Harawira Hone: Motions — Family Support Tax Credit—Increase 
Harawira Hone: Motions — Family Support Tax Credit—Increase 
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HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Madam Assistant Speaker. Kia ora tatou te Whare. My mum reckons that any legislation that comes into force on April Fool’s Day has to be a joke—and both Shane Jones and the Hon Parekura Horomia agree that my mum is always right. Mark Twain also made the comment that April Fool’s Day is the day upon which we are reminded of what we are on the other 364 days. So naturally when we saw this Government motion No. 1 suddenly pop up on the Order Paper we wondered whether Dr Cullen had been working overtime to make sure that his joke got online by this Sunday—except that it is not a very funny joke. 
 The Maori Party supports anything that will help families in need and to put more money into the pockets of families with children to support is a worthwhile notion. The problem is that this initiative comes to the House hidden beneath a whole stash of complicated tax and social welfare legislation that most Kiwis simply cannot even understand let alone get benefit from. This motion follows hot on the heels of the KiwiSaver Bill the taxation of portfolio investment entities the introduction of foreign tax regimes the establishment of social security reforms and a 2700-page Income Tax Bill that rewrites income tax legislation. The hilarious explanatory note of that bill states that the objective is to reduce compliance costs by producing tax legislation that is clear uses plain language and is structurally consistent. Yeah right! 
The truth is that out in the real world families are already finding the criteria and requirements for family tax credits to be too confusing. Yet now they are being asked to wade through a quagmire of new legislation and compliance terminology and get up to speed with a whole new vocabulary including family support tax credit child tax credit family assistance credit family plus family credit abatement in-work payment family support family tax credit parental tax credit social assistance payment and family scheme income. It is not as if any low-income worker or beneficiary in my electorate—or any other electorate for that matter—will be able to understand any of that. 
The hardest thing is that this gets even worse. If we log on to the Inland Revenue Department website we see that from now on payments will be called Working for Families tax credits and that the department is also changing the names of the payments that make up those Working for Families tax credits. So people who thought they had sussed out Working for Families will now have to go back to school and start all over again because what was once called family support is now called family tax credit what was once called in-work payment is now called in-work tax credit and what was once called family tax credit is now called minimum family tax credit. How ridiculous is all of that? It kind of makes one want to know what poverty will be called from now on—possibly “a negative financial tax credit” or some other foolish phrase. 
But wait for it; it gets even worse. There are now different truths about how much the family support tax credit—I think that is what it is called rather than a family tax credit—actually is and for whom. There are now different names and different amounts if one’s eldest dependent child is aged 16 to 18; if one’s dependent children other than one’s eldest are aged from 16 to 18; and if one’s dependent children other than the eldest are aged from 13 to 15. It goes on and on. I would like to try to summarise what this motion will mean for all the real people out there—I am talking about the people for whom this is supposed to be of help. 
The Government has changed the name from family support to family tax credit. I know a name is supposed to be just a name but it would have helped if the Government had talked to those who will be most affected—real families—to see whether it makes any sense to them or even whether they understand what the changes will mean. It is not just a matter of a name change; the Government’s proposal actually adds another complicating layer of confusion to an area that is already confusing. People had become used to family support which has been in place for some time and they had finally worked out how it applied to every child regardless of whether the parents were in paid work. However the family tax credit used to refer to payments for children whose parents were in work. But this will now be the term for family support because family tax credit has now become the minimum family tax credit. If that is confusing for you Madam Assistant Speaker or anybody else in this House we really have to guess what that will mean for the people out there on the street. 
Another obvious outcome of the confusion is that families will find it more confusing to apply for and even more difficult to get. The whole tax credit system is marketed towards working families but the newly termed family tax credit which used to be family support actually applies to all families. People who were entitled to one benefit or another will now miss out because they will not understand what benefit they should be getting. This means that people who know that Working for Families means “Beneficiaries not Welcome” will be cut out from this new model because they will not know that they are entitled to a tax credit. We already know that whenever complicated new beneficiary laws are introduced Maori are the group most likely to miss out because they simply do not know whether they should be getting it. 
Another important outcome of the confusion is that by using a name like family tax credit which meant one thing but now means another it becomes very difficult to get any coherent analysis of the changes for beneficiaries during that whole transition period. The Government has bracketed together three separate parts—minimum family tax credit which used to be family tax credit; in-work tax credit which used to be in-work payment; and family tax credit which used to be family support—and lumped them all together into one Working for Families tax credit. That means that families do not know the values of the separate parts and that they will not be able to work out what they should get. So those families will miss out on benefits that they had previously received because they will no longer know how to apply for them. 
The point about this whole April Fool’s Day motion is that instead of simplifying an already complex area the Government’s proposals will simply make it even harder to understand. The real joke is that those in greatest need—the beneficiaries who will be bypassed by this legislation—will be even worse off after 1 April than they were before. If that is the joke then the comedian deserves to be shot. Kia ora tatou.