Newman Muriel: Social Security (Long-term Residential Care) Amendment Bill — Third Reading 
Newman Muriel: Social Security (Long-term Residential Care) Amendment Bill — Third Reading 
[Volume:622;Page:17414] 
Dr MURIEL NEWMAN (Deputy Leader—ACT) 
: 
 The ACT party will oppose this bill on the basis of three different arguments. The first is that it is an example of poor policy. It is based on the need to buy votes not on the needs of those people at whom it is targeted. The second reason is that it will impose an enormous cost burden on New Zealand taxpayers into the future and particularly on our younger people. In a way it could be described as intergenerational theft. The third reason we will oppose the bill is that in effect it is the nationalisation of aged care. The Government is driving out providers in the marketplace—providers like The Salvation Army which has been there for almost 100 years. We will end up with a situation where the Government is the monopoly purchaser of residential care for the elderly. I would like to discuss each of these three points in my contribution. 
I go first to the policy issue—the fact that it is poor policy. There are really two reasons why laws are passed by Parliament. The first is that Government agencies have looked at a problem that confronts New Zealand society and have come up with some sensible solutions whereby laws need to be changed so that those concerns can be addressed by the Government of the day. The second reason why policy is passed into law by Parliament is that a political party decides it wants to do so usually because it is appealing to a particular voting group. 
In the 1999 election promises made by an airbrushed Prime Minister Helen Clark she essentially gave the promise that Labour would abolish asset testing of the elderly. She said in a brochure: “We say asset testing of older people is wrong. It will go.” Five years down the track here we are with a bill that gets started on the path towards removing asset testing for the elderly. The problem is that the promise was made in 1999. It is now 2004 and this bill will come into force in the middle of 2005. That is the first problem. The people who voted for Labour because they thought asset testing would go have had a long wait. 
The second point is that if we look at the detail of the bill we find that the year in which asset testing actually does go is 2026. A large number of the submissions to the select committee said that this is simply not good enough because the bill represents a broken promise by the Labour Party. Labour said it would abolish asset testing and it is doing no such thing. It is making a little move in that direction but it will actually take over 20 years for asset testing to go. New Zealanders who will be voting for Labour on the basis of this legislation had better hope they are here in 20 years’ time so that they live to see the promise become reality. 
Good policy is based on meeting a need. This bill will over time abolish asset testing for all New Zealanders who might need elderly care and the problem is that many of those people will be able to afford to pay for that care themselves. Here we are in Parliament passing a piece of law that will put an enormous cost burden on families who are struggling to make ends meet and who are trying to pay taxes that are far too high. The reason why taxes are far too high is as every New Zealander knows that the Government is sitting on a huge surplus. Governments should take just as much as they need. We have a Labour Party that is so greedy it takes way more than it needs and here it is burdening the taxpayers of the future with a piece of legislation that will cost them very dearly. 
If the Government were passing legislation now to help people in genuine need ACT would support it. But because it is not—because it will be asking struggling taxpayers of the future to pay for people who could well afford their own elderly care—we will not support it. 
The second issue is the cost burden. We have been told that the legislation will cost about $110 million a year. I understand that there are about 15000 people retiring every year at the moment. In 30 years’ time that number will be something like 55000. One does not have to be a mathematician to be able to figure out that the $110 million will blow out in the future as our ageing population goes into retirement and goes into the position of needing such care. The calculations I have seen put the eventual cost of this legislation—the simple bill we are passing into law today—at about $1 billion in the future. 
We just have to ask ourselves whether it is fair of the Labour Government to commit future generations of taxpayers to having to fund such a costly piece of legislation. Many of the people retiring in the future will not actually need to be supported by the taxpayer but will of course accept that support because the bill is being passed and will be available. I say that it is intergenerational theft. 
I heard a contribution from a Labour Party speaker who talked about fiscal responsibility. This bill is the antithesis of fiscal responsibility. This is a Government that simply wants to buy votes at the next election. It is a Government that says: “Oh gosh we made a promise; we’d better look like we’re keeping it.” It is not keeping its promise but it wants to be able to bluff voters into thinking that it is keeping its word when it is not. This is an appalling piece of legislation because it is not based on future need; it is based on political expediency now. 
The third issue is the nationalisation of the aged-care sector. We heard during the select committee process from many of the social care providers—I suppose we could say they are part of civil society because they are not Government agencies; they are charitable organisations trusts church-based groups and the like—that have traditionally provided aged care. We heard them telling us that unless the Government did something pretty quickly they would be driven out of the business. As we said in the debate earlier on this week already The Salvation Army has decided it will sell those facilities that it has been operating for many years. 
Those people told us that the straw that was breaking the camel’s back was the costs that this Labour Government has been imposing on them; the cost burden of extra regulation that they are having to comply with and then the additional costs of industrial relations including the extra costs of holiday pay ACC levy Occupational Safety and Health Service regulations and the 4 weeks’ holiday a year that will come up. The submitters told us that there are so many additional costs to employers these days they simply would not be able to continue to operate under the additional costs that have been put on by this Labour Government so they would look at having to quit. 
We have to say to ourselves that as a country having a flourishing sector providing those types of services is what we should be aiming for and it is a sad day when we have a bill that is driving that sort of provider out of New Zealand society. It is a sad day when I say that we have to oppose this bill.