Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
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Social Security (Long-term Residential Care)  Amendment Bill 
First Reading 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 I move  
That the Social Security (Long-term Residential Care) Amendment Bill be now read a first time. 
 At the appropriate time I will move that this bill be referred to the Social Services Committee for consideration and that the committee finally report back the bill to the House on or before 30 September 2006. 
Last year the Social Security (Long-term Residential Care) Amendment Act 2004 made significant changes for people in long-term care. That Act significantly increased the amount of assets that older people in care who have been needs-assessed as requiring care would be able to retain. The Act also clarified the rights and obligations of people in care and put into legislation a number of provisions that had previously been solely administrative. The income and asset-testing regime to which the Act relates is complex. 
As this legislation deals with the entitlement and obligations of the public a high degree of specificity is required around its provisions. Experiencing the operation of the regime under the new legislation has revealed a number of anomalies that the bill I am introducing today seeks to amend. Specifically it inserts a purpose and overview section and it increases the amount of income earned from assets that a couple may retain where one partner is in care. This provision ensures that such a couple is able to retain the same proportion of income from their assets as a couple with both partners in care or single people. 
The bill also ensures that people who are exempt from asset-testing such as people deinstitutionalised from Kimberley and Templeton Hospitals are able to receive a weekly personal allowance. It also allows the Chief Executive of the Ministry of Social Development to carry out a means assessment that considers income only for people who have already been assessed as having assets at or below the $150000 threshold. Without such a provision there is a risk that these people could subsequently become fully liable for their care costs when their income is reviewed annually. This is contrary to Government policy which limits the circumstances under which further reviews of assets will be carried out. 
The legislation also clarifies the discretionary powers of the chief executive over deprivation of income and assets. If it is established that a person has deprived himself or herself of assets or income the assets or income involved may be counted in a means assessment. The provision in the bill allows the chief executive where deprivation has been established to decide whether those assets or incomes should be counted based on the circumstances of the individual. 
The amendments also provide certainty for older people about how much they are required to contribute towards their care costs. The bill clarifies that any needs-assessed resident who is receiving the care he or she needs in a rest home or hospital that has a contract with the district health board for residential care will pay no more than the maximum contribution for contracted care services—that is services set out in the district health board’s contract with the residential care provider. The bill clarifies that the maximum contribution cap applies whether or not the district health board has any liability to pay for the contracted care services provided to that person. If the cost of contracted care services exceeds the maximum contribution at any time the district health board will pay the difference. 
At present 50 percent of a New Zealand private pension can be disregarded in a means assessment whereas 100 percent of overseas private pensions must contribute to care costs. This treatment of overseas private pensions in the income assessment for residential care is unfair. This bill will allow those who receive an overseas private pension to be treated in the same way as someone who receives a New Zealand private pension. 
Two recent decisions of the Social Security Appeal Authority have established that people receiving disability-related care can claim disability allowance for disability-related services that are not supplied by a person’s service provider. Legislative amendments are required to clarify the basis on which the disability allowance is available to people in residential care. They distinguish between people receiving disability-related care and those in age-related care. This distinction is necessary because of the difference in contracting arrangements for services provided for the two groups. 
Funding arrangements for disability-related services for younger people with intellectual physical sensory and psychiatric disabilities do not generally provide for medical costs pharmaceuticals and related services. For this reason the bill clarifies that people in these services who receive the residential support subsidy can now receive disability allowance on the same basis as those in the community. On the other hand contracts with age-related residential care providers are more comprehensive. Under those contracts older people are to be provided with the health and disability-related services that are necessary to meet their assessed care needs. The bill therefore precludes people in these services who receive the residential care subsidy from receiving disability allowance. 
At the appropriate time I will be pleased to move that the Social Security (Long-term Residential Care) Amendment Bill be referred to the Social Services Committee for consideration and that the committee finally report the bill to the House before 30 September 2006. I am delighted to commend the bill to the House. 
Hon TONY RYALL (National—Bay of Plenty) 
: 
 In speaking to the Social Security (Long-term Residential Care) Amendment Bill I have a number of questions and it would be most helpful if the next Government speaker could address them. There are a number of changes in this bill that I think all parties will support. They are consistent with what we understood and voted for previously in the legislation that Ms Dyson brought in. That legislation was obviously full of mistakes and here we have a bill to clarify it. 
But there is one point that we in the National Party Opposition want to challenge the Government on and that is the comment in the explanatory note of the bill that it is current practice that rest home providers charge the same amount to paying residents as they do to subsidised residents. The Government is trying to say in this bill that subsidised and non-subsidised rest home residents currently are charged the same amount in rest homes and that is not true. So whereas the explanatory note of the bill is trying to pretend that that is the case that is not true. I have rung a number of rest homes in the country today and it is clear that there is a difference between what Government subsidised residents are charged and what private paying residents are charged. There is a difference and as a number of rest home providers told me they subsidise the Government subsidised residents with the money that they have charged the private self-funding residents. 
So can members see the issue here? The issue is that in many rest homes Government-subsidised residents are charged about $636 on average each week but private self-funded rest home residents could be paying $100 extra or a bit more. Rest home providers use that extra amount being paid by the private payer to help subsidise overall services that benefit the Government-subsidised resident. But here is the problem. I do not think the Minister even realises this judging by the funny grin on his face. What the Minister does not realise is that he is going to price-fix those private paying residents. The private paying resident in a rest home is not a party to the contract the Government has with either the provider or the subsided resident. That resident is in no way associated with that contract but the Government is saying in this bill that it will regulate across the private contract and the rest home will not be able to charge any more than the Government rate. I do not know whether the Government actually understands the full implications of that and we would like the next Government speaker to address it. Does the Government actually realise that the private patients in rest homes now are paying more than the Government fee and that that surplus is being used to subsidise overall operations? 
