Hague Kevin: Social Security (Long-term Residential Care—Budget Measures) Amendment Bill — First Reading Second Reading In Committee Third Reading 
Text is incorporated into the Bound Volume 
Hague Kevin: Social Security (Long-term Residential Care—Budget Measures) Amendment Bill — First Reading Second Reading In Committee Third Reading 
[Sitting date: 24 May 2012. Volume:680;Page:2501. Text is incorporated into the Bound Volume.] 
KEVIN HAGUE (Green) 
: 
 Tena koe Mr Speaker. Can I begin by remarking on one of the last things that the previous speaker David Clark said. He said he would leave his contribution on the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill at that for today. But that is kind of the problem is it not? Today is it. 
The reason that has been advanced by the Labour speakers so far for opposing this bill is one of the two substantive reasons that we in the Green Party will also oppose it. The process that is being pursued here is nothing short of abysmal and shows a certain contempt for the New Zealand public. This is a policy that was not signalled by National prior to the election. It was not signalled by the Government in the months following the election. It was not signalled in the Budget speech. It is the kind of policy that now today as we face a bill that is to be progressed through all of its stages today is going to rob a significant number of New Zealanders of their right to have a say about this issue. Of course we understand that sometimes following a Budget there will be a need for urgency. There will be a need to progress a bill through all of its stages in order to ensure that changes to legislation come into place in a timely way and that they are not avoided. I am a little surprised for example that the next bill that the House debates is not going to be progressed through all of its stages today. I would have thought on the track record of Governments that it would be a bill that would go through all of its stages today. But not this one. There is no need. There is no urgency surrounding the matters in this bill. There is no reason why it could not go to a select committee to give New Zealanders the opportunity to have a say about it. That is one of our reasons for opposing this bill. The process that the Government intends to follow is a completely wrong one. 
But unlike the comments of the Labour speakers that I have heard so far we do not have an equivocal view about whether the measure that is outlined in this bill is a good one or not. We believe that it is entirely wrong. Although some of the media coverage of the bill so far has suggested that it is something of a cosmetic change in fact to the asset-testing threshold we do not believe that to be the case. It is understandable perhaps that people will have got hold of the wrong end of the stick because their opportunity to scrutinise what is planned has been so limited. But the reality is that rather than a cosmetic change this bill in fact is a complete change of the policy setting around asset testing for aged residential care. 
Our policy the Green Party’s policy has always been to oppose asset testing for residential care and I will go into the reasons for that in a moment. But we were certainly heartened by the Labour Government in I think the 2002-05 period having campaigned on removing asset testing setting about a process—slower than we would have liked but none the less a progressive process—to remove asset testing. And that is the current policy setting. It is a policy setting towards progressive removal of asset testing for aged residential care. What this bill does is to change that policy setting from eventual removal of asset testing to instead freezing the asset-testing threshold at its current level. That is the effect of this bill. It is to freeze the asset-testing threshold where it currently stands. That is a complete change of policy and we believe that it is one that New Zealanders ought to have had a say about. It is not cosmetic. It is entirely substantive. 
The reasons to oppose asset testing are many. Probably the single greatest one is that in fact asset testing for aged residential care introduces age-related discrimination in the provision of State care. That has been the argument that has been advanced by Age Concern. It has been advanced by Grey Power. it has been advanced by the Green Party and it has been advanced by many others. The argument is that this is effectively the only area of care or support from the State that is asset tested and it is a form of discrimination based on age and it ought not to be. 
Secondly it is especially discriminatory for a couple who own assets collectively but one person of whom requires aged residential care. That is a second form of discrimination that ought to be scrutinised by a select committee but will not be because of the process being followed around this bill. 
The third reason to oppose asset testing is that its effect is capricious. The reality is that those of us who are more resourceful in society will find ways of evading the asset test. Actually it promotes behaviour to avoid the regime by those who are sufficiently well connected and knowledgable to be able to do so. That is not an appropriate basis for the policy being applied or not. So the effect of asset testing is capricious and that is a bad principle in law. 
The fourth reason—and I certainly heard Dr Clark allude to this in his contribution—is that another effect of an asset-testing regime is that it encourages people to not save. So it actually creates conflicting signals to ageing New Zealanders about whether they ought to be saving for their retirement or not. An asset-testing regime around aged residential care in fact encourages people to spend rather than save. I think it has been a mantra of I believe all political parties for quite some time now that that is the polar opposite of the effect that we are trying to encourage in our economy. So for picking up the 170 New Zealanders who will be picked up by this effect in its first year actually we create an incentive that takes the economy in the wrong direction which is away from saving and towards greater spending. 
The last point that I want to make that is an argument against asset sales— 
Hon Member 
: Asset sales? 
KEVIN HAGUE 
: —well it is an argument against asset sales and maybe I will come to that—or rather against asset testing for aged residential care is a point that has been made by Age Concern and that is the point that as we move to an environment in which we wish to encourage ageing in place where we want people to be able to remain in their own homes or home-like environments for as long as they possible can we do not want aged residential care to become the norm. What happens with asset testing is that a person who has been living in their own home who moves into aged residential care and is subject to the asset test may well lose therefore the asset—which is their own home—that they are most likely to have. Then should they no longer need residential care and be sufficiently independent to be able to live in their own home again their own home is no longer there for them to move back into. So asset testing undermines our approach to aged care and to the health of older people. 
The last point I want to make at this point in the many debates that we will have over this measure today is that what this measure is about—and the regulatory impact statement makes it clear—is saving money for the Government. And that is because the Government has not allocated sufficient in the health budget for the health services required by New Zealanders. So it is instead taking the money that it needs for the new initiatives from other services. In this case it is taking it from older New Zealanders from older New Zealanders who have contributed to the care that they need through a lifetime of work a lifetime of contribution and that is unprincipled and wrong.