Borrows Chester: Social Security (Fraud Measures and Debt Recovery) Amendment Bill — Third ReadingText is incorporated into the Bound VolumeBorrows Chester: Social Security (Fraud Measures and Debt Recovery) Amendment Bill — Third Reading[Sitting date: 17 April 2014. Volume:698;Page:17450. Text is incorporated into the Bound Volume.]Hon CHESTER BORROWS (Associate Minister for Social Development): I moveThat the Social Security (Fraud Measures and Debt Recovery) Amendment Bill be now read a third time. As the House considers our final vote on this bill I would like to ask members to turn their minds to the principles at the heart of this particular bill and to think for a moment about what it is that this bill is trying to achieve. To my mind it can be summed up in one word. It is about fairness. Welfare fraud is inherently unfair. Once someone takes money from the welfare system that they are not entitled to no one really wins. It is not fair on the taxpayers who fund the system. They give from their pay cheques money they have earned in order to allow our Government and society to function. Often I have found those most vocal and most angry about welfare fraud to be people on lower wages people who—[Interruption]The ASSISTANT SPEAKER (H V Ross Robertson): Order! I am sorry to interrupt the honourable member. I am sure members know why I am standing. Would you please show some courtesy to the Minister trying to address the business of the House.Hon CHESTER BORROWS: Thank you Mr Assistant Speaker. Often I have found those most vocal and most angry about welfare fraud to be people on lower wages people who themselves have to work hard to make ends meet but do so without resorting to ripping off the State. It is not fair on them to have the funds they have provided taken by fraud and it is not fair on other beneficiaries. Over the last couple of years we have had just above 300000 people on a benefit at any given time. In the year ended June 2013 only 906 were convicted of welfare fraud. So we talking about only a small minority who seem to think that they can rip off the welfare system yet those few allow some people to cast aspersions on all beneficiaries—an opportunity that some people are unfortunately all too eager to take and that is not fair.At an individual level relationship welfare fraud the type of fraud this bill’s main measure is aimed at is rife with unfairness. The irrefutable fact of this type of welfare fraud unlike other kinds of fraud I can think of is that it can occur only with two people as the perpetrators. The essence of the fraud is a beneficiary receiving a benefit that depends on them being single when they are actually in a relationship. If that partner was not there the fraud could not occur.Let us step through a hypothetical example of how this happens. Most commonly we are dealing with a woman on a sole parent support benefit the new DPB. She has entered a relationship which is absolutely fine. You do not give up your right to a love life when you come on to a benefit. Communities are founded on strong relationships. Individuals and families prosper in good relationships and so we should encourage them. Later that relationship turns more serious. It moves from something casual into something that for all intents and purposes looks like a marriage. They become emotionally and financially interdependent.It is at this point whether they sign on the dotted line or not that her circumstances have changed. She is receiving money based on the fact that she is a single mother but she is no longer single. Again for the vast majority of beneficiaries at this point they have a conversation with their case worker at the Ministry of Social Development and their entitlement can be changed yet some choose not to. Time passes the relationship continues and then 5 years later it comes to our attention that she has been receiving money she was not entitled to. An investigation is carried out. The ministry establishes that she has received $100000 she was not entitled to and she has repeatedly signedforms reasserting that she is single despite that being untrue. A prosecution is commenced. It is here that our bill will make a difference.Under the law as it stands the beneficiary faces the law alone. She is liable for the entire $100000 of debt. She alone faces criminal sanctions—in the worst cases including jail—and he walks away. That is the nub of the unfairness that this bill will address. He has spent 5 years living alongside her participating in her fraud—a fraud that could not have occurred but for him—and he gets away scot-free. That is unfair—pure and simple. Unlike other examples of fraud that may be quoted he has not simply benefited from the fraud; he has been inextricably a part of it. Under this bill he will be held liable for his part in the fraud because that is fair. It is fair on the beneficiary who will not have to take the blame herself for the actions of two and it is fair on the taxpayer who has been defrauded and will now see their money recovered faster.To turn to another part of the bill it is also worth remembering that welfare fraud is not fair on those who depend financially on the fraudster. That fraud forces us to make a choice—to require the repayment of that money even if it will disadvantage those who are financially dependent on the beneficiary or to let them get away with their fraud. This bill reaffirms and clarifies the position that all money taken from the taxpayer should be recovered. That recovery should be done sensitively and carefully to ensure that no one is placed in undue hardship but it should occur.Through the debate on these measures both in this House and publicly some have said or implied that we should not recover debt at all in a multitude of situations. They would see fraudsters escape unpunished and the taxpayers’ loss remain by adopting the most cautious and precautionary approaches. Although I recognise that it is an opinion that they hold sincerely it is not one this Government subscribes to. Instead we place our faith in the skill and professionalism of our welfare fraud investigators to work with those who owe money and to recover it quickly and appropriately. It is a stance that I believe is right and I will quite happily and confidently place it before the people of New Zealand. That is the essence of this bill—fairness. I invite those parties that intend to vote against the bill to consider that before casting their votes. Whatever they think of this Government’s policies around other types of fraud or other issues of social welfare are they willing to record their vote against such a simple and such a fair change?Before I finish I would like to acknowledge those who have contributed to this bill. I would like to acknowledge members across the House who have engaged with me on this subject. It has been a robust debate. There are areas where we disagree but I appreciate the generally constructive and open way members from all parties have engaged on this bill.I want to acknowledge the officials from the Ministry of Social Development who have assisted me to develop and will go on to implement this bill. It has been my pleasure to work with them on this and on this Government’s wider fraud reform package. I have found them without fail to be a group who exemplify the highest standards of professionalism in the Public Service. So I want to record my thanks for their past and ongoing service. This bill will put right a wrong and make our system a little bit fairer. I commend it to the House.