Cutting child poverty one aim of $5.5b Families Package

Grant Robertson
Grant Robertson
Too many children live in poverty and, in a lot of cases, without adequate food, healthcare and housing, Finance Minister Grant Robertson says.

Releasing his first Budget Policy Statement yesterday,  Mr Robertson said evidence showed childhood poverty, particularly in the early years, cost the country significantly each year.

More importantly, it was unjust.

Households on low and middle incomes were struggling to get ahead. Home ownership rates were the lowest in more than six years and rents were rising.

More than half a million New Zealanders did not go to the doctor last year because of the cost, he said.

"The Government is  committed to addressing those social deficits, starting with putting child wellbeing at the heart of what we do."

Mr Robertson launched the Government’s Families Package, which would cost $5.53billion of  the $8.4million saved by reversing National’s promised tax cuts.

The remaining $2.8billion would be  invested in other Government priorities.

The major parts of the Families Package were Working for Families, Best Start and the winter energy payment.

The Government would repeal National’s changes to Working for Families and replace them with higher rates and a higher abatement threshold, effective from July 1 next year, he said.

The Best Start payment of $3120 per year ($60 a week) per child would help families  in a child’s early years.

It would be available to all families in the first year of a child’s life.

For the second and third years, support would continue for low and middle-income families.

Best Start payments would be abated at 21% for incomes above $79,000.For families receiving paid parental leave, Best Start payments would start after paid parental leave ended.

About 65,000 babies are born annually.

The winter energy payment would support those  receiving  a main benefit — New Zealand Superannuation or a Veteran’s Pension — to heat their homes in winter.

The payment of $450 a year would be made for single people. Couples or those with dependent children would get  $700.

Mr Robertson said the Government was also facing significant pressure for infrastructure investment following under-investment in core public services in previous years.

It was affecting hospitals, housing, schools and the transport system.

Recent transport investment had been overly focused on a handful of expensive projects selected for political reasons rather than on improving the whole transport system as an integrated network.

Budget 2018 would confirm the Government’s commitment of putting child wellbeing at the heart of what it did, he said.

The Government was committed to building a strong economy, to being fiscally responsible and  providing the public and markets with certainty.

As part of the Treasury’s Half-Year Economic and Fiscal Update, figures showed an extra $5.4billion of residential construction would take place over the next four financial years, largely as a result of the Government’s KiwiBuild programme.

The Government had pledged to deliver 100,000 affordable homes over the next 10 years.

Housing and Urban Development Minister Phil Twyford said the Government would focus on turning around a forecast fall in the number of houses built.

"Through KiwiBuild and policies to drive speculation out of the market, including the ban on non-resident foreign buyers, the Government is delivering a more stable housing market."

Wages were forecast to grow faster than house prices for the first time since the global financial crisis and interest rates were expected to remain low.

Home ownership would become more affordable for New Zealand families, he said.


Budget Policy Statement

What you get

Best Start: $3120 per year per child born on or after July 1

Winter energy policy: $450 a year for single people on a main benefit  and $700 for couples or those with dependent children

Working for Families: the eldest child rate will increase to $5878 per year and for subsequent children to $4745, up to age 18. The abatement threshold will increase to $42,700 and the abatement rate will increase to 25%.

The numbers

• Families package to cost $5.53 billion

• The package will lift 88,000 out of poverty

• Each Budget would identify how many children have been lifted out of poverty, starting in 2018

• KiwiBuild will add $5.4 billion of residential construction over four years


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