Ball Darroch: Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill — Second ReadingText is incorporated into the Bound VolumeBall Darroch: Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill — Second Reading[Sitting date: 01 June 2016. Volume:714;Page:11584. Text is incorporated into the Bound Volume.]DARROCH BALL (NZ First): It is a pleasure to rise on behalf of New Zealand First to speak on the Social Security (Extension of Young Persons Services and Remedial Matters) Amendment Bill. New Zealand First will be supporting this bill at this stage because New Zealand First fundamentally agrees with the purpose the aim and the intent of the bill. I do not think that there is any question from anybody including the submitters or any other Opposition party that we all support the intent purpose and aim of the bill because what it means fundamentally is that youth in need are getting more support.We do have some concerns that I will be going over but the concerns are not with the “what”. The “what” is the fact that the extension of the Youth Service aims to improve the educational and social outcomes for young beneficiaries. When that occurs they will be getting some wraparound support including youth coaching services such as budgeting help and parenting courses which are all good things and New Zealand First supports that. We also support the fact that there are some obligations put on to beneficiaries because this is not a handout; it is a hand up in a time of need. New Zealand First understands that it is a social contract and as with any contract there are obligations and New Zealand First supports those. We are talking about positive obligations for the outcomes of the youth especially things like them being subjected to money management.But like I said it is not about the “what”—the “what” is good—but it is about the “how” and “why”. So if we look at the heart of what the legislation is trying to change which is the extension of the Youth Service to all 19-year-old beneficiaries with children that is the “what”—we agree with that. The problem that New Zealand First fundamentally has with that is that all it is doing is increasing the number or the size of the ambulances at the bottom of the cliff. That is all that it is. Actually it is an indirect admission by the Government after 8 years of being in Government that the system is failing. If the system was working and if the investment approach the Government was taking was working then there would be no need to extend the new service. The new service would be working—apparently it is already by the Government’s standard. But how can that be if it needs to extend it? It does not make sense.The issue is that the Government is refusing to address the actual reasons why youth get on to the benefit in the first place. So we talk about the fact that the youth who are on the benefit are doing well and the Youth Service according to National is doing well so we need to expand it. But where was the talk about why the youth were put on the benefit in the first place? Where are the preventative measures—the legislation and the policy and the principles and the ethos and the values—from the Government that would stop our youth getting on to the benefit in the first place? It has been mentioned before but we are talking about the fact that New Zealand has a very very high youth unemployment rate.We have just seen from Statistics New Zealand that in the last quarter unemployment has actually risen overall but especially for the youth and especially for the regions. We are talking about Northland: 8.5 percent. We are talking about Gisborne: 8.5 percent. Wanganui and the Manawatū is at 7.7 percent which is now the second-highest rate in the country. The highest increase in unemployment has been on the West Coast which is at about 1.5 percent.We have heard about the “neet” rates. We have got 87000 youth who are disengaged with society. They are not just out of employment or education but actually disengaged with everything in society. That is over 12 percent close to 13 percent and as has been mentioned it has never been below pre-2008 levels. So apparently that is a success for the Government. The Government cannot be talking about “Well we’ve gone through a rough period of the GFC and the earthquake.” because apparently the global financial crisis according to Bill English ended in 2012. So what has this Government been doing? That is not success. We are talking about the issues—social issues with the youth jobs issues education issues and health issues—and the Government has not done anything to solve those problems in 8 years.That is the same approach that we have just heard in the last week or two from the social housing Minister announcing we have got some more funding for emergency houses—that is not a good thing. That is not a positive announcement because what it is doing is demonstrably showing that the safety net has failed. This Government is supposed to have a social obligation to ensure that safety net is strong and can catch people. People are falling through it and becoming homeless. To come out and announce that the Government is going to invest more money into emergency housing is an admission of failure. It is an admission of failure and it is the same approach that this Government is taking with this piece of legislation.I would like to use an analogy about what this Government is doing to solve the youth unemployment issue and the issues with youth and “neets”. It is taking the approach of emptying a sink full of water with a teaspoon without turning the tap off first. That is what is happening. What it is doing by trying to increase the wraparound Youth Service to include 19-year-olds is changing the teaspoon to a tablespoon—that is all that is going to happen. It is not going to solve any of the issues. It is not going to solve any of the issues. It will continue just like the previous 8 years.The other main thing this legislation concerns is 18 and 19-year-old beneficiaries without children who are considered to be at significant risk of long-term welfare dependency. I know that we have heard it previously from a few of the other members talking today but that brings into discussion the risk predictive models that the Government is using. The bill’s commentary states: “Some submitters asked how the risk of long-term welfare dependency would be assessed.” We have got an issue with the way the risk predictive models are being utilised to assess the youth. On the face of things Joe and Jane Bloggs would look at a risk predictive model and an investment approach and think that sounds logical. But if I could use an analogy—if we for example were trying to target millionaires and the predictive model said that all people who drive red cars are millionaires the indicator we would be looking for would be red cars but if all people who drive red cars are millionaires that does not necessarily mean that all millionaires drive red cars.What that means is we are going to use a predictive model we are going to use a criterion and we are going to use a tick box to try to predict how these youth—and they are not just youth but they are adults; 18 and 19-year-olds—will be a long-term financial liability on the State. This has all got to do with the investment approach and the Government has had legislation go through just recently about putting the investment approach in the entire purpose of the rewrite of the Social Security Act. Everything including this legislation—and this is a demonstrable fact of that—has to relate back to the investment approach.These are the Ministry of Social Development’s own comments in the departmental disclosure statement in regards to risk modelling: “The risk model for the Youth Service extension is still in development and will be finalised prior to implementation of the Youth Service in August 2016.” So first of all it is still in development. I am not sure what the backbenchers of the Government are talking about or what the Minister is talking about when they say they are happy with the development of their risk modelling and that they know it works.The worst thing is the fact the existing model used for the Youth Service is based on how the Government assesses the “neets” and we have just heard that in the last 8 years it has never been lower than pre-2008 levels. We have had a record increase in the last quarter of young unemployed males. It is going up. It is not being solved by this Government and yet this Government wants to use that same predictive model that it uses for “neets” for this legislation. So it is still being developed and it has demonstrably failed in the existing model.There are a number of issues that New Zealand First has with this legislation but we do agree with the intent and that is why we will be supporting it at this stage. I think that the Committee stage and third reading will be an interesting discussion and hopefully we can get some resolution for the concerns that New Zealand First has but we will be supporting it at this stage. Thanks.