Parmar Parmjeet: Social Security Amendment Bill (No 3) — Second ReadingText is incorporated into the Bound VolumeParmar Parmjeet: Social Security Amendment Bill (No 3) — Second Reading[Sitting date: 17 February 2015. Volume:703;Page:1637. Text is incorporated into the Bound Volume.]Dr PARMJEET PARMAR (National): It gives me pleasure to rise and speak in support of the Social Security Amendment Bill (No 3). This bill about the treatment of weekly compensation payments and assistance for students’ accommodation costs makes the legislation sturdy so that we treat people the same way. I do recognise that all Government spending is attached to some form of social value but this is about balance. The bill dictates the closing of loopholes in the Social Security Act which people can use to receive an unfair increase or different levels of support even when they are in exactly the same kinds of circumstances. The passing of this bill will allow for students and beneficiaries in similar circumstances to receive equal levels of monetary support. This is vital as it will allow everyone an equal opportunity and not provide unintentional benefits to those who knowingly or unknowingly see fit to slip through any apparent loopholes. It is vital that this is looked at as a loophole does mean the Act is flawed. We are striving to correct the issue of students and beneficiaries garnering unequal monetary support. As one can imagine this is coming at an extra expense to the taxpayer which is something we should try to minimise.The loophole regarding student payments in the Social Security Act allows students to access the accommodation supplement if they choose not to receive a student allowance. The returns from study accrue to individuals as well as to society so the clear policy behind the student loan and allowance system is to share the cost between students and the Government. Students should not be reliant on any other benefits and grants that result in the Government paying a greater share of student support.The Social Security Act states that accident compensation payments from ACC should be deducted dollar for dollar from any benefit that a person receives. A loophole in the Act means that it does not include weekly payments coming from an accredited employer. This bill will validate the past and current practices of deducting payments dollar for dollar from benefit payments. For example if a DPB recipient is paid $150 per week in compensation with no other income but the DPB they will have their benefit reduced by $150 if the compensation is from ACC. If the compensation is paid by an accredited employer their benefit will not be reduced at all. The deduction should apply equally to compensation whether it is paid by ACC or by an accredited employer. It would be unfair that a person who receives compensation from an accredited employer would be better off than a person who receives weekly compensation from ACC. That simply would not be fair. So the overall purpose of the bill is to ensure that people in similar circumstances are treated equally.This is also about responsibly managing the Government’s finances so taxes are spent wisely on the services families need. The Ministry of Social Development has estimated the total cost of this loophole at $700000 per annum and a ministry report states that a legislative fix is the only option to maintain the intention of the policy and avoid increased fiscal cost that adds to unequal monetary gain for people in exactly the same situations. The existing provision may reduce the financial incentive to return to work—this is another drawback of this loophole—since the combined income from the benefit and compensation can be higher in some cases. As a Government we are always looking at ways to get people into employment. This is and has been a major goal of ours. The drawbacks of unemployment were made glaringly evident during the recession we had in 2008. The fact that we as a nation have reached an unemployment percentage of 5.6 percent shows the amount of work we have put in and its positive effects on our economy.An increased percentage of people choosing to receive a benefit instead of getting into a job is not good for our nation and our nation’s growth. It is not ideal as the taxpayer becomes responsible for these funds and their money is not able to be used in an efficient and effective manner especially when there is a large number of people on benefits. As well as this those who are unemployed are unable to help better their communities and our country. Their skills and talents are not being used or recognised in a positive manner. Dependence on a benefit creates a decline in the social quality of a person’s life. It does not allow them to make the money they should be earning to adequately provide for themselves and their family let alone any debatable luxuries. The lack of money coming to people in the community also leads to a possible drop in living standards and can hinder the chances of future generations having access to the best possible health-care education and recreational facilities. This can prove to become a great disadvantage to our country in the future.All these things can obviously affect spending habits in a negative manner. We need to avoid the factors that can contribute to this happening at all costs. It is a very gloomy perspective but this is the real possibility of people deciding to be on a benefit by choice.Talking about education students rely on this loophole for monetary gain or monetary support. The National-led Government is focused on improving tertiary education lifting achievement increasing skills and focusing on better outcomes for students and taxpayers. National wants to help students get the qualifications they need to succeed and play their part in growing our economy. Data from the Ministry of Education shows that New Zealand students completed a record number of undergraduate degree qualifications in 2013. In 2013 25800 domestic students completed Bachelor’s degrees an increase of around 400 on the 25400 who completed degrees in 2012. This is 24 percent higher than the 20800 who graduated in 2008.Hon Member: How much percent higher?Dr PARMJEET PARMAR: Twenty-four percent higher. It shows National’s focus on achieving results. It also reflects the emphasis we are placing on students achieving qualifications at higher levels that provide them with a stronger financial return on their study. Overall the total number of qualifications achieved in the year by all students—this is including domestic and international—remained at a very high level at 162000 and more than 20 percent higher than 5 years ago. The number of Māori and Pasifika students completing degrees has also climbed. The number of Māori students completing Bachelor’s degrees has increased from 1960 back in 2008 to 3180 in 2013—a 62 percent increase. The number of Pasifika students completing Bachelor’s degrees has increased from 918 in 2008 to 1530 in 2013—a 56 percent increase. In 2013 over 10000 more Māori students achieved qualifications across all levels of tertiary education than in 2008 and over 5300 more Pasifika students did the same.National is committed to increasing achievement in the tertiary sector. Having more people achieving tertiary qualifications means a more highly skilled labour market. Higher skills mean higher-paying jobs for all New Zealanders and their families. Back in the 2000s the previous Government threw more and more money at tertiary education and the number of people achieving degrees stayed around the 20000 mark. With a focus on performance and results we have lifted that number to almost 26000 degrees with virtually the same amount of funding across the sector. So this shows that students are not relying on this loophole and this monetary gain to achieve education. I was not part of the Social Services Committee when the bill was discussed. I thank the current and past Ministers for this bill and also thank the select committee for the work it has put into this bill and I commend it to the House. Thank you.