Social Security (Youth Support and Work Focus) Amendment Bill — In Committee 
Text is incorporated into the Bound Volume 
Social Security (Youth Support and Work Focus) Amendment Bill — In Committee 
[Sitting date: 17 July 2012. Volume:681;Page:3575. Text is incorporated into the Bound Volume.] 
Social Security (Youth Support and Work Focus) Amendment Bill 
In Committee 
Part 1 Substantive provisions taking effect on 30 July 2012 or immediately 
The CHAIRPERSON (Lindsay Tisch) 
: This is debate on clauses 4 to 21 and schedule 1. 
JACINDA ARDERN (Labour) 
: 
 It is my privilege to rise and begin the discussion at the Committee stage around Part 1 of the Social Security (Youth Support and Work Focus) Amendment Bill. I want to begin at the very beginning of Part 1 which of course sets out that the substantive provisions in this part of the bill will take effect on 30 July. I understand that the Minister for Social Development has tabled a Supplementary Order Paper that would move the enactment date for these provisions to later in August. I would ask the Minister her reasons if she were willing—she referenced in question time the reasons for shifting the enactment date for these provisions but I would be interested in hearing in greater detail the reasons why the enactment of these provisions has been shifted. I have of course heard anecdotally the reasons. I understand there are contract negotiations still under way that there are issues with information sharing that still have not been resolved and that not all of those who will be affected by these changes have yet been contacted. My understanding is that there are considerable issues not least the fact that some services are of course in a state of limbo while this piece of legislation is still before Parliament. So I would be interested in the Minister commenting on the state of play as it were for those youth services and the preparation she is doing for what are substantive changes to the way these services are offered to our young people. I do want to spend a bit of time over the course of this debate breaking down some of those changes and debating them further. 
I think it is important though before we start to at least have some frame and some understanding—and I would be happy to share it—of where the Labour Party has come from in analysing the changes put before it by the Government. The Government has framed these welfare reforms as being the most substantive in decades. Our contention has been that for young people these are significant changes—their interface with Work and Income will change dramatically—but only for a very particular group of young people. We will come back to the question of the breadth of these reforms but for the majority of people who are on some form of Government support this bill primarily introduces for them work testing and beyond that there are very few additional provisions in this bill that will assist them into work. So what we have been calling for throughout this debate is a look at first the availability of work—we know that the number of those on the unemployment benefit has moved since 2008 from roughly 18000 to just under 50000—second the availability of affordable quality child care; and third of course questions of training and education. That is the lens with which Labour has looked at these reforms. 
Coming specifically to the provisions of Part 1 the youth services that are being introduced here are proposed to replace the status quo—the status quo being of course a series of Youth Transition Services. We acknowledge that they were ad hoc in terms of their provision across the country. They cost basically $12 million a year to run. That money has been picked up and dropped into the pot for the new youth services. Those Youth Transition Services dealt with a range of ages—anything from a school leaver who could be as young as 15 if they had an exemption right up to the age of 20. In fact many Youth Transition Services have told Labour members that up to 60 percent of the young people they deal with are outside the ages of 16 and 17. The referrals they got we acknowledge were ad hoc. Youth Transition Services were not always getting information from schools about school leavers. We acknowledge that that was something that needed to be addressed. They did sometimes in some cases have ad hoc arrangements with schools that worked well but otherwise they were taking referrals and walk-ins. So again there was certainly room for improvement there and that we acknowledge. 
But our question is whether we have thrown the baby out with the bathwater with the replacement youth services that this Part 1 will bring in. I think the question we want to ask in Part 1 which is the substantive part that addresses the new youth services framework is first the question of whether we have narrowed down too far the scope of young people we are working with. The youth services make no apologies for the fact that they are targeting what the Minister has flagged as being roughly 14000 sixteen and seventeen-year-olds. We are not denying that they are very much in a pool of young people who do need targeted interventions and services but they are a subset of a much wider pool. Our concern given the experience of the service providers in this area who have told us that in some cases a school leaver may move into work straight after school or may move into some kind of training but may find that after a year or even 6 months that plan has not worked out and suddenly they do not have the support of schools and they do not have the support of other services around them is where do they go? If they tip past their 17th birthday now the youth services are not going to be there specifically for their needs. So our concern first off is whether the eligibility criteria have been narrowed too far for the purposes of this bill. 
Our second concern with the youth services is essentially the way that they are structured. The funding regime for youth services under this model under Part 1 has changed dramatically. No longer do we have a contracted service that is picking up all the young people in a region. We now literally have a price on the head of particular young people who are identified centrally as being vulnerable and then dispatched down to a regional level for the local—it sometimes might not be too local—youth service to pick up. The price on the head of that young person essentially increases depending on their vulnerability and also depending on what pathway the youth services try to nudge them down. If they try to get them heading towards National Certificate of Educational Achievement (NCEA) level 2 they will get a bigger bonus payment than they might for some other option for that young person. 
I guess our concerns there are quite specific ones. We have heard from Youth Transition Services that often they are dealing with some young people who have not even achieved NCEA level 1 and that in fact it may end up with us having a situation where they have a disincentive to work with that most vulnerable young person because the likelihood of them achieving NCEA level 2 of that service receiving their bonus payment and all of that happening before that young person hits their 17th birthday is considerably reduced. Therefore are we creating a rod for our own back here where the most vulnerable young people simply become too expensive a gamble for those youth services to take? That is not I am sure a scenario that the Minister would wish to encourage. 
Another issue that we have had is we have seen that small services have essentially been priced out. A good example of this has been the much-heralded Otorohanga example. I understand that it continues with funding at the discretion of the Ministry for Social Development rather than under this contract model because it has literally been so successful that those young people who might be flagged as attracting payments for this service just do not exist to the scale required to maintain a service in that area. Yet it has been such a successful service. In our minds that points to a model that is not necessarily fit for purpose for smaller communities larger communities and everything in between. 
We are also concerned that we are not necessarily via this model and the incentive-based payments system taking into account the individual and best needs and interests of that young person and the circumstances in which they find themselves when they walk through the door of the youth services. That was discretion that Youth Transition Services previously held and I think managed very very responsibly. 
We have a Supplementary Order Paper on the Table that essentially says let us not throw out the baby with the bathwater by opting for a very expensive alternative regime when we had the bones of a successful much more universal system that we could have tweaked and improved upon. The way we would have improved it was firstly by extending it and making sure it was nationwide; secondly by making sure the information sharing between schools and those Youth Transition Services was mandated; and thirdly by really building on the good work that the Mayors Taskforce for Jobs had already done on trying to improve the Youth Transition Services model acknowledging where there were some gaps in that service provision. I have to say that all of that came at a cost much cheaper than what we are seeing from this particular set of provisions acknowledging of course that the Minister has overlaid incentive payments for young people. Putting that aside I still believe the alternative an extension of a Youth Transition Service model was a much more fiscally prudent option than the one that we see before us today. So I ask the Minister if she can in her call to respond to the question around the timing. Perhaps she could explain to us her position on why she opted not to— 
Hon PAULA BENNETT (Minister for Social Development) 
: 
 There are no two ways about it change is on the way and this is certainly going to be a completely different way in which we work with young people. Certainly this first bill of our welfare reforms the Social Security (Youth Support and Work Focus) Amendment Bill is going to show us putting an attention on those whom we see at times as being most vulnerable that they have never had before. 
There was absolutely no doubt about it when we looked at who was going on to benefit. It had not really been done before. When we looked at the pipeline of who was going on and how long they were likely to stay there it will not be rocket science to know that the evidence said that the younger you go on the more likely you are to stay on welfare for long periods of time. If you go on as a teen parent then you are more likely to have subsequent children while on benefit and to be there for very long periods of time. I would not say it is easy but it is one thing to turn round and ask how you are working with those who are on welfare where you are setting the age of when you work test and when you are making sure that you are putting the right work tests around people; it is quite a different scenario to ask how we are going to work with them before they even get there. 
That was a big call. It was a big call for the Government to look at it quite differently because in some respects—from Work and Income’s perspective if you like and from a welfare perspective—if you wanted to be pure they were not our problem. They kind of were not our problem until they came on at 18. But of course that is not the Ministry for Social Development’s approach to this and that is certainly not this Government’s approach to this because in some respects working with them earlier was going to make a difference. 
Often when I talk about this stuff I think that we could go back really early because the reality for most of these young people at 16 and 17 years old is that for many of them they have had a poor upbringing for many of them school has not worked—if it had they would still be there—and for many of them they are the lost and ignored and forgotten. It just seemed wrong to me that they might get picked up ad hoc if we were lucky. But the information was not flowing between the Ministry of Education and the Ministry of Social Development. I would say that we have taken the components of what we know works and then expanded it. 
I make no apologies for my concentration on 16 and 17-year-olds although there will be some room in this for providers to work with 15-year-olds as well. No matter which way you look at it it is expensive but this is where you ask whether it is expensive that they spend 10 years on welfare and on benefit. Is it expensive that we actually try to work with them when they are 21 or 22 or when they are 30? It is expensive to work with them when they are 16 and 17-year-olds when you add it all together but in effect the opportunity that we have to change their lives is an investment that we want to make. 
So as we say there are about 3000 young people aged 16 and 17 and young parents—teen parents aged 18 as well. There are about 3000 of them. Add to that if you like about 11000 what we term “neets”—not in education employment or training—and all together you have got about 14000 I count who are “neets” as such. And yes we are going to give a different amount depending on their risk because otherwise you see providers just working with those who are easier to put in. So we make it outcome-based. We say to the organisations that are working with them: “These are the outcomes we want.” 
The Opposition member picked up on National Certificate of Educational Achievement (NCEA) level 2. I make no apologies because every bit of evidence—international local upside down sideways—tells you that those young people gaining that kind of educational achievement is the best chance that they have of having a successful life. The best chance they have of staying off welfare and of actually getting a job that is meaningful that will actually take the ups and downs of lives and economies and everything else is if they have that education behind them. I can say to you now that not every kid is going to get NCEA level 2 but quite frankly to think that they deserve for us to strive for something less than that for them is appalling. We will strive for NCEA level 2 for them with everything that we have and we will incentivise and reward those providers that get them through to NCEA level 2. Some will take longer. For some it will take a long period of time for those young people to get there. What we are asking is for them to head towards it. 
Jacinda Ardern 
: They can’t. They stop being funded at 17. You’re not giving them time. 
Hon PAULA BENNETT 
: They are getting time actually. The member is yelling out that they are not getting time. Actually we are going to work with them for years. Actually we are going to work with them for years. That is the reality. When you look at the funding that is coming from the Youth Guarantee on which we have over 10000 places now these are the very young people who are going into them. Then you add to that the substantial thousands of dollars that are going into the support that comes alongside of them whether that is making sure they are picked up in the morning and taken to that course or training or making sure that it is actually engaging because their brains work quite differently and in some respects need to be turned on in a different way if you like so that they can get that buzz of learning and education that leads to those sorts of qualifications. We see fantastic examples of it. Whether it is via trades training and is more hands-on whether it has got work-based experience in it whether it is in a different environment that actually gets their brains thinking we have tried to make it valuable. I make no bones about that. What we have also done as I said is pay more for those whom we consider high risk. 
This is different. How many times and in which ways? There are payment cards and the benefits for those 3000 are going to go on to a payment card. That provider is going to work alongside the young people. I have been out in the last few weeks really talking to them about what this means and how it looks for them. Some of the young people themselves—as much as I do not like to admit it to some of those fantastic workers—think it is quite exciting they are not going to have to go to Work and Income as much. They kind of like that they get to have a real relationship with a provider that they know—that is basic. I mean I know what that means in the context of it all but for them they sort of see that as a more welcoming environment and they have someone advocating on their behalf. So they get that kind of connection there and they are pleased about that. 
There is assistance with the budgeting programmes. Look at how new this is. We have never had social obligations like this attached to a benefit before and these are. There are going to be obligations on teen parents for example to be doing a parenting course to have their children engaged with a primary health organisation and to do their Well Child checks. Never before has that been so directly linked to the benefit system. It will be in this case and that makes major changes that we have not seen before. 
I come to the commencement date. I mean here we are in the Committee stage now. We want to give people once we go through the process and everything we need to do at least 2 weeks to be getting all of the notice they need for the change that is coming up. Actually the providers are ready we hear when we speak to them but the extra training that will go in so that they can pick it up will be well needed from them they tell me. Their contracts will start on 1 August so they are not going to miss out on any payments. They see that time as really getting ready for when it turns over on 20 August and having the opportunity to do that. I think that that is the right way for us to go. 
It is one thing for us to say there was this fantastic programme that was running before and yes we are funding parts of it through Work and Income in different ways but when did they last work with kids who had severe disabilities and needed help that was quite different? When were they working with young people who have convictions or have drug and alcohol dependency problems? They are high risk and they need far more intervention and they are expensive. With all respect to some of the programmes that we saw they were not working with those really difficult kids whom we see particularly in the bigger cities in high numbers. So they are going to take a different approach. How do we get a more cultural element to it that is going to actually engage those Maori Pacific and Asian kids who need it quite differently actually than what we see otherwise? 
The change in the law for information sharing is a vital vital part of the change that we are making and is something we have not seen before. What we had in some respects was a relationship with schools where they did pass on information but none of the schools felt particularly comfortable about it. They were not sure they had permission how it looked and whether they should be. And it never happened in real time. So you could literally have a young person dropping out of school at 15 16 or 17 and there being if you are lucky months in between a provider actually then knowing and in many cases they did not know at all. With this change it will be happening in real time. Information will be passed on to that provider via the Ministry of Social Development and via Work and Income that provides good information and good knowledge on what is happening. The sooner we pick them up the bigger difference we can make. 
