'Poor' spending choices in Govt's families package - National

  • 01/07/2018

National is sinking its claws into the Government's families' package, which rolls out Sunday.

The multibillion-dollar scheme will give 384,000 families extra money in the back pocket through changes to Working for Families, the 'Best Start' payment to families of newborn babies, winter energy payments for beneficiaries and extended paid parental leave, at a higher pay rate.

Finance Minister Grant Robertson says it will lift a weight off people's shoulders.

"[We're] making sure that those families who earn modest incomes, who perhaps struggle when they get an unexpected bill, they're gonna know they can get on with their lives with some more comfort than they've had in the past."

But National finance spokeswoman Amy Adams said it was a classic Labour approach of tax and spend.

"They are taking more money out of the pockets of hard-working New Zealanders, taking back the tax cuts, taking more in fuel taxes, they are taking more in a range of other areas so they can make a whole lot of pretty poor choices around spending."

Ms Adams says 1.7 million families are worse off because Labour opted not to give Kiwis tax cuts, as National had promised.

"Under this Government we've seen a halving in the number of new jobs being created and our growth rate per person slowing down to a virtual standstill. None of that is a recipe for making New Zealanders more prosperous."

High-ranking Labour MP Phil Twyford defended cancelling National's tax cuts, saying they'd "put more than $400 million into the top 10 percent of earners" instead of going to those at the bottom.

National itself last year said workers on $26,000 to $52,000 would get $560 a year, while those earning more would get $1000.

Mr Robertson says the package is aimed at middle- and low-income families for a reason.

"I don't think people on high incomes will begrudge that. In fact, what we've heard is people are very pleased we're putting that money into the place where it will make the most difference."

He also said the Auckland fuel tax, at about $5 a week per household, was easily offset by gains in the families package.

"The amount of money we're talking about here on average for a family… is about $75 per week they'll be better off. The increase in petrol is estimated to be around $5, so there's a huge difference."

Best Start

This will cost $1.14b over four years.

Parents of every single newborn will get $65 per week for an entire year, with those earning less than $79,000 getting the payment for up to three years.

It applies to all babies born after July 1, 2018 and is estimated to cover 65,000 newborns each year.

It cannot be claimed simultaneously with paid parental leave.

Winter energy payment

All pensioners and all beneficiaries will be eligible for money to help pay to heat their homes in winter.

Those living alone with no children will get $450 for the winter or $700 if they have children. Couples also get $700.

Working for Families tax credits

This will cost $2b over four years.

An extra 26,000 families will be eligible to receive some kind of support from the Government's existing Working for Families package.

Households with kids earning an annual income of less than $42,700 are entitled to $5878 each year for their first child, and $4745 each year for each subsequent child.

This simplifies the previous rates and increases the amount each family can claim.

Paid parental leave

Is going from 18 weeks to 22, with a 4.7 boost to the payments. It'll go up to 26 weeks from 2020.