New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill — First ReadingText is incorporated into the Bound VolumeNew Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill — First Reading[Sitting date: 16 September 2015. Volume:708;Page:6722. Text is incorporated into the Bound Volume.]New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment BillFirst ReadingDENIS O’ROURKE (NZ First): I move That the New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. Superannuation is a matter of great concern for all New Zealanders especially those looking forward to retirement. The current pay-as-you-go scheme is entrenched in the Kiwi psyche and this bill will have no effect on the great majority of people who have resided here for all or most of their lives. It would not alter the age of eligibility from 65 years its freedom from means testing or the universal entitlement but it does seek to alter the amount of the entitlement based exclusively on residence between the ages of 20 and 65 years. It would abolish the much-reviled section 70 of the Social Security Act 1964.Superannuation must never again become a political football. New Zealand First wishes to participate in a debate to attempt to achieve consensus with other parties so that people can plan ahead for their retirement with a high degree of certainty. Many young people are already saying that they do not expect New Zealand superannuation to be around when they retire so it is high time that the debate took place. This bill is New Zealand First’s contribution to that debate and this bill is a platform upon which the debate can be had. I ask all parties to see it in that light and therefore to vote for it at least at its first reading so that the debate can then take place through the select committee process.I want to make one thing very clear. This bill is not about New Zealand First policy; it is about superannuation in the long term. It is about certainty for future retirees. It is about fiscal responsibility and mostly it is about fairness—fairness to retirees who have lived here all their lives to immigrants to returning expatriates and to present and future taxpayers. No one has all the answers to the many problems with the current system and of course its costs. So in this bill it is entirely negotiable as to whether pro rata entitlement is the best way forward and if so it is still entirely negotiable as to its detail. Every party can promote its views on the future of New Zealand superannuation if they vote for the bill to go to the select committee.A bill of this importance is not a matter just for political parties. There are over 70000 people affected by the hated section 70 of the Social Security Act 1964. There are academics who have been pressing for change for many years. The Retirement Commissioner has long been seeking to have the issues debated and there are many others asking for a chance to be heard at the select committee.I turn to the bill itself. The pro rata system is not complex. It is already used by the Government to calculate the amount of New Zealand superannuation for a recipient who goes overseas to live. They get New Zealand superannuation pro rata for their period of residence in New Zealand. So pro rata is already in the Government system. New Zealand superannuation does need change not because there is anything wrong with eligibility at age 65 years not because there is any problem with universality and not because there is anything wrong with having no means testing but because of three major factors that are priming a time bomb for the future.The first one is high levels of net migration. This bill is not about discouraging that—it is not about discouraging that—but it is a big factor in the cost of future superannuation. In the last 15 years there were 79000 immigrants over 50 years of age. These people qualify for New Zealand superannuation after only 10 years’ residence—the same as people who have lived in New Zealand all their lives. This is by far the most generous pension system for immigrants anywhere on earth. This is neither necessary nor fair considering that a person who reaches the age of 65 then has a life expectancy of 20 years representing $450000 in superannuation payments per person.Another factor is the distinct possibility of a tsunami of returning expatriates coming home to retire—and they are welcome home but on fair terms for superannuation. A person can leave New Zealand at age 25 work overseas for say 35 years return at 60 and retire on 100 percent New Zealand superannuation at age 65 probably after having paid taxes to an overseas economy and having almost certainly earned an overseas pension or some form of retirement savings. There are about 600000 Kiwis in Australia and another 600000 in the UK Europe and North America. That is the size of the issue. As overseas Governments raise their retirement age and generally restrict access to pensions a tsunami can be expected to build and build with huge implications for the New Zealand economy.The third issue is the direct deduction policy of overseas pensions from the New Zealand superannuation scheme under section 70 of the Social Security Act 1964 and associated with that are the outdated reciprocal pension agreements that New Zealand has with some but not many overseas countries. There are many anomalies with the direct deduction policy and there are many cases of gross unfairness resulting from it. One is that a spouse’s overseas pension will be deducted from the superannuation of a Kiwi who has lived here all of their life. There are also huge issues around which overseas pensions are deductible and which are not. The scope for avoidance and for fraud is huge. The Government spends tens of millions of dollars trying to catch and prosecute these people. This bill would end all of that by abolishing the awful section 70. What people earn overseas for retirement is no business of the New Zealand Government but abolition means a new residence-based regime is needed so that people with overseas pensions also do not get full New Zealand superannuation. That would be double-dipping. This bill provides a fair alternative.Pro rata entitlement means that every resident would get New Zealand superannuation on reaching age 65 just as they do now but the amount would be based entirely