Is this going to be perfect? Of course it is not. We are going to have to work our way through and it is not just a partnership because that always sounds like two people. It is going to take that whole community approach to see it and we are going to need to keep that relationship—we are going to need to keep tweaking as we go. One of the things we have done is we have said we will have Work and Income in with the actual youth provider for the first few weeks so that we do not mess up their benefits at all and we make sure there is sufficient— 
JAN LOGIE (Green) 
: 
 I am pleased to rise to join this conversation as well around the detail of this Social Security (Youth Support and Work Focus) Amendment Bill which as we have stated before the Green Party is not supporting. It is quite difficult to speak to Part 1 of the bill because there are so many many points to make in relation to it all of which feel very important and quite substantive. So I am going to try to limit myself which is going to be difficult. I would just like to pick up on some of the comments that the Minister in the chair the Minister for Social Development has made and speak a little bit to the idea of the wraparound service. It sounds fantastic. It sounds like a really good thing to get alongside young people and connect and help them build on their strengths to be able to achieve their potential which is that model of youth development that we have learnt over time is effective. 
The problem is that this bill is based on a deficit model. It is identifying young people who are on varying degrees of the scale of being at risk whereas with the strengths-based model that this whole sector has spent years developing it is recognised that when we focus on the risk we actually develop the risk. When we focus on the strengths we build the strengths. We need to be working with each young person where they are at and be building trust and relationships and giving young people things to do that they can do. They are the things that make a difference in youth development. 
This bill by setting the point of NCEA level 2 by requiring those community providers to report on the young people—potentially resulting in sanctions—undermines trust and relationship. This bill by defining young people on degrees of risks undermines the analysis of strength-based development. 
I will speak a little bit more to the NCEA level 2 challenge and particularly I would like to challenge the concept that all of the evidence tells us that NCEA level 2 is the point that makes the difference. When I was trying to get the evidence to show me that because I do believe in checking things out and making sure my assumptions are not wrong I tried to find the evidence around that and whether it was school-based NCEA level 2 or NCEA level 2 outside of school. It seems to me that the evidence is based on school because when you step outside of that school system it becomes a hotchpotch of unit standards that do not even guarantee that basic literacy and numeracy have been achieved. It could be a completely random collection of educational points that do not create a comprehensive pattern of learning. The comprehensive pattern of learning and development is what makes the difference. 
I have seen some of the educational providers and some of the outcomes for young people who are working in that system and it is not rigorous. So for those young people who are up to it that is not actually going to be aspirational for them at all. I do not believe that for every young person it is for us to strive for them when I hear from young people who have been refugees and who had never been to school before they came to New Zealand at say the age of 13 who do not even have reading or writing in their own first language. Their response to the idea of NCEA level 2 and their being helped to strive to achieve that was just no because that is actually overwhelming and demotivating whereas good teaching is based on a student-centred approach. We develop the strengths and the aspirations for those young people from where they are at. That is not about making assumptions. That is not about characterising them and not expecting enough for them in the world. That is just good practice. This bill undermines that good practice. 
I also have concerns around—oh so many things—the human rights. I will just touch on this briefly. This bill undermines and breaches human rights in terms of age in terms of marital status and in terms of several other points around gender and employment status. There have been conflicting views around this. Some people have said that it is justified because the end goal of getting people into work justifies that breach of human rights. The Minister for Social Development when there was a criticism by the UN Committee on Economic Social and Cultural Rights said that if the committee had seen the detail of the bill it would not have had that criticism. The problem was that the committee had seen the detail of the bill in the draft form. So to stand up and say that there are not breaches of human rights in this is actually saying that this Government’s perspective holds primacy over the UN committee’s perspectives it holds primacy over the Human Rights Commission’s perspective and it holds primacy over the Children’s Commissioner’s perspective. It holds primacy over so many organisations whose daily bread is human rights. That to me seems arrogant. 
I believe that human rights are important. I do not believe that this Committee should be undermining people’s human rights blithely without exceptionally good reason. I do not believe that this bill has anything behind it that comes anywhere near exceptionally good reason. 
I would also like to just speak briefly to our Supplementary Order Paper 78 which is to extend the training incentive allowance and bring that back because currently level 4 study and above are not eligible for the training incentive allowance. When the Government talks about the answer to child poverty being getting parents off the DPB and getting them into work that sounds reasonable. But when the evidence shows us that one of the best ways of keeping people off the benefit—particularly women—is that level 4 and above study and the Government is not willing to actually fund that and include that in the bill then we really have to question the integrity of this approach. We are asking the Government to reconsider that and to extend it back up to degree-level courses because we know those higher-paid jobs actually give women that flexibility in terms of their employment that makes it so much easier for them to stay in employment and look after their kids. We know that higher-paid jobs are more likely to have those support mechanisms around them. 
I will end my speech there. We just encourage the Government to consider the underlying principles; reconsider the underlying principles of this bill and get back to the things that will make a difference. 
TIM MACINDOE (National—Hamilton West) 
: 
 I am pleased to take a call on this part of the debate because I care so passionately about those underlying principles of this bill the Social Security (Youth Support and Work Focus) Amendment Bill. In fact I care passionately about this issue and I feel so strongly that it is the right thing to do. I want to look just at a few of the comments that we have heard already from Miss Ardern. We had concern expressed that somehow imposing work testing on young people who are the focus of this bill is inappropriate or unreasonable. I want to suggest to her— 
Jacinda Ardern 
: I didn’t say that. 
TIM MACINDOE 
: That was the focus of your initial comments Miss Ardern. I struggle to understand why the Labour Party—the modern Labour Party—would in any way oppose such an arrangement as work testing. At least Miss Ardern did not use that word “punitive” which has been thrown at us in previous stages of this debate over and over again. Miss Ardern gave us a deeply theoretical approach and I listened to it with some interest. But she was largely imagining problems that might occur at some future date rather than focusing on the overwhelming problems that confront us right now which this bill is all about. This bill is much more than simply about “tweaking systems”—I think that is a phrase that she also used. It is about confronting major challenges setting out clear expectations and providing substantial determined and wide-ranging support to those who are currently caught in the trap of long-term welfare dependency and especially as the Minister for Social Development emphasised those who are at the beginning—standing right on the cliff; about perhaps to lurch down that path. 
Those young people need our support. This bill is all about providing that support. It is one of the reasons why I care so much about it. The Minister when she spoke told us about the reality of life for those young people who have been the primary focus of much of what is in this part of the bill. She acknowledged that yes it is very expensive confronting those challenges. In the Budget a substantial sum of money has been committed to dealing with it. But the cost of not doing so is almost beyond calculation. It is measured just as much—if not more—in human terms as it is financially. That is why we must not shy away from what needs to be done. The Minister’s approach is determined it is realistic and it is compassionate because she is not being soft or naive. It is because she wants so much better for these young people. 
When I read Part 1 of this bill I see provisions that are practical and contemporary. They are measures to confront life as it is for far too many people in my electorate and in our communities right around the country. They assert—as this Government does and as I am proud to do—that we can and must do so much better if we are to guide our vulnerable youth into further education and training positive parenting effective budgeting and so much more. I believe that that determination is understood and supported in our communities. When I am out and about talking in my electorate meeting with people in low-decile areas with social services providers and with various agencies they are not telling me: “Turn back you’ve got this wrong.” By and large those at the coalface are saying: “Yes this needs to be done; thank you for finally confronting a challenge that has been overlooked for far too long.” 
They are not flooding our offices with emails and phone calls saying that this is wrong. In fact it is quite intriguing to note how little opposition there has been to date. We thought this was going to be controversial. Of course we encountered at the Social Services Committee some objections but by and large it is not controversial out there. It is not controversial out in our communities because the public know this needs to happen. The objections have been few and far between and as I say those who work with vulnerable youth at the coalface know that we need to support their efforts and the young people they work alongside. But I did listen to Miss Logie. None of the concerns that Jan Logie spoke of in respect of education or refugees’ experiences and so on negate the value of the measures in this bill. I did listen carefully but I simply cannot comprehend how she could conclude that this bill undermines the human rights of those it is designed to assist. 
TRACEY MARTIN (NZ First) 
: 
 Kia ora. I rise to speak to section 123F in clause 18 particularly in Part 1 of the Social Security (Youth Support and Work Focus) Amendment Bill. I rise to speak as New Zealand First spokesperson on youth; as a mother of a 17-year-old who is about to be affected by this bill as he leaves school at the end of this year; as a woman working with the Mayors Taskforce for Jobs; as somebody who spent some time with Dale Williams down in Otorohanga— 
The CHAIRPERSON (Lindsay Tisch) 
: I am sorry to interrupt the honourable member. The time has come for me to leave the Chair. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
The CHAIRPERSON (Eric Roy) 
: The House in Committee is resumed on the Social Security (Youth Support and Work Focus) Amendment Bill. Members when we were last considering the bill we were debating Part 1 and Tracey Martin had the call; she has about 4½ minutes left. But just before the member takes the call I should inform the Committee about a Supplementary Order Paper in the name of Jan Logie—an amendment that is set out on Supplementary Order Paper 78. I have received a certification where the Government is exercising a financial veto which rules that particular amendment out of order. 
Chris Hipkins 
: I raise a point of order Mr Chairperson. Just to seek clarification does the ruling out of order of that amendment thereby mean that reference to it in the debate is also out of order? 
The CHAIRPERSON (Eric Roy) 
: Technically yes. So I call Tracey Martin. Yes—the answer is yes. 
Chris Hipkins 
: I was going to say! 
The CHAIRPERSON (Eric Roy) 
: Look OK. Sorry. Just for clarification it is my hope that when I say: “Speak to the bill.” or “It is out of order.” the Committee actually acknowledges that. I was being a little subtle and I apologise to the Committee. The answer is yes. 
TRACEY MARTIN 
: Kia ora. As I was saying before the break I rise to speak as New Zealand First’s youth spokesperson I rise as a mother of a 17-year-old I rise as the chairman of the board of Mahurangi College I rise as a person working on the Mayors Taskforce for Jobs and I rise as the holder of the youth portfolio for the Rodney local board of the Auckland Council. So this is an area I have a great deal of passion about. I am dealing particularly with section 123F in clause 18; there is a lot in this bill but I am going to focus on just 123F. The regulatory impact statement refers to 3307 sixteen and seventeen-year-olds whom this youth package will affect. The Minister and Mr Macindoe in his second reading speech referred to the 14000 young people not in employment education or training which is “neet”. And the suggestion through those references is that those are the young people whom this bill will affect. Those are the young people—that is the extent of the young people whom this bill will affect. 
In reality there are 188470 sixteen to eighteen-year-olds in New Zealand who when this bill passes will be tracked by their National Student Number through the Ministry of Social Development and the country does not know that. The country does not know that every single one of those 16 and 17-year-olds when they leave school no matter where they leave school to go to—whether that be a job whether that be into tertiary education or into a tech or on to a benefit—will have their data handed over to the Ministry of Social Development and then a risk analysis will be done on them. A risk analysis will be done on them and their families and that risk analysis is to figure out what sort of risk they are to us as a nation of ever going on a benefit. Then they will be categorised through that risk analysis—188470 citizens will have a risk analysis done on them by the Ministry of Social Development when this bill passes. However the Ministry of Social Development does not have the workforce to do it so the Ministry of Social Development is going to have to contract out that analysis to private providers. 
I pick up on this point now about providers. I am a person who also spent some time with Dale Williams down in Otorohanga looking at that model and I can understand that the Minister has attempted to take what is a highly successful model. The Otorohanga model is built on a community that gives a damn and actually has wrapped around their young people and come up with solutions for their town but you cannot take a community-based model and stretch it across the country Minister. I am sorry you cannot. 
I appreciate also that those contracts have recently gone out and again I point to the fact that I work in the Rodney local board area of Auckland City which is 46 percent of the land mass of Auckland. Four contracts were given out around for the provisions inside this bill to work with youth in this area and to cover the Auckland region: two of them in South Auckland one of them in central Auckland and one of them that reaches as far as Takapuna. There are no provisions inside the Rodney local board area—covering 46 percent of the land mass of Auckland City—inside the current contracts that have been handed out and actually provision has been removed. Springboard and the men’s centre in Helensville and the others working in Wellsford—two areas particularly that have social deprivation scores of 8 and some severe youth issues—are now going to have to seek other funding. They are going to have to fight for other funding Minister. I think that is a shame and we are frightened. We are actually frightened that this model which is being stretched across the country which is being delivered in this way is going to leave us out in the cold. And we want to participate. Our communities want to duplicate replicate and work with the Otorohanga model. We care for our young. We want to participate and we feel shut out in the way that the model in this bill currently puts that provision into our space. So I speak out of all those things. 
MICHAEL WOODHOUSE (Senior Whip—National) 
: 
 I seek leave to amend a vote cast by me on behalf of the Maori Party to the Minister’s amendments on Parts 1 and 2 of the Dairy Industry Restructuring Amendment Bill. 
The CHAIRPERSON (Eric Roy) 
: That is a reversal of the vote is it? 
MICHAEL WOODHOUSE 
: It will be yes. 
The CHAIRPERSON (Eric Roy) 
: I have had a look at the vote—at the outcome—and it will not change the result but it changes the numbers. So I can assure the Committee of that. Leave is sought for that purpose. Is there anyone opposed to that course of action? There appears not. The record will be amended. 
CHRIS HIPKINS (Senior Whip—Labour) 
: 
 I raise a point of order Mr Chairperson. I just want to get a clarification from you regarding the ruling that we just heard before. You took me somewhat off guard there. I have now had the chance to look at the Standing Orders and I refer particularly to Standing Order 322(4) which says that “Any certificate may be debated on the House’s next consideration of the bill amendment motion or Vote.” I want to just check with you that although the amendment has been ruled out of order it is still legitimate for the Green Party to speak to their amendment and debate the certificate on their amendment. I think the amendment has been put forward in good faith in accordance with the provisions that require the party to put it forward within a certain period of time and it would seem to be contrary to that to then say that it could not speak to it. 
