Clark David: Child Support Amendment Bill — Second Reading 
Text is incorporated into the Bound Volume 
Clark David: Child Support Amendment Bill — Second Reading 
[Sitting date: 26 February 2013. Volume:687;Page:8172. Text is incorporated into the Bound Volume.] 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 This bill the Child Support Amendment Bill represents a missed opportunity to address the well-being of children in vulnerable families. We know that the last Labour Government lifted 130000 children out of poverty with Working for Families. We know that it can be done and we know that it is a priority for the Labour Party and for several parties in this House. Unfortunately it seems to be a very low priority if any priority at all for this National Government and that is a tragedy. 
That is a tragedy because we heard in the Social Services Committee from many groups representing the interests of children that made it very clear that this legislation could be improved by referring to and referencing the United Nations Convention on the Rights of the Child. I moved a motion in the select committee to make sure that we considered the rights of the children so that the legislation would be targeted toward the well-being of children so that children would be its priority and that was voted down by the Government members on that committee. I think that that is to their shame. A second motion was moved when there was concern raised about litigation potential if we referenced that legislation. We put it to the vote again as to whether we should take some legal advice and broaden the scope so that there was no room for legislative action but equally we were referencing the desire to put children at the heart of the legislation. That too was voted down. So what we have here unfortunately is a piece of legislation that refuses to put children at the heart of it. That is ignoring directly submissions presented by the Auckland Coalition for the Safety for Women and Children the Child Poverty Action Group the Dunedin Community Law Centre the Families Commission the Human Rights Commission the New Zealand Law Society the Office of the Children’s Commissioner the Equal Justice Project and the Women’s Studies Association. Others referenced it too but those are significant groups that raised concern about the welfare of children in New Zealand and the failure in this proposed legislation to deal with the rights and well-being of children. It is a missed opportunity by this Government. 
Part of that missed opportunity lies in the way in which the legislation perpetrates the current practice. We know that roughly 25 percent of New Zealand’s children are being raised in poverty—25 percent of New Zealand’s children. The way in which the new payments will be calculated in this legislation perpetrates that same problem. It is based upon a redistribution in the current sense; officials have modelled the estimates of cost of raising a child on the status quo. That means we are missing an opportunity to make sure those most vulnerable children have the resources necessary to give them the opportunities that would raise them and their families in future out of poverty. It would break that chain potentially and this opportunity has been passed over. The Government was also advised on the benefits of a pass-on mechanism in the legislation and it refused to take a position on it. 
Overall we know that this legislation will be bad for women. It will be bad for the taxpayer overall because the taxpayer picks up some additional bills but it will also be bad for women as the burden of payment shifts on to those who do the majority of the caring. We know that the 28 percent threshold proposed in the bill will mean that costs will be shared between caregivers but we do not think that represents a fair way of doing things under the current proposals because those who look after kids for the weekend seldom are buying the school uniforms seldom are paying the dental bills seldom are paying the doctors’ bills and so on. We know that those who are the majority caregivers those who are the lead caregivers pick up most of those costs. So apportioning costs directly on the basis of time spent will see the majority of caregivers worse off. We know that the majority of caregivers are women so we know that this bill is likely to mean that those women who are struggling to raise children will struggle yet more when this legislation is passed. 
We have concerns also in the Labour Party about the transparency of the proposed new formula. It is very hard for families to plan ahead in any circumstance. Life presents many challenges. But for those families that have separated particularly in acrimonious circumstances and have not been able to reach a voluntary agreement as to how they will share responsibilities and the costs associated with raising children we find that they now will have to try to understand and try to wrestle with a very complex formula. Forward planning becomes a whole lot more difficult. 
I saw that the Hon Peter Dunne was on the back foot on this issue. He began by saying at the start of his speech that you would not need a fancy accountant to work out the formula. Well I contest that in fact an advanced degree in algebra might be helpful if the amount of time the select committee spent wrestling with this issue is anything to go by. 
Mike Sabin 
: You’ve got to consider the average IQ on the committee. 
Dr DAVID CLARK 
: If we listen to what the officials said and the 15 percent extra time Mr Sabin that they suggested would be required to train up their own staff and for them to carry out their business in future we would see that the Inland Revenue Department is planning for this to be a much more complex piece of legislation to understand too. So where the Minister gets the idea that this will be transparent and simple to work with is anyone’s guess. The Inland Revenue Department reported that it was expecting a 15 percent increase in workload associated with administering an area that is already its most expensive product to administer on a per-person basis. So this new solution is going to take a whole lot more bureaucracy. And we would hope that if it was involving a whole lot more bureaucracy it was actually going to deliver a better outcome. That is by no means clear. Women are worse off children are not prioritised and there is extra cost involved. 
There are number of other little fish-hooks in this legislation. One for example is the burden that will be placed on employers who are likely to receive requests for additional payments to be docked from the wages of employees who are not meeting payments. In principle that sounds like it might be a fair thing. If employees are not meeting their obligations then we in Labour believe that they should be encouraged to do so. However we learnt—again from officials—that no immediate plans are in place to inform people that this might be happening. We also understand that they have not consulted employers. Employers are going to be expected to administer additional payroll things. They are also going to be required to take care of specific personal information that they will have about their employees that presumably their employees had not shared with them for some reason cultural or otherwise. Then the employers are going to be expected to keep this information to themselves. If they do not they may open themselves up to future litigation. As far as I am aware employers have not asked for nor been consulted on these extra responsibilities that are being foisted upon them by the Government. It is a Government that seems determined to push more red tape on to business. 
In addition to the administration costs the Inland Revenue Department is expecting it is also expecting that the IT rebuild will cost somewhere in the vicinity of $100 million. This is to rebuild a system that is not currently working very well anyway. It is adding on to our current legacy system in the tax department. It has a plan it tells us to fix it some time in the next 5 years. We have heard no credible plan to see how it is going to do this. But the Government is saying that it is going to rebuild a little add-on to the system to make sure that it can run it. We have seen it fall over when it has tried to do this in similar circumstances with the student loan. It will have its fingers crossed that it is only $100 million. Then if it introduces a new tax system eventually a new IT system—if it gets around to updating our 20-year-old tax system one day—it will have to do it all over again. It is duplicated money. It is poor spending of taxpayers’ money to introduce a system that is not transparent that disadvantages children that makes them not the priority that makes women worse off overall and that has fish-hooks for employers. 
Overall this is bad legislation. It represents a lost opportunity to address the well-being of children and vulnerable families. This Government has had plenty of opportunity to ensure that the bill presents a fair way forward. It has failed to generate an outcome that is fair transparent and representative of taxpayer money. We think it could have done a whole lot better. 
Peseta Sam Lotu-Iiga 
: How? 
Dr DAVID CLARK 
: It could have listened to the officials it could have happily—the member asks how. It could have taken it back to the Minister as was proposed in the committee to broaden the purposes of the bill so that it actually took account of the welfare of children. That is what was put to the select committee and was voted down by the Government members who did not want children at the centre of this legislation who did not want children’s well-being at the centre of this legislation and who do not seem to care about the 133000 children dependent on this legislation working correctly.