on their period of residence between the ages of 20 and 65 a period of 45 years or 540 months. A number of months of residence is used to calculate the amount of New Zealand superannuation on a pro rata basis. Periods of absence of up to 2 months per year would be disregarded allowing for an overseas holiday and such like—and in addition an aggregate of up to 5 years would be exempt allowing for a young person on their big OE postgraduate study or whatever without affecting New Zealand superannuation retirement.So the real question then is not so much whether this bill is the best solution to current and potential problems with New Zealand superannuation but whether we together—political parties and others—are now willing to get together to solve them. Now is the time.DAVID BENNETT (National—Hamilton East): This is one of the most tragic bills that has come before this House. It is an attempt by a party that has no sense of any moral compass with regard to immigration. It is an attempt by a party to differentiate between New Zealanders. It is an attempt by a party to not accept and understand the power and success of people who are over 65 years of age. This is a bill that is really the disgust of the New Zealand First Party coming out in legislation again.Let us go through some of the parts of this bill. Basically if somebody is not—Tracey Martin: I raise a point of order Mr Speaker. I have listened to the speaker for a few moments and I actually can see no relevance to or any reflection upon the bill that Mr O’Rourke has put before the House. I wonder whether you could direct the member to speak to the bill rather than to the party.Mr DEPUTY SPEAKER: No I will not at this stage. I look forward to hearing his very relevant speech.DAVID BENNETT: Thank you Mr Deputy Speaker. It is common practice by Opposition members when they do not like a speech to raise points of order and there will be a few other points of order I am sure during this speech because they will not be able to handle the heat in the kitchen. They can give it out but they cannot take it over there in that party.So this is what happens. Under this bill if somebody is not born in New Zealand they are treated differently from other New Zealanders. This bill treats people born outside New Zealand differently from other New Zealanders. That is the disgust of this bill. New Zealand First members are saying that if you are not born in New Zealand you are not a true New Zealander. That is what this bill says. I say to members of that party that half of them probably were not born in New Zealand so half of them should not be getting New Zealand superannuation—and how are they going to work that through?It is a disgrace for this Parliament to even have to debate this bill. Why should we be differentiating between our citizens on the basis of where they were born? If somebody is a New Zealand citizen they are a New Zealand citizen. They should get superannuation. Their right to superannuation should not be removed. What is next? What about health care for non - New Zealand - born residents? Do they deserve health care in this country? I want to see the New Zealand First Party bringing in legislation around that! What about education? Are non - New Zealand - born citizens not entitled to education in this country? That is what the New Zealand First Party should be doing if it actually believes what is in this legislation.The New Zealand First Party is a disgrace to this Parliament. It is a disgrace to the modern world—Ron Mark: Point of order—DAVID BENNETT: Oh again we get another point of order from the man who cannot even handle—Ron Mark: I raise a point of order Mr Speaker. I have been very conscious that we have a young audience and they have to endure this but I would really like it if the speaker would talk about the part of the bill that he thinks actually makes us a disgrace as a party.Mr DEPUTY SPEAKER: I do not need any assistance—[Interruption] Sit! I am on my feet. I am surprised that the member who took the point of order could actually hear what the speaker was saying because his own members were making so much noise that I had difficulty hearing. I am conscious of people in the gallery; I am pleased that they have an opportunity to see the full colour of the Chamber.DAVID BENNETT: To those young people up there: all New Zealanders are the same. We are all the same people. It does not matter if we are born somewhere else. We are not like that party. They want to go back to the 1950s. If you are not born—Mr DEPUTY SPEAKER: The member—[Interruption] Order! The member does not speak to people in the gallery. The member addresses the bill that he is supposed to be debating.DAVID BENNETT: Let us address the bill if you want to talk like that. The New Zealand First Party starts off with a line stating “no effect on most people”—no effect on most people. The New Zealand First Party is quite clearly open to the prospect of treating differently the different people who are resident in New Zealand. The New Zealand First Party does not believe we are all equal. It does not believe that everybody has the right to superannuation.The New Zealand First Party says that this is not about superannuation in the long term. But I say to everybody out there who is in the superannuation camp or will be to remember New Zealand First. Those members are the ones who have brought legislation to this House to take away the universality of superannuation. What is next? What is next for those poor superannuitants out there?New Zealand First has shown its true colours. It will attack superannuitants; it will go and do that. What is next? Is it going to means test superannuitants? Is it going to say that superannuitants who do not live in certain areas or do not pay a fee to the New Zealand First Party do not get any support?Clayton Mitchell: Point of order Mr Speaker.Mr DEPUTY SPEAKER: It had better be good.Clayton Mitchell: I raise a point of order Mr Speaker. He is talking about nothing of relevance to the bill whatsoever. He is just throwing stones at New Zealand First. It is just his speculation of what this bill is about—Mr DEPUTY SPEAKER: I am on my feet. The member can sit down. He has been here long enough to know the rules and the rules are that the Chair is the determinant of relevance. I certainly