Harawira Hone: KiwiSaver Bill — First Reading 
Harawira Hone: KiwiSaver Bill — First Reading 
[Volume:629;Page:1686] 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 It looks like “here we go again”. The KiwiSaver Bill is a good idea. Unfortunately though it has been designed by people who are divorced from the reality of those it is supposed to support particularly the whanau of the working poor and the families of beneficiaries. Now it comes before us for consideration which is a bit of a joke really—when our individual tax bills are bigger than the annual income of 50 percent of the nation. 
Let me say firstly that the Government is to be commended for its efforts to set up a workplace scheme to encourage people to sign up to long-term retirement savings with the offer of a $1000 Government sweetener to get things rolling. The ability to use KiwiSaver savings as a home deposit is also a positive step in encouraging workers to save for their own homes. The Maori Party supports the thinking behind this bill because it aims to help whanau become financially secure and self-reliant into the future. But while the Government in its bumbling flip-flop way is trying to encourage people to save this bill sadly will not address the issues faced by low-income families. 
Yesterday I quoted Nelson Mandela. He said that a political movement must keep in touch with reality and the prevailing conditions. Mandela also said in referring to poverty: “It should never be that the anger of the poor should be the finger of accusation pointed at all of us because we failed to respond to the cries of the people for food for shelter for the dignity of the individual.” The rights to food shelter and human dignity are determined by people’s access to those rights. In this country that access is determined by the income or the wages that people receive and it is that low level of income that we need to focus on in consideration of this bill. 
The bill sets at 4 percent the threshold for getting into the KiwiSaver scheme. That is a real problem for those on low incomes and particularly for low-income working families. We note here that for a young family with the breadwinner on a minimum wage it would mean a drop in wages that that family simply could not afford. We note that with a 4 percent threshold the bill also makes it impossible for beneficiaries to join the scheme and given that Maori unemployment is three times higher than that of the general population Maori will be doubly penalised. 
We suggest that the initial $1000 sweetener will soon lose its glow. In terms of the home deposit there are also issues that need to be addressed. One of those is that the home deposit will be available only after 3 years. That is a long wait for families whose living conditions are not likely to be the best anyway. Another issue is that there is no scope to increase the Government commitment based on family size which means inequitable delivery to low-income young families. Furthermore the fact that only 3000 households a year can qualify for the home deposit limits the potential to lift people out of poverty. 
With the continuing rise in house prices it is unrealistic that a family on a weekly income of $290 can service a $200000 mortgage. When Westpac can get fail-safe mortgages from the Government while ordinary workers have to bust their backsides to pay every cent or get booted out of their homes we really do have to query where the Government’s priorities lie. The Council of Trade Unions also points out that while house prices have rocketed up over 50 percent in the last few years wages have sputtered along to a pathetic 8 percent over the same time. 
One of the Maori Party’s key concerns with this bill is that quite simply it discriminates against Maori. The facts are that Maori just do not live past 65. That means that although Maori like everyone else will be encouraged to join the scheme fewer than 4 percent of Maori will live long enough to derive any benefit from it. That is simple discrimination. 
If this House is serious about helping the Kiwi saver we also need to get a clear picture of who that Kiwi saver might be. The  
Social Report 2005 
 noted that the state of being for Maori and Pacific Island people in health economic standard of living and education is poor particularly in areas like Northland and Gisborne and the report criticised the action taken to reduce those inequalities as well. This House also needs to be aware that the UN rapporteur Professor Rodolfo Stavenhagen during his visit here last year was critical of the lack of quality data to identify disparities for Maori. As Maori Party co-leader Tariana Turia told this House last night if we do not have the right data we cannot properly target our social policy. In terms of that data we know that wage levels for Maori and Pasifika are considerably lower than for Pakeha. Maori and Pasifika have difficulties with housing affordability and overcrowding. Polynesians also figure highly in unemployment statistics. Many Polynesians both Maori and Pasifika will struggle to participate in the KiwiSaver scheme. 
The Maori Party also has a number of other concerns with this bill. We are concerned firstly that yet again society’s underclass will be bypassed because as with the Working for Families package the KiwiSaver scheme will exclude beneficiary families. Secondly this bill will not change the child poverty that ravages this country. A poor child born today into poor housing will already have passed his or her most formative years before this bill has any impact on society. Thirdly despite the fact that more than 250000 children in Aotearoa are living below the poverty line this policy has no child-impact analysis at all. Fourthly the Government will not guarantee the KiwiSaver scheme and again the risk will be taken by the poor worker. Fifthly low-income families may get sucked into what might look like a worthwhile scheme when in fact limited finances might best be spent on food mortgages and kids. Sixth the record of managed funds suggests that KiwiSaver returns may disappoint those being asked to invest their hard-earned money. The seventh point is that the number of low-income families relying on food banks is still rising and the eighth is that commitment from employers may be too high an expectation for small businesses. If we really want to lift the game this bill will not do it in its current form. 
But the Maori Party is nothing if not helpful and we have a few suggestions that we would like to put forward. We should first raise the minimum wage to make the scheme more feasible—$12.50 is a good start; second introduce legislation to limit the capability of loan sharks to terrorise communities of the poor and reduce the easy access to credit for low-income earners; third reintroduce savings schemes to encourage children to learn to save and introduce budgeting education into schools; and fourth give those with a lower life expectancy the entitlement at an earlier age. 
In closing I say that the Maori Party supports the thinking behind this bill because it aims to help whanau to become financially secure and self-reliant into the future. But we will not be supporting it during this first reading because the negatives far outweigh the positives. However we will do our best during the select committee process to ensure that the concerns we have raised—the concerns of the people we serve—are met.