Ardern Jacinda: Social Security (Youth Support and Work Focus) Amendment Bill — In Committee 
Text is incorporated into the Bound Volume 
Ardern Jacinda: 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.] 
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—