do not need any further help in respect of that issue which has now been raised by New Zealand First members three times. I did not come down in the last shower and I am not going to be taught how to suck eggs by you.DAVID BENNETT: Thank you Mr Deputy Speaker. There will be more though because a previous speaker said that the time bomb for the future is high net migration. I say to tell the people of New Zealand who came from other countries who work in our hospitals who work in our schools that they are the time bomb for the future of this country. They are not. They are genuine New Zealanders who should be treated the same and should not be treated in the way that that disgusting party does.Another thing in that legislation is that if you are a New Zealand resident if you are born in New Zealand and you go overseas and work then you are going to come back and your superannuation will be reduced by the number of years you have been overseas. They are even saying to New Zealand - born people that if you go overseas and earn an income and work you do not get the same rights as other New Zealand - born residents. What is it about that? What about the New Zealand Bill of Rights Act? The Attorney-General says that is discrimination.The other bit in this legislation is—and this is a party that will go around at election time go to every rest home that will go and say: “We look after the people who are over 65.” Under this bill if somebody is over 65 they do not count. Their contribution to New Zealand does not matter. If a person is over 65 that does not count as making sure that you can be equated to having superannuation. I say that may be true for that party. Everybody in that party is over 65 and none of them have contributed anything to this Parliament in the entire time they have been here especially the leader of that party Winston Peters who is gallivanting around the world at this time when he should be here.Tracey Martin: I raise a point of order Mr Speaker. I am sure that you know of the Standing Order that says that you are not allowed to refer to the absence of a member in this Parliament. I ask you to uphold those Standing Orders. I have finished—I am asking you to uphold the Standing Orders.Mr DEPUTY SPEAKER: Order! When you have finished—thank you. When you have finished normally you sit down. Yes it is a rule that a member’s absence is not referred to. The member knows that. Obviously within the passion of the debate it momentarily slipped his mind. I am sure it will not happen again.David Seymour: I raise a point of order Mr Speaker. As a point of fact the Business Committee has actually agreed that the Rt Hon Winston Peters is on the premises for all intents and purposes during this period.Mr DEPUTY SPEAKER: I do not need any more assistance—[Interruption] No I do not need any more assistance in respect of this matter. The member should not have referred to the leader of New Zealand First in that regard. He should carry on with his speech—the time for which is rapidly evaporating.DAVID BENNETT: Another thing: the New Zealand First Party has gone out there and asked to increase the refugee quota. Under the refugee quota—so they want to have 1000 refugees come in but the refugees would not be entitled to superannuation. What is going to happen to the refugees coming in? And all New Zealanders would have to go through a process to evaluate whether they had been overseas for a certain period of time and that would mean a huge increase in costs to the system.So in summary this is a bill that treats people who are not born in New Zealand but are New Zealand citizens who could have given 40 or 50 years of their life and probably saved some of New Zealand First members’ lives in hospital—they have the inability to get superannuation and that is unfair. The second thing: even if you were born in New Zealand they are going to means test you. They are going to means test you on the ability for you to have stayed in New Zealand and they will reduce your superannuation by the number of years you have been away.I say to all those people who are looking at retirement: do not trust them. Do not trust them because this bill shows their true intention. They want to reduce universal superannuation. They have shown it through legislation. What more can you do than show that through rising in this House? They want to say to superannuitants: “If you are over 65 whatever contribution you make to this country does not matter.” That is what the New Zealand First Party is signalling and it is a disgrace to this Parliament. It is a bigoted party that should not be in this House.Ron Mark: I raise a point of order Mr Speaker. I am sure you heard that word that was used. It is unparliamentary and I would ask that he be asked to withdraw and apologise. It was thoroughly offensive.Mr DEPUTY SPEAKER: I did not hear what the word was—Ron Mark: He said we were bigoted—he said we were bigoted.Mr DEPUTY SPEAKER: Thank you. If the member has taken offence then the speaker should withdraw and apologise. I will remind the member taking the point of order that many of us who have been here for a long time have borne witness to a number of members using a number of words that are unparliamentary and have declined to take umbrage. If the member has taken offence then Mr Bennett should stand withdraw and apologise.DAVID BENNETT: I withdraw and apologise.GRANT ROBERTSON (Labour—Wellington Central): There is only one disgraceful person in this House tonight and that is David Bennett. Mr Bennett that was an appalling contribution. There was nothing in that speech about an incredibly important topic to the future of New Zealand. Members on this side of the House in the Labour Party might not support every bit of this piece of legislation but at least Denis O’Rourke has come to this House to address the issue of how we make superannuation sustainable in this country. All you have got to offer are insults and nonsense Mr Bennett. You are a disgrace.David Seymour: I raise a point of order Mr Speaker. I am sure you heard that the member just brought the Speaker into the debate.Mr DEPUTY SPEAKER: Order! I just want to make a couple of points here. I realise that this is a robust debate but I make the same point that I made to New Zealand First earlier on. Relevancy and whether or not