Clark David: 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 
Clark David: 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:2499. Text is incorporated into the Bound Volume.] 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 Thank you for the opportunity to rise to speak to the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. The bill amends the thresholds used in determining the amount residents in aged residential care have to contribute towards the costs of their own care. The current increases of $10000 each year in the thresholds are proposed to be replaced with Consumers Price Index indexation of the thresholds. 
This will affect a couple of groups of people. Those in that category are those who have partners and those who do not whose partners are either in aged residential care or not. Specifically in clause 7 in Part 2 of the bill we read that schedule 27 is going to be amended and the threshold—the upper threshold threshold A—“applies to every resident assessed as requiring care—(a) who has no spouse or partner; or (b) whose spouse or partner is also a resident assessed as requiring care; or (c) whose spouse or partner is not a resident assessed as requiring care but who has elected under clause 2 to have Threshold A apply to him or her rather than Threshold B.” Threshold B the second threshold is a lower threshold and applies to every resident who has a spouse or partner not assessed as requiring residential care and who for some reason has opted out of threshold A. 
So there will be elderly people facing difficult decisions in changing circumstances whom this policy affects. Members of the families of those people will also be interested in following what is going on here. It is actually a relatively small number of people and the savings over a number of years are not enormous but there are some savings. So there is an issue here that should properly be debated. So that sits before us. People eligible for the subsidy pay their income less certain exempt amounts for their care and the residents’ district health board pays the difference between what the residents pay and the contracted cost of their care. 
We have seen the Government go after the paper boys in the previous bill; here we see it going after the most vulnerable elderly folk and we see that these measures are required to be taken under urgency to take the economy to a different level to turn the economy round. Well I do not think that is so. I think it is more tinkering by the Government but it is the kind of tinkering that does actually affect real people. It would be far better in my view to have a full and proper process around the progress of this bill not a process whereby it simply slips through under the veil of urgency when it is really not the measure that is going to turn the country round. Again it is not a pro-growth tax policy; it is more tinkering by this Government. If we go through the history of this threshold asset testing was introduced by the National Government in the 1990s. We can see where it was going with that. Following the 1999 election Labour introduced a big increase in the threshold and later made sure that $10000 chunks went in year after year to make sure that that threshold continued to rise. It is clear that National is wanting to reduce it; there is no question about that. Our quibble is really with the process on this matter—our primary quibble—because there is a real genuine issue that sits behind this. 
On the one hand you have got those who have worked hard saved and paid down a mortgage and the incentives for them to do that are that they may well be able to pass on some of that to the next generation. There are many elderly folk out there who are proud of the fact that they have worked hard all their lives paid their taxes saved and paid down a mortgage and they want to pass a little bit of that on to the next generation. So are we discouraging savings here? Is this what is going on here? Is the National Government against savings? Well it pushed KiwiSaver out in the Budget so we might be led to conclude that. On the other hand we have got the issue of intergenerational wealth and we do have here a subsidy that goes in and around our elderly folk—those folk who do have assets. We have got to ask ourselves when we have one of the more generous superannuation arrangements in the world whether this is the right thing to be doing. Is this perhaps a good measure to make sure that we are supporting these people but not supporting them more than we can afford? 
So there is a live debate there but this Government does not want to have the debate. It does not want to invite people to come in and have their say. That is unfortunate. These people do have real lives and this measure affects them and it affects their wider families. But for some reason this Government—and Mr Woodhouse is yelling out because he is one of those people who do not think that old people should have a say on this matter and do not think that their families should have a say on this matter. It is a real disappointment. The answer is that the process is wrong. This does not need to be done in urgency. It is not going to turn the economy round Mr Woodhouse any more than picking the pockets of paper boys and paper girls in Dunedin will turn the economy round. It will not turn the economy round. It is a bill that tinkers once again but it is tinkering with real people’s lives. 
The Labour Party will not support this bill because we do not support the process that has been put down. We have a select committee process for a reason and it is so that we can hear the views and the concerns of the people who will be affected by these measures. That is the proper process and that should be happening. That should be happening. There is no reason for the National Government to crimp this process back “crimp” being a word that we associate with the ACT Party not the National Government necessarily—but occasionally with some others. Let us leave my contribution there for today but for saying there is a better way of doing this. There are better policies that could be put in place. It is a shame that we are having this debate here in this crimped down shortened fashion when the measure affects real lives and it is not going to change the economy. It is not addressing the real issues.