Sepuloni CarmelSOCIAL ASSISTANCE LEGISLATION (BUDGET 2019 WELFARE PACKAGE) AMENDMENT BILLFirst ReadingHon CARMEL SEPULONI (Minister for Social Development): I move That the Social Assistance Legislation (Budget 2019 Welfare Package) Amendment Bill be now read a first time.This bill gives effect to the income support policy changes Incomes for people receiving benefits—indexing main benefits removing deductions and changing abatement thresholds." announced through Budget 2019. This Government believes in a welfare system that ensures people have an adequate income and standard of living are treated with respect and can live in dignity and can participate meaningfully in and contribute to their communities. The Social Assistance Legislation (Budget 2019 Welfare Package) Amendment Bill is part of this Government's continued commitment to that vision.Today we will pass a bill to help implement Budget 2019 income support changes. These changes will increase abatement thresholds for main benefits to keep up with increases in the minimum wage repeal section 192 of the Social Security Act 2018 and ensure that the rates of main benefits are indexed to wage growth. Increasing abatement thresholds will benefit around 73000 low-income individuals and families who might otherwise see the value of their hard work diminished as the minimum wage increases. Repealing section 192 will help around 12000 sole parent beneficiaries who will see an average gain of $34 a week from April 2020. It is estimated that indexing benefits by wage growth will lift the incomes of around 329000 individuals and families. Most main benefit rates will increase by between an estimated $26 and $46 per week by 1 April 2023. As a package these changes mean 339000 individuals and families will be better off. This year's changes build on the progress made through the Families Package implemented in 2018. With these packages combined it is projected we will lift between 50000 and 74000 children out of poverty on the after-cost measure and are on track to meet our target of halving child poverty in the country by 2028.This bill is an important part of our ongoing overhaul of the welfare system to help those New Zealanders who access the welfare system for support to live in dignity. The changes that are proposed through this bill are enduring and effective changes that signal the transformation that this Government is committed to in our welfare system. This Government wants to support people in the welfare system to have adequate incomes and part of this is having a welfare system that encourages people to work when they are able to. The Government's abatement threshold changes will match expected increases to the minimum wage over the next four years. This means that as the minimum wage increases the number of hours people can work at the minimum wage before their benefit reduces will stay the same.While most of the abatement changes will happen through Order in Council this bill makes sure veterans pension abatement thresholds can be increased along with increasing the abatement thresholds for other benefits. I acknowledge the collaboration with my colleague the Minister for Veterans Minister Ron Mark in making these changes to the Veterans' Support Act 2014.The repealing of section 192 of the Social Security Act 2018 will ensure the removal of a discriminatory sanction that has been allowed to exist in legislation for far too long. Section 192 of the Social Security Act 2018—formerly section 70A—reduces the benefits of sole parents if they do not name the other parent of their child and apply for child support. This sanction does not apply to any other parents receiving other benefits who might choose not to apply for child support such as those receiving benefits who have found new partners. In 2016 the National Government was advised that there was insufficient evidence to support that the then section 70A sanction was fulfilling its purpose of collecting child support from unnamed parents. That briefing also said that section 70A sanctions were associated with poverty and long-term benefit dependence. The sanction is discriminatory and creates undue hardship for children. This Government wants to ensure New Zealand is the best place to be a child and the best place to raise a child. This means reducing child poverty and it also means improving the wellbeing of New Zealand families. By repealing section 192 of the Social Security Act 2018 we are also removing the stigma and judgment on the women and children who have had this sanction imposed on them.The indexation of main benefits to wages is an historic move for New Zealand. It makes sure the rates of main benefits do not continue to go backwards against wage and salary earners. As I've mentioned on numerous occasions the changes we make as part of our welfare overhaul must be enduring and effective. The indexation of main benefits to wages enshrined in legislation reflects that principle. In 1991 the National Government significantly cut benefits including scrapping the universal family benefit and since then main benefit levels have largely been adjusted using the Consumers Price Index instead of wages but New Zealand's average weekly wage increases faster than inflation. This is one reason the gap between the living standards of New Zealanders on benefits and other New Zealanders has grown significantly over time.In each of the last 10 years increases to the net average wage have been larger than the Consumers Price Index rate used to adjust benefit rates bar one. The slow erosion of the value of main benefits relative to average wages has contributed to increased poverty in New Zealand society. This legislation makes sure that the main benefits will increase in line with average weekly wages so that New Zealanders who rely on the welfare system can keep up relative to wage and salary earners. This is an important step toward making sure people in our communities aren't simply left to fall further and further behind.As previously mentioned this bill supports us in our ongoing overhaul of the welfare system. It makes significant improvements to some fundamental benefit settings and will improve the lives of many thousands of New Zealanders who need support from the Government. After years of under-investment we are left with a system that is inadequate and burdened with complexity a system that has sometimes seemed set up to punish people in need rather than help them realise their potential. Our Government does have a vision for a fairer and more accessible welfare system that treats New Zealanders with respect and dignity. The change in this bill represents some fundamental steps toward that vision but I acknowledge that there is more work to do.The bill plays a necessary role in complementing the Ministry of Social Development's ongoing work to develop a stronger culture that improves the experiences of people that come to the welfare system for support. Notably it also delivers on some of the recommendations outlined in the recently released Welfare Expert Advisory Group report Whakamana Tāngata—Restoring Dignity to Social Security in New Zealand. The report will be pivotal to informing the development of our three- to five-year work programme to overhaul the welfare system in a planned and systematic way.I want to take the opportunity now to acknowledge Professor Cindy Kiro and her leadership in chairing the Welfare Expert Advisory Group. This is a group of 11 members representing a diverse range of backgrounds expertise and views. I want to commend their commitment to delivering a report of high quality and building consensus across their final 42 recommendations. As previously mentioned this bill also builds on the gains achieved through the Families Package and will assist us with continuing to lift children out of poverty.This bill changes income support policy in ways that will matter for people's lives. It is part of the Government's promise to overhaul the welfare system in a meaningful way so that people have an adequate income and standard of living are treated with respect can live in dignity and can participate meaningfully and contribute to their communities.This bill today signals an historic turning point for the welfare system here in New Zealand. It is with great pleasure that I introduce the Social Assistance Legislation (Budget 2019 Welfare Package) Amendment Bill. I now commend the bill to the House."