The CHAIRPERSON (Eric Roy) 
: I have had time to reflect on my ruling as well and it would appear to me that it is probably in order in the context of the debate to speak not only to the amendment but to the certificate as well. The sign of a good operator is someone who can change their mind. 
Su’a WILLIAM SIO (Labour—Mangere) 
: 
 I wanted to respond to some comments the Minister in the chair the Minister for Social Development made earlier in this debate because I got the impression that the Minister’s thinking was that somehow Maori and Pacific children grow up wanting to live on the benefit—wanting to be on welfare. I want to say to the Minister that that thinking is absolutely wrong. It is flawed and I think if that is your thinking it is actually an affront to the intelligence of New Zealand communities. I also think that it is the Minister’s thinking that somehow because the Opposition opposes this bill it is our desire for the wider New Zealand community to have a lesser quality of life. With the greatest respect to this Minister I am saying that she is absolutely and totally wrong if that is her thinking. In fact I would dare say that it is almost as if she is totally out of touch with the reality that many families and many young people are experiencing today. 
I suspect many of us who visit schools will take the opportunity to visit and ask the children of those schools what it is that they want to become when they grow up. I know whether it be in my electorate or somebody else’s electorate that every time you ask young people what it is that they want to become when they grow up no one—no child—ever says: “I want to be on the benefit.” No child ever says: “This is my goal: I’m going to be a bludger for the rest of my life.” Every child that I have ever come across talks about becoming an All Black playing for the Warriors becoming lawyers becoming doctors. I even had one young man out of Robertson Road School in Mangere who wants to be the Prime Minister of New Zealand. The dream— 
Grant Robertson 
: Probably do better than John Key. 
Su’a WILLIAM SIO 
: Could be. They dream these young people of going to the Olympic Games. They dream of being policemen in their local community nurses and doctors. They dream of being professors. So I find the earlier comments by the Minister just absolutely wrong. I think the Minister will be familiar with a group of young people who work with Strive Community Trust in Mangere. In the times that I spend with those young people they have big dreams of their future and of what they want to become. No one ever mentions that someday they want to be on welfare. They have big dreams. The last meeting I met with them they talked about what this Government can do for them in terms of part-time jobs or school holiday jobs while they are going to school. How can they earn income to support the projects they are involved with and also to support their families? They talked about opportunities that in so far as they are concerned just do not seem to be there particularly when they listen and hear that things will be tougher for their families or that they will not get the support they want to believe they could get if they wanted to go to university or tertiary education. 
I just want to say to the Minister that if the thinking in her earlier comments was that somehow Maori and Pacific children are working-class children—that somehow their purpose in life is to aim to be on the benefit or aim to be on the welfare system—then I say to her that she is absolutely absolutely totally wrong. Even with regard to the parents I work with or the parents who come to my office—those who have complaints with regards to Government departments—I say to the Minister that parents who are on the benefit are often embarrassed because that is not the kind of living that they dreamed about. They cannot support themselves or give their children a high-quality standard of living on the benefit that is provided. I have met numerous parents who are simply gutted that on the benefit they cannot provide for their families and therefore it is their hope— 
Hon PAULA BENNETT (Minister for Social Development) 
: 
 I think it is appropriate to just answer a few things that are going around at the moment just so that we are setting it straight. Let us get a few things straight. One I think that member Su’a William Sio should read  
Hansard 
 perhaps. His kind of sympathy 5 minutes that he has taken up—quite frankly certainly not being factual about what was said by me or my interpretation of young people who are out there and actually doing the best they can instead trying to make it sound like we are sort of patronising them and putting them into some sort of box—is simply untrue. We want to stand up and wrap more support around them and actually we recognise that in some cases school has not worked. For all the best intentions of community and family and where they are living and what they are doing they actually need a bit more support. They need for us to actually stand up as a Government and say that we do not think that government is the solution but what we can do is offer the right kind of resource and the right kind of funding to community organisations that are on the ground and that actually know these people and that actually know these youth and can wrap around them. The member himself mentioned Strive Community Trust. Well that trust will be a vital part of the equation of making sure that these young people get the support that they need. 
Is this going to be an easy process? This is complex. These are individuals and instead of a programme—what I have purposefully not developed is a programme where we wrap around and step A leads to step B which leads to step C—what we have done instead is say that these are the outcomes. We are quite uncompromising about them. Let that be up for debate and let that be criticised or encouraged or supported as it is but these are the outcomes we are going to do. 
What we are not going to do is tell the community and those organisations how to do it. We try to set up the tools. We try to put the resources where we think we need them most but we actually give a degree of flexibility to organisations on the ground that know these young people so much better. Jan Logie in her speech earlier raised those youth workers who are on the ground and who know these young people. They actually have the practice behind them and recognise as she said a strengths-based approach. I am putting enough faith in these organisations which have been through a rigorous process to get into actually being one of the chosen organisations that they have got that degree of flexibility and that they do work from a strengths-based model. That is why we ain’t got government doing it to be quite blunt. It needs people on the ground who see these kids as individuals and not as a number. 
Yes we have absolute outcomes that we want from them but how they do it is up to them. Let them actually think bigger and think wider than what we can as a Government where we get quite restricted in bureaucracy and rules and the steps that we must take. Let them pay extra for the bus for the kids. Let them feed them every day because actually food is a motivator for young people to turn up and get there. Let them think outside the box and have the kind of innovation that quite frankly only community can have. That is the kind of backing that we are trying to give them. 
We hear criticisms of how expensive this is. It is expensive because once you start adding it up and recognising the costs that go into paying those workers appropriately like they should be so that they are actually rewarded for being the professionals that they are for the qualifications they have and for what they have done then yes that means actually putting a bit of money behind them and actually making sure that they can do it. 
As I have said I am not going to apologise for National Certificate of Educational Achievement level 2 being our goal. Will everyone get there? No but it is a goal of ours that we are working them towards education— 
Jacinda Ardern 
: They’ll pick the kids that will get there. 
Hon PAULA BENNETT 
: Not if you are paying appropriately; they will not pick the kids who will get there easily. They will actually get paid much more for the ones who need it. 
Can I just pick up also on what Ms Martin said which was that you cannot take a community-based model and roll it out nationally. At some level I agree; we could not pick up the Otorohanga model and replicate that in South Auckland. You just cannot. You cannot take the actual model and the components. What we have done though is taken the key components and the evidence base behind it and we are actually rolling that out with a stronger model that goes along beside it that recognises the value and the costs that go into getting that stuff right. We have got the best of what we know and the best of what is proven will work and we are going to put the model behind it. We are going to put a lot of trust and responsibility in those community organisations that work on the ground while working alongside them and making sure that we fund and support them appropriately. 
Peseta SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I rise to first commend the Minister for Social Development for taking the courage to bring this piece of legislation the Social Security (Youth Support and Work Focus) Amendment Bill to the House with the support of the Prime Minister and the support of the National Government. We actually care about the kids who are being discussed tonight. We care about the 330000 people who receive benefits every year. We care about the 170000 who have spent the majority of the last 10 years receiving a benefit. It is all about the facts. Rather than throwing the mud—about what the Minister said or what this party stands for—we are putting an investment approach into place that will see these children and these young people and the people who receive benefits put on a road to aspiration and a road to working. That is what this Government stands for. 
Jacinda Ardern 
: How? How? 
Peseta SAM LOTU-IIGA 
: The list member Miss Ardern actually asks how. She is asking me how after listening to submission after submission of how this Government will help these young people and how it is about parenting courses how it is about budgeting courses how it is about mentoring these young people by allowing them to be helped up rather than handed out. For too long this system has all been about just giving people money and leaving them to their own devices. We have said that it has got to stop. It is broken and it has got to stop. So what are we going to do about it? We have said that it is about an obligation. We have got to meet halfway. In order for the State and the taxpayer to support people on the benefit they have got to come halfway and meet those obligations. Welfare if they remember correctly—the Labour Party—Michael Joseph Savage and how he saw the social obligation around welfare was that it was only a temporary measure to allow people to go on and work and contribute to society. It is about—as the Minister for Social Development has pointed out—modelling those things that actually work. We have seen the evidence around budgeting— 
Jacinda Ardern 
: What are you actually doing for the majority of people on welfare? 
Peseta SAM LOTU-IIGA 
: I see it every day Miss Ardern. If you want to see how people struggle and the role budgeting services play come to Maungakiekie. Come to my electorate office and I will show you what these types of services can do. They can actually help people in need and that is what this piece of legislation does. Despite the protestations of the members opposite this is about investing in people and investing in services. I am going— 
Jacinda Ardern 
: How? Sam all I’m asking is what is your investment? 
Peseta SAM LOTU-IIGA 
: She keeps asking how and we keep saying $287 million over 4 years. We keep saying early childhood education and quality early childhood education at that. We keep saying it is about supporting and mentoring and nurturing those people who need help. But it is also being values-based. It is about the value of our people. It is about saying it is not just throwing the money and leaving them to you know whatever devices they have. Mr Sio talked about the aspirational goals of kids who want to be Prime Minister—kids who want to actually contribute to society. Well that is what this legislation does. Mr Sio if you would like to look up and actually listen to what this legislation does—I know you slept during the select committee process but you can at least listen in the Chamber during this debate. It is about providing those kids with the sorts of tools and the sort of assistance that they deserve. They deserve that assistance so that is why this National Government supports this legislation. That is why I will continue to support this hard-working Minister. Thank you. 
HOLLY WALKER (Green) 
: 
 I am pleased to take a call on Part 1 of the Social Security (Youth Support and Work Focus) Amendment Bill. In my call I would like to address in particular the impact of the sanctions regime outlined in the part on the dependent children of the young parents whom the bill talks about. We know that the changes to the work-test obligations and the sanctions regime that this bill introduces have not been evaluated in terms of their impact on children and that seems like a particularly big oversight and vitally important when one of the justifications that is often given for the Government’s welfare reform agenda— 
Hon Paula Bennett 
: I raise a point of order Mr Chairperson. I am reluctant to interrupt the member and I kind of apologise but that is not in this part at all. It is actually in Part 3. Part 1 is about youth providers but it is not about subsequent children or the effects on children. 
HOLLY WALKER 
: Speaking to the point of order I offer my apologies if as a new member I have misread things but I am looking here at Part 1 clause 20 on page 36 which talks about “Sanctions for failure by young person receiving young parent payment to comply with obligations under section 170”. 
The CHAIRPERSON (Eric Roy) 
: I am not going to uphold the point of order. The member Holly Walker has the floor. 
HOLLY WALKER 
: Thank you Mr Chair. The section I am referring to outlines the sanctions that apply to young parents if they fail to comply with their obligations under section 170. We are talking here about young parents with dependent children and the impact that those sanctions will have on the children. As I was saying I am concerned that no child impact assessment or analysis of these sanctions has been done to determine the impact on children because we often hear that the justification required for these reforms or for this particular part of the reforms is to improve the outcomes for children of benefit-reliant households and children who have parents who are young and sole parents. That is a noble goal and one that we share but I think it is very important that we make sure that the sanctions that this bill introduces are not going to have unintended consequences on the very children whom they are designed to support and to help. It highlights why we should be routinely doing these kinds of assessments because I think that if we did the bill would look very different. 
How will the provisions in Part 1 make things worse for children? Well I am talking here about the sanctions regime that it outlines for the failure of young people on the young parent payment to meet the obligations that the bill sets out. Actually it is useful that the Minister for Social Development made a contribution just now and I would like to invite her to take a call perhaps to clarify that for me. In my reading of what is new section 174 in the bill that is in front of the Committee it is my understanding that in recognition of the impact on children of applying sanctions to their parents’ benefit that sanction would never be more than 50 percent of the benefit. I am looking here at new section 174 which deletes the provision that would have restricted the sanction to only 50 percent of the benefit and inserts a provision that says that on a third failure a young person’s young parent payment can be cancelled altogether and a new provision on the next page that says that they can be stood down from receiving that for 13 weeks from the date of the cancellation. I would like to ask the Minister to explain why it looks like this. It may not be as sinister as it appears but to me that is very concerning because that could have huge implications for children whose parents are young parents who are receiving the young parent payment because that could result in them losing their income altogether. They would certainly be unable to supply food pay rent pay for the power bill and supply the basics of life for their children which is so important. 
 And it is ironic because the obligations that they are being tested against and that they may fail to comply with are things that are supposedly there for the benefit of their children like enrolling them in a primary health organisation or making sure they are in early childhood education. So if we are going to sanction the parents for not doing that by cutting off their income it means they cannot provide any of the basics of life for their children and it seems like one of those particularly perverse unintended consequences that we would like to avoid. 
Even if my reading of the clauses I have just outlined is incorrect and it is only a 50 percent sanction I still have some very serious concerns about the impact that this will have on children. As we know it is not a dream lifestyle living on a benefit. It is not a huge amount of money for young parents on the DPB or the new young parent payment and cutting that by 50 percent will make it extremely difficult for them to meet the needs of their children or to supply the essentials that we know are so crucial for children’s outcomes—you know the basics of a warm healthy home enough to eat and shoes to wear when they go to school. If their parents’ benefit has been sanctioned by even 50 percent I have extreme concerns about what that will mean for the ability of their children to have their basic needs met. It is ironic that we are trying to protect the best interests of children—supposedly—in this legislation yet we are introducing sanctions that will drastically reduce their parents’ income potentially by up to 50 percent or perhaps by removing the benefit altogether and leaving the children in a very unfortunate situation. 