someone brings the Speaker into the debate is a matter for the Speaker. You may note that with the various presiding officers there are various amounts of latitude but they are very narrow. If a member brings me into the debate I do not need to be reminded of the fact. I have been around long enough to be able to handle that all by myself thank you very much.GRANT ROBERTSON: The National Party does not want to have a conversation with New Zealanders about one of the most important parts of our social welfare system—that is whether or not there is universal superannuation. Can we make superannuation sustainable for the future? John Key and Bill English have built their Government around putting their heads in the sand on this issue. Bill English said that this was a conversation for another Government to have. That is recklessly irresponsible. If we want to make sure that there is superannuation available for generations of New Zealanders to come then as a country we have got to have a conversation. Denis O’Rourke has brought a bill to this House that we can send to a select committee to see what we can do.There has been no leadership from the National Party on this issue and that is a disgrace. This Government is so out of touch and arrogant that it is refusing to listen to New Zealanders who want dignity in retirement and who want to make sure that superannuation is there for future generations. This Government will not talk about it and it is completely irresponsible.What this legislation does is raise up the question of section 70 of the Social Security Act. There is not a member of Parliament who does their job properly in their electorate or in representing their area as a list member who has not had someone come to them about section 70 of the Social Security Act. That is because it does create inequities. It does create situations as Denis O’Rourke said in his opening speech where the spouse of somebody who has earned superannuation overseas suddenly ends up with their entitlement as a New Zealander being taken off them. I had a constituency case of a woman who was a teacher and had taught in New Zealand for 30 or 40 years. She was married to someone from overseas and somehow or other she lost her entitlement which she had paid taxes for for her whole life because of section 70 of this Act.The solution being proposed by Denis O’Rourke may not be perfect and we do have some concerns which we want to air at the select committee about whether or not we have got the definition right. We do have concerns that the concept of universality is for the first time being called into question by this bill through the pro rata system. That is a very serious step to take and one that the New Zealand Labour Party is not confident that this bill will achieve in a way that we would want to vote for at the end of the road but we want to see the issue debated.There are serious issues about the sustainability of superannuation. The New Zealand National Party might have its head in the sand but we will vote for this bill—imperfect as it is—to go to select committee because we believe that Zealanders deserve the right to have a discussion about this important topic.JAMI-LEE ROSS (National—Botany): I do want to just start out by politely saying thank you to New Zealand First for bringing an issue to the Parliament for debate. Respectfully the New Zealand National Party will not be supporting this bill and there are very good reasons why we are doing that.I just want to say to Mr Robertson that we have had a conversation with New Zealanders about New Zealand superannuation. It was called the 2008 general election the 2011 general election and the 2014 general election. At each of those general elections the Prime Minister of New Zealand has been to the country and said: “We will maintain New Zealand superannuation entitlement at the age of 65. We will also maintain New Zealand superannuation entitlement at 66 percent of the average wage.”That is a commitment we have made to New Zealanders after having a conversation with them three times during general election campaigns. We intend to stick to that commitment to New Zealanders because we are a Government that sticks to what we say we are a Government that delivers on what we say and we have delivered that for New Zealanders.The reason why we will not be supporting this bill on top of the fact that we have made commitments to New Zealanders is that we believe in fairness and we believe in simplicity. We are not a party that believes we should be attacking those who come to this country or attacking those New Zealanders who were born here who wish to go overseas make their way in the world and then eventually come back to reside here and contribute back to their country. Because a bill like this does that.A bill like this does attack and make it harder for those wanting to bring skills to this country and those who want to bring capital to this country. It also makes it harder for those New Zealanders who want to go overseas and have an overseas experience working for a number for years or who may go overseas to get involved in business and then bring those skills back to New Zealand because they are penalised for doing that.The New Zealand First Party is basically saying to New Zealanders that if you want to go overseas you are allowed to go overseas for only 2 months a year because that is what this bill allows or it is also saying you can go overseas for 5 years only between the ages of 20 and 65. The New Zealand First Party wants this Parliament to dictate to New Zealanders that they are allowed only 5 years overseas between the ages of 20 and 65 otherwise they are penalised for that. We do not believe that is fair we do not believe that is right and we do not believe that is just for New Zealanders.I can see that New Zealand First is looking at ways to try to reduce the cost for New Zealand superannuation. We have budgeted the cost for New Zealand superannuation for the foreseeable future. We have included it in all of our calculations and it is affordable at the rate that we are keeping it at.We are a country that for many many years—decades hundreds of years—has welcomed people to this land. We have welcomed them to this land and through our immigration policies as a country. We welcome migrants to this country