Social Security Act 2018

Social Security Re-write to become law

A modern, clear, and accessible Social Security Act

Under the previous National-led government, a complete re-write of the Social Security Act 1964 was initiated. NZCCSS was among the many people who made submissions on the resulting Social Security Rewrite Bill (see our 2016 article on this and submission). The Parliament Select Committee reported back to Parliament on the Bill in 2016 but the legislation was not passed before the 2017 General Election.

The new Labour-led coalition government picked up the Social Security Rewrite Bill and it has been debated in Parliament during May – September 2018 (read the details and debates on the Parliament website). The Committee Stage was completed on 24th July 2018 and the final reading is expected in September when it will become statute.

In all stages of the passing of the 2018 Bill the vote has gone along party lines with National and ACT parties having opposed it. This means that the rewrite has not achieved cross-party support despite efforts at “policy neutrality”. Once passed, the Social Security Act 2018 will come into effect from 26th November 2018.

Main Changes to the Bill

Minister Sepuloni summarised the main changes as making the rewrite a genuinely “policy neutral” one by taking out the new policy elements that were included in the 2016 Bill. She says it “is essential to clean up the legislation first without rushing through policy changes that haven’t been properly thought out.”

“A modern, clear, and accessible Social Security Act will provide a solid legislative platform for changes that stem from this Government’s overhaul of the welfare system. The focus of the overhaul will be on making substantive policy improvements to social security.”

This means that any recommendations made the by Welfare Expert Advisory Group (WEAG) that is due to report in February 2019 may well result in further changes and amendment to the new 2018 Social Security Act.

Most of the recommendations made by NZCCSS in our 2016 submission on the original Bill have not been addressed and this means there are still major changes needed to make social welfare fairer, to help lift hundreds of thousands of people out of poverty and reduce inequality in this this country. Find out more about our ideas for welfare on our Vision for Social Security in the 21st century page.

Meanwhile here is a brief summary of the changes the Government has made to the previous Bill are (page numbers refer to the PDF document on the NZ Legislation website):

  1. Taking out the investment approach in the Act’s principles “people at risk of long term dependency” (Part 1 cl 4(e) of the Bill, p25). Note that the other principles are retained with the focus on paid employment as the “best opportunity for people to achieve social and economic well-being” (p.24).
  2. Parents in split-care situations will not be eligible for sole-parent support (i.e. maintains the status quo Section 20C of SS Act 1964) – new clauses Part 1 cl 29(aa) and 31A; Bill p.39-41).
  3. Single rate of sole parent support for single carers paid the supported child’s payment is taken out (clause Part 1 cl 31(b), Bill, p.40). This is taken out because it is “not policy neutral” although the Government considered it to be a positive change.
  4. Merging the orphan’s benefit & unsupported child’s benefit (new subparts 5 & 5A of Part 2 cl42-44; Bill p.45) are not now part of the Bill. The status quo is retained (Subpart 5 & 5A cl42-44; Bill p.46-47).
  5. Emergency benefit changes – renaming it the “exceptional circumstances benefit” (Subpart 8 of Part 2, cl 59; Bill p.53) has been taken out and it will continue to be known as the emergency benefit.
  6. Case worker discretion to apply work or work-preparation obligations on exceptional circumstances benefit (i.e. emergency benefit) will not be allowed (new clause 59(5)(b); Bill p.53). The clause will read: “MSD may, on a case by case basis, make the grant of an emergency benefit subject to any conditions imposed by MSD.” (Compare: Social Security Act 1964 No 136 s 61).
  7. Regulation-making power to identify circumstances where the compulsory redirection of benefits is acceptable is taken out (Part 8 cl. 421 (2)(a), (3) & (4); Bill p.244-5).
  8. Definitions for accommodation costs and cash assets remain in the main Bill and will not be covered in regulations (clause Part 2 cl 61; Bill p. 54 and Part 3 cl 147(2); Bill p.96) as will eligibility for funeral grants (Part 2 Subpart 13 cl 80 to 80D; Bill p. 65).
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