I want to address briefly my colleague Jan Logie’s Supplementary Order Paper which has been ruled out of order. The Government has chosen to use its financial veto on it which is interesting actually because we heard Mr Sam Lotu-Iiga talk about the investment approach in his contribution just now and this seems to me like the prime example of taking an investment approach by reinstating the training incentive allowance for sole parents and other beneficiaries who are studying for degree-level courses because we know that people who receive the training incentive allowance and study degree-level courses move off the benefit up to 6 months earlier than those who do not. We know that when they do that they earn more and are better able to provide for their children. We know that a mother’s education is the single best indicator of child outcomes in terms of health education and other economic and social indicators through that child’s life. As the daughter of someone who used the training incentive allowance to train as a kindergarten teacher when I was a small child it is something that I know particularly well and it is particularly close to my heart. It seems to me to be the very embodiment of an investment approach where the ability of the mother and the family is invested in for the better outcomes of that family long term. So if the Government wanted an opportunity to take its investment approach then this Supplementary Order Paper from my colleague Jan Logie here was the prime opportunity for it to do so and it is very interesting and disappointing to see that it has chosen to use that financial veto to rule it out of order. I suggest that perhaps it must have been nervous that it might actually pass. 
So I will end my contribution there and I invite the Minister please if she could to clarify that situation. But I reiterate that whether it is a 100 percent sanction or a 50 percent sanction the impact on children is what is not being analysed in this debate and what is not being analysed in relation to this bill and it is what should by rights be the primacy of our consideration of this legislation. 
JACINDA ARDERN (Labour) 
: 
 It is my absolute pleasure to be able to clarify some of the friendly banter that has been happening between this side of the Chamber and in particular my colleagues from the select committee process. I want to point out that some of the frustration on this side of the Chamber comes from the assumption that I have heard made by members that somehow this Social Security (Youth Support and Work Focus) Amendment Bill embodies the investment approach that the Minister in the chair the Minister for Social Development espouses when it comes to welfare reform. The simple point that we wish to raise is that if you are on Government support and are older than the age of 19 the only thing this bill does for you is introduce more work testing. Let us be clear. We have not ignored that this bill does change youth services that it puts in additional child support for teen parents and that it has got incentive payments attached for those on a youth payment card and a teen parent card. But those are all measures that will affect only those who are under the age of 19 years. So for the 112000 on the DPB over 90000 of whom are sole parents for the almost 50000 on an unemployment benefit and for the tens of thousands on invalid or sickness benefit this bill either does absolutely nothing or it introduces increased work testing. 
Let us be clear. We are not talking about rhetoric on this side of the Chamber; we are debating the bill that the Government has put in front of us. I think it is absolutely legitimate to question the rhetoric around an investment approach when this bill affects the roughly 3000 young people who are currently drawing down Government support. I accept that there are another 11 that you will put services in for but that is whom you are targeting. I also do not question that it has purposely been done by the Government because of the statistics around trying to discourage young people from staying on a benefit in the longer term. There we just dispute whether or not this is the most effective way to do it and that is a legitimate argument to have. But please do not test this side of the Chamber with rhetoric around investment for the majority of people on a benefit when that is not what this bill does. 
Now that we have clarified that point I am happy to come back to Part 1 of this bill and continue with this discussion. I want first though to come back to what the Minister raised around her goal of ensuring that young people are in education. Again we do not dispute the importance of education as a foundation for our young people in securing their future. Our concern is that by narrowing the incentive around a goal that may be quite a distance from where a young person’s starting point is we may create a disincentive for a youth provider to work with that young person. Our argument has been that the existing Youth Transition Service framework gave more discretion to youth providers than this framework does. If the Minister can prove to me that that is not the case that the way that the contracts were structured before did not constrain in the way that you are purporting they were constrained I would be very interested to hear that because that is not what youth providers are telling members in this House. We heard a very different story from what the Minister is purporting. 
We are not saying let us not have these services; we are trying to aim for some of the same goals that the Government is. But we believe that the Government is spending more working with fewer young people and potentially getting a worse result and I think that is a very legitimate point to make. 
I want to come back to the youth support payment—we have not discussed that yet—in particular the fundamental change around the way that young people who are currently on an independent youth benefit or who are currently on a domestic purposes benefit will now if they are under 19 transition to a teen parent payment system. We heard from Government members that their purpose in moving to this youth support payment which would be underpinned by a card system and would affect roughly 1000 independent youth benefit kids—roughly 1500 teen parents—was to try to encourage greater financial management by these young people. The way the Government wanted to do that was move them on to a card system. This essentially means that they automatically have some of their bills paid out and then they get a small discretionary amount on a card. 
Dr RAJEN PRASAD (Labour) 
: 
 Thank you Mr Chair. 
Hon Member 
: Finally! 
Dr RAJEN PRASAD 
: Finally indeed Mr Chair recognises me. 
The CHAIRPERSON (Eric Roy) 
: Oh no that’s unfair. 
Dr RAJEN PRASAD 
: I do apologise for that. I know I am a bit hard to recognise on this side of the Chamber. I would always support—and I say this to the Minister in the chair the Minister for Social Development as well—well-thought-out social policy; social policy that has gone through a good process and actually does make sense and is supported by a whole lot of evidence that is brought to the House. In the two terms I have been in this House whenever the Government has brought bills like that in the social development area around children this side has always supported those bills. But on this occasion we are not. I simply ask the Minister and indeed the speakers opposite to consider why would it be that this side of the Chamber would be so hostile to provisions like this. It is not because we are silly; it is because these proposals are silly and because these proposals are not well-thought-out. They are driven by something else; they are driven by a particular ideology and I want to come back to that as well. Clearly the officials have been given particular policy outcomes—and I acknowledge the officials here they worked very hard with us in the Social Services Committee—and that is what is driving this. But that is not the logic of what we ought to be doing in New Zealand if this is an issue. The Social Security (Youth Support and Work Focus) Amendment Bill is driven simply by a set of ideological statements which really are about welfare dependency. 
So what has been the Government’s approach as shown in the provisions in Part 1? Clearly it has been to think through a whole series of difficulties set up a Welfare Working Group get it to identify and create—welfare dependency is its own creation—and then begin to drive the particular ideology that the Government started with in the provisions particularly in Part 1 and Part 3 of this bill. That has been the Government’s approach in this particular bill. The Government also has an intellectually dishonest approach to what it has been saying. Certainly the chairman of the select committee Sam Lotu-Iiga indeed used that a little while ago. First you start with a large number 339000 of people who are either on welfare or are children who live in welfare-dependent homes. That is where you start. So you create in the country this notion that here we have this huge problem and then you drive this kind of process through. But how many people do the proposals that are in this bill affect? I have taken the officials’ own figures and it comes to about 31 948. So it is not exactly something that is going to alter the development pathway for a whole bunch of people. But somehow what the Government wants to do is to create this notion that here we are addressing welfare dependency. 
The next place where we saw that is the way the whole bill has been handled. It has been one of the most rushed processes one can imagine and this is not a bill that was well-thought-of in the select committee. Our submitters did not support the provisions of Part 1 of this bill. They did not. And yet it was rushed through. The Minister would not allow the select committee to have a decent period. What was the Government’s argument? The argument was that when the Welfare Working Group reported the country had had its say and that therefore it did not now need to have its say. That was also intellectually dishonest. It is taking our people for a ride and that is because the Government wants to drive this particular ideology through in a way that the Minister believes is the right way of doing things. So the rhetoric that the Minister uses here is that change is on the way. Bravado and rhetoric of that type is simply just that but in the end does not achieve fundamental change. The belief that as the Minister says this will achieve fundamental change—it will not. It really will not. It will give the impression that a lot is being done that welfare dependency will be throttled and everything else will be OK. Well it would not be. In the provisions of Part 1 that actually look at the—[ 
Bell rung 
] Mr Chairman! 
The CHAIRPERSON (Eric Roy) 
: Dr Rajen Prasad. 
Dr RAJEN PRASAD 
: Thank you Mr Chairman. Things are looking up already! Thank you. I knew I needed to speak at this time. Thank you Mr Chairman you are so wonderful. [ 
Interruption 
] This is called banking; you have got to bank for your future! 
When we look at the attitude to young people that Part 1 reflects we see that it is actually a negative punitive attitude and it is now being shaped by the Minister herself. This is this new thing—let the agencies out there that know more about this than everybody else work with these young people and it will be all hunky-dory at the end. Well it will not be because this is a rather curious way of shifting resources into the private sector as well and letting them provide. 
Many of these young people who are in this 16-17 year age category have actually come out of Child Youth and Family Services; they were in care. They are quite vulnerable people. The State in a sense has not done very well by some of these kids. What would we do? We are applying in the provisions of Part 1 this punitive approach a little bit further. So the presumption is that these young people cannot manage themselves. That is the starting point of this Government and this bill in the provisions of Part 1. The attitude to these young people is “Let’s not give them a chance to show us what they can do but let us start with a presumption that they will waste their money and that they will not care for themselves.” Part 1 does this—it builds these quite Draconian provisions and I personally object to them because the young people I know actually do have the ability when trusted and guided to do very very well. But this bill does it the other way round. Young people have to earn the respect of some NGO out there or some social worker or some service provider and show that they are good enough to manage their own resources and have the little bit of money they are entitled to get. 
I think that is a curious approach. It is an anti - young people approach and I want to know from the Minister where the science is that says that this is the way young people operate. Which is the theory? What is the research that says that this will work? The Minister talks a lot about being evidence-based. Well this is not evidence-based. This is ideology-based and this is based on a punitive approach: “We will show somebody else out there that we are taking a tough approach.” And that is what bothers Labour members about this particular way that the Government is doing things. The Minister for Social Development shakes her head. The Minister can couch it any way she likes and you can criticise us and say: “You don’t care you don’t know. The Minister is the only one who does.” but in fact the science is not there Minister. All of the theory I know all of the research I know and much of the experience I know says that you work with young people you take them along and you do not start by saying: “No you are not going to get any control. Only when you are good will we give you some control.” That approach comes from a crazy reverse psychology that does not make sense at all and I think that is a fundamental flaw in this area. 
We know that this side of the Chamber has the experience of reducing the number of people on benefits through triaging through the same Work and Income that is there today. Triaging very early on it got people into work and had the lowest unemployment rate in the world. So the science is in that particular ministry right now. Given the space to do it it knows how to do it. But if given a policy direction that says “You have got to apply this approach based on welfare dependency.” then I think we have created a problem and now we are trying to fix it. And what are the chances of that working? Very very little. 
Let me just come back to ask the Minister to have a bit more thought around the young people who have been in Child Youth and Family care themselves are now or have been on the independent youth benefit and now will be caught by this particular programme. I mean these are people who need to be trusted who need to be taken very carefully by the hand and enabled to make something of themselves. Starting from the rhetoric of welfare dependency will not get us there. 
Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First) 
: 
 I rise on behalf of the party that takes pride in its good judgment on genuine practical policies that help address the social security issues of this country New Zealand. That party is New Zealand First—of course. Allow me to say that when people try to tell me how bad things are right now I have to say “Tell that to the National Government; tell that to the Minister for Social Development Paula Bennett; and of course tell that especially to Peseta Lotu-Iiga who chairs the Social Services Committee.” because those are the people who have ignored 99 percent of the submitters who opposed the bill. This bill the Social Security (Youth Support and Work Focus) Amendment Bill is being sold to the people of New Zealand using the phrase “transforming the benefit system into one that is modern active and work-focused for adults and education-focused for young people.” I want to acknowledge the Minister for her efforts in acknowledging that this is an issue in our country of Aotearoa; I want to acknowledge her for that. One thing I know for sure is that the intention behind this bill is a good idea. However any good idea must have good strategies for a successful delivery in order to achieve the best outcomes. 
Part 1 of this bill focuses on substantive provisions taking effect on 30 July now 20 August—in other words as soon as possible. It also means that time management and organisational skills are probably not high on the Minister’s agenda I must say. National intends to rush this legislation through without informing the public especially those individuals who would be affected by the changes in the bill. 
 We know of course that the aim of the bill is “to provide services to encourage and help young persons to move to education training and employment rather than to receiving financial support under this Act. The interpretation of “contracted service provider”—mentioned in section 125A(1) and in section 123E which are both inserted in Part 1—is extremely broad. It is extremely broad and allows for any party that can be seen to assist in the aim of this bill to be contracted. So we do have a concern in this area. If we are to allow these third parties to be contracted to provide services surely we also need to put in place ways to assess and test these service providers’ work and performance. Sufficient audits and safeguards need to be put in place to ensure that these service providers are actually assisting young people into employment and training—proper training that is. 
It is admirable that we spend money and that young people spend time with these providers but at the end of the day if there are no jobs this whole operation fails. There is an apprehension as to whether these service providers are even competent enough. That is the question we need to ask. Are they competent enough in providing helpful services? And what will make these services any different from someone sitting today at a desk at Work and Income and telling a young person to go on to the website seek.co.nz for a job while knowing full well that there are thousands of others in the same position? What is the difference? 
The aim “to encourage and help young persons to move to education training and employment” is a very broad definition. What defines “encourage” and “help”? That is another question. The aim “to move to education training employment” is reiterated in the section dealing with contracted service providers. I am just wondering. Are we looking at not training young people not educating young people or not employing young people but rather at encouraging and helping? 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 I want to refer back to the youth services model that is established in Part 1 of this bill the Social Security (Youth Support and Work Focus) Amendment Bill and in particular to talk about the concept of wraparound services. On this side of the Chamber that is a concept that we support. Once upon a time members on the other side of the Chamber would have called that nanny State and said that it should not be done but they have come around to the idea that wraparound services are the way to deliver best to the difficult needs of many of the people who are being dealt with within this bill. That is something we should all welcome. These are what some of the officials sitting here tonight would call messy problems—problems that do not have single situations. 
Jacinda Ardern 
: Wicked. 