because they bring essential skills to the country they bring capital to this country or they are marrying a New Zealander. Under the bill that is in front of us any person who comes to New Zealand and is not able to spend the requisite time that the bill dictates that they spend to be able to get full entitlement to New Zealand superannuation—and I say full entitlement to New Zealand superannuation—is penalised for that.That is an awful message to be sending people from overseas who want to come here. That is a terrible message. We should be more welcoming as a country. We should also ensure that we keep the New Zealand superannuation system simple. It is very simple right now. The rules are very simple and every person—every New Zealand citizen—is treated equally under the current superannuation rules. That is a policy that this Parliament should maintain that is a policy that this Government wishes to maintain and we will be voting that way tonight.I just want to conclude by saying that the solution to New Zealand superannuation and the cost of New Zealand superannuation is not to try to cut some people out of the pie. The solution is to continue to grow our economy continue to grow jobs and continue to grow wages in this country. That means New Zealanders have a greater entitlement and they have a greater ability to be able to afford their retirement.As a country the more we grow the more we can afford to support New Zealanders with dignity at the end of their life when they are in those final years of their lives after the age of 65 and are wanting to retire. That is what we should be doing: simplicity dignity and fairness for all. That is the way we are voting tonight.JAN LOGIE (Green): I rise to take a call on the New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill which is being brought to this House by Denis O’Rourke from New Zealand First. The Green Party does not support this bill as it is written. We have some very deep problems with it. But we will support it going to the select committee to enable a discussion and parliamentary consideration particularly of section 70 of the Social Security Act.But I do firstly want to outline some of our concerns with this bill and what it does. The bill proposes a pro rata entitlement for New Zealand superannuation so it will erode the universality of New Zealand superannuation based on how long a person has been in this country between the ages of 20 and 65. Currently the requirement to receive New Zealand superannuation is that a person has been present and resident in New Zealand for at least 10 years since attaining the age of 20 including 5 years after the age of 50.This bill replaces that requirement that a person be present for 10 years between the ages of 20 and 65. The pro rata entitlement will then be calculated on the number of qualifying months that a person has spent in New Zealand during that time. One is allowed according to this bill to have short absences of 2 months or less during a calendar year. There is an exemption of 5 years for New Zealand - born residents to—I think the member himself described it—perhaps go on a well-earned extended world cruise. But if you moved here when you were 5 and have lived here your whole life well no cruise for you.This bill has a number of gaping holes including how qualifying months are calculated. What about all those New Zealand residents who travel for more than 2 months a year for work? There is a significant number of them and then there are people like me who have lived outside this country for more than 5 years. Also there are no exceptions for people like refugees who in most cases come here after the age of 20. It creates a blanket rule and this disadvantages many people. And although not the tone or the detail of the first speaker’s bill I understand that it would be possible to interpret some of the provisions in this bill as borderline racist.I would like to be very clear that the Green Party does not support these aspects of the bill. However we do support having a conversation about superannuation and this bill enables that to happen. I note that the Retirement Policy and Research Centre has also indicated that although it does not support the content of this bill it does support its referral to a select committee to open up the opportunity for dialogue in this country.I particularly do note the fact that this bill gives us the opportunity to address section 70 of the Social Security Act. I worked for a member of Parliament who was the Greens’ spokesperson on superannuation 8 or 9 years ago and I remember back then getting the letters from people who were not able to get New Zealand superannuation because they had—out of their own pay overseas—paid into a foreign pension scheme and now that money was just taken out of New Zealand superannuation so they were not able to access New Zealand superannuation or else they had a New Zealand partner who was now no longer able to access New Zealand superannuation because they had paid out of their own wages into a voluntary scheme overseas. That is patently unjust and it does create very strange anomalies in our system. I understand that approximately 70000 pensions are affected by this provision and on top of that it can also affect Kiwis who have worked overseas and even the partners of anyone who is affected who do not even show up in that figure.The Green Party policy is to restrict the dollar for dollar abatement regime on overseas pensions so that it applies only if an overseas pension is paid from an overseas Government scheme funded through taxation similar to the New Zealand benefit and to treat income from contributory income schemes—like our KiwiSaver superannuation saving scheme—no differently from other income for benefit abatement purposes. Therefore we support this bill’s referral to a select committee to give this House the opportunity to redress that injustice.ANDREW BAYLY (National—Hunua): It is a pleasure to be talking on this bill tonight the New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill. I find this an interesting bill which has been put forward by Denis O’Rourke a member from New Zealand First and it is really a refinement of our current superannuation arrangements here in New Zealand.I believe that it is based on the French model. Interestingly