Sandra Goudie 
: Helping our older people. 
Hon TONY RYALL 
: It is helping our older people. 
The effect of limiting the private charge is that the services and the viability of the rest homes will be put at risk. I do not think the Government fully appreciates what that will mean. It will mean that innovation will be stifled and even greater financial pressure will be put on the providers of services to some of our most vulnerable older people and that will happen because the whole economics of running a rest home will change. Rest homes are currently operated on the contribution of the private patients and the contribution that comes from the Government for the subsidised patients. If we cut back on one it makes it harder to spread the burden and make the rest homes viable. So this price control of private paying rest home patients will be bad for residential care and at the select committee we will be looking forward to understanding why the Government wants to do that. If the Government undermines the viability of the rest home sector there will be fewer places to deal with the most vulnerable in our community. 
One of the things that we in the National Party are very concerned about as we look out at our responsibilities over the next 20 years as policy makers in this country is the big shortfall there will be in providing rest home facilities. The fact is that the Government cannot shoulder the full cost of providing those services to retired New Zealanders and those who are in a position to make a contribution will have to do so. But we think that for Parliament to pass a law that will regulate what rest homes can charge their private paying patients will undermine viability of rest home care in New Zealand and stifle innovation. 
The Government has accepted I think in its overall changes that rest homes that provide additional services on top of the standard care regime can charge extra. That is why we are seeing around the country that even subsidised Government patients might be paying another $20 or $30 a week to get an en suite or something extra in their rooms. We do not want to change that. We think that is a way to ensure we have innovation and improving quality. But we are quite concerned about the suggestion that the Government regulate across the private contract of the private paying residents because that premium is being used to subsidise the Government-subsidised residents. It would be wrong and it would undermine the viability of rest homes to change that. 
We also want to make sure that the Government takes some time to explain—maybe in this debate—whether any change is proposed to the set-up of what is provided with the new definition in this bill for “contracted care services” in clause 6. What does that mean? There are some changes to contracted care services. We want to know what those changes mean—in particular paragraph (c): “in relation to a particular person the services necessary to meet the person’s assessed long-term residential care needs”. What does it mean to include that in the definition of “contracted care services” and what do the changes to the definition of “cost of contracted care services” mean? We asked for a briefing from the Government today and we were told no we could not have a briefing on this bill. 
Hon David Benson-Pope 
: You should have asked before lunch time. 
Hon TONY RYALL 
: We did ask before lunch time I say to the Minister. 
Hon David Benson-Pope 
: You did not. 
Hon TONY RYALL 
: We did ask before lunch time. We asked for a briefing by 9.30 and we got no—[ 
Interruption 
] Who do I believe? David Benson-Pope or myself? Well frankly I would believe myself hands down against David Benson-Pope. Would we believe David Benson-Pope—a man a prima facie case was found against? 
Hon David Benson-Pope 
: Be careful Tony. 
Hon TONY RYALL 
: You be careful Minister— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
Hon TONY RYALL 
: The fact is he cannot say in this House that things happened after midday when they did not. 
So we want a Government member to take the next call and explain to us those key issues. There are many things in this bill that we will support and facilitate the speedy progress of in the select committee. But I think it is clear that the Minister himself does not understand the implication of this. The Government is wrong if it thinks that rest homes currently charge their private paying patients the same level of subsidy that the Government pays. That is what this explanatory note says and it is not true. We want to be assured that the Government knows that is not true and that it knows it is planning to regulate the fees that private patients have negotiated with rest homes. It will have significant implications on the financial viability of a sector that is already under pressure and it will stifle innovation. 
The biggest issue facing Vote Health in the next 20 years is the ageing population and the care of our most vulnerable. We simply cannot expect that Government regulation will provide the places and the care that we need for our elderly. We need a much more imaginative and forward-looking approach in aged care rather than this narrow and managerialistic regulatory approach that the Government is looking at. In the next 6 months the National Party will be launching quite a discussion about how we get the services right and how we make sure that the rest home sector is expanded that home care is expanded and that we have the workforce the beds and the care for our most vulnerable. We do not think that can be done by Government regulating all the costs in rest homes. It will stifle innovation and undermine the financial viability of our rest home sector. 
GEORGINA BEYER (Labour) 
: 
 I am pleased to rise and speak on the first reading of the Social Security (Long-term Residential Care) Amendment Bill. In addressing the question asked by the member who has just resumed his seat I point out that he answered it himself. If he would care to sub himself on to the Social Services Committee I am sure his contribution and particularly the questions he raises will be well traversed there. The Social Services Committee which I am very proud to chair looks forward to receiving this very good legislation. 
This Labour-led Government is committed to providing high-quality affordable care for all older New Zealanders. This is a far cry from the experience in the 1990s under the National Government. Older New Zealanders are a valued and important part of New Zealand families and communities. They deserve certainty about how much they will need to contribute to the cost of their care. It is about investing in New Zealanders—in this particular instance our older New Zealanders. Last year we made significant changes for people in long-term care. Most important was our manifesto commitment to remove asset testing progressively for long-term residential care. We also clarified the rights and obligations of people in care. 
This bill amends a number of anomalies. The changes include treatment of overseas private pensions which will be treated the same as New Zealand private pensions—that is 50 percent of both will be excluded as income when determining how much someone should contribute towards the cost of care. Previously 100 percent of overseas private pensions were treated as income. Also the bill clarifies that the contribution of older people who are assessed as needing long-term residential care indefinitely and who are receiving their care in a facility contracted to a district hospital board will be no more than the maximum weekly contribution which is currently set regionally at between $640 and $740 a week for their care. 
