed in terms of the research and evidence. The international research on sanctions is not good. It doesn’t lead to better outcomes for those on welfare. It doesn’t lead to more of them getting into employment. What it does do is it raises the stress levels of those people who already have very little bandwidth to deal with the stresses that have come their way, and it leads to more individuals and their families being in poverty. That is what this Government is wanting to happen and is pushing to happen when they put this particular bill through.

We’ve seen, in this bill, that they have included things like non-financial sanctions of money management and community work experience. As we’ve debated across the course of considering this bill, the Government has continued to push that this is actually some kind of charitable addition to the suite of sanctions that are available and that they are doing something good for beneficiaries by not actually giving them a financial sanction. Well, again, it shows how out of touch they are. If they were to take 50 percent of a beneficiary’s benefit and then expect that that would be money-managed by putting it on a payment card, then they would be ignoring the fact that for so many of these beneficiaries, because of the fact that their benefit incomes are so low, they are already paying 50 percent or more for their accommodation. Then they say that they won’t apply it to those people. Well, that means that a whole lot of people won’t have it applied to them. All I can think, when I’m looking at that, is they’re just trying to look, to the general public, like they’re coming down hard on these people, when the reality is it’s not even a practical measure that can be implemented with these individuals or these families.

The community work non-financial sanction was criticised by the community work sector, by the charitable sector, and by the community and voluntary sector. The expectation that they would be able to on-board a volunteer as quickly as what would be expected by this measure, do all the vetting, make sure that they are safe in their own practice and safe for those that they would be serving, within a matter of days, and that those undertaking the community service would only serve a period of time of two weeks or something is absolutely unrealistic. All of these organisations came out and told the Government that that was the case. How they can possibly do the work that it takes to on-board a volunteer, get them ready, make them safe for themselves, make them safe for everyone else, and then give them a community service experience that is going to inform their future work prospects, as well as support that organisation is unrealistic, and the Government were told that. Again, it’s just some attempt to try and look like they are coming down hard on beneficiaries. In many ways, it’s a disguised version of working for the dole or something—something that we know members on that side of the House like to talk about.

This is not a piece of legislation that is going to support those who are already down and out to get into employment. It is, instead, a bill that is another attempt to blame beneficiaries for the current economic conditions and to deflect away from the fact that, actually, they are responsible for the fact that over 30,000 more people are on benefit and that that has occurred under their watch. Instead, they want to put the boot in and make out that it’s these people’s fault that they are unemployed. This is a sad continuation of the National Party’s legacy of beneficiary bashing over the course of decades. It is predictable. It is so incredibly predictable. You have to wonder at what point in time that political party will reflect on some of the decisions that they have made since the outset of their party being formed and realise that, actually, there was no evidence behind any of those decisions. It did not help New Zealand become a better place. It did not turn the tide on the levels of poverty that we as a nation have faced over the course of decades, and it did not improve the lives of not just those beneficiaries but of the children in those beneficiaries’ households.

We, of course, will not be supporting this bill, and I stand here saying—I put on record, again—that we, of course, will always support New Zealanders who are out of work to get into upskilling and training and employment. But we’re not going to kick them while they’re down to deflect from any of the mistakes that we might make. Certainly, that lot over there have made a lot of mistakes in their last 18 months.

From welfare to work—that is our goal, and nothing contributes to the overall wellbeing more than work. This bill, in my view, encourages work. It’s not—

Ricardo Menéndez March: Have you read it? It does nothing to do that.

DAN BIDOIS: I have read the bill. It’s right here. It’s actually pretty reasonable to expect those on a benefit to upskill, to continue to reapply for their benefits, and to make sure they’re doing everything they can to get into work. It’s a carrot-and-stick approach. This side of the House has much, much greater ambition for Kiwis than staying on a benefit, and that is why I commend this bill to the House.

The question is that the amendments recommended by the Social Services and Community Committee by majority be agreed.

This bill is set down for committee stage immediately.

In Committee

Part 1 Amendments to Social Security Act 2018