I have got a lady working with me who has had firsthand experience of that system which does apply a pro rata arrangement. The interesting thing in the French arrangement is that the contributions made by members to the scheme are absolutely significant. The application of the pro rata arrangement does provide some form of recompense to people but it is a difficult scheme to administer. Therefore on many grounds I do not think it actually works that well. So I was sitting here trying to work out what the benefits of trying to refine our New Zealand superannuation scheme were and to be honest I am struggling to understand what the merits of this bill might be.If I were to look at some of the issues that it does raise I think the first one is that there is a maximum allowance for someone who is a New Zealander to legitimately travel overseas for 5 years between the ages of 20 and 65. I think that many New Zealand people do travel overseas—as we are all aware; many of us have—and this stipulation around the 5-year requirement is I think actually quite constraining and counter-productive not only to the personal interests of New Zealanders who legitimately want to do that but also to the interests of New Zealand as a whole in terms of allowing people to go overseas and get the valuable skills that they may want to achieve while they are working there.Secondly this bill actually makes it very difficult for returning New Zealanders and in many ways it actually puts in a disincentive for New Zealanders to return to their homeland. I actually believe that that is a bit of a mistake. I think those Kiwis returning to New Zealand who may have worked overseas for many years and who want to come home—and to be penalised for doing so under a bill like this is actually fundamentally flawed.The third issue I have with this bill is that if you strictly apply the rates. If you return at any time after the age of 55—i.e. within that last 10-year period—you are actually quite disadvantaged financially. Again it is putting in place a mechanism that actually reduces the superannuation that New Zealanders or other people returning to New Zealand are actually entitled to.Fourthly the bill actually is absolutely anti-migrants and that is an issue I really have an issue with. If we accept people into New Zealand as migrants and they go through the strict process of immigrating to New Zealand with all the assessment that goes on under the present arrangements they are entitled to a full pension after a certain period of time. This bill would cut across that and I think that that is a very poor commercial issue as well as a sort of fundamental rights issue that New Zealand First is raising with this bill.The fifth thing about this is that even for those returning with a foreign-based superannuation scheme that would be part of the remuneration that they would be able to draw on together with a part-share of the New Zealand superannuation scheme that creates a whole lot of problems for those individuals. It creates problems not only in terms of what that means in terms of assessing what returns they might get subject to foreign exchange differentials that go on from time to time and the management of that—and any of you who have actually tried to bring back a foreign pension scheme it is not without its difficulties. In fact it is an administrative nightmare. So on that basis also I cannot support the bill.Then what the bill does not do is it does not actually respect older people coming back to New Zealand. You know I was at a bowling club on Saturday and I met this very nice English gentleman who had been in the Royal Air Force for many many years. He had worked in France and then he came to New Zealand. He had been through that superannuation and immigration process and you know he was loving living in New Zealand. He had a lot to contribute to New Zealand. But under this bill I suspect that that gentleman would not have come to New Zealand and I think again that that would have been a significant pity.Finally New Zealand already has in place good reciprocal arrangements with nine countries around the world. Where we have these arrangements set up it is absolutely clear what superannuation entitlements people are entitled to. I think that on those grounds I would have to say I do not support this bill.Hon RUTH DYSON (Labour—Port Hills): Thank you very much for the opportunity to speak on this bill. Can I just begin by congratulating the member in whose name this bill is—Denis O’Rourke a fellow Cantabrian who lives just down the road from me in the best part of the universe. I think it is a bill with parts of which I agree and parts of which I disagree. It raises the issue about the structure of superannuation and the sustainability of it. Those are serious big issues for New Zealand and we should have this bill at a select committee so that we can have the debate. I know that there will be parts of it that other members will feel strongly about—we have heard Jan Logie say similar comments—but we should be brave enough to have the debate and that is where National misses the boat.Those members are going to put their heads in the sand and say: “No there’s no issue with superannuation. We don’t want to talk about it.” I am sure that not a single member there could honestly say that they have not been approached by somebody who had concerns about section 70 of the Social Security Act. I cannot believe that they are so disconnected from the planet that they have never heard anybody raise concerns about this.Dr David Clark: Oh they’re out of touch.Hon RUTH DYSON: They are certainly out of touch and this bill provides the opportunity for that debate.Just briefly the concerns I have are about the long-held tradition that once somebody meets the criteria they have universal superannuation and that this chips away at that. New Zealand First will be the last party after Labour to want to erode New Zealand superannuation in my view but I would not want to open the door for that party opposite to erode New Zealand superannuation and this has the potential to do that. So that is a concern that I have. I wholeheartedly support the proposal to treat people who are exposed to section 70 provisions in a fairer way and this bill provides a really good opportunity to do that.I want to