GRANT ROBERTSON 
: They are wicked problems that have to be dealt with by a number of different interventions a number of different programmes. That is a good thing. But the model that is actually developed and proposed here absolutely scraps what has been the delivery of that kind of wraparound service model through Youth Transition Services and through as has already been talked about today the fantastic work that Dale Williams has done in Otorohanga but also in other parts of the country. I met with the Mayor of Clutha District earlier this year when I was down there—a man named Bryan Cadogan. I do not know what Bryan’s politics are but I have a suspicion given where he is from and one or two other things what they might be. He is gutted by this bill. He is gutted by this legislation. 
Hon Member 
: How do you know? 
GRANT ROBERTSON 
: Because he told me. He told me; that is how I know. It is because he told me that he is gutted by what the Government is doing to the Youth Transition Services which has meant that in his district he has gone from having numerous young people out of work with no hope wandering the streets down to as he says one person. There was one person they could not find work for one person they could not get into a training course using Youth Transition Services which are being scrapped as part of this bill. That is what I just do not understand about this. 
Hon Paula Bennett 
: That’s not true. 
GRANT ROBERTSON 
: Well it is true Minister. Youth Transition Services which have delivered in these communities are now being told: “Yes you can still have funding. In fact you can have more funding but you can deliver it only to these 16 and 17-year-olds. You can deliver it only so that we the Government can tick it off and say that yes we’ve achieved that we’ve got that target and we’ve got that goal.” Never mind those who miss out. Never mind the hundreds of people whom the Gisborne branch of Youth Transition Services has said it no longer will be able to deliver services to because of the model that is in Part 1 of this bill. 
The examples we were given time and time again as I have travelled around the country and talked to these providers showed that young people do not live linear lives. I have a member of my family who left school at age 17 to go into an apprenticeship. That was the deal for leaving school. He had to have something to go to and he went into an apprenticeship. But that apprenticeship fell over after a period of time and he drifted out of the worksite system. He drifted out of the sight of people. We were able to find him support. Under this bill at 18 he is outside of the system and the people who work in Youth Transition Services say to us that that is a pattern they see. If we are going to wrap services around people let us wrap services around people in need. Let us not set up artificial distinctions that can make the Government look good if it fulfils them. Let us actually work with the young people to make sure that we deliver to them the things that will change and transform their lives. So I support a wraparound service model. I welcome that the Government now sees that this is how services can and should be delivered. But let us deliver them in a way that builds on what we have got which is having Youth Transition Services around the country. Sure we could do more and better with them but let us build on what we have got and actually make sure that we use the communities that have bought into those services and make sure that we use their skills and their expertise. 
But instead what we see here is fitting people into a box. The Minister said she wanted to give the power to the people who can think outside the box. These are the people who are thinking outside the box and they are the ones who are telling us to not do this and to not take away the ability for us to deliver to the full range of young people in our communities who need this support. But instead no it gets narrowed down. It gets narrowed down to this goal of National Certificate of Educational Achievement (NCEA) level 2. NCEA level 2 may be totally unattainable for some of these young people. It may be something that is completely outside their orbit yet we set that up as the goal and we set them up for failure. Students who have struggled at school and for whom NCEA has been part of the issue for them are the ones who are now being told that NCEA level 2 is where they should go. What is worse is that it is the providers who are now being given all the incentives to go for the kids who will get NCEA level 2. That is where the incentives now are. So it is a little bit like the whole national standards and national testing—teach to the test. Go for the thing that will deliver the extra funding the extra bonuses and the ongoing contracts for the providers. Do not deliver so much to the community. Do not deliver so much to the need. Deliver to the prescription of the contract. 
The problem here is that we have got a proposal however well intentioned it might be that is ignoring the good models of work that are already on the ground and that is putting in place provider provisions that will force those providers who want to do this work who are well motivated and have good records in most cases into an even narrower set of measures. That is not what we need. It is not about ticking boxes; it is actually about making sure we deliver to those communities. So it makes me very sad to see a situation where we do not build on what is good. Just because Youth Transition Services is something Labour came up with the National Government is not inclined to build on that build on the success of those services and actually bring young people through whether they are 16 17 or 18. 
Part 1 of this bill unfortunately is predicated on the view that it is about blame and it is about dependence and it is not actually about getting alongside the young people. But worse than that it does not add up either. We heard that in the Chamber today. The Minister has had to admit that Treasury advice said that it was $285 million spent and $100 million saved. It does not stack up economically. It does not stack up socially alongside what we know about our communities and what we know works. So I think Part 1 of this bill is wrong. It is flawed. We could be having a debate here tonight around how we build on the strength of initiatives in the community that are currently working. Instead what we are doing is debating how National can fulfil some goals and targets it has set for itself tick some boxes and say that it has done well for the young people of New Zealand instead of actually delivering the services the training and the community development that we need. More than that the Government will not deliver the hope for that. 
I just want to finish with a reference to the amendment in the name of Megan Woods to amend in new section 157 inserted in clause 20 the definition of “approved training”. What this speaks to is whether we are concerned about ticking the box of NCEA level 2 or about what people can actually do and contribute. Megan Woods’ amendment adds in on approved training: “or trades training course through the Skills for Canterbury package.” It is a simple amendment that says that we should actually enable people to work on the Canterbury recovery as part of doing approved training under this programme. It is a simple amendment but it speaks to the idea that we actually should be doing what works what is there to be done and what supports young people to develop their skills not fit them into the box that National wants to fit them into. We could be having the debate tonight about how to meet the skills needs of these young people and how to make sure we have got the people who can work in Canterbury. Instead what we are doing is debating an ideological solution in search of a problem and that is the wrong approach to take when it comes to getting our young people back into work. 
ALFRED NGARO (National) 
: 
 I am honoured to take a call on the Social Security (Youth Support and Work Focus) Amendment Bill. I want to highlight a few points of the member Grant Robertson who was speaking previously. What concerns me is that he used the word “hope”. He talked about the fact that there is concern about the benchmark of National Certificate of Educational Achievement (NCEA) level 2. As a father of four children and as a member of a board of trustees for over 20 years I am concerned that I have seen what happens when you do not set an aspiration and a benchmark of achievement for young people. That is what concerns me about that member of Parliament. What he is actually saying to mums and dads in New Zealand is: “Don’t set your sights too high.” These are disengaged youth in what you would call the “too hard to deal with” basket. This is what they say: “Let us make it really simple. Let us not make it too hard.” 
Let me tell the honourable member over there—maybe because he has not actually worked with disengaged youth—a little story about how I worked with some disengaged youth a disengaged youth who did not have NCEA level 1 NCEA level 2 or NCEA level 3. He was on track for going into crime and into incarceration. His parents had given up on him and his community had given up on him. This is what we did with this young man: we set a benchmark of what he could achieve. I am happy to say that that young man through the support we have given him is now qualified as a carpenter. He is now working as a lecturer in carpentry and his department has said that in 2 years he could be head of department. Why? Because we did not dumb his expectations down. That is what this bill is about. [ 
Interruption 
] This is not about theory Mr Prasad; this is about reality. This is the reality that we are talking about. 
On 25 June this year I was at Robertson Road School and it was Leadership Week. At Robertson Road School I met with young people in years 7 and 8. The young man who met me at the school office was called Apec—that is right. He and I laughed a little bit. I asked whether his parents named him after Asia Pacific Economic Cooperation and he said yes they did and he laughed. I said to him: “Young Apec what’s your dream?”. He said: “Mr Ngaro my dream is that one day I could become an accountant.” I went in to year 7 and year 8 and we talked about daring to dream and aspirations. You see Mr Robertson that is what this bill is about: aspirations with reality. 
It is also about this: it is about being responsible. This package of reforms balances obligations of support with new initiatives and a focus. 
Grant Robertson 
: From the heart not from the paper. 
ALFRED NGARO 
: Mr Robertson what this is also about is transformation. The word “transformation” means dramatic change. This is the thing: what this Government is committed to is dramatic change. Why? It is because the things that were always done have not always supported and helped our people. This is what we are doing: we have a youth package to help disengaged young people. It is about education training and employment. 
Grant Robertson 
: Just a few of them not all of them. 
ALFRED NGARO 
: We have talked about wraparound services. Well Mr Robertson obviously you have not been involved in wraparound services so let me give you just a few instances of wraparound services. It is not just a big hug like a Pink Batts ad; it is a reality of tough love and actual support services. That is what this is about. Again who are we talking about? We are talking about disengaged youth who need support who need help. This is what we are saying to them: “No we’re not going to leave you alone. We are going to help you with support on budgeting we are going to help you with support on parenting and we are going to help you with support on childcare.” That is what we are doing. That is what you call wraparound services. You see we have learnt from the eighties when the Labour Government tried it and it fell over. You need only ask the organisations of South Auckland about the eighties. It all fell over. Why? Because it was all cotton wool; it was all fluffy. This is what we have done. We have taken the learnings from that and we have made sure that we have got the support to have wraparound services that focus on that. 
What about a stronger work focus? That is what we are doing. This bill aims to change work availability and preparation requirements. This bill is also about saying to young people that it is not just about saying that yes we have heard the cries and the gnashing of teeth about these poor young women who were on the DPB and that what we were doing was oppressing them in terms of their ability to have young families—absolutely not. What we are saying to them is this. This is about a stronger work focus. That is what this bill aims to do. It is about changing attitudes. The honourable member over there Mr Sio talked about how he thought he heard—and he was wrong; it is in  
Hansard 
—the Minister for Social Development say that Maori and Pacific young people had this impression and this perception that they would be on the benefit. Absolutely not and we know that that is not the intent of the heart of the Minister or the intent of this party and this Government. In fact what it is Mr Sio is about saying this: “Lift your aspirations. Look for opportunities.” 
Let us give you another example because we are not talking about theory. Let us talk about Manaiakalani at Pt England Primary School over in Glen Innes. With regards to e-learning the young people there turned around and said: “We want to contribute. We want a focus that we too can contribute to just like our parents are.” An amount of $3.85 a week is what their parents contribute to help pay for their notebooks. These young people said that they could do the same too. So what did they do? They designed a programme about how they could be employed by the school in order to contribute. What did they do? They saw that there were a lot of visitors coming to the school and looking at the e-learning programmes so they said: “What if we made coffee and tea?”. They bought a coffee machine. They got trained as baristas. This is the wonderful thing: children as young as 7 and 8 are also changing the attitude. Why? Because it is about an attitude of work focus. It is an attitude of opportunity. Work is the means to an end that our young people are looking for. This is what we are talking about. These are the opportunities that we are offering as well. It is about addressing the concerns raised. 
What about the Privacy Act and the sharing of information? This is absolutely important. This is not about breaching privacy; this is actually about ensuring that the right information follows through with the young person so that they can be supported. 
This is a great bill. I stand here proudly as one who has worked in the social services worked in NGOs and worked in community-led development. This is a community-led development approach. Why? Because it puts the resources and the opportunities in the hands of the community for them to innovate a new response and to be able to develop programmes and initiatives—yes like the Otorohanga youth policy. You see the issue is this: it is not about redeveloping that programme or about Youth Transition Services and good practitioners know that; it is about the use of the practitioner and the skills that they have to truly make the difference. This is a great bill. It is making a difference in the lives of many of our young people and our families. I support this bill. Thank you. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koutou e te Whare nui. I am going to take a very brief call. I have got just a couple of strands that I want to think about. One is the Welfare Working Group and the other is my own practical experience as a youth worker in the town of Thames and also as a beneficiary advocate in the town of Gisborne. In fact if you think about reality and experience we have all got different experiences to bring to this debate but one of my experiences was of working with young people who had been expelled from school because the school was culturally inappropriate for them. There were no jobs in the town for them. What is more the more beneficiary bashing there was in the town the less likely they were to get employed. So it is kind of interesting to think about the Social Security (Youth Support and Work Focus) Amendment Bill not just as a narrow set of clauses but in the context in which it operates. It is so hard for our young people to get respect when there is so much stigma associated with needing to be on a benefit at any time. 
The myth of welfare dependency needs to be put alongside the issue of wealth dependency. It is much harder to change people’s dependency on wealth than their dependency on welfare. Try to clean up the mess of the bankers on this planet who are actually dependent on having so much more money than everyone else try to get them away from their money and try to help them with their addiction to wealth—that indeed would be a wonderful challenge. The reality is that for many young people in this country where there are no jobs they need our support. So the debate becomes about how we give them support. Wraparound can be either a boa constrictor or a liberating experience. I do not think any of us are disputing that we need to be supporting our rangatahi because that is what is important but actually wraparound is just another slogan. The reality is that this is about relationships. The previous speaker Alfred Ngaro talked about a community development approach. As somebody who has worked in community development too—and I do not claim to know it all—what I do know is that if there is private profit driving it then it may distort the outcome for the most vulnerable people in it. 
What the Welfare Working Group did was adopt an English model around private training providers and it did not present the evidence to those of us who went to its presentations. There was one that I tried to go to but the group would not let me in because its members did not want to consult with people who disagreed with them. But what has happened in England with these private service providers is that they get paid bonuses for meeting targets. They have benefited and guess what? The statistics around youth unemployment have not changed. So if anyone is interested in evidence have a look at the private service provider model. Who benefits? Someone definitely does—those private contractors benefit. It is a model about the privatisation of welfare. 
You can use all these fabulous descriptions of wraparounds and responsiveness and all the other jargon but as somebody who has worked with rangatahi I know that they do not want our jargon and they do not want to be put on a card. They want to see us role model respect and human dignity for them and their human rights and provide them with real work. That does not come from controlling them nor does it come from creating a welfare dependency industry which those private contract providers will benefit from. Of course they love it because they are going to see the big NGO the big opportunity and the big money. But the genuine community development models are about quality relationships that have nothing to do with making a profit. 
