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Legislative Assembly for the ACT: 1996 Week 9 Hansard (28 August) . . Page.. 2729 ..

MS HORODNY (continuing):

Agencies in New Zealand expressed to the committee that the pace of change in social welfare programs and the broader economic and financial reforms has been too rapid and that there has been a lack of appropriate community readjustment mechanisms. The changes appear to be economically derived and appear to neglect consideration of the circumstances in which people find themselves. In conclusion, if we look at the society of New Zealand as a whole, I would have to say that the reforms have failed. Some people have done very well out of changes - that is indeed true - but it appears that a huge number of people have suffered as a result of the reforms. One of the things we saw in New Zealand was food bins provided in shopping centres. That is surely an indication that things are not going well for a large sector of the community there.

MR KAINE (4.41): I will be quite brief. Like the chairman of the committee, I found this visit most instructive and most interesting. I would like to record my appreciation of the number of people who were willing to speak with us and for the openness and frankness with which they were prepared to discuss issues. It did not matter whether they were government employees, from the volunteer sector or from the private sector, they seemed most interested to discuss the issues with us. I had the feeling that they held nothing back. They gave us what they believed to be an accurate opinion as to what had happened.

Having been there a couple of years ago with the Public Accounts Committee, this was something of a follow-up visit for me. There is no doubt that there has been massive change in New Zealand. In the macro sense, there is no doubt that New Zealand has, by and large, believed that those changes have been very successful. Almost without exception, people said that they thought the changes had been beneficial for New Zealand. As is explained towards the end of this report, on the basis of national economic indicators, there is no question that New Zealand has done very well in pulling itself up by its bootstraps compared to what it was 10 years ago.

The thing to be noted, however, is that whenever you make a massive structural change, such as has occurred in New Zealand, there is a price to be paid. I think that the thing for us to observe is that there has been a price that has been paid, and it is not always by the people who are best able to pay it. It has some lessons in it, I think, for us. If we move broadly in the direction that New Zealand has done, there are some things that we need to watch for. One of them is in the housing market - an issue that came up today. The New Zealand public housing stock was sold off to private enterprise and the problem with that was that no provision was made for people on low incomes. They do get a housing subsidy, but it in no way covered market rental. The people who bought the entire New Zealand public housing stock continue to own and operate it, but they charge market rental.

What that has done is squeeze the lower-income people out of the market. It has caused enormous housing problems for that low-income sector of the community. The lesson from that, of course, is that if we ever contemplated selling off our housing stock you cannot sell it all. There is some percentage of the housing stock that you must always retain because there are people who cannot compete in the normal rental market. I think it is a lesson that needs to be observed.

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