Benson-Pope David: Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
Benson-Pope David: Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
[Volume:631;Page:3083] 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 I move  
That the Social Security (Long-term Residential Care) Amendment Bill be now read a first time. 
 At the appropriate time I will move that this bill be referred to the Social Services Committee for consideration and that the committee finally report back the bill to the House on or before 30 September 2006. 
Last year the Social Security (Long-term Residential Care) Amendment Act 2004 made significant changes for people in long-term care. That Act significantly increased the amount of assets that older people in care who have been needs-assessed as requiring care would be able to retain. The Act also clarified the rights and obligations of people in care and put into legislation a number of provisions that had previously been solely administrative. The income and asset-testing regime to which the Act relates is complex. 
As this legislation deals with the entitlement and obligations of the public a high degree of specificity is required around its provisions. Experiencing the operation of the regime under the new legislation has revealed a number of anomalies that the bill I am introducing today seeks to amend. Specifically it inserts a purpose and overview section and it increases the amount of income earned from assets that a couple may retain where one partner is in care. This provision ensures that such a couple is able to retain the same proportion of income from their assets as a couple with both partners in care or single people. 
The bill also ensures that people who are exempt from asset-testing such as people deinstitutionalised from Kimberley and Templeton Hospitals are able to receive a weekly personal allowance. It also allows the Chief Executive of the Ministry of Social Development to carry out a means assessment that considers income only for people who have already been assessed as having assets at or below the $150000 threshold. Without such a provision there is a risk that these people could subsequently become fully liable for their care costs when their income is reviewed annually. This is contrary to Government policy which limits the circumstances under which further reviews of assets will be carried out. 
The legislation also clarifies the discretionary powers of the chief executive over deprivation of income and assets. If it is established that a person has deprived himself or herself of assets or income the assets or income involved may be counted in a means assessment. The provision in the bill allows the chief executive where deprivation has been established to decide whether those assets or incomes should be counted based on the circumstances of the individual. 
The amendments also provide certainty for older people about how much they are required to contribute towards their care costs. The bill clarifies that any needs-assessed resident who is receiving the care he or she needs in a rest home or hospital that has a contract with the district health board for residential care will pay no more than the maximum contribution for contracted care services—that is services set out in the district health board’s contract with the residential care provider. The bill clarifies that the maximum contribution cap applies whether or not the district health board has any liability to pay for the contracted care services provided to that person. If the cost of contracted care services exceeds the maximum contribution at any time the district health board will pay the difference. 
At present 50 percent of a New Zealand private pension can be disregarded in a means assessment whereas 100 percent of overseas private pensions must contribute to care costs. This treatment of overseas private pensions in the income assessment for residential care is unfair. This bill will allow those who receive an overseas private pension to be treated in the same way as someone who receives a New Zealand private pension. 
Two recent decisions of the Social Security Appeal Authority have established that people receiving disability-related care can claim disability allowance for disability-related services that are not supplied by a person’s service provider. Legislative amendments are required to clarify the basis on which the disability allowance is available to people in residential care. They distinguish between people receiving disability-related care and those in age-related care. This distinction is necessary because of the difference in contracting arrangements for services provided for the two groups. 
Funding arrangements for disability-related services for younger people with intellectual physical sensory and psychiatric disabilities do not generally provide for medical costs pharmaceuticals and related services. For this reason the bill clarifies that people in these services who receive the residential support subsidy can now receive disability allowance on the same basis as those in the community. On the other hand contracts with age-related residential care providers are more comprehensive. Under those contracts older people are to be provided with the health and disability-related services that are necessary to meet their assessed care needs. The bill therefore precludes people in these services who receive the residential care subsidy from receiving disability allowance. 
At the appropriate time I will be pleased to move that the Social Security (Long-term Residential Care) Amendment Bill be referred to the Social Services Committee for consideration and that the committee finally report the bill to the House before 30 September 2006. I am delighted to commend the bill to the House.