The maximum contribution caps the weekly amount individuals must pay towards their care. The amendment makes it clear that even if people have assets of more than $150000 they will pay no more than the maximum contribution for standard residential care services. Currently around 28000 people are in age-related residential care and the Government invests about $539 million exclusive of GST in their care. In addition the Government is funding district health boards for the impact of income and asset testing changes implemented from 1 July 2005 at a cost of about $93 million exclusive of GST. 
As I mentioned previously in my speech this is about a Labour-led Government investing in New Zealanders—in this particular instance in our older New Zealanders who in their twilight years should be able to enjoy with some security the residential care they need. I will conclude on one historical point by taking us back to asset testing in the 1990s—and this is why I look forward to the National Party’s contribution at the select committee. In 1998 the day before International Day of Older Persons the then Minister of Health Bill English announced he was abandoning the bill that would have abolished asset testing for older people in private and public hospital long-term geriatric care. One has to ask whether the attitude from that party on the other side of the House has changed. I would have to say that it probably has not. 
With the passage of this bill which I hope will come to the Social Services Committee expeditiously we will hear National members explain what their policy on the care of older New Zealanders supposedly is. They have shown little care in the past and some of the disasters they left us with from the 1990s with their policy of integrated care and privatisation of the area have provided this Government with a headache—yet another one from the previous National Government. This Government is only too happy to help rectify the situation because it is a Government that cares that knows and that understands New Zealanders. We will invest in them and we will along with the rest of the nation transform our country into something that we will most definitely be proud of. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I begin by congratulating my excellent colleague the Hon Tony Ryall on such a superb speech. I think he very clearly outlined one of the shortcomings of the Social Security (Long-term Residential Care) Amendment Bill. After all this is meant to be about ensuring the residential care of our mums and dads when they can no longer care for themselves. He raised a very pertinent point about the continued viability of residential care services particularly when by 2020 20 percent of the population will be aged over 65 years. It is an incredible concern for us all. 
In response to Georgina Beyer I note that when the bill was introduced Age Concern urged the Government to be open and honest about what this bill means in terms of what older people can be expected to pay in rest homes and hospitals. Kerry Dalton the chief executive officer of Age Concern says that it potentially gives with one hand and takes away with the other. Of course that non-profit organisation is particularly concerned about the care safety and well-being of our older people and does a lot of work around elder abuse. But I will refer to more of that later. 
Kerry Dalton goes on to say that the changes in asset testing will see more older people qualifying for public funding but what that funding covers may be reduced under this legislation and what was meant to be good news for older people has a hidden sting. The bill brings in a new definition of what public funding covers called “specified care services”. Under the bill the older person is liable to pay for anything outside of specified care services. The $636 limit on what people have to pay also relates only to specified care services. The Hon Tony Ryall raised this point and wanted an explanation from the Minister so he will be looking forward to that explanation—if not from the Minister or the Government benches then in the select committee. 
More comments were made that it was thought that the changes contained in the bill have the potential to put older people at significant risk particularly those on low incomes. They may be in danger of not having essential health and disability needs met because they are unable to pay for them and there is also the risk of financial exploitation. Their understanding is that such things as transport to and from the specialist as well as ambulance costs in certain regions and the cost of customised equipment will be charged for and these are not luxuries. People need these things and should have them regardless of their ability to pay. 
Age Concern is concerned that older people will fall through the cracks between what the provider is funded to deliver and what the person needs. It is a concern. Those people who are paying privately for services are the ones who help to subsidise the Government-subsidised residents and that should not be forgotten. The benefit of that should not be underestimated. In the last 3 or 4 years 30 to 40 providers have gone out of the provision of residential care services. That should send a very strong message to this Government about needing to be very very careful about the policies that are put in place for our older people. 
The price district health boards pay for residential care is determined by the territorial local authority region in which the residential care facility is sited and the level of care provided. Prices paid to providers vary from $556.47 a week GST inclusive for rest home care in the Clutha district to $986.30 per week GST exclusive for hospital level care in the Auckland City area. So any amount any resident pays towards the cost of his or her care is limited to the maximum contribution which is gazetted by the Ministry of Health. The $636 cap is unrealistic and does not reflect the current cost of the provision of aged care. As regional variations currently exist it is the view that the current cap is largely fictional and should be removed in order to provide greater clarity on pricing for residents. The Hon Tony Ryall is absolutely correct when he says that it cripples innovation and stifles investment. People should have the freedom to pay what they want to pay for. If that helps others by creating a subsidy for people who cannot afford the same level of services then surely that is not a bad thing. Surely it would be a good thing to have more services for all those people in residential care even though only some of them may be paying for those services. 
One has to ask whether the Minister really has the health and well-being of our vulnerable people at heart. Age Concern raises that issue and Age Concern as members are aware is very much into the protection of our older people particularly our vulnerable older people. It has put out a very good report on elder care abuse. In that report information is provided on 1288 cases of elder abuse and/or neglect self-neglect or institutional abuse. I think that psychological abuse accounts for 59 percent of that. 
One of the other issues that Age Concern raised was enduring powers of attorney whereby older people because they are vulnerable can be persuaded into undertaking enduring powers of attorney. Now if they can be persuaded into giving other people their enduring powers of attorney then they can also be persuaded into allowing their photographs to be taken and then used for purposes that they are scarcely aware of. This is about elder abuse. If Age Concern is concerned about what can happen to the elderly as a result of some of the provisions of this bill then I think we should be listening to that. 