What I fear for in taking some of the power away from the State is the accountability when things go wrong. Because how do you go back to a private contractor and demand a hearing? You cannot. A young person cannot go back to a private training provider as they currently can to Work and Income and say “Hey I need a review of decision.” How are they going to get a review of decision? These are people who do not have a lot of power. Talking about the independent youth benefit it has always been like getting through the eye of a needle to even get that benefit. Now we are talking about making it even more prescriptive. Well who is going to benefit? I can see who is going to benefit; it is the private training providers. But I do not see a benefit to young people in that approach. 
We need to look at what works and if you are going to talk about Otorohanga it is not about transporting models. It is about recognising that that community bought into the responsibility for the relationships with young people on a personal level. They did not privatise it. They did not say that welfare is a commodity that can be privatised so that people can meet targets and make money out of it. They said it is about our young people at the heart of our community. They made it real. Every community whether it is South Auckland or others— 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 I am very happy to speak to this bill the Social Security (Youth Support and Work Focus) Amendment Bill. It is good to follow a speaker Catherine Delahunty who was raising some important points about the Otorohanga model and the way in which that has worked by drawing on local communities. Indeed Mr Robertson referred earlier to the example in Balclutha which applies a similar principle and has been very successful.  
We have certainly heard a lot of vacuous nonsense from the other side of the Chamber this evening. Most recently Mr Ngaro used some examples of young folk with ambition whom he said he was able to inspire to be successful all the while failing to note that that was during the period when the youth transition scheme implemented by the Labour Government was in place. He implied that this proposal will have more funding and bring more funding with it when that is not true. It does not put the supports in place that are necessary for our young people to get ahead. We heard Paula Bennett talking excitedly about using food as a motivator. She may as well have said: “Let them eat cake.” 
This really does not work as a concept because what it fails to do is address the real barriers to work—it fails to address the real barriers to work. The availability of work is not addressed by this bill. The availability of childcare is not addressed by this bill. And the skills and education training required for the young people to find work is not addressed by this bill. This is important context and these barriers to work must be addressed if we wish to make a difference in this area. Work testing alone will not achieve anything. 
The long-term welfare dependency concept was created by the Welfare Working Group and it is perhaps something of a dog whistle. We know that it takes for example a university graduate between 6 months and a year to find work so defining long-term as more than a year is something of a stretch. 
What is most shocking perhaps about these reforms is that they are in their own way quite unambitious. There will be more people we are told on a benefit in 2017 if these reforms are successful than when the Government took office. That is shameful. That is embarrassing if that is ambition. It is probably realistic given that this bill does fail to address those fundamental barriers to work: the availability of work childcare accessibility and skills training. Those welfare targets too are notably two elections away. 
There is similarity there with other plans and targets that the Government has brought to bear: the emissions targets and rebalancing the economy—when in fact we see the balance of trade getting worse over the projected period that the Government accounts look at. We see the record getting worse in terms of so-called welfare dependency. The number of people on the DPB rose by 13.2 percent between January 2009 and January 2012 but the number of people on the unemployment benefit rose by 82 percent. So we might ask ourselves why in that context we are targeting DPB mums. Perhaps it is indeed simply a distraction away from the real issue of creating jobs the real issue that the Government has not addressed during its 4 years in Government. We know it has the worst economic record of any Government in the last 50 years. There are 50000 people a year leaving for Australia and unemployment has risen by over 50 percent—nearly 50000 people—since John Key took office. These are the real problems and these are the things that are not being addressed through this legislation. 
To get proper work and decent paying jobs parents require correct training and education. They require the correct care and education opportunities for their children for childcare and they require more than anything jobs to go to. There is no solution as good as a decent job for people who are seeking one. Nothing in this bill will provide those facing these barriers with the tools to overcome them. Indeed in this context we see that— 
Hon PAULA BENNETT (Minister for Social Development) 
: 
 I thought it was opportune to answer a few of the questions that have come up over the last few calls on this bill the Social Security (Youth Support and Work Focus) Amendment Bill. First of all the Greens had quite rightly I think some concerns about sanctions and whether they would effect a complete sanction for those particular children. The answer is that we are inserting into the principal Act new section 177 which says that there can be only a 50 percent sanction for those who have children. I actually introduced it through Future Focus in 2010 for that very reason when we had some concerns. 
There are also some other concerns around sanctions. They are not something that one does lightly and without taking into consideration the actual consequences of them because I do agree that no one is sitting there thinking that this is a life of luxury particularly living on the DPB and trying to make ends meet. So to actually look at how you incentivise and how make sure you have got the right kind of obligations can I tell you lead to a lot of debate in my office with very good officials and amongst my Cabinet colleagues as well as to how you try to get that balance right. 
I would say in relation to the incentives that we are putting in this bill for those who are going into education and those who are doing the budgeting that that was an interesting discussion. Instead of sanctioning the behaviours and not getting the kind of behaviours you would want we wanted to look at rewarding the kind of things that could happen by giving a bit more money in people’s pockets. There is a really good chance that people could get $30 more. 
We sanction now and I think that is important to know. And actually we sanction quite a lot. For example in the month of May there were about 3500 sanctions. Of them about 3000 were to those on the unemployment benefit. These may be part-sanctions by the way so they are not all 100 percent. Some of them are for 50 percent and some are more. It is quite high. I obviously keep a close eye on the numbers and I am quite surprised at times about how high they are. About 3000 are from the unemployment benefit—and I really am going from memory on this—but about 312 are from the sickness benefit and others and then we have about 170 from memory who are on the DPB. 
Then—and this was actually a big call particularly from Dr Pita Sharples—when we were doing Future Focus he wanted to make sure that we were following up on those who had been sanctioned particularly those with children so that they were not staying a long time on 50 percent. There was a risk particularly from the Maori Party’s perspective that those who are isolated and living in very rural areas would just be sanctioned at 50 percent because they did not turn up to appointments which perhaps they had not turned up to for a very good reason—it might have been beyond their means—and then they would be sitting for months potentially on 50 percent. 
So we have put checks and balances in place to make sure that we are following up with them immediately and so that actually recomplying is relatively easy and you can literally do it within a day. I know it sounds as if sanctions by their very means are there to punish but they are not. They are actually there to make sure that people are fulfilling their obligations and we want to make sure that recompliance is actually relatively easy and that people can. In most cases they do. 
I also want to jump to some of the cost things that we have been talking about and we certainly have had some discussions on the forecasts of Treasury and the forecasts of the Ministry of Social Development. Let me give you an example of a forecast that—bless Treasury’s cotton socks whose officials are not here so I can say it—was just fundamentally wrong. So with Future Focus the savings that were projected out of that which were relatively minor changes were perceived to be $13.3 million in the first year. Actually the savings were $29.9 million. So we more than doubled them. 
Our officials in Treasury are by their very nature conservative and very narrow as to what they will look at as far as the changes that are happening and with good reason. It is their job to be but they will not look at behavioural changes that come from these. So I am very confident about what can happen when you take the example of previous changes under Future Focus. 
I suppose I will spend my last minute saying that we are targeting and that is a fundamental difference from what you see in many of the programmes that are out there now. I can accept that there are members in this Chamber and there are members out there in the public who do not agree with targeting. I do. At the moment we scatter across about 188000 people and we hope we get to the ones who need it most. We lightly touch instead of going into the intensive support and wraparound that some need. 
The reality is that most of our kids are going to be fine. They have got us. They have got us with all of our intellectual—or not—grunt that we bring with it our love and care our attention over our extended whanau and everything else that comes with it. It is the other kids out there who have not had a great start in life who have struggled all the way through often through circumstances not of their own doing whom we need to wrap the support around. 
I pick up on one thing that Mr Prasad said. He said—and I have written this down as best I can—that when guided and trusted these young people will succeed and move ahead. I could not agree more. The independent youth benefit by its very nature means these kids have not got someone to guide them. They are on the independent youth benefit because there is no one there to look out for them care for them and support them. They actually have to prove that to get on it. It is not easy. 
So what we are trying to do is give them a person connected to them in their community who will guide them who will trust them and have a mutual responsibility with them. I agree you cannot actually replace a parent or a whanau member but the sad reality of some of these young people’s cases is that we kind of have to try to. You cannot actually replace a family member or where that love comes from but the reality is that unfortunately for some of the kids you see in Child Youth and Family and for some of these young people we are going to actually have to try to replace that by putting it into a community person. That is what we are trying to do. 
The member also said they need to be taken carefully by the hand and I could not agree with him more. They do need to be taken carefully by the hand and it is by us actually taking them—[ 
Interruption 
] Well it is kind of the words you used and I found it quite interesting that by their very definition these are the young people who need us most. So we are going to target them. We could lightly scatter across and hope that we get those who need it most or we can do these risk assessments that mean we are narrowing in on supporting and yes wrapping around all of those who really do need it. 
I want to also mention teen parents who are being discussed tonight not very much to be quite fair. In 2010 there were about 4600 teen births. We saw that go down by about 600 last year actually which was a fantastic thing but let us see how we go from there. You have around 5000 teens at any one time in that 16 17 and 18-year-old range who need our help. What we do at the moment is give them anywhere between $300 and $600 a week into their bank accounts and then off they go and we hope that they are all right. That is wrong. It is fundamentally wrong. 
You can ask why we are targeting why we are wrapping around so much support and why we are doing this differently. We are doing it because they are young and actually they do need our support and they do need more guidance. We will work with them towards independence. Some will take only 6 months some will take 2 years. Whatever it takes we will work with them. 
We looked at those who are 17 and turning 18 very quickly. For those teen parents we extended it; they could go to 6 months. We looked at those teen parents who were in a relationship and so are not receiving a benefit but could still be open to getting that kind of support from within their community and from organisations. We opened that up to them so that they can have access to that level of childcare that level of support that they need so desperately. 
Some are calling this punitive. I have already heard someone tonight say it is beneficiary bashing. It is anything but you know. Every time a National woman stands up and mentions that she wants to work with these people and actually wrap more support around them and see a different future she is knocked down and told that we must have some sinister ulterior motive. Well that is simply not true. But will we cajole will we push will be obligate will we incentive will we put it all right? Yes we will. That is the premise behind this and as right as we can get it. We will trust in those organisations put our responsibility in them to make sure—as we check all the way through—that these young people are given every shot to get ahead and make a real difference and make their contribution as well. 
Su’a WILLIAM SIO (Labour—Mangere) 
: 
 I wanted to say just in response to Mr Alfred Ngaro earlier that I thought maybe he had been listening to Peseta Sam Lotu-Iiga for too long but the more he spoke the more I recognised that the arrogance oozes naturally from him. I would just remind him of the old Maori saying that a kumara does not tell the vegetable patch how sweet he is because eventually the kumara dies and stinks. 
The reality is that I think it is good that the Minister in the chair the Minister for Social Development is attempting now to articulate some of the concerns that we have raised but there are more questions that need to be answered. I thought that the Minister was taking this bill the Social Security (Youth Support and Work Focus) Amendment Bill quite seriously but the members on the backbenches on the other side do not seem to be when you consider the bullying tactics and the personal attacks that they have heaped on us. 
If you consider clause 4 on the purpose of this legislation it is “to provide services to encourage and help young persons to move to education training and employment rather than to receiving financial support”. Let us consider that. Let us consider exactly how the Government intends to do that and ask the Minister how many of the young people whom she has identified are going to end up with a qualification at 17 years of age. How many of the young people she is targeting will at age 18 end up in a job? I asked the officials as to what happens when these young people reach the age of 18. The expectation of the officials was that they all get into jobs. At 18 years of age these young people will get into jobs. Well if you look at the purpose and if you were— 
The CHAIRPERSON (Lindsay Tisch) 
: Order! 
Su’a WILLIAM SIO 
: —if I were to take the word “encourage” as a code for “coerce and bully people into jobs”—my colleague Jacinda Ardern was kinder. She said this is work testing but with a specific focus on 16 and 17-year-olds and the second focus being on sole parents. Sole parents are going to be tested. Young people of 16 and 17 are supposedly going to get jobs. But this bill fails to consider what jobs are available. It fails to consider the childcare costs that sole parents have to consider and it fails to consider whether a person has the skills necessary for the jobs that might be available. That is what this bill fails to address. So much for the work focus! All this bill will do as articulated by the Minister and the members there is to—in my words—bully and coerce people into jobs and sanction them if they do not do what the Government department is going to coerce them into. 
I want to remind the members on the other side of the Chamber who sat through the select committee that the Salvation Army which does work throughout this country and is probably the most experienced in dealing with social issues throughout the country—it has 45 units—has said that if this bill is an amendment to the Social Security Act 1964 the aim of the bill is inconsistent with the main Social Security Act 1964. Let me read for the benefit of the members on the other side what the Social Security Act’s purpose is: “(a) to enable the provision of financial and other support as appropriate—(i) to help people to support themselves and their dependants while not in paid employment; and (ii) to help people to find or retain paid employment; and (iii) to help people for whom work may not currently be appropriate because of sickness injury disability or caring responsibilities to support themselves and their dependants: (b) to enable in certain circumstances the provision of financial support to people to help alleviate hardship: (c) to ensure that the financial support referred to in paragraphs (a) and (b) is provided to people taking into account—(i) that where appropriate they should use the resources available to them before seeking financial support under this Act; and (ii) any financial support that they are eligible for or already receive otherwise than under this Act from publicly funded sources:”. The Salvation Army submitted that this bill here is so far away and detached from the original purpose of the Social Security Act that it does not deliver what the main Social Security Act was set up to do or as I have reiterated the main purposes. None of that is in this amendment bill set up by this particular Government. 