conclude my contribution before the bell rings because I am very keen to get on to the next bill on the Order Paper. It is a fantastic bill. I am very pleased to be putting my vote behind this bill going to the select committee. Well done Denis O’Rourke.DAVID SEYMOUR (Leader—ACT): I rise on behalf of the ACT Party in opposition to this bill. At first blush you might have thought it would be at least a topic worth supporting because there are some serious issues and I have to disagree with Jami-Lee Ross; the sustainability of New Zealand superannuation although it may be a politically popular thing to trumpet is not a fiscal reality. You only have to ask Treasury to give you a copy of its statement on New Zealand’s long-term fiscal outlook to understand that. I can also concur with what Grant Robertson said: anybody who has a regular presence in their electorate office—and that is not everybody as we know—will understand that section 70 of the Social Security Act is a real issue for a great many people. There are people who find that they have perhaps as Mr Robertson said a pension entitlement to New Zealand superannuation. They may have a spouse whose entitlement from an overseas pension scheme is greater than that pension entitlement and they find that the excess is actually deducted from their New Zealand superannuation entitlement. I can understand why people find that very very annoying. I have dealt with some of them and often it is actually very saddening.Let us have a few observations—let us have a few realities about this bill. This bill is unworkable. Where was Denis O’Rourke in 1977? Who knows? And you would have to multiply that. You would have to ask everybody where they were during that period and whether it was more than 2 months that they were away. The fact is that it is unworkable and impossible but where it becomes very easy to tell is if you are like Julie Anne Genter. We know that she was not in New Zealand in 1977 because we know that she grew up in another country and that might be why the Attorney-General has given a report showing that this violates the Human Rights Act: because it treats different groups of people differently. This New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill will never be enforceable. For recent immigrants it will be almost impossible to get a fair hearing. They will be treated differently. The problem with New Zealand First in general is that you might say “Oh but their intentions with this bill were at least sound in this particular case.” but they do it so often that you come back to what it was that I think it was Stephen Covey who once said: “I can’t hear what you’re saying because what you are screams so loudly.” Once again in this bill we see the New Zealand First trend of being at the very least I think as one member said borderline racist.But then we come to the section 70 issues—those that all of us who have sat in our electorate offices would like to help with. There is Sarah Dowie. We know she was born in Invercargill so it will not affect her because you will never be able to prove where she was in 1977. Nevertheless we would like to help people affected by section 70. But just take the example that Mr Robertson brought up earlier of the woman who has taught in New Zealand for 30 or 40 years. She has a full entitlement to New Zealand superannuation and yet she finds herself by the sound of it with a husband who has a fairly generous pension from overseas—at least twice as much as the New Zealand superannuation entitlement—and she finds that she does not get any New Zealand superannuation so they miss out. The reality is that under this bill of pro rata entitlement he would miss out anyway. They would still be out by one pension because he by the sounds of it has spent so much time overseas accumulating a pension. You will find that even though it is a lovely idea to at least go forward to select committee and debate section 70 the reason it is so fraught is that there are so many pension schemes that it is simply very very hard to reconcile the many schemes that there are around the world. With that in mind I say that this is a bill that is insincere in its commitment. It will not have the effects that we hope for and for that reason it would not be a good use of the select committee or the House’s time to continue debating this bill through any further stages. Thank you.Dr DAVID CLARK (Labour—Dunedin North): I rise on behalf of the Labour Party to support this bill going to the select committee. We are concerned that New Zealand has a debate about the sustainability of New Zealand superannuation. This is a Government that is not being straight with New Zealanders; we know that. Bill English has said he does not want to have a conversation about the sustainability of superannuation. He said in his own words that that is a task he wants to leave to a future Government.The Government is out of touch with New Zealanders because the New Zealanders I speak to do want to have a conversation about superannuation. People my age young people know that when they get old the current settings will not deliver them New Zealand superannuation. They know that under the current settings they cannot be sure that they will get superannuation as it is provided today. It is simply not sustainable. We need to have a conversation as a society about how we can get to a sustainable place so that everybody can have fair and equal access to superannuation.We do have concerns of course about the bill. This is the first time that the principle of universal superannuation has been brought into question once criteria are met and this notion of a pro rata payment based on residence and presence is something that we think would need to be teased out and discussed in select committee. It is not something that we are comfortable with on the surface but we do congratulate New Zealand First and Denis O’Rourke on bringing this discussion to the House. It is something that this Government has refused to lead on. It is a Government with its head in the sand which is refusing to have the conversation. The Prime Minister has ruled out a conversation on it; Bill English has ruled out a conversation on it. Nobody wants to deal with the issue and that is not serving the interests of future New Zealanders. We will have a concern