It is interesting to note that elder abuse has been in the news recently. It is disappointing that this Government—and indeed the Minister for Senior Citizens—has not come out and defended the vulnerable people whose photographs were displayed in the Nurses Organisation magazine in one instance without the permission it would appear of the family. It is quite clear that older people are vulnerable. We need to have their interests at heart. If we do not have their interests at heart how can we be putting policy in place through legislation that will really take care of them and protect them and their future care? I would like to see the Minister come out and support Age Concern and defend our vulnerable older people against elder abuse. Quite clearly those photographs in that magazine are elder abuse and anybody who has seen them will be absolutely appalled. 
If one does not have the concerns of our aged citizens—our vulnerable older people in residential care and home care—at heart how can one possibly put policies in place that will protect their interests? That policy is the exact one that Tony Ryall was referring to in regard to subsidised and non-subsidised paying residents. It is the paying residents who help to subsidise the supports necessary to ensure that our older people are effectively looked after in residential care. That cannot be understated in any way. If we do not allow the innovation and investment in residential care facilities we will not have those beds available in years to come when they will be absolutely critical to supporting our rising older population. I exhort Government members to really give some consideration to the very wise words of the Hon Tony Ryall. Hopefully their minds will be open to what it means for people to have the right to pay for what they want and for the Government not to start interfering with contracts that are essentially between private paying individuals and the service provider. 
In this instance the Government is attempting to interfere in that contract and is intending to interfere in that process. Price fixing should not be a part of this bill and I would exhort the Government to rethink its direction in this regard and spend some considerable time at the select committee. I am sure there will be submissions to the bill on that particular issue exhorting the Government to do that. 
BARBARA STEWART (NZ First) 
: 
 New Zealand First supports this Social Security (Long-Term Residential Care) Amendment Bill) going to the Social Services Committee. We believe that the bill contains some potentially contentious issues. As the Minister said it contains some technical amendments and we know that other substantive amendments will be proposed during the select committee process. It will be absolutely essential to have the input of many submitters into this legislation particularly those involved in private care. It is really important to ensure that this legislation which affects 28000 New Zealanders is as good as it can possibly be. We need to know that the services are right. We know already that the workforce numbers are a challenge and we hope that area will be addressed smartly. 
The bill amends the Social Security Act of 1964 in relation to the income and the asset-testing regime for people requiring long-term residential care. I must admit I was very pleased to hear the Minister state that this bill gives certainty to those requiring residential care particularly in the costing structures. 
Sandra Goudie 
: No not if there are no residential service providers; they will all have left the industry. 
BARBARA STEWART 
: That will be challenging. Many of us here in the House know that the cost of residential care quickly erodes the savings that many people have worked for throughout their lives and carefully put away for their senior years. We have a most interesting argument there and I will be pleased to see submitters’ comments on this aspect. One of the key changes this bill makes is that people who are needs-assessed as requiring long-term residential care indefinitely in a rest home will pay no more than the maximum contribution for care whether or not they are subsidised. Many people will applaud this change and of course we know that rest home providers will have some queries about it. 
The second point worth noting is that people who have assets that are over the applicable assets threshold and receive contracted care services that cost more than the maximum contribution—services they enjoy and have had often for many years—pay only the maximum contribution. The downside of this is that some of these services will be cut which we do not want to see happen because the funder as we note in the legislation is to subsidise them by paying the amount above the maximum contribution. So the funder liability in this bill is interesting. We all want people requiring care to have the best possible care and we do not want the viability of any rest home to be put into question. We know that many rest homes have closed down over the previous few years. We do not want to see any more of them close down particularly in view of our ageing population. 
It is worth noting that residential care providers who have been charging residents with assets over the threshold more than the maximum contribution for the same care provided to subsidised residents are not likely to be happy with these amendments. No doubt the select committee will hear more on this. We will be following that up. New Zealand First believes that this is one of the potentially very contentious matters although we contend that when it comes to this type of care there should be no difference in the type or amount of care people are entitled to receive regardless of whether they pay privately or are State subsidised. 
 We note that although the residential care subsidy is intended to meet all disability costs it is possible that there may be a shortfall in terms of both transport costs and some one-off costs such as dentures glasses and hearing aids that many people in age-related care may require. That is one matter that needs to be addressed and it is one that New Zealand First will be following through very carefully. We are aware too that people receiving a residential care subsidiary for age-related care may not receive a disability allowance because the residential care subsidy is intended to meet their assessed disability-related needs. As I said earlier New Zealand First is concerned about that shortfall. 
We note that the legislation to allow exempted persons to retain a personal allowance expires on 30 June 2006 so it is really essential that legislation be passed quickly to address that matter. When one reads the commentary on the bill it is interesting to see there will be uncertainty as to how assessments of deprivation will be treated if challenged on appeal as the wording of the deprivation provision differs from that of the former provisions interpreted by the courts. We are pleased to see that New Zealand and overseas private pensions and annuities will be treated equitably. The bill provides for overseas private pensions and annuities to be treated in the same way as New Zealand private pensions and annuities. In both cases only 50 percent of a private pension or annuity is to be included as income in a means assessment. 
New Zealand First will support this bill going to the select committee. With this country’s ageing population we believe that the viability of rest homes is absolutely paramount as also is the care of residents in long-term residential care. We want to see the best possible care for the people in residential care facilities and we look forward to ensuring that as we follow the select committee process. 
