Ardern JacindaJACINDA ARDERN (Deputy Leader—Labour): I want to if I can speak to my amendment which is on the Table just to be really clear about what it is that Labour intends to do with the Taxation (Budget Measures: Family Incomes Package) Bill. What our amendment essentially does is it acknowledges the elements of the bill that we do think are tightly targeted and will make a significant difference to those families and working people who absolutely need it without the trade-off of pouring $1.9 billion into tax cuts for those who do not—for people like ourselves. So that is what our amendment does. It supports the good and it cuts out the bad. So I want to run through what those elements are because a lot of them significantly affect Part 1 of the bill.We are obviously keeping those parts that are relevant to making a bill work: the title and commencement. But clause 4 and clause 5 both go. Clause 6 remains because clause 6 of course is the element of the bill that adjusts the payment rate and makes the current payment rate of Working for Families the equivalent of that for children aged 16 and 17. It spreads that higher rate across younger children. That means that the eldest dependent child will have a $5303 rate. So for those families that does lead to the equivalent of a lift of about $9 a week. Then for each dependent child there is a higher rate again: $4745 across a year. That works out to a varying rate depending on how many dependants a family might have. All in all our view was that those elements of the bill should stay. They will make a difference for working families. We acknowledge that; we think it is important they remain. However we do not agree then with the next clause down clause 7 because again it is a demonstration that the National Government continues to give with one hand and take with the other. Those are the clauses that replace our existing threshold and abatement rates. At the moment abatement kicks in at a threshold of $36350. National has decided it wants abatement to now kick in at $35000. That actually functionally means that with this bill and that clause some families with one child will be worse off as a consequence of this bill than they currently are and by quite a substantial amount. Our view is that those families should get the boost of these changes without the removal of their eligibility which is what these threshold changes mean.National is also increasing the rate of abatement at the moment from 22.5c in the dollar to 25c in the dollar. So sharp cutting out of those tax credits. We do not agree with that so we are removing that via our amendment as well.We have kept in the inflation adjustments that the Government has. Without going into it some of those were already scheduled to occur. These clauses alter it based on the fact that this package brings forward some extra benefits for those eligible. And then basically we cut the remainder of the bill because the remainder of the bill will see an untargeted $1.9 billion worth of tax bracket changes. Our view is that what happened with the Working for Families changes shows what a difference you can really make for those who genuinely need it without their being a kind of flow-on effect for earners like us who do not need that extra boost. So $373 million is well spent on the Working for Families changes and $1.9 billion is wasted on untargeted spending.We might have been having a very different debate if the Government had chosen to use the family tax credit as its way of delivering to those families who need it the most without doing what it has done in this bill. So I think our amendment really does a great job of taking the good acknowledging the good and giving an indication of what we would have liked to see more of whilst cutting out that which we did not think was useful.I want to speak specifically though now to clause 6 of the bill. Clause 6 is where we see that different rate change for the first child. I want to speak a little bit to the origins of that. It has not come from nowhere. I acknowledge that the Government obviously did look at some elements of the recommendations from the Children's Commissioner's expert advisory group's report which was put out some years ago now but still has some excellent work in it.Under one of the chapters on tax credits the expert advisory group made it very clear that The immediate cause of child material deprivation is low family income. Family income is usually low due to low employment income." It is a very important point and one that goes unaddressed in this Budget.But it goes on further in to say that "Around 60 percent of children in poverty … are in beneficiary households and most of these are sole-parent households. Sole-parents face considerable challenges in supporting their children through paid employment and meeting their childcare needs. Any system changes need to be sensitive to these challenges." It goes on: "The system needs to take account of the fact that children have different care needs at different ages …".But it also then makes a very specific recommendation: "We recommend that in the short-term"—because I think they were acknowledging that a lot of what we are trying to repair is a low-wage economy—"the government increase the Family Tax Credit by: initially raising the maximum rates for all children aged below 16 years to equality with the rate of a first child aged 16 years and over." So that was an explicit recommendation by the expert advisory group and that is something the Government has picked up. It was however only one of three recommendations in that one section alone. One of the extra recommendations was "subsequently and incrementally raising the rates further for children aged 0 to 5 years …".So what the Children's Commissioner report said was that initially yes we do need to get those children under 16 at the same rate as those in the last 2 years of that payment. Good because actually we just need a higher rate generally.But then they said to let us not be under any impression that means that children cost the same amount or have the same needs through every stage of growth and in fact if you are going to target anywhere target under-fives. That is what the expert advisory group said. Labour listened to that advice and that was why we produced an alternative in the form of Working for Families.The Government has given an extra $9 here to every child under the age of 16—the first child. Our argument was that from zero to 3 a child is not only in their most important developmental years but actually the parents' options for work are limited—which is why 60 percent of our families living in poverty are those who are sole parents and on benefits because the options for work when you have got a child aged zero to 3 are incredibly difficult because of the costs of childcare. It is very simple. That is why so many of our sole parents move off benefits after their children are the age of 3.It all makes sense. That is why we targeted that support from zero to 3. That is what Best Start was about. What I would implore the Government—you have taken one small element of a really comprehensive set of recommendations and you have taken that one element and you have implemented it. Good; we acknowledge that with our Supplementary Order Paper. But do not forget the rest of what was recommended. When you look at the relative focus and the relative priority that the Government has placed on that recommendation—$373 million versus the $1.9 billion; what is that a ratio of—that has gone into the tax bracket changes it shows that you just did not get the priorities right.We could have been debating here a package that would have been much more comprehensive and would have been able—because I can tell you; I have costed the Best Start package. It is even cheaper than what the Government has done with—Chris Bishop: Oh you've costed it? JACINDA ARDERN: Oh absolutely we costed it. It is part of our policy. It is cheaper than the $373 million that went into the age-range change. So I would really implore the Government—if you are serious about some of these recommendations then the Best Start package would have been the way to tick off not one but two of the recommendations from the expert advisory group. It was at a much higher rate because it acknowledged where the harshest penalties and those harshest levels of poverty were.I implore members of the Committee to look at our amendment—the fact that it acknowledges where there is good in this Budget but acknowledges that $1.9 billion is a poorly targeted spend in the rest of that bill."