KEY POINTS:
National Party leader John Key plans to focus on the growing underclass in his first big speech of the year tomorrow, arguing that Labour has failed to look after a core constituency.
Mr Key will deliver the speech in the Christchurch suburb of Burnside, near where he grew up in a state house.
He said yesterday the topic was an unusual one for a National leader "in the sense that we probably haven't in recent times focused so heavily on a social issue".
But it was consistent with his message since becoming leader, which was that National was "showing that as a Government we'll be prepared to tackle a wide range of issues".
Mr Key is set to unveil some solutions, but also detail a programme to develop policy over the coming year.
He will argue that dealing with the "growing underclass" involves tackling serious and interconnected issues of long-term welfare dependency, crime, illiteracy, poor parenting skills, social exclusion, malnutrition, drugs and "lost hope".
National's welfare policy to date would require unemployment beneficiaries to make themselves "available" for work-for-the-dole or training schemes, with the aim of placing young beneficiaries on schemes first. It has not promised all those collecting the dole would be placed on such schemes.
The Maori Party co-leaders said in the Weekend Herald that they wanted compulsory attendance for all unemployment beneficiaries.
Labour has condemned the plan, but National's welfare spokeswoman, Judith Collins, welcomed it, saying she wants more talks with the Maori Party on the issue.
Mr Key was reluctant to discuss the matter yesterday, saying he would prefer to wait until later in the week - a signal that he is likely to tackle the issue in tomorrow's speech.
He confirmed that he envisaged changes to National's welfare policy this year.
Asked whether his concern about the underclass might result in a different approach from National's tax-cut plans, Mr Key was noncommittal.
He conceded that tax cuts would provide little benefit to that group, but said lower income families would not lose the money they got from Labour's Working for Families package.
"We're not going to roll back the money people have got as a result of Working for Families, but we're certainly keen to explore different ways of delivering that money.
"My view is that Working for Families was never designed to be for families earning in excess of $100,000. That was a political reaction to National's tax-cut plan and was an ineffective way of delivering those resources to middle and higher-income New Zealanders."
Mr Key said Maori "certainly heavily dominate a lot of the statistics in the economic underclass and there are tremendous gains, I think, if we can improve those sort of statistics, not only for Maori but for everyone".
Asked if specific programmes should be directed at Maori, he said, "I'm still very comfortable that, broadly speaking, the solutions are not ethnically based, they are economically based."
National MPs Phil Heatley and Paula Bennett meanwhile continued to raise concerns about Government department staff numbers and bonus payments.
National has long argued that tax cuts could be paid for by cutting the alleged fat from Government department spending.
Mr Heatley said that while the number of state houses had grown only 9 per cent since 2002, staff at Housing New Zealand had ballooned by 42 per cent. Those earning over $100,000 had risen from 39 to 90 in that period.
Ms Bennett said the Labour Department had paid staff $2.8 million in bonus payments in the 2004-05 year and $2.2 million in lump sum performance payments already this year.