SUE BRADFORD (Green) 
: 
 This bill which we are debating for the first time in the House tonight highlights for me the shambles that is the Social Security Act 1964. There is very little in this bill that could not and should not have been anticipated when the Social Security (Long-Term Residential Care) Amendment Bill 2004 was being considered by Parliament 2 years ago. What we have in front of us now appears to be largely a series of tidying-up provisions aimed at clarifying and rectifying drafting errors and omissions in that particular legislation. The fact that this bill is before the House at all should be seen as an endorsement of the Green Party policy I have talked about so often in the past—that is that the Social Security Act 1964 should be totally scrapped and rewritten from scratch on principles of sufficiency simplicity and universality. I imagine that the Social Security Act must be one of the most abused amended and unusable pieces of legislation still on this country’s books and I hope Labour is seriously considering a total rewrite as part of its intended major reforms in the welfare area. 
Meanwhile and that said the Green Party will be supporting this latest piece of the jigsaw puzzle—the Social Security (Long-Term Residential Care) Amendment Bill—on the basis that it is a necessary evil. Like the Minister we are keen to ensure that older New Zealanders in poor health are not unfairly disadvantaged as a consequence of the confusion and complexity of the 2004 amendments. As some will be aware it is unusual for the Green Party to support any clause that restricts entitlements to a benefit but we see the restriction on the disability allowance as proposed by clause 4 as fully justifiable. It is not acceptable that people can double-dip—receive payment from two sources for the same expense—and it is bizarre that for almost 2 years the Act has permitted that practice. 
Further a number of amendments deal with the means assessments of older New Zealanders in long-term residential care and although the Green Party supports the total abolition of income and asset testing for long-term residential disability services we supported the 2004 bill on the basis that it was at least a move by Government in the right direction—towards equitability and sufficiency for older New Zealanders with long-term disabilities. However the Government’s insistence on retaining an ameliorated but massively complex income and asset-testing regime means we are back again 2 years later tidying it up. 
We support the inclusion of purpose and overview sections in Part 4 of the Act inserted by clause 5 of the bill but ask why they were not included earlier. The inclusion of purpose and overview sections is as far as I can tell standard practice in legislative drafting. The Green Party likewise supports the other clarifying provisions contained in subpart 2 but most could have and should have been anticipated earlier. None of those changes will impact adversely on older New Zealanders receiving residential disability services. Some are necessary to ensure that such people are treated fairly and therefore we support subpart 2. 
In particular I would briefly like to address clause 12 which restores the discretion that—probably inadvertently—was removed from the deprivation provisions by the 2004 amendments. The provision will make sure that even if a deprivation of income or property is found as a matter of fact the ministry will have discretion as to whether to include the value of the deprivation in the means assessment. That clause is to be commended. It is impossible to legislate or regulate for the whole range of human experience and a discretion such as that is essential to ensure vulnerable people are not being unfairly forced into poverty. It is just a pity the Government could not have acted on the same principle regarding the discretionary special benefit which it has so recently replaced with the highly regulated and inflexible temporary additional support allowance—a move that will increasingly force some of our most vulnerable citizens into even deeper poverty than they suffer already. 
With some reluctance because most of the bill’s provisions should have been addressed legislatively 2 years ago the Green Party will be supporting this bill. I hope for all our sakes but especially for the sake of those people most affected that we get it right this time around. I am also keenly awaiting the day when a progressive Government has the time energy compassion and courage to bring forward a totally new Social Security Act which would transform welfare law in this country into something usable by staff and beneficiaries alike and which would not be fraught with endless and ongoing complications and amendment bills like the one we are dealing with tonight. 
TARIANA TURIA (Co-Leader—Maori Party) 
: 
 Tena koe Mr Speaker; tena tatou te Whare. Te Ao Maori is absolutely rich with allusion and imagery that illustrate the value of our elderly. One pepeha that I am particularly fond of is: ka haere te matatahi; ka noho te matapuputu—youth rushes in where age deliberates. 
And so it is in a spirit of deliberation that I come to this bill. The Maori Party has taken time to deliberate on such an important matter as the capacity to care for our elders. Our elders provide us with our foundation our wisdom and our learning as whanau as communities and as a nation. We must cherish the contribution of those who have been tested through the trials of time and do our utmost to care for them. The care of all our whanau members must surely be at the heart of every decision made in this House as it is in every household of the nation. 
The Maori Party comes to this bill today seeking reassurance that the decisions we will be making on it will enhance the social and cultural wealth of our nation. That must be the test that is applied to every policy initiative before us. The bill deals with the issue of older people requiring indefinite long-term residential care in a rest home or a hospital. Although that is only a small proportion of our elderly population the initiatives will stand to benefit the 2 percent of tangata whenua over 65 years of age who are in rest homes and the 3 percent of tangata whenua over 65 years who are in long-term hospital care. In essence it means that if our pakeke are assessed as requiring indefinite long-term residential care in a rest home or hospital they will pay no more than the maximum contribution for care whether or not they are subsidised. 
Earlier today my colleague Dr Pita Sharples introduced to the House the notion of a genuine progress index. The economic health of the nation is reflected as much in the quality and distribution of economic growth as it is in the value we place on such activity as caring for the elderly the unwell and the disabled. The time and resources that we give to the care of whanau and to strengthening whanau members should be included in a genuine progress index for the positive outcomes they achieve. 
