Parmar Parmjeet: Social Security Amendment Bill (No 3) — Third ReadingText is incorporated into the Bound VolumeParmar Parmjeet: Social Security Amendment Bill (No 3) — Third Reading[Sitting date: 31 March 2015. Volume:704;Page:2778. Text is incorporated into the Bound Volume.]Dr PARMJEET PARMAR (National): Thank you for the opportunity to contribute to the Social Security Amendment Bill (No 3) in its third reading. The bill clarifies that students who choose not to apply for assistance under the Student Allowances Regulations are excluded from receiving an accommodation supplement. It also clarifies that the income test includes the income of a person’s spouse or partner as well as parental income. Assistance for students is designed so that there is a shared approach from both the Government and the student to contributing resources. This is because the benefits from tertiary education accrue to both the student and the country. The bill is not about the level of assistance provided. The reason for this bill is not to save costs but to ensure that the legislation is clear in relation to the policy intent.Currently assistance with accommodation costs for students is available through the accommodation benefit provided under the Student Allowances Regulations 1998. A student is not eligible for an accommodation supplement if they are receiving a basic grant or an independent circumstances allowance but the wording of the legislation does not make it clear that a student is not able to receive an accommodation supplement if they are eligible for a basic grant or independent circumstances allowance but do not apply for such assistance.A student is also not able to receive an accommodation supplement if their income or the income of their spouse or partner if any or the income of their parents is too high for them to be paid a basic grant or independent circumstances allowance but they are otherwise eligible. The wording of the legislation does not make it clear that income includes the income of a spouse or a partner so this bill closes loopholes that allow for some students and beneficiaries to receive varying levels of income support. The accommodation supplement is intended to assist low to middle income people with accommodation costs—those who do not receive any student allowance or a loan.The National Government encourages equality and fairness. This loophole in the Act is leading to an inequality in the benefits received by two people in exactly the same kinds of circumstances. The proposed commencement date will have no immediate impact on those students currently receiving an accommodation supplement. Work and Income plans to use the annual review cycle to review and adjust ongoing entitlements. Students should receive the assistance designed for them. Students who are eligible for student allowances should not be able to take advantage of the system and request an accommodation supplement. The current wording in the Social Security Act is not clear enough and it leaves a loophole that allows people to claim the accommodation supplement if they give up their student allowance and accommodation benefit and simply do not apply for a student allowance. This bill closes that loophole it provides clear wording to exclude students who have access to the student allowance scheme from being granted the accommodation supplement.This bill also intends to ensure that the direct deduction of weekly compensation payments from income-tested benefits applies whether these payments are made by or on behalf of ACC or by an accredited employer. The changes set out in the bill will provide for the current practice in relation to treatment of weekly compensation payments to continue. It will amend the definition of weekly compensation to make it clear that it includes compensation paid by or on behalf of ACC or an accredited employer. It will make it clear that weekly compensation paid by or on behalf of ACC should be deducted dollar for dollar from income-tested benefits and will also validate best practice in this respect.The weekly compensation received should result in a corresponding reduction of the benefit to ensure that the person is not advantaged over other people receiving benefits in similar circumstances. The largest difference is reached at the point when the weekly compensation rate is the same as the benefit rate. Direct deduction of the weekly compensation results in no benefit payment at this point while treating the weekly compensation as income results in an unemployment benefit payment of $116.70 per week or a DPB sole parent benefit payment of $196.87 per week.The bill also addresses the fiscal risk of $0.7 million per annum in benefit payments and the more than $3 million in one-off backdated benefit payments. These payments would be made to beneficiaries who have received their weekly compensation payments from their accredited employers rather than ACC. In addition Work and Income resources will need to be diverted to identify the beneficiaries affected and the amounts and time periods covered by an accredited employer and to make the adjustments to the benefit payments.This bill has been examined by the Social Services Committee and the Committee of the whole House. The select committee received two submissions on this bill at the select committee stage. I was not part of the select committee when these submissions were received. The first of these submissions was from the Dunedin Community Law Centre and the second was from the New Zealand Union of Students’ Associations. These submissions discussed wider issues of the adequacy of accommodation assistance provided to students through the student support system. There was a view expressed that student accommodation rates are inequitable and do not meet the needs of students. There was a suggestion that we should consider why students seek to access the accommodation supplement just as the members on the other side of the House are saying but this bill would not be an appropriate vehicle to make changes of the type suggested to the assistance levels provided to students.As to the other view from members on the other side that students are having a tough time that simply does not stack up with the evidence and also the bill is not about changing the assistance levels provided to students. If you look at the evidence it says that the National-led Government is focused on improving tertiary education lifting achievement increasing skills and focusing on better outcomes for students and taxpayers. Since 2008 there has been a rise in the number of full-time students and we are seeing more graduates than ever before and at higher levels. Data from the Ministry of Education shows that New Zealand students completed a record number of undergraduate degree qualifications in 2013. It shows—Chris Bishop: More Māori more Pasifika.Dr PARMJEET PARMAR: Yes—more Māori more Pasifika. It shows that our reforms across the tertiary sector are steadily delivering much better results for students. Having more people achieving tertiary qualifications means a more highly skilled labour market. Higher skills mean higher-paying jobs for all New Zealand families. This is because of the New Zealand Government focusing on the things that matter to New Zealand families.I am actually astonished at the stance from members on the other side that they do not mind having a loophole in the legislation and they do not mind the loophole being used by some to gain financial advantage. The National-led Government is focusing on improving tertiary education and increasing skills. The National Government is committed to efficient and effective legislation that treats people fairly and this bill closes fiscal loopholes supporting the National-led Government’s undertaking to responsibly manage finances on behalf of taxpayers.So in summary the Social Security Amendment Bill (No 3) amends the Social Security Act 1964 to ensure that people in similar circumstances are treated equally in relation to the treatment of weekly compensation payments and assistance for students’ accommodation costs. I support the bill and commend the bill to the House. Thank you.