Ardern Jacinda: Social Security (Long-term Residential Care—Budget Measures) Amendment Bill — First Reading Second Reading In Committee Third Reading 
Text is incorporated into the Bound Volume 
Ardern Jacinda: Social Security (Long-term Residential Care—Budget Measures) Amendment Bill — First Reading Second Reading In Committee Third Reading 
[Sitting date: 24 May 2012. Volume:680;Page:2520. Text is incorporated into the Bound Volume.] 
JACINDA ARDERN (Labour) 
: 
 It is my pleasure to speak on the second reading of the Social Security (Long-term Residential Care—Budget Measures) Amendment Bill. I was listening to the contribution made by the National member Shane Ardern and of course he was speculating over some of the impact that this bill—these changes in asset thresholds—might have. I guess the key word there is “speculating” because we really do not know because this bill is not going to go through the rigorous process that we would usually in this Parliament expect a piece of legislation to go through. We do tend to use urgency I think often unwisely in this House and I think this is a prime case of that. I understand that when we are talking about excise and when we are talking about things that might cause a run on the liquor stories you may have reason for extraordinary urgency but this is not one of those cases. So I really challenge the Minister for Social Development to share with us during the Committee stage why this was determined to be of such urgency that we denied the people of New Zealand the ability to have their say. I look forward to the Minister’s contribution on that because I know that on this side of the House we would have appreciated the opportunity to speak with members of the public about the impact that this change would have on them and also with the likes of groups such as Grey Power and Age Concern which represent the interests of the people the elderly who will be affected by these changes.  
 I am also interested from the Government’s side in its motivation for this change because I do not think that has come across with enough clarity. Is it an issue of sustainability? Or is it an issue of revenue? I see these as being two distinct things. Most of the changes we have debated in this House to date since the Budget was read yesterday have been under the proviso of revenue-gathering exercises or savings. If that is indeed the case and if this is the best we can do that is somewhat worrying and we would suggest that there is still time for the Government to consider a capital gains tax. Secondly if it is an issue of sustainability then I think that that is an incredibly interesting point because the impact that this will have will be very direct for the individuals it affects but in terms of the wider fiscal spend nominal—compared for instance with the impact of superannuation.  
I should not need to tell the Government this because it is set out in plain language in Vote Social Development. In fact it states from the Ministry of Social Development that New Zealand superannuation accounted for 55 percent of total expenditure on benefits in 2007-08 and fell to nearly 52 percent. This ratio is at 55 percent in the current year and is estimated to rise to 60 percent by 2015-16. Sixty percent—that might seem meaningless but when you factor in that within 3 years the amount we spend on superannuation alone will be equivalent to almost the entire education budget then we are starting to talk about a significant spend.  
So if we want to talk about sustainability in this House we need to start getting real about the impact that our superannuation spend is having not just on social development but on the New Zealand economy generally. In fact by 2050 according to the long-term fiscal Treasury output—which of course it is required to provide I believe every 5 years—over $200 billion will be the amount of the shortfall. That is more than New Zealand’s entire GDP. Even Treasury is supporting a lift in the age of superannuation. It is completely disingenuous that that side of the House should try to maintain the line that we do not need to look at this issue. We absolutely do and this is classic avoidance. This bill represents classic avoidance. In fact Bill English himself admits that something needs to happen in this area which puts him at odds with the Prime Minister when it comes to the age of eligibility for superannuation. In fact it is widely known that the Prime Minister comments privately that the position is probably unsustainable but because he has made a political commitment he is unwilling to address that.  
That is not leadership in my mind. That is not leadership. These are the hard issues and the issues that this Budget has chosen to avoid and the result of that is this bill. This bill is a direct result of avoidance from that Government around the most significant issues. I even just this morning heard a Government Minister in fact state that the Retirement Commissioner said that this is really going to bite in 2020 so we do not need to worry about it now. We do not need to worry about it now. Again I see that as a failure of leadership. The reason we need to debate this now is that for all of those who are under the age of 45—that may not include many people in this House—they deserve to know that there will be changes coming. They deserve to know that the system will be sustainable and they deserve for instance to have the knowledge in order to be investing in their own retirement funds because that is what we are going to need in the future: a real mixture of personal savings as well as superannuation.  
But the sad fact is that most of the people my age when surveyed by the Retirement Commissioner did not believe that universal superannuation would be available to them when they retired. And no wonder when you see classic avoidance in this House to deal with the sustainability of superannuation. We need to address it. I also think the reason we need to address it is that we need to start looking at ways to cushion any change on our most vulnerable. I do believe it is necessary that if we see a lift in the retirement age those who are working particularly in low-wage low-skilled but hard working environments which mean that it would be physically impossible for them to continue beyond a certain age we need to make sure we cushion that that we have the necessary policy in place that allows them to retire at a time that is fair and equitable. We need time to develop those policies and those ideas and that is what we should be debating in this House not this threshold change that we are debating today.  
But also I think one of the reasons the Government is unwilling to bring this up to date is that it would highlight the contradictions in what it is doing currently. In fact if this really is about sustainability for people when they retire delaying auto-enrolment delaying the urgency around people’s personal savings which we know is crucial given the outlook for the Treasury books seems utterly bizarre to me. Our personal savings are shallow—they are shallow—and that has a flow-on effect for our wider economy. But instead of encouraging further personal savings this is another thing that this Government for political expediency has decided to just waylay and we cannot do that for ever.  
Where is all of this coming from then—this idea that all of this should be loaded on to future generations? It is not just in superannuation policies it is not just around superannuation; the intergenerational inequity that this Government feels perfectly content to load on to the next generation of voters extends beyond superannuation. Where else does it go to? Well we can name a few on this side. Asset sales. Selling off future revenue-gathering—[ 
Interruption 
] I am still going I am sorry Mr Calder. I have not finished. We are selling off our assets—a future source of revenue for the next generation.  
What about student allowances? I will listen intently to you when you do get to your feet but if you would not mind I want to use these 2 minutes. Secondly student allowances—we have now removed in Mr Joyce’s wisdom the ability for anyone at postgraduate level to gain a student allowance in order to allow them to contribute to our economy. This bill delays the bigger issues and instead of dealing with them we are offloading them on to the future generations.  
It is easy for that Government to talk in general terms about policy like this but what about some real examples? I know a graduate at the moment who is studying towards helping those with learning disabilities—deaf children to learn in the classroom. She will not be able to complete her studies as a consequence of Mr Joyce’s grand plan to remove student allowances. And I have not even started on the freeze on early childhood education funding and of course the classic paper boy tax credit which becomes emblematic of this Budget—and how emblematic of this Budget is that Government’s refusal to address the big issues. That is why this is a nickel-and-dime Budget.