We are of course aware of the political promises and pledge card commitments that provide the politicians with the motive to introduce legislation such as this. The Maori Party is satisfied however that regardless of the political driver the ability of the bill to demonstrate manaakitanga to our elders is worthy of our support. The interpretation of manaakitanga is that of behaviour that acknowledges the mana of others as having equal or greater importance than one’s own. Manaakitanga is demonstrated through the respect of aroha hospitality generosity and mutual respect. The demonstration of manaakitanga elevates the status of all building unity through humility and the act of giving. In simple terms what this means is that the rewards of caring for another such as an older person requiring indefinite long-term residential care is that the act of giving will also reflect well on the person who gives. The qualities of caring kindness and generosity as a means of showing love are valued in high regard. 
Ngapuhi Chief Executive Sonny Tau told of the reflections of a German missionary who was purported to have said some 200 years ago: “These natives are a peculiar people. They don’t measure their wealth by what they own but by what they give away. We must teach them to be mean.” The Maori Party is here today to say that the concept of caring for our elderly is indeed represented by what we give away—the time and resource that we willingly share in protecting our pakeke. 
We cannot afford to be mean as a Government either as we consider the rising demographic with an increasing proportion of people living longer and subsequently likely to require care including residential care. The decisions that are set in policy to address the income and asset testing regime for older people are important ones that we support. The Maori Party is pleased that means testing is to be based on income only and not on a combination of income and the value of a person’s assets. The separation is welcomed by the Maori Party as the current legislation means that many Maori who might be cared for in rest homes could lose what little land assets they might have left. In our view this could lead to dispossession and the likely ownership of Maori land by non-Maori individuals and institutions including the Crown—and the Crown already owns enough Maori land. 
I hope that the select committee will also ensure that the issue of access to elder care takes sufficient account of the issues around work and care for those services provided by elder care nurses. Research carried out by the Wellington and Christchurch city councils a couple of years back found that about one in 10 workers are caregivers to elderly people mostly family members. If we are to be genuine in our commitment to providing a sustainable service for older people the salaries of the more than 25000 staff in rest homes and hospitals across the country would reflect that. 
One of the finalists in the 2005 Roger Awards for the worst multinational corporation operating in New Zealand was Guardian Healthcare an organisation that runs a network of rest homes around the country. Guardian Healthcare which is predicted to achieve a profit of $26 million this year last year offered its staff a pathetic 2 percent pay rise. In dollars and cents what this equated to was virtually the adult minimum wage of $10.25 an hour. How can we guarantee quality of care and sustainable health and well-being for our elderly population if the stories are true and that rest home management is scrimping on the medicine in order to make a profit? We must look again to the real profit as measured in the social health of the nation—the prosperity and progress of our families. 
I am sure that this House is very aware that yesterday was the International Day of Families. It seemed to me absolutely appropriate that on a day that the United Nations has designated as recognising the importance of supporting families a celebration was taking place in Te Arawa of an extremely rare event which was the 100th birthday of kuia Witarina Te Miriarangi Parewahaika Harris. By anybody’s accounting framework this kuia must be assessed as an absolute treasure of the nation. She starred as Princess Miro in the 1928 silent movie  
Under the Southern Cross 
 which was later released as  
The Devil’s Pit 
. She was also a soloist with her renditions of immortal waiata featured on the album  
Ko Ngati Poneke Hoki Matou  
Ngati Poneke Young Maori Club which was recorded in the 1930s. Not content with her artistic and cultural accomplishments her academic and intellectual spirit also impressed frequent visitor Sir Apirana Ngata who recruited her to work in his parliamentary office. 
This endearing kuia has continued to thrive right throughout her life even featuring in a 2004 documentary  
Homegrown 
 which described the remarkable friendship between Witarina Harris and film historian Jonathan Dennis. In 2006 she still retains her chiefly role as the kaumatua for Archives New Zealand.  
However it has not all been neon lights and film-star glory; in  
The Silent Migration 
 in 2001 Witarina recalled her experience of moving to Wellington in 1929. She said: “Sometimes I’d leave work and go to the continuous pictures at the Roxy in Manners Street and I’d cry. I used to go in there and cry and cry you know? I was so lonely. And I’d think to myself ‘Please just to see a Maori face that’s all I want to see’ ”. These silent tears speak volumes of the key critical factor in maintaining the health and well-being of this 100-year-old wonder. A couple of days ago this kuia had a few words of wisdom to share with the nation which give a context to those tears: “Kia mau te aroha i a koutou.”—“I have survived to this age because I have always known the most important thing is love within your wider whanau.” 
The Maori Party will support the Social Security (Long-term Residential Care) Amendment Bill. 
JUDY TURNER (Deputy Leader—United Future) 
: 
 I stand on behalf of United Future to speak to the first reading of the Social Security (Long-term Residential Care) Amendment Bill. I begin by saying that we will support the bill going to select committee but like other members in this House we have one or two areas of concern. We will be very interested to hear what submitters say about those issues and the outcome of how the bill is progressed beyond that stage will be of interest to us and may even determine our ongoing support. 
I want to correct a couple of interesting things the National member Sandra Goudie mentioned in her speech. She created a bit of a misunderstanding—it sounded like there are hundreds of residential care facilities closing down all over New Zealand. I think there are a few people out there who think that is the truth. I looked at that issue a little while ago and found out that no a number of residential care facilities have been sold and have changed owners but most of them remain in operation. A few that were beyond maintenance or would have been too costly to bring up to spec have closed down—and that is probably a good thing. A number of providers—I spoke in particular to Presbyterian support services up north—explained that they had sold on some of their residential care facilities to providers so they could focus their attention on home-based care. Home-based care is becoming the cutting edge of age care in New Zealand and they wanted to be part of that. They therefore felt that there were a number of sensible and good providers that were able to take over the work they were doing so they sold their facilities in order to engage in home-based care. 
