On Newshub Nation: Simon Shepherd interviews Minister for Social Development Carmel Sepuloni

Simon Shepherd: Eleven months after the Government asked a 11 strong panel to overhaul the welfare system, findings have been released this week. Social Development Minister Carmel Sepuloni joins me now. Thank you for your time this morning. The report says our welfare system is dire and desperate - 42 recommendations, you’re taking just three. So is that delivery in this so-called year of delivery?

Carmel Sepuloni: Well, Simon, I think we have to keep it in perspective that we received that report nine weeks ago. We’ve just released it publicly. As I’ve said, we want to take a two-phase approach to this, and we are doing some things immediately as well as taking seriously this very fulsome report with huge recommendations that we really need to consider as part of phase two so we can make sure that we think through how we can phase some of these recommendations in, over a three- to five-year period.

Let’s talk about phase one, then. The Prime Minister said the welfare system needed an overhaul. The changes you are making were all promised before the election, so there’s nothing new in phase one, is there?

Well, it’s important that we situate some of the promises that we’ve made previously with regards to the overall recommendations that are being made--

When you say situate, do you mean deliver?

Situate, deliver in terms of this is what we’ve told needs to be done, this is what we can do now. Also as part of phase one, taking stock of what has been done, because we do need to remember there was that $5.5 billion investment through the Families Package.There’s already been the service delivery and culture-change work that’s been undertaken since we’ve got into government. All of that sits within the report as well. And so it’s not just the three announcements that I made yesterday, Simon. It’s also some of the work that’s already started.

Okay. So you’ve done the work that you say you’ve started, but the report takes that into account and it says that benefits are not enough to meet basic costs. It’s recommended, in some cases, a 47 per cent boost. So how long will people have to wait before that is addressed?

We’ll be considering the recommendations in the report. As I said, we’ve just received the report nine weeks ago. At this Budget, we won’t see an increase in benefits, but I’ve given some pre-budget announcements to say what we can do already. And the rest, people will have to wait for the Budget.

How long? The next budget?

There’s still this year’s budget to come. Obviously what I announced were just pre-budget announcements, but--

So you’re saying there might be more in this budget coming?

I can’t promise or say what might or mightn’t be in the Budget, but what I announced was not the entire Budget. Just a few pre-budget announcements.

But in terms of welfare, you announced $286 million worth of three options yesterday. Will there be more than that in the Budget?

I want to go back to the fact that in the report it also says there needs to be a cross-government approach. So it’s not actually just what’s offered up through the welfare system. It’s also what we’re doing with respect to things like mental health, and particularly with regards to housing, which we’ve highlighted as a priority for us as a government and which the report highlights as being a priority with regards to those who are accessing the welfare system.

Right, so what I read from that is that we’re going to spend in other areas, but this is the additional funds available in this upcoming budget for the welfare system.

I think you’re going to just have to wait rather than read anything into things, Simon.

Okay. We just saw in Mike Wesley-Smith’s story people queuing for hardship grants out at Manurewa, and they’ve doubled in the past five years. 472,000 in the first three months of this year. So why not raise the benefits now to counteract people having to queue and sort of lose their dignity early in the morning?

What I have to say, Simon, is queues like that—I respect the work that AAAP does, but queues like that are actually not a common occurrence. It happens when you’ve got a campaign or you draw people together in the way that AAAP do – a call for action telling them to come out at that time – but it is very seldom where you see people lining up an MSD office from 5.30 in the morning.

Sure. You might not get the queues, but you are getting the applications and the spike in applications.

We are. Yes.

So the problem does exist.

Yes, and so can I say too that the demand and the need were there before we got into government. The difference is now that, actually, we are actually addressing the needs and giving people what they’re eligible for to a much further extent than what was previously being done.

Three recommendations out of 42 doesn’t sound like you’re addressing it very fast, though.

Look, Simon, as I said, there’s two phases to this. What can we do immediately, and I announced those as pre-Budget announcements here, but what needs to be done in the longer-term, and we’ll be working together across government – not just MSD, across government – to suss out a plan to make sure that we can implement those recommendations.

So $286 million. They wanted $5.2 billion. Massive distance between the two. Can you not afford this upgrade to the welfare system?

$286 million for the three announcements that I made as part of pre-Budget announcements, Simon.

And the report says you need $5.2 billion.

Simon, as part of the three pre-Budget announcements that I made yesterday, that’s the cost of them. Also keep it in mind that as soon as we came in, we put that $5.5 billion investment in as part of the Families Package. 385,000 families will be better off by $75 a week, and that’s fully implemented. And tens of thousands of children will be lifted out of poverty. And I think although that’s a start and we know we’ve got more to do, I think that was a really good start.

Let’s talk about what you have done. So, one of the things you announced was the sanction where solo parents are penalised for not naming the other parent. That’s gone. All the other sanctions that were recommended to go in this report are staying. So why aren’t you scrapping those?

The repeal of Section 192, the one that you’ve referred to, is something that we decided to announce as a pre-Budget announcement and so—

It was also a pre-election promise, wasn’t it?

Oh, it was something that we were committed to doing, and it was something that was recommended through the report. The other sanctions, we’re going to look at as part of our coalition, with our coalition and confidence-and-supply partners, and we’re going to take the recommendations in this report really seriously. I will say that the advisory group themselves said that time constraints meant that they didn’t necessarily have time to ascertain whether or not any other interactions might result in unintended consequences. And so that’s our job as a government—

What do you mean by that?