ongoing about this issue—whether or not this bill succeeds in the House.We know that this Government stopped contributions to the New Zealand Superannuation Fund—the Cullen fund—and has foregone $5 billion in dividends alone. We know that it stopped the KiwiSaver kick-start contribution—$1000 per family. We know KiwiSaver enrolment rates have dropped off. We know the Government does not have the long-term interests of New Zealand at heart. It is interested in the short term. That is bad for New Zealand and that is why we will continue to be critical of its position on superannuation.We will be supporting this bill to select committee because we want to have this debate. We are not afraid of it. We think this Government should support it too and actually have the discussion.ALASTAIR SCOTT (National—Wairarapa): Reservations have been alluded to from the Labour Party around the pro rata basis of the calculation so the challenge is therefore why not vote against it? Then we have the Green Party members talking about this bill being racist and they are absolutely right—it is racist. So therefore why do they not vote against it?We will be voting against this bill because it is unfair. It is unjust. It is based on the fear of immigrants. It is based around a philosophy of building a fence around New Zealand to keep migrants out. It is based on anti-Asian sentiment. Maybe Mr Phil Twyford should be here because he would certainly vote for it given that he does not want anyone with a Chinese-sounding name joining in the economy of New Zealand. [Interruption] You should take note of Mr Lees-Galloway. He is trying to tell you guys to quieten down because you are only making fools of yourselves by protesting.At the end of the day this bill is a poor bill. The current legislation is good and fair. It treats people with respect and with equality. It does not prejudice refugees. That is why we oppose this bill.Mr DEPUTY SPEAKER: I call Denis O’Rourke—right of reply.DENIS O’ROURKE (NZ First): This is a debate that needs to be had in much more detail than has been possible tonight. It is a debate about superannuation which has many problems as every member in this House knows and which needs desperately to be addressed but the National Party will not do it and the ACT Party will not do it—not just because they do not understand it but actually because they do not care about it and they do not care about the people who are badly affected by it. If they think that there are not people who are adversely affected by it then I invite them to go and talk to the 70000 people who are adversely affected by section 70 of the Social Security Act. Then they will get an earful that they cannot bear because for years on end the rest of us have dealt with these people in our offices and we know that there is a problem there that must be addressed.I want to refer to David Bennett’s awful speech. First of all he is entirely wrong about the New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill being anti-immigrant because this bill treats everybody exactly the same whether they be Kiwi expatriates returning to New Zealand or whether they be immigrants or anybody else. This bill treats everybody exactly the same and it would not matter at all whether they were an immigrant or a Kiwi so he is entirely wrong about that. He is also entirely wrong about the bill having any impact on means testing. It does not even refer to that so that member cannot possibly have read the bill—or if he has he has not understood it.This bill is only about fairness really and it is in no way discriminatory. New Zealand political parties need to front up about New Zealand superannuation they need to front up about its problems and they need to solve those problems. We all know that it has massive problems but Jami-Lee Ross is wrong about the pro rata system discouraging Kiwis from working overseas and then returning to New Zealand. The opposite is actually the case and the reason for that is that they will earn an overseas pension while they are overseas because the countries where they work are the countries that require that to be done and they will also earn other overseas savings. Those are the pensions and the savings that will be deducted under section 70 of the Social Security Act when they return to New Zealand and that is the reason they will currently not return—because of that section; that section which this bill actually abolishes.I did want to refer also to the Greens’ concerns which are rational and understandableat least. However I would have to disagree with them that this bill erodes universality. It does not erode universality. It alters only the amount of New Zealand superannuation not the entitlement which would still be universal. I agree however that there may be a problem with the words “born in New Zealand”. As I have said this bill is negotiable. If those words are a problem New Zealand First is more than happy to negotiate about that and if necessary to remove those words—and indeed any other detail that may be said to be problematic.There are already many exemptions for some of the people listed by Ms Logie and that is already the case in the current superannuation system. Those sorts of exemptions could easily still be built into and apply to a pro rata system as well. Also I would have to disagree with the Greens over the words “borderline racist”. Nobody in this House has yet made a speech that shows how this bill could be racistin any possible way. There is actually no justification whatsoever for that claim. It has got nothing to do with that. It has got to do only with a fair system for the New Zealand taxpayer in respect not just of immigrants but also of returning Kiwi expatriates.Mr Bayly said that pro rata would be difficult to administer and that he was struggling with the merits of it. Well he struggles with just about everything but this bill is not difficult—The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! The member’s time has expired.A party vote was called for on the question That the New Zealand Superannuation and Retirement Income (Pro Rata Entitlement) Amendment Bill be now read a first time.Ayes 60New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.Noes 61New Zealand National 59; ACT New Zealand 1; United Future 1.Motion not agreed to.