Part 1 of the current Act is to do with disability allowances and this particular amendment bill that we are talking about sets out to amend section 69C of the Act with provisions to preclude those who are already catered for in a residential care facility from receiving some disability allowances because the understanding is that they are now receiving it within the facility. The great thing I found when I read the fine detail of this is that if there is some care that their disability allowance covers when they are in community care that is not covered by the residential provider—it may be something like some physiotherapy that they are in need of to stay mobile that is not offered on site at their residential facility—they are still allowed to get that disability allowance to cover that lack of service where they are living. I think that is a really really good thing. 
The amendments proposed to Part 4 and schedule 27 of the Act are probably the areas that will be the most controversial. I expect that we will hear from people involved in aged care from Grey Power and from people who want to talk to this bill. It is an area that United Future has some questions over. 
Those who require long-term residential care indefinitely are those who are affected by this bill. Providers with contracts with district health boards will not be able to require a resident to pay any more. Let me say up front that I think it is important that people are not treated unfairly. I think the intention of this legislation is to make sure that there is no unfair treatment of people in residential care. However the concern we have is that on one hand we are encouraging New Zealanders to save towards their retirement and their needs in their senior years and on the other hand we are now saying that having gone to all the trouble of saving and providing for themselves they cannot use the money from their assets to provide a better standard of care for themselves. That is flawed. That is the kind of area that I would like to see properly discussed at the select committee so that we can have some flexible arrangements around that. 
Having said that I reiterate that our concern does not mean that we believe there should be two standards of care given to elderly residents in residential care. The standard of medical care needed by anybody in one of those situations should be consistent across the board. We need to make sure in talking about flexible arrangements that those flexibilities are not dependent on a person’s ability to pay. However it is possible that people who have gone to a lot of trouble to save towards their retirement and their needs may be able by adding some of their own money to the money offered to have a larger room to have their own TV or maybe to have a room with a view. There may be some additional comfort factors that they could choose to pay for and secure for themselves and I think that needs to be considered. If we ask people to save and make provision for those last years then we should not suddenly remove their ability to use those savings productively for what they want. We need to look at that and I will be really interested in it. However I say again that this must not be about the level of care that is given but about the comfort factors that people may want to afford. We really are keen to see that. 
United Future does support the clarification of assessment against income not assets and we support the intention to treat income assessment equitably regardless of whether it is secured in New Zealand or overseas. That is a great move. 
The explanatory note of this bill explains under the heading “Funder liability”: “If the cost of contracted care services provided to a resident assessed as requiring care exceeds the maximum contribution the funder is liable to pay the difference.” This raises some questions for me. Many of us have heard from providers that the assessor—the person who determines what level of care an elderly person will receive—is also the funder. A lot of providers say that they often receive somebody who has been assessed at one level of care and in reality find that the person needs a much more intensive level of care than he or she has been assessed at. Currently funders have to absorb that loss themselves. Does that mean then that despite what an assessor may decide a person’s level of care needs to be the provider can then invoice the district health board that funds that person for additional funding if the provider believes that the level of care required is more intense than has been designated to the person? If that is what it means then that is very interesting. Has anybody calculated what that could possibly cost us? I suspect that no one has. We need to be very clear about what that means. 
United Future totally supports the intention to correct any disadvantage that is currently experienced by couples in the matter of increasing the income from assets exemption when one partner is in care. That is a really good provision. 
I say in finishing that I have an interesting background to this issue. My paternal grandmother—and I was the only grandchild who ever enjoyed staying at her house having her conversation lollies that she kept in little jars and seeing her make dolls’ clothes for our toys because the other grandchildren were never old enough to be able to be left in her care—had a stroke that left her in residential care for the last 11 years of her life. She had serious mobility problems and a loss of speech. That meant that nearly every Sunday afternoon for 11 years of my life I went over the hill at the Raglan deviation—if anyone here travelled it in those days he or she will know that it was no small trip—and spent 3 hours with grandma. When someone has lost her power of speech and get confused by lots of people talking at her the way those 2 or 3 hours are managed is by taking turns. So I spent a large part of my childhood wandering around the hospital wing of a rather lovely residential care place and getting to know and befriending lots of people. I was really impressed with the level of care that was given. But I will say one thing here. My dad and his brother could never have afforded to pay the full cost of what that service provided over those 11 years. It would have taken my father out of the small farm that he owned and changed our life for good if we had had to pay the full amount. We have always been eternally grateful to Presbyterian Support Services which owned the home that my grandmother lived in for 11 years for the subsidies that allowed us to see her in very good quality care to visit her at will and also to befriend a lot of other people. 
We need to make sure that we remind ourselves that the measure of a nation surely is how we treat those who are most vulnerable in our society. This bill is all about that. United Future is happy to support its first reading. 
JO GOODHEW (National—Aoraki) 
: 
 I rise to speak in support of the Social Security (Long-term Residential Care) Amendment Bill. I heard a whisper in front of me just before that this is the “Look after ‘Bob the Builder’ Bill” but in fact it is not. Bob is way too young— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member must use the member’s full name. 
JO GOODHEW 
: The bill will be called the “Look after Bob ‘the Builder’ Clarkson Bill”. There is a bit of alliteration there. The Hon Tony Ryall has spelt the situation out this evening. We have some questions for the Minister the Hon Pete Hodgson and for Government members who should answer the questions if they can. Maybe they will not be able to dispel National’s disquiet and concern about this bill. I am speaking along with my colleagues in support of the bill but with severe qualifications to that support. 