I want to reiterate some figures for the other side. My colleague David Clark has already said them but I think they are important. Let us ask the Minister to table now the exact numbers of people whom she intends to be able to support as a result of this bill. Between January 2009 and January 2012 the number of people on the DPB rose by 13.2 percent but between January 2009 and January of this year the number of people on the unemployment benefit rose by 82 percent. The Government seems to be clamping down on people on the domestic purposes benefit—mums in particular. One cannot help but consider that this Government is just trying to show us that it is acting when in actual fact it is not acting on the real issue which is job provision: the creation of jobs ensuring that there are jobs that young people can go into and ensuring that the opportunities of quality education are provided—as the bill originally states. 
I want to say that in 2009 a paper from the Inland Revenue Department found that among sole parents 67 percent of those available for work had problems getting work that paid enough 66 percent could not find work for enough hours for it to be worthwhile and 64 percent did not have the skills employers wanted. What is this Government going to do about that? What does this bill indicate it will deliver for those sole parents in terms of skill development and in terms of the jobs that these sole mums are looking for? No sole mum wants to be on the benefit. Every single sole mum that I have come across wants to be able to provide a high-quality standard of living for their children and for their family. Childcare arrangements are getting harder with the high cost of private care and long waiting times. All of that has happened under this particular Government. 
Despite the Minister’s adamant assertions that her Future Focus reforms have been working there are more people on the DPB now than there were prior to the reforms. It is expected that by 2017 we will have a significantly increased number of people on the unemployment benefit and on the series of benefits that this Minister and this Government seem to want to reduce. It is a fact that when jobs and opportunities for work are available it reduces the dependence on our welfare system. We saw that when Labour was in Government between 1999 and 2008. There was a significant reduction in the number of people on welfare benefits across the board. Why? Because there were jobs and people had incomes where they could earn a living and be able to hold their work up. 
But as I said so much for the aspiration that this Government has talked about. The only thing that I know is that the people on the ground who are struggling to make ends meet who aspire to opportunities and who aspire to better living standards for their family are leaving our shores because of the lack of activity from this Government to address the real issues. The point I have made is that despite the focus on work all that this bill does is work test coerce and bully people into jobs that do not yet exist for the kinds of skills that many young people are seeking. If the Government was serious about this it would address firstly the job availability. It would address childcare needs that sole parents have— 
JAN LOGIE (Green) 
: 
 I would like to take this call now to speak a little bit more to my Supplementary Order Paper 78 and to address a few other comments that I did not get to last time. To start with I would like to just talk a bit more about community development and some of my concerns around the contracting out of these services. I absolutely support the Minister for Social Development’s vision of this of providing a mediator for young people between young people and Work and Income because of the stories that we hear of a lot of people in Work and Income: of refugees talking about coming out with their heads burning feeling as if they are right back in the trauma that they have left in other countries and of women leaving violent relationships describing their experiences in Work and Income as quite similar to the abuse they have experienced in their relationship. That is not an environment we want our young people to be trying to negotiate. However the alternative of having community organisations provide this service is undermining the essential role of NGOs and community organisations which is to look at what the community need is and to develop responses to help from that community base. Community organisations are not there and community development does not work when those community organisations are used as arms of the State. That fundamentally changes our democratic system and our ways of working. This system undermines what we know works and that is a real concern. Also I absolutely acknowledge the Minister’s intent and that sense of helping and being alongside young people. I do find that— 
Mike Sabin 
: Group hug. 
JAN LOGIE 
: It has felt like that sometimes. But I do think it is quite strange when the Minister has said that she finds that promotion of job creation is kind of a form of beneficiary bashing—in response to the leader of the Mana Party’s media—and in her words is belittling for people who are trying to do their best. To me that is a really strange world when job creation is seen as belittling but taking over control of somebody’s finances is not. That is a pretty strange world to me and I am sure the young people in Otorohanga would not agree with the Minister. 
So now to talk a little bit more to my Supplementary Order Paper about the training incentive allowance. Again I am disappointed to be honest. The Minister knows the benefit of university education—alongside our co-leader Metiria Turei and many other women—and knows that real benefit of getting a university education to get off the DPB and look after your kids. So I am really sad that the concept of an investment approach to welfare does not extend to the investment that they got. 
Mike Sabin 
: Well it’s investment not lifestyle. 
JAN LOGIE 
: It is wanting the best for their children. And in response to that member’s comment about it being a lifestyle I would just like to bring back into the Chamber the story of a woman whom I worked with earlier this year—a young mother with two beautiful children who discovered that the only way she could cover the costs of higher study was by doing escort work. This young woman left school with School Certificate and had been working pretty much all the way since then on stud farms but when she got pregnant and went back to work she found that she was $60 a week worse off after travel and childcare costs were factored in. So being highly motivated to build a better life for herself she found a course—a higher-level course—that would enable her to get a better-paid job in the long term so that she would not have to keep going on and off benefit which the Government has acknowledged is a real pattern. But sadly that course was a level 6 course and— 
TIM MACINDOE (National—Hamilton West) 
: 
 I move  
That the question be now put 
. 
JACINDA ARDERN (Labour) 
: 
 I am pleased to be able to take another call because I did want to get into some substantive remarks and the amendments—in particular around the payment card which is set out in Part 1 of this bill. I do want to acknowledge that the Minister in the chair the Minister for Social Development talked for some period about the nature of those young people who are currently receiving the independent youth benefit and I do thank her for portraying what is I think the reality of the situation for a lot of our young people who are on the independent youth benefit who do have very little support be it from caregivers or parents and who find themselves often in heartbreaking situations that lead to their requiring that level of support at such a young age. 
I think the position that Labour came to on the use of a payment card system was not to deny that intensive services were appropriate for these young people—in fact that is something that we have always strongly supported. Our issue was with the fact as Rajen Prasad has pointed out that the payment card made a presumption about all young people transferring all of them on to a payment card system rather than using the payment card system as a backstop measure. 
So we have an amendment which is on the Table currently that suggests reversing the onus. If a young person demonstrates that they are struggling financially or they have moved into debt for instance a youth service could have the discretion to move the young person on to a youth payment card system if that were appropriate rather than putting everyone on it and then saying: “Well if you earn your right you can come off.” which actually was a position that was reached only after the Social Services Committee debated this provision. In fact it was previously that everyone stayed on for the length of the couple of years until they hit 18 and could move off. So what we are putting to the Committee is the proposition that yes if there is evidence that that additional support was required then use the youth payment card system but let us not make a presumption about all young people. 
The second provision that I want to speak to briefly is clause 8 in Part 1 where it talks about domestic purposes benefit recipients being up to the age of 19. That was something that I was interested in having the Minister’s comment on about the difference there—the length of the period that for instance a young woman might stay on a payment card system versus say a young man on an unemployment benefit. I have had that raised with me; it is an interesting question. I would be interested in hearing her thoughts on why we have those two distinct systems based on the age there. 
I want to come back though to a part that has not been talked to that is currently within the bill. If we flick through to section 125A(1)(a) in clause 18A it talks about the chief executive having the ability to contract with service providers for what is listed as services that are “(i) services of the kind referred to in section 123E(a); or (ii) services in relation to Part 5;”. If we flick through to what Part 5 refers to it talks about financial support for young people. I do not believe that there has been enough public discussion about the fact that this bill substantively transfers powers previously only ever administered by Work and Income to private sometimes community-based NGOs and youth service providers. It was something canvassed at the select committee but it has not been canvassed widely enough in the public domain I believe. Catherine Delahunty has spoken to it; I believe Jan Logie may have as well. The fact is that now decisions and discretionary decisions—quite substantive powers held by Work and Income over things as significant as the financial well-being of that young person and things as personal as emergency food grants; specific needs like that—are being transferred to a youth service provider. That is a significant step away from what we have previously had in New Zealand. 
I know that the Minister has justified this move previously. My concern is that this is one massive pilot project for the wider—the wider—privatisation of the welfare State. The member Peseta Sam Lotu-Iiga on the other side of the Chamber shakes his head and I would welcome his taking a call and giving— 
ALFRED NGARO (National) 
: 
 I move  
That the question be now put 
. 
Jacinda Ardern 
: Mr Chair— 
The CHAIRPERSON (Lindsay Tisch) 
: I am sorry you have had all your calls. I am going to hear from Kris Faafoi. 
KRIS FAAFOI (Labour—Mana) 
: 
 For as long as I have been a member of Parliament in this House I have sat and watched the Minister for Social Development say to those young Kiwis out there who are looking for work that “We back you. We are right behind you.” But in this bill the Social Security (Youth Support and Work Focus) Amendment Bill there are measures that say: “We back you and we are behind you but we don’t trust you. We don’t trust you enough so we are going to give you a payment card to make sure you can make all these payments. We don’t trust you enough so we are going to bring in these measures.” 
I think the amendment that has been put forward by my colleague Jacinda Ardern to slightly amend the way in which those payment cards are used is a sensible and wise amendment in the fact that it gives those young people on those benefits the opportunity to at least prove that they are trustworthy when they are getting their benefit. They might be able to get some assistance in terms of budgeting too and if they do get themselves into trouble after 8 weeks then the authorities can look to the payment card system for them as a possible option. But we do not believe as Jacinda Ardern told the Committee a couple of minutes ago that this payment card system should be applied to all of those young people which it currently does in the bill as it stands now. 
This bill is another case from the National Government—and there have been many since it took office—of wanting to make the rhetoric meet the reality. This is the kind of bill that you introduce when you have not done enough to create jobs in the 4 years that you have been in power. If it was serious about tackling unemployment we would have seen some measures in the economic growth department but as we have seen for the last 4 years it has done pretty much zero. That is why unemployment has increased and stayed around the relative level that it has now for some time. We can see the growing level of frustration around the country as Kiwis find it harder and harder to find work. This is what they are being given in terms of the great white hope from this Government in terms of trying to find ways to encourage young New Zealanders into work. 
This bill does not address the real issues that are stopping job seekers from finding work. It does not address the real issues. It does not address as I have said the availability of work and we have seen the many many instances where supermarkets have advertised the likes of 300 jobs and three and a half thousand people many of them well qualified for much better jobs have lined up wanting a job at their local supermarket. In that instance this Government has failed to address the unemployment problem and this is what it brings in to try to address it. This is what it tries to bring in to address it. 
The Government also has not addressed whether the people who are looking for work have the appropriate skills for the work that might be available and we have also heard of a Supplementary Order Paper from the Green MP Jan Logie around the training incentive allowance. We think along with the Greens that the Government should maybe take a rethink around that and reintroduce it given what it has achieved for many other people who have had the experience of having had the training incentive allowance available to them. 
I must go back to the inability of this Government to take any real action in terms of trying to create real jobs in our economy and to the fact that our unemployment rate has stayed static. I think this is a bit of a lazy effort to try to make it look like the Government is taking action to address the unemployment issue. It is sad in the way that it has addressed this issue for our youth. 
I also understand that youth receiving a benefit under these circumstances will have to meet certain obligations such as undertaking full-time education or budgeting programmes for parents. We believe that this is simply a bribe. You know if youth are going to get $10 more a week this is simply a $10 bribe for those young people to stay in training. It is not the sustainable response that is needed to help the 80000-plus New Zealanders who are out in our communities—and certainly the many young people out there in my community of Mana—and honestly trying to find work. They are finding it difficult given the conditions. It is not just young people I must add. There are a lot of older Kiwis out there especially. I have met a couple— 
MIKE SABIN (National—Northland) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Motion agreed to. 
The question was put that the amendments set out on Supplementary Order Papers 75 and 83 in the name of the Hon Paula Bennett to Part 1 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Amendments agreed to. 
The CHAIRPERSON (Lindsay Tisch) 
: The next amendment in the name of Jan Logie as set out on Supplementary Order Paper 78 has been ruled out of order as the Government has exercised its financial veto. 
The question was put that the following amendments in the name of Jacinda Ardern to Part 1 be agreed to: 
to delete clause 18; and 
to delete clause 19. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Noes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendments not agreed to. 
The question was put that the following amendment in the name of Dr Megan Woods to clause 20 be agreed to: 
in new section 157 after “approved training means an employment-related training course approved by the chief executive” insert “or trades training course through the Skills for Canterbury package”. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Noes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendment not agreed to. 
The question was put that the following amendment in the name of Jacinda Ardern to clause 20 be agreed to: 
replace new section 174 with: 
174Sanctions for failure by young person receiving young parent payment to comply with obligations under section 170 
If satisfied that a young person receiving a young parent payment has without good and sufficient reason failed to comply with an obligation placed on him or her by section 170 the chief executive must for a failure suspend the in-hand allowance and any incentive payments until the young person satisfies the obligation (or if he or she has failed to comply with 2 or more obligations until he or she satisfies all of them). 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Noes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendment not agreed to. 
The question was put that the following amendment in the name of Jacinda Ardern to clause 20 be agreed to: 
replace new section 179(5) with: 
(5) A payment card voucher or device that enables a young person to obtain goods or services from a particular supplier and enables the supplier to obtain payment from the department for the goods or services will only be provided replacing payment to the youth personally where the youth has demonstrated an inability to manage their finances as determined by the chief executive or has incurred debt over a period of 8 weeks or more. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Noes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendment not agreed to. 
A party vote was called for on the question  
That Part 1 as amended be agreed to. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Part 1 as amended agreed to. 
Part 2 Consequential amendments and transitional and savings provisions taking effect on 30 July 2012 
The CHAIRPERSON (Lindsay Tisch) 
: This is debate on clauses 22 to 27 and schedule 2. 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 This is going to be just a brief call and it is actually in the nature of a question for the Minister in the chair hopefully. This is partly because I was not on the Social Services Committee. I know it is much to Mr Lotu-Iiga’s regret that I was not there. But I was not quite able when I was looking through this bill the Social Security (Youth Support and Work Focus) Amendment Bill to understand the impact of clause 27 “Transitional arrangements for financially disadvantaged people”. Essentially what clause 27 does in various parts is allow for regulations authorising the provision of financial assistance to any people who are financially disadvantaged as a result of the net effects of the amendments made by Part 1 or Part 2. This is able to be done in two parts of this clause by the Chief Executive of the Ministry of Social Development and also by the Governor-General by Order in Council. 