Well, if you shift one thing, how does it impact on another. For instance, if you lift benefits, what’s the impact on the accommodation supplement? What’s the impact on temporary assistance support, additional support? And then do families end up being better off. So all of those things have to be taken into consideration, and that’s our role as a government.

Well, there’s a case-in-point in Mike Wesley-Smith’s story that just ran where a rape victim who kept the child, and basically her mother’s looking after it, is then charged child support for that child. And years of pleas, including to your own office, went unheard. That shows that the system is not working.

Mm. And no one would dispute that that’s a terrible situation, at all. And looking at that, even watching the footage on TV, of course, you know, we all feel that way. That’s a terrible situation. Unfortunately, with regards to me, that’s an IRD issue, it actually not an MSD issue.

I understand, but there is an interaction between the two departments.

There’s an interaction between the two departments, but I don’t have any levers with regards to the policy for that particular issue.

OK. The solo parents’ sanction that you are getting rid of, that’s cost a lot of people a lot of money, so will you be refunding them?

It won’t be retrospective.

So that’s a ‘no’.

It won’t be retrospective, so that is a ‘no’. Can I say, though, that what MSD have been doing at my request is been proactive with regard to those who’ve had that sanction applied? So, since the beginning of April, they’ve actually been proactively phoning to check that those women, predominantly women, are actually getting what they’re eligible for, that the sanction has been applied appropriately, and making sure that, you know, that MSD’s been doing what’s right. The findings from that so-far have been really interesting. And we have been able to find out that, actually, they haven’t always been getting what they’re eligible for, and so, let’s make sure that they do get that. And in some cases, their situations had changed, so it didn’t need to be applied. In some cases they’ve made the decision they can, or will name the other parent, and so they have done that.

OK. The Green’s confidence and supply agreement stated that they wanted to remove all the excessive sanctions. And, so, you’ve done one, and then six more have been recommended by this review. And, so have you reneged on your agreement with the Greens?

Oh, we haven’t reneged at all. As I said, as part of phase 2, we go and ascertain, look at those recommendations, and then we make a plan working forwards with regards to how we—

So will you commit to removing further excessive sanctions before the next election?

We need to work together to ascertain which ones are excessive, taking on-board the recommendations of the report, and that will be part of the phase two programme.

You’re also increasing frontline staff by 263, which is part of your three announcements. How would that actually help people living on the benefit to live with dignity, which is the core message of this report?

Well, what became very clear from the consultation that occurred from the Expert Advisory Group of the general public, and also is evident in report, is people do want MSD to be proactive in terms of supporting them into meaningful and sustainable employment. But what’s happened over the course of time, as hardship has increased, and little additional investment has gone in to resourcing and staffing in MSD, is that the focus has shifted away from work and towards housing and hardship, as you can imagine has happened. And, so, what this government is saying is that, yes, income support, hardship, housing are all really important. We need to maintain that focus. At the same time, we need to make an investment so that we can provide those going to MSD with the support that they need to get into meaningful and sustainable employment.

Okay. ‘Living with dignity’ seems to be the core message from this review. One of the things that was looked at was the way the welfare system treats a couple. Now, at the moment, if you are together for six weeks then you are then deemed to be a couple. The review says to make that six months. Why didn’t you address that? Six weeks seems so short, it doesn’t seem modern.

Look, these are one of the recommendations and issues that are traversed in the report that we’ll be taking into consideration in phase 2 of the thinking through what we’ll do.

Because, like, Labour said in its election manifesto that it wanted to modernise the welfare system. And that, in the report, was saying that was an old-fashioned way of looking at it, like a breadwinner type of relationship. Are you living up to your promises here?

The report, thankfully, has provided us with these very fulsome recommendations, including ones about modern relationships, and now it’s our opportunity, given that we only received the report nine weeks ago, to actually think through our plan for the next part, which is actually rolling out some of these recommendations.

Should you be ready for this report? In terms of— you’ve been promising these things, it’s now 18 months down the track, and one of the key works when you came into power was transformation. How is it transformational adopting only three out of 42 recommendations?

It wouldn’t be transformational, either, if we made changes that weren’t enduring and could be changed at any given time, or where there were unintended consequences that we hadn’t thought through properly that meant that people weren’t any better off. So I think the general public would appreciate the fact, as a Government, we need to be considered and we need to make sure that we’re making the right decisions.

OK, just one, a couple of questions about the culture of welfare system— The Privacy Commissioner is investigating the way relationships are verified. And we understand that includes caseworkers asking about the personal, maybe, sex lives of people who know the client. And that investigation’s ongoing, so, once again, is that a dignified way to treat welfare recipients?

Oh, look, there’s lots to traverse here around relationships, around a whole range of areas, and so that’s what we’ll be doing as part of phase two.

So, this is a year of delivery, coming out with a wellbeing budget. Are you sure that you are delivering on that promise of a wellbeing budget?

Ah, look, I’m looking forward to the budget being announced. And as I said, and as has been reported, put in the report, it’s not just about what MSD offers with regards to the people that we’re there to serve, it’s also about the other areas — health, housing, education and actually making sure that across government we’re actually responding to the recommendations that are in this report.

Right, Social Development Minister Carmel Sepuloni, thank you very much for your time.

Thank you.

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