What is the reason for this bill? The explanatory note states: “The amendments address anomalies in the Act so that the Government’s policy decisions in relation to long-term residential care for older people can be fully implemented.” What does that mean? I have a couple of suggestions—one of them my own and the other someone else’s—as to what it may mean. The first—my suggestion—is that the Government mucked the legislation up and now needs to fix it. It is time in fact to have a second try at getting it right. The second view is from some of the providers who say: “The bill Ruth passed last time was poorly drafted so we are going to spend good taxpayers’ money to do it again.” Those are not my words but they are nevertheless quite succinct. The last 6 years have been a litany of unintended consequences and the taxpayers are the poor sods who get to foot the bill again and again. We know what we are here to do. If we do it what will happen? 
Here I will digress. I will tell those present tonight and anyone who is listening to this debate how I spent part of last Friday night. The Strathallen Lifecare Village a rest home and hospital held a ball to celebrate 10 years of that institution. I was a special guest and I had several hats on. I spent the early part of the evening pinning corsages and buttonholes on the residents who were attending the ball. They arrived in wheelchairs or on walking frames some shuffling and others walking. Some were with their lifelong partners and some were on their own. They purposefully went towards the decorated hall attired in their glad rags. Some of them had their own glad rags which had been saved from times gone by when they had attended parties and balls. Others were attired in garments from the drama league—and the rest home provided a large selection of drama league garments for those people to wear. I can tell members that they all looked amazing and they obviously felt amazing. There was much pride as I pinned buttonholes or corsages on the ladies and gentlemen. 
Members may wonder what that has to do with the bill. As I waltzed with the beau of the ball maybe not as skilfully as Georgina Beyer or Rodney Hide could perhaps do—but one never knows; maybe I was as skilful— 
Steve Chadwick 
: You could be one day. 
JO GOODHEW 
: I might be one day indeed. Maybe one day we will try it out. I realised what a huge commitment it was for the rest home—that organisation—to put on the ball. By commitment I mean the commitment of all the staff. Every single one of them was present whether or not he or she was on duty. Those who were not on duty had returned from home in order to help the residents to get ready. They helped the women to put on their best lipsticks and get their hair looking great and they helped the men to look dapper—and they were dressed in their glad rags as well. About 130 residents were involved. 
What about the costs associated with putting on the event? There was a three-piece band there were drinks decorations and party food and the families were gathered there. Now I come to another one of my hats on this occasion: my grandmother was there as well—she is a resident of that rest home. She is 90 years old and celebrated her birthday just recently. She was dressed in a beautiful jade outfit; she looked fabulous. My parents were there with her and my uncle was there as well. That event came at quite a cost which was met by the organisation. Were the wages paid for the extra staff that came back? I am sure they were not. There is no fat in the system to pay the staff who came back for the ball. 
I spoke with the senior manager who was also the manager of a facility here in Wellington and of others elsewhere in New Zealand. We talked about the two risks that face that organisation—and one of those risks is attached to this bill. One of the risks that may result in the ball not continuing—it is the fourth such event over a 10-year period; it happens every 2 years—is the increasing acuity of the residents. What does acuity mean? It means that those residents are sicker. It means that the residents who enter the facility are becoming much sicker as the years go by. Yet the funding has not changed and the qualifications of the staff have not changed. More hospital and dementia care residents are coming in. Those residents will enjoy fewer of those events over the years. 
The other risk is this bill. Let us concentrate on the element of the bill that has been mentioned already which is that the Government wishes to cap one particular funding stream that is currently available to rest homes. It wants to restrict cap and interfere—members can call it what they like. Currently the funding for subsidised residents would not cover extras; it barely covers the staff now. The funding certainly does not meet the cost of wages that compare with those paid to district health board nurses. Events like the Strathallen Lifecare Village hospital and rest home ball may be a casualty. Where is the aged care sector now? In my electorate we have the highest over-65-year-old population of any district health board in the country—it is 17.2 percent. The caregivers worry about existing on the poor wages. The managers worry about replacing the staff; they find it very difficult to compete with the district health boards. 
So what do the representatives of the sector say about the bill? There is a consensus so that is healthy. They say there is some merit in improving the lacklustre original bill—again there is some consensus on that which is healthy. But we find that the agenda that worries them intensely is again that the method of funding will be capped—that they will find that people will not be able to negotiate the level of care that they can afford. I make reference to what Judy Turner has already said this evening. If people have saved hard for their retirement but they find they have been assessed as needing residential care why would they not want to use their savings for their own benefit? Some people would like to do so and they should be able to. Representatives of the industry fear this legislation and the ramifications it may cause. They are after all business people; they try to operate a business and this is a problem for their funding. They want to keep afloat. Forty providers have exited the industry which is not the small number that Judy Turner has suggested it is. Will this measure bring them back? No it will not. 
I will finish by speaking briefly on one topical issue at the moment. “I wore a pedometer and did more than 17000 steps on a single shift. Ten dollars fifty an hour is not enough—not with our baby.” Are comments like that any justification for the appalling photographs that have appeared in the  
Kaitiaki 
 magazine—a magazine I used to value as a New Zealand Nurses Organisation member? No they are not. That is yet another issue we will have to address if it is the sort of— 
Hon David Benson-Pope 
: You’re in the wrong party. 
JO GOODHEW 
: I am not in the wrong party. I say to the Minister that I know value when I see it. I tell members that issue was a dreadful indictment of that organisation and a case of appalling judgment. 
Having made those final comments I finish by saying that I support this bill but with severe reservations. 
Bill read a first time. 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 I move  
That the Social Security (Long-term Residential Care) Amendment Bill be referred to the Social Services Committee for consideration and that the committee finally report the bill back to the House on or before 30 September 2006. 
Motion agreed to.