Why the Government won't boost benefits in next year's 'Wellbeing' Budget

Next year's Budget focused on upping the country's 'wellbeing' won't include a boost to benefits.

Finance Minister Grant Robertson on Thursday previewed what to expect in next year's Budget, saying it will allocate funds in a way that will boost more than just gross domestic product (GDP).

"That's one measure of success, but others measures of success are how we're going at lifting the skills of our people, or the mental health of our people or the quality of our environment," he told The AM Show on Friday.

"We're going to assess all of those Budget bids against that whole range of measures, rather than just how is it adding to GDP."

But boosting benefits is "not on the cards". At present they're linked to inflation, which generally lags behind wage growth. The last time they were boosted beyond inflation was 2015, when Bill English held the purse strings - and that was first increase since the 1970s. 

Mr Robertson said low-income families, including those receiving support, would benefit from other initiatives.

"We did put in place the Families Package last year, which actually is going to push a lot of money towards those families - about $75 a week extra by the time that's fully rolled out. So we are making a pretty big difference in those people's lives."

He said the focus on GDP in recent years hasn't resulted in better outcomes for Kiwis.

"We've had really good rates of GDP growth over the last few years, but at the same time homelessness has grown, we've seen poorer health outcomes."

There's expected to be a $1.7 billion surplus on the Government's books next year, rising to more than $8 billion by 2023. Wages are expected to rise 3.3 percent next year. Inflation is presently at 1.9 percent - it's only been above 2 percent once in the last six years.


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