Shaw James: KiwiSaver Budget Measures Bill — First ReadingText is incorporated into the Bound VolumeShaw James: KiwiSaver Budget Measures Bill — First Reading[Sitting date: 21 May 2015. Volume:705;Page:3781. Text is incorporated into the Bound Volume.]JAMES SHAW (Green): Tēnā koe Mr Deputy Speaker. I rise on behalf of the Green Party to speak on the KiwiSaver Budget Measures Bill. We will be opposing this bill. This bill is one of five pieces of legislation introduced under urgency to give effect to particular elements of yesterday’s Budget—and what a Budget! What a Budget! Billed as a hardship Budget it included—let us be gracious here—a $25 a week benefit increase for families with children which we applaud; a Working for Families increase which we applaud; and an increase in childcare assistance. After 7 years in Government National has finally realised that it can no longer ignore increasing public alarm at the broadening and deepening of child poverty rates in New Zealand.When I was campaigning in Wellington Central in 2011 and going to the meet the candidates evenings I would talk about the 250000 children living in poverty. I kind of got that sort of blank look you get when you know that people do not really know what you are talking about. Three years later in 2014 when I was campaigning to the same people in the same halls around Wellington Central and I was talking about the 275000 children who were living in poverty I got absolute recognition and nodding heads. People really knew it was an issue and I will tell you why. It is because for the intervening 3 years that is what we campaigned on. That is what we talked about. We never shut up about it and a huge range of civil society organisations from Barnados Unicef Save the Children and others have made child poverty the political issue that it deserves to be.So we are going to claim some credit for the Budget—for actually making it a political issue for getting child poverty up on the agenda to the point that the Government has had to listen. It is great to see this Government adopt this as an issue even if it is a “weak tea just might work maybe” kind of approach. If you want the real thing then in 2017 I recommend you vote for the Green Party because we have been championing this cause for years and years and years. National has done what it has done not because it wanted to but because it had to because it became such an important issue.So I come to the bill at hand—what does the bill do? It removes the $1000 KiwiSaver kick-start contribution making it effective from the delivery of the Budget yesterday. The Government’s argument for this is to achieve fiscal savings and improve the value for money of the KiwiSaver scheme by lowering the headline cost. OK that is a fair enough objective but as has already been remarked on tonight this is a wildly successful scheme. About 15000 people a month sign up for KiwiSaver and they do so in large part because of the incentive scheme that is in place. That sign-up rate has slowed down not because the incentive is not working but because the rates of adoption are getting to saturation point. More than half of the eligible population is now a member of KiwiSaver but we also know that the group hardest to get to are the most disadvantaged right? These are people at the bottom end of the scale and these are the people who need the incentive more than anything. So although we understand that the Government wants to pay for the extensions to benefits that it described yesterday it is taking that money out of KiwiSaver and essentially moving it around in the same pot.Let us take a little bit of a closer look at some of the other things that happened in yesterday’s Budget. The jobseeker support and emergency benefit were down 5.7 percent. Supported living payment was down 1.2 percent. The sole parent support was down 1.5 percent. The accommodation assistance was down 0.8 percent. The hardship assistance was down 1 percent—and this one of the most successful schemes that we have to address poverty in this country is losing the main incentive to get people into the scheme. It is a “Peter and Paul Budget”. We are taking money from one and moving it around largely the same group of people.What we are proposing later on in this debate is putting in a Supplementary Order Paper the intention of which is to keep the $1000 kick-start payment for people who have a community services card. What we are suggesting is that we can meet the Government halfway. We are saying: “OK we understand that you want to eliminate what you see as a middle-class subsidy. You want to help to cut the costs of what is a pretty expensive scheme. We understand that. But if you really believe that yesterday was a hardship Budget that was designed to reach out to the most vulnerable people then support our Supplementary Order Paper to retain the $1000 kick-start for people who are on a community services card.”Why a community services card? Because that is the easiest simplest way to implement a proxy for people on low incomes. It does catch a wide array of income bands but we believe that it is the simplest best way to retain it for the people who need it the most who actually need that incentive the most. We also know that the overall cost of that to the Government will not be that great because it is adoption at the lowest end which is the hardest to get. We think that if you keep the incentive in place for the people who are at the low end you are going to continue to keep it for that vulnerable group. And because we know that without the element of compulsion rates of adoption will be reasonably low. The overall headline costs to the Government will not be nearly as great as they would be if you kept the overall scheme.Our preference of course is to retain the overall scheme. In fact Metiria Turei only a week ago launched a proposal for a kids KiwiSaver scheme which would also ensure that the most vulnerable children in society had a nest egg of up to $12000 by the time they got to the age of 18 which they could use for tertiary education or for a house deposit or similar purposes.Given that the Government has the numbers to pass this bill and to remove the $1000 kick-start contribution from KiwiSaver in its entirety what we are proposing to do is to limit the harm of that and to support the Government’s notion of yesterday’s hardship Budget by retaining the kick-start contribution for people who have a community services card. We believe that that will not be as expensive for the Government. We believe that that will be in line with the Government’s intentions yesterday of producing a Budget that is orientated at the poorest in society and it keeps in place the principles of what has been a wildly successful scheme. We do hope that the Government supports us on that. Thank you.