It seems a curious clause because other parts of the transitional provisions entitle some rollovers of the youth payment or young parent payment and some issues around the domestic purposes benefit but this clause seems to be placed here for a reason of some description. Firstly it pre-supposes that there are people who are going to be financially disadvantaged by Part 1 and Part 2 of this bill. It is quite clear when we look at Part 1 of the bill that we do in fact see that there are a number of changes obviously around eligibility particularly for the youth payments and the young parent payments and also—as was earlier raised by Holly Walker—questions around the sanction regime on those payments. 
What I am looking for clarification on here from the Minister in the chair is exactly who is intended to be covered by clause 27 of Part 2 around transitional arrangements for financially disadvantaged people. Although some transitional arrangements are being made for those on the youth payment there must be somebody in mind with this particular clause and I would like some clarification from the Minister. Are we talking about everybody who is financially disadvantaged? Is it the Government’s intention that nobody will be financially disadvantaged out of this bill? That would be an interesting position for the Government to take particularly in light of the sanction regimes that are outlined in Part 1 of this bill. 
We on this side of the Chamber are obviously concerned about the impact of these changes on young people. The Government has a particular agenda that it is pursuing within Part 1 of this bill and now in Part 2 it is saying that if you are worse off there is the possibility of transitional arrangements. So the questions I have for the Minister in the chair are who is designed to be covered by that and are we talking about people who are in receipt of the young parent payment? Some transitional provisions exist for them in clause 25. I do not know whether that is everybody who has been getting it up to now who now will not be getting it. Or is it for others who are perhaps in receipt of the youth payment and are not covered here who will no longer be in receipt of that payment? 
 The Government I presume has done some work to understand the impact of the changes that it is making—who will not now be in receipt of these payments—and to have a transition clause like this one indicates that the Government obviously has something in mind in terms of helping those who are financially disadvantaged. So the questions we have for the Minister in the chair are whether this is everybody who it is and who the Government intends to apply it to. 
It seems to me having made a decision to have a clause like this in the bill that clearly there are people who will be financially disadvantaged but I also want to know how this interacts with the sanction regimes that are mentioned here. Clearly some people will end up being worse off as a result of this bill and obviously on this side of the Chamber we find it hard to understand that the Government in an environment where so many young people are out of work and where there are so many young people who would like to be in training and in work could be so focused on the punitive side of the regime. The Government is not focused on ensuring that we have people who are being given assistance but in these transitional clauses it gives some hint of the fact that perhaps there is some consideration being given to those people who are doing that. 
So really what I am looking for as someone who was not on the select committee is some clarification from the Minister as to who it is envisaged will be covered by the transitional arrangements in clause 27. I would ask the Minister to take a call and let us know. 
Dr RAJEN PRASAD (Labour) 
: 
 This is again a very brief call on clauses 22 and 23 in Part 2 of the Social Security (Youth Support and Work Focus) Amendment Bill. We have already articulated the views of this side of the Chamber that here is a major change and we are a little bit suspicious because we think some of the provisions are the ticking-the-box type of approach that Grant Robertson talked about earlier. 
 I wonder about the reference here to income-tested benefits. What has happened is that we have changed the terminology from “benefit” to “payment”. That is then used consistently in clauses 22 and 23 and elsewhere as well. I wonder whether the Minister in the chair the Associate Minister for Social Development could explain why there was that change what it is that the Minister is trying to convey through this particular change and whether those payments will still be counted as benefits down the track when we begin to count to see whether benefit numbers have gone up or down. We know that the independent youth benefit which is the one that is replaced here by a youth payment was one that was specifically designed some years ago and we know that those who are on that benefit generally have somehow fallen on bad times in their relationship with their family and their parents and they got that particular benefit. Now it is going to be a payment—a youth payment. So if the Minister could just explain to us why there is this change what the implications are of this change and whether the payments will still be counted as benefits down the track when we count the number of people on benefits or whether they will be taken out of the benefit count as well. It looks like a technical amendment but I want to know what was behind it. If the Minister could give us some explanations of that it would be very helpful. Thank you. 
The question was put that the amendment set out on Supplementary Order Paper 83 in the name of the Hon Paula Bennett to Part 2 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Amendment agreed to. 
A party vote was called for on the question  
That Part 2 as amended be agreed to. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Part 2 as amended agreed to. 
Part 3 Substantive provisions taking effect on 15 October 2012 
JACINDA ARDERN (Labour) 
: 
 It is my pleasure to stand up and take the first call on Part 3 of the Social Security (Youth Support and Work Focus) Amendment Bill. I point out that of course this part does have a different commencement date from the other parts we have previously discussed. It is taking effect on 15 October of this year. Obviously the substantive changes are as previously raised to do with new work-testing arrangements so these are clauses that will affect a significantly larger number of people certainly than those we have discussed up until now. 
I would like to focus in on some of the amendments that have been put forward by Labour members around some of these clauses. Rather than going into the substantive changes made by the Social Services Committee I want to hone in on where there continues to be ongoing debate and where we would still like to see some change. I want to start with clause 29(3) in which there is some discussion around the definition of “suitable employment”. That is a critically important definition to have entrenched in this bill because if you are putting in work-testing arrangements that then have a flow-on in terms of sanctions that can be applied it is obviously very important to set out the criteria under which Work and Income is able to use its discretion to determine whether or not something that has been put forward to a Work and Income client is considered suitable employment. As set out in subclause (3) “suitable employment in relation to a person means employment that the chief executive is satisfied is suitable for the person to undertake for a number of hours a week determined by the chief executive having regard to the employment required to satisfy the work test for that person.” 
What we wanted to see was as much consideration as was given to the definition of “suitable employment” given to the definition of “suitable childcare arrangements”. The reason for that is because obviously it is the prerogative and up to the discretion of a Work and Income case manager to determine whether or not all of the needs of that client have been met and if the client is then turning down work they have the ability to sanction them. That means as set out in section 60GAD in clause 34: “The purpose of sections 60GAE and 60GAF is to improve the financial and social outcomes for families that include people to whom those sections apply by providing earlier access to employment services and expectations while recognising the care and development needs of children.” In order to recognise the care and development needs of children we felt it was important to set out a specific clause that set out what were considered suitable childcare arrangements. 
There was some discussion at the select committee as to whether or not defining this ended up placing a prescription on the job seeker that might mean that we would be setting a bar that they would have to reach. So for instance if a job seeker came up with their own childcare arrangements such as a grandparent whom they thought was suitable would setting in the legislation a definition that had a higher bar mean that their arrangements were not considered suitable and therefore they would not transition into the job? 
 We would dispute that that is what setting a definition would do. We wanted to set a definition that is not necessarily around determining if someone has found their own childcare arrangements whether or not those arrangements are suitable. If they are suitable for the individual and they have determined that for themselves that should be their prerogative. But if a Work and Income case manager says: “We have a job that we believe is right for you.” and that person then disputes that and says: “But I do not have suitable childcare arrangements.” we thought there needed to be a definition if a dispute then ensued and a Work and Income case manager said: “Well we believe there is a babysitter network on the corner of your street that is suitable.” In that circumstance we believed it was appropriate to have a definition for the sake of clarity but also for the sake of ensuring that we are not putting children in vulnerable situations because at the discretion of a case worker Work and Income deemed those childcare arrangements from their bar to be suitable. 
So what we have proposed is a new subsection under section 60Q where we wanted to make clear that “ ‘Quality child care’ is defined as one that provides healthy environment that meets standards prescribed by regulation” so those standards we set ourselves including “the availability of registered professionals and the appropriate ratio of care-givers to children prescribed.” 
We wanted to go on as well and pick up on one of the recommendations that from my recollection I believe was raised by the Office of the Children’s Commissioner which reflected on this as well around whether or not we should be taking into account the availability of suitable early childhood education where the child is aged 3 or over. We know based on the substantive work that the Office of the Children’s Commissioner has already done that the availability of suitable childcare in some parts of our community is poor. So if we are going to oblige those on a domestic purposes benefit to transition into work at a particular point and it is on the assumption that early childhood education is available with 20 hours free surely we should be testing that that assumption is correct because it is not in all cases. This is why our amendment adds subsection (6) which says “Where the child is 3 or over the parent (beneficiary and their spouses and/or partners) must have access to registered early childhood education requiring services to be widely available in the area of residence prior to the obligations …” being applied—and those are those work-testing obligations. That is an amendment in the name of Sue Moroney as our early childhood education spokesperson. I think it is sensible. It is not saying that if someone finds their own childcare arrangements that meet their needs the arrangements are not sufficient. But it is saying that if it is mandated by a Work and Income case manager we should have some standards in place and I think that that is only fair. 
I want to come to a couple of additional amendments. It was interesting that the Minister for Social Development raised in one of her earlier interventions from the chair the issue that this is a bill that does not make assumptions about those on Government support. Yet one of the clauses we have in this part of the bill places earlier work-testing requirements on those on Government support who may for whatever reason have an additional child whilst on Government support. That is making an assumption I would wager about those who are having additional children whilst on Government support. If I am wrong and if the Government is not making assumptions about those on Government support in the circumstance of having additional children then I would be very happy to hear the Minister clarify what the purpose of this bill is. I have heard it very plainly stated that there is a perception that people have additional children to stay on Government support and yet I did not see the evidence of that in the select committee. So if the Minister has evidence of that I would welcome seeing it. Until that evidence is provided we believe that work testing when a child is 12 months old when that would require care arrangements would therefore be imposing that provision on that family and our preference is to remove that clause because of developmental reasons of the child. If the Minister has some counter-evidence to counter that amendment we would welcome seeing it. 
 The next amendment I want to speak to is around clause 37. We had a discussion around the exemption from obligations. In particular a very good case was brought by CCS Disability Action from my recollection around parents who are looking after disabled children in particular children with behavioural issues or for instance children who have been expelled from school. We believe that it is important to set out that there should be the ability to have an exemption from work-testing obligations where a parent has a very high-needs child. In high-needs we include potentially a disability that prevents the parent from being able to step away from their full-time care arrangements or if there are significant behavioural issues that require that parent’s full attention and care. Although we were given assurance at the select committee that that ability existed we thought there was no harm in that being explicitly stated in the bill and that is why we have an amendment to clause 37 suggesting that in section 105(1) after the words “from complying with section 60HA” we insert “or where the beneficiary has a dependent child who has a disability has been deemed to have significant behavioural issues and/or has been excluded from school.” That does not stop a parent exercising their choice to transition into work if that is appropriate for their arrangements. But it does allow a bit more flexibility for individual circumstances. I think given the discussion had at select committee— 
Hon PAULA BENNETT (Minister for Social Development) 
: 
 I just want to take a call on Part 3. The previous speaker Jacinda Ardern has identified some of the clauses to this part. Ultimately what we are doing is lowering the age of the youngest dependent child from 6 years to 5 years for DPB sole parent recipients and partners of beneficiaries so that they are available and can be looking for part-time work at least. Lowering the age of the youngest dependent child from 18 years to 14 years for the commencement of full-time work availability is quite new. 
Obviously we have had a part-time work test for those whose youngest child is 6 years and we are moving that to 5 years which quite frankly still puts us at the lower end of the OECD as far as work testing for DPB mums. But the full-time work test for those whose youngest child is 14 years is very new. It has been 18 years for ever which has meant that before National was in Government last time there was actually no work test at all for DPB mums until their youngest child was 18 years old. We have now moved that part-time work test to when their youngest child is 5 years but a full-time work test at 14 years. 
What we occasionally hear from others and from the Opposition on this particular policy is that it is unfair that parents cannot do it there is no possibility of finding work and what will happen to their children. When looking at some of the facts it is quite interesting that for those whose youngest child is 14 years - plus actually 68 percent of sole mothers currently work—68 percent—and 83 percent are partnered. The proof is kind of there that they can do it. It does not mean that there is always the right job available hence that kind of suitability around work. But to say that it is not possible to find work is simply not true. 
What we have done is made sure we have put some clauses in the Social Security (Youth Support and Work Focus) Amendment Bill that accept that those who are coming on benefit in particular because of domestic violence incidents or because of a death or because of something that has been quite traumatic are given due time to work their way through some of that. It is not an instant work test even if their youngest child is over 5 years for part-time work or their youngest child is 14 years - plus. We have taken some advice on that. There is a level of discretion around it in particular. The other reality around it when we really looked at it is that there are just so many individual circumstances. What Work and Income case managers in particular want more than anything is something that is very clear and very plain and very straightforward. We are giving them that but we are also giving a degree of discretion and flexibility around it recognising people’s different circumstances. 
To the member’s call around the insertion of a Supplementary Order Paper that covers quality childcare to say at the least that I find it kind of sanctimonious and ridiculous would be an understatement. The reality is that the early education and childcare legislation actually already has defined what quality childcare is. We have regulations around that and we subsidise only to that. For parents not to have an actual say in what is childcare and what is suitable for their own children because we feel it needs over-regulation which is what we saw for so long is actually what is half the problem with the cost blowout in the sector itself. The reality is that parents are very good at making informal and formal arrangements themselves. In fact I challenge a mum or a dad in this House who has not actually had an arrangement of some description with their friends or parents where they said “I’ll pick up yours”— 
The CHAIRPERSON (Lindsay Tisch) 
: I am sorry to interrupt the honourable Minister. The time has come for me to report progress. 
House resumed. 
The Chairperson reported the Dairy Industry Restructuring Amendment Bill with amendment and progress on the Social Security (Youth Support and Work Focus) Amendment Bill. 
Report adopted.