Ardern Jacinda: Budget Measures (Financial Support for Newborn Children) Bill — In CommitteeText is incorporated into the Bound VolumeArdern Jacinda: Budget Measures (Financial Support for Newborn Children) Bill — In Committee[Sitting date: 15 May 2014. Volume:698;Page:17983. Text is incorporated into the Bound Volume.]JACINDA ARDERN (Labour): Is that all—2¾ minutes remaining? Oh right so technically I have up to an extra 5 minutes if I am lucky. I thought it might—Hon Trevor Mallard: It’s another 15 minutes actually.JACINDA ARDERN: Well I think I managed to clock up 40 minutes last night so I am still waiting for the Minister in the chair the Minister of Labour to match me call for call in this debate.I thought it might be helpful to recap on where we were in this debate last. We are in the Committee stage obviously and last night we debated Part 1 of the Budget Measures (Financial Support for Newborn Children) Bill which talked about the extension of paid parental leave. The extension from 14 weeks to 18 weeks was basically all that Part 1 did despite the Minister talking about the extension to eligibility. That is not what this bill is doing.Hon Simon Bridges: It’s coming.JACINDA ARDERN: He says it is coming. That is interesting. Last night the Minister went to great lengths to make a claim about Labour’s comprehensive paid parental leave policy and Best Start policy which is quite a significant package fully costed fully stepped out and based on consultation with the sector. He claimed that the policy work had not been done yet here we are debating a little bit of a change to paid parental leave—just one simple change from 14 to 18 weeks; it is just a little bit of what the Government announced—because I suspect the policy work has not been done. That is my very big suspicion. Why would I expect that that might be the case? From what I was reading of the regulatory impact statements last night some of the briefing papers were not actually being churned out by the Government until last month. So my strong strong suspicion in responding to what the Minister has said is that perhaps some of it was done in a bit of a rush.That brings me to Part 2 which we have only just begun debating and I am sure it will be a comprehensive discussion this morning. Part 2 contains the changes to the parental tax credit. Very simple changes are made in that part. They are changes that the Minister—again I am astounded by the statement—said are extending support to people who got nothing from Labour. That is an absolutely unbelievable statement made by the Minister in the chair because there have always been losers in the system that we currently have. Labour’s policy was clearly focused on trying to plug those gaps. So let us look at who those losers are and how that has changed because the parental tax credit was always about supposedly plugging that gap.We have roughly give or take 60000 births in New Zealand per annum. Of those births we know that roughly 40 percent tend to be eligible for paid parental leave. Why is that? Under the existing criteria which have not changed yet you have to be in a job for a particular length of time you have to be working for a certain number of hours—there are a number of criteria that often preclude people’s eligibility. The Minister haschanged those criteria a bit and I applaud him for that; it is good to see. But out of that change what did the Minister say? Was it roughly 1200 or 1400 people affected by that change give or take? Again that is not a massive extension of the eligibility then for paid parental leave. It is good but not too significant.Jenny Shipley in the 1990s recognised that that gap existed and she brought in the parental tax credit. It is not for everyone. Not everyone who does not get paid parental leave automatically then receives the short-term parental tax credit. Let us be really clear about what the parental tax credit is. It is not the family tax credit; that is part of Working for Families which Labour brought in cuts across the life of a child and is income tested. It is not the in-work tax credit which is meant to be a payment to cover the extra costs of being in work when you have a family. It is the parental tax credit. At the moment after these changes it will be for 10 weeks. It used to be at a rate of $150. Under these changes in Part 2 it will be $220 for that 10-week period. So it is roughly $2000 for a family.It sounds like everyone who does not get paid parental leave is going to get that—not so. In fact the eligibility criteria are going to narrow—not yet in this bill; I believe that is yet to come is it Minister? I imagine that might be a revenue bill perhaps. The criteria are going to narrow. So who misses out? Students miss out. The reality is some people might say “Well if you are studying why are you having kids?”. There are people in many varying circumstances who might be in study at any age at the time that they may fall pregnant. Life happens. The fact is that in New Zealand 50 percent of our pregnancies are unplanned—life happens. It is about making sure that when it does parents are well supported to give their child that best start in life. When people are unemployed it might be the most temporary of unemployment. They might be transitioning between jobs and be temporarily on jobseeker support. They are not eligible for this extra support. They might be in a situation where their relationship has split up. As dire as it sounds there are relationships that fall apart when people find out they are pregnant. It is a major stressor in relationships and it happens. If they happen to then have to seek sole parent support they are not eligible either. You could say that these are individuals who actually are probably in the most precarious of situations—potentially our most vulnerable families—and they are excluded from the parental tax credit.I think this is a really important point to make because the extension that the Government has made is in the length of time of the parental tax credit and to the amount but not to who receives it. That has always been one of the biggest downsides of the parental tax credit. It was a little bitsy thing that Jenny Shipley came up with that predominantly tends to go to families where for instance parents are staying at home to raise existing children but are under a certain income rate. Those tend to be the families who are receiving the parental tax credit and families who already have children when another one is on the way if members would like the longer-form explanation of that. Those tend to be the ones who are falling into those eligibility criteria.The Minister has also said though that the criteria are going to change. At the moment yes the parental tax credit is not universal outside of people on benefits. It is abated. It is income-tested. The income testing is going to narrow now; that is what we have been told. It is not what we are debating yet but it is going to narrow. That basically means that if you are currently eligible for the family tax credit—you are roughly on that kind of income range—then you are going to qualify for the parental tax credit. That is the rough guide that we have been given by the Government. That means that there are some families who often miss out on any kind of support from the Government. They do not feel particularly wealthy but they are not going to get anything now.