Bennett Paula: Budget DebateText is incorporated into the Bound VolumeBennett Paula: Budget Debate[Sitting date: 28 May 2013. Volume:690;Page:10449. Text is incorporated into the Bound Volume.]Hon PAULA BENNETT (Minister for Social Development): I think it is appropriate that I stand up and take a call on the Budget considering that it is within Vote Social Development and I am responsible for more than a third of all Government spending.Vote Social Development is spending a total of $22.23 billion on social support and services for New Zealand over the 2013-14 year. This broadly maintains the same funding from the previous year although there is an increase of about 3 percent. There have been some key movements. We are certainly seeing an increase in superannuation as we see the results of keeping it at 66 percent and the need for those who are older.Just to run through some of those bigger numbers so that people have got them we are spending about $8 billion a year on benefits—on welfare for the working-age population. It is broken down into many aspects but we now spend about $1.2 billion—and rising as we said to about $1.3 billion—just on accommodation supplements. About 40 percent of that goes to those who are on benefits but actually a lot more goes to those who are on lower incomes and it is a way that we support people who are struggling in some areas and cannot afford to pay their rent and their mortgages. If you take the overall spend and include income-related rents this Government over the next year will spend around $1.9 billion on accommodation supplements and income-related rents for those who are as I say on lower incomes and/or benefits which do seem to come hand in hand.We are investing another $188.6 million in welfare reform. I would like to go into that in a bit more detail than perhaps we have done in the past but I am going to come back to it because I want to stick to some of the stuff that we have announced that gets overlooked pretty quickly.The Confidential Listening and Assistance Service—we get the Department of Internal Affairs to administer the funding for it—is really important for those who have suffered historical abuse. It was actually started under the Labour Government in 2008 and we have stuck with it and have now extended that funding for another 2 years. It is for those people who quite frankly certainly have the most horrific stories that I have ever heard. You can see that path that they have been on. What the Confidential Listening and Assistance Service does is give them a place to express that and actually it is a really important part of their healing. Many will tell you that it is the first time they have been listened to and believed and have actually felt that they have had the State listening which is the way that it happens. The service is also able to wrap support around them.In line with that we have also put substantial money into addressing historical grievances—about $16 million additional from memory; I will find the figure as I am talking. That $16 million goes a long way to addressing historical abuse claims. The truth of the matter is that when these people go to court the State actually wins because it is too hard for those people to prove that all those years ago the abuse took place and because it is too hard to prove how much of it is from the previous hurt that led to thembeing in care and how much of it is from the horrific abuse that some suffered while in care.What we have done certainly with the leadership of me and the Attorney-General is that we have said that wherever possible we would like to err on the side of paying people out. So if it is a certain point in time they were in certain institutions and we had evidence that there was other abuse and neglect there then we would like to see these people be able to move on with their lives and wherever we can we actually pay out. From memory we have about 1000 claims. We have settled about 265 and we have another whole lot that are still in train and still working their way through. Hence we need to put more money in and need to see those people have what I think is quite minimal closure to be honest. In some respects it feels quite trivial but it makes a big difference to them and their lives.The other thing we have done is we have continued funding of $5.6 million for family violence response coordination. We have also put more into budgeting advice services and that is temporary. We already put in about $9 million a year. That is more than double the funding over the last 4 years but we see that they need some help in the interim. But that needs a complete review so we need to look at the current policy. Is it working? Are we are getting unintended consequences or the consequences that we intended; if so how is it affecting them and do we need to look at more sustainable funding options for them going forward?The other initiative of course is what we have already heard today which is food in schools. It is really positive to see it being accessible to all decile 1 to 4 schools for 5 days a week—Weet-Bix and milk which will make a big difference I think. A lot is being said today about whose fault it is and why these kids are hungry and I can stand here and pontificate for a long time on what the causes might be and why that is but at the end of the day any member who stands in a classroom and sees hungry kids who are fidgeting unable to learn and unable to get that kind of support to get that little brain switched on will see that it makes sense that we are stepping up and expanding a programme that is already there.We have also talked about KidsCan. I think it is important that we are more than tripling its funding. We give $150000 now; we are actually going to $500000 a year over the next 3 years. That funding goes towards those other items. One that I thought was really important as a mum myself is around lice treatment. Lice can be really hard to get rid of at times and it can be very expensive to purchase those treatments and keep up with them. So seeing that treatment come through from KidsCan and seeing that it is able to step in do those sorts of services I think makes a big difference.The other thing I want to touch on is microfinance and whiteware. There was a bit of derogatory from the Opposition when we said that we were going to look at a procurement model for whiteware where the truth of the matter is that we spend nearly $11 million a year in giving special-needs grants to those on benefits. They actually pay it back so it is a loan. Effectively what is happening far far too often for my liking and for the liking of those who work with these people is that they buy poor-quality second-hand goods with no warranties or guarantees. The goods then break down and the people have not got the money to fix them. They go and borrow another loan and they are still paying off the one that they bought originally. It just seems to be a really hard cycle for them.What we have discovered is that the average price that they are paying is around $420 for as I say predominantly second-hand goods. I reckon we can get them a new machine at that kind of price with a warranty of 2 years that is actually installed in their home. The old machine is taken away and they actually have a much better service andit is much better that they are not having to re-borrow again and again and again. I just think it makes sense. We have seen substantial changes and alarm in previous years where I changed the procurement model for that. I think it will make a difference.Microfinance is something that I personally am particularly interested in. I think life is tough on a benefit but actually people can do it and that is made evident by the fact that 50 percent of those on welfare actually do not go for special-needs grants or additional payments. But when something goes wrong it is hard to manage. We far too often see people borrowing from loan sharks and from others and getting themselves into financial difficulty and unable to pay it back. The kinds of questions though that we need to go through over the next few months—and we want to do that in partnership with the community in partnership with banks and others—are about what sort of lending we want to do. Are we the lender of first choice or the lender of last choice? Are we looking at consolidating people’s loans from loan sharks or should we not be doing that because it almost incentivises? Are they low-interest or are they no-interest? Are we taking on the loan sharks in some respects in their own business and saying “Come and borrow from this kind of microfinance service.” or not? Those questions are what we are going to work our way through as we go through it.I want to talk about Work and Income and the changes that are happening there. There is $188.6 million new going into Work and Income. One that has not been talked about much is that $16.4 million of that is actually a work bonus. That is for people on sole parent support or people on the new supported living payment who go off their benefit and do not have work expectations so that they can retain some of their benefit over time. It is a huge transition going from benefit to work and often the pay cycles do not add up nicely. What we are saying is that your benefit will decrease by $100 a week even though you have started in a job so that you can actually have a little bit of time to manage and get yourself into that new world. We project that that will cost us $16.4 million but I think it is a good investment.What we are also doing is employing 354 new staff within Work and Income. I heard New Zealand First today saying how shocking that is and how awful it is and if the number on the unemployment benefit is going down then why do we need them? For the very reason actually that the numbers on sole parent support and those on the current invalid’s benefit now the new supported living payment are not going down at the same levels. They need intensive support that works alongside of them. We need to bring case loads down and to do that we need to be putting more staff on the front line. Forty of those staff will be going into the contact centre 100 will be in administration roles that are actually taking away a lot of that work from the front line and the others of course about 214 of them will be on the front line and making a big difference.We are also putting money into making sure that we have got money for drug testing so that we can help out with the cost there.This is a big package. I could speak far longer than 10 minutes on this as it is so significant but this is making a real difference for people on the ground and I am really proud to deliver it.