National has blasted the Government coalition partners for not honouring the Green Party's Confidence and Supply Agreement.
The Government announced it would scrap a disciplinary sanction imposed by the former National-led government that cut income to women and their children if the name of the child's father is not declared.
Removing the sanction was part of three pre-Budget announcements made by Social Development Minister Carmel Sepuloni on Friday who said it was "good first steps to improving the [welfare] system".
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The Greens have a Confidence and Supply Agreement with Labour who promised to work towards overhauling the welfare system, in order to form the current Government with New Zealand First who have also shown support.
But the Greens' agreement with Labour explicitly says the Government will work towards removing "excessive sanctions" - and the Government's latest announcement only addresses one of them.
National's Social Development spokesperson Louise Upton said the announcements are "another case of the Greens being promised action in their coalition agreement and receiving nothing when it comes to delivering on that agreement".
Upton said: "The Welfare Expert Advisory Group recommended 42 extensive changes to the social welfare system but the Government has delivered on just three of them."
Auckland Action Against Poverty has also come out against the Government for not acting on all of the sanctions that the Welfare Expert Advisory Group recommended removing.
Coordinator Ricardo Menendez March said the organisation will "continue campaigning to end all sanctions, and ensure people have access to their benefit entitlements at Work and Income".
He pointed to sanctions recommended to be removed that the Government did not act on, such as pre-employment drug tests and mandatory work ability assessments for people with health conditions or disabilities.
Nevertheless, Greens' co-leader Marama Davidson said removing the sanction - along with the other two announcements - is "a crucial step toward delivering on our Confidence and Supply Agreement with the Labour Party".
She welcomed the Government's decision to lift the abatement threshold in line with minimum wage increases - that's the reduction of beneficiaries' payments when they earn more money.
The ACT Party has criticised the decision to remove the sanction, saying it goes against Labour's traditional values, as pointed out in 2004 by then-Social Development Minister Steve Maharey, who said fathers "must front up to their obligations".
He said: "It is not unreasonable to expect that single parents bringing up children on their own identify who in law is the other parent, or to expect that they seek financial support for the child from the other parent."
The ACT Party, led by MP David Seymour, said removing the sanction would mean taxpayers will assume greater responsibility for supporting children, rather than their fathers.
The party promoted its policy that beneficiaries should be given a card that can be used for select purposes only otherwise "we are going to continue to foster a culture where beneficiaries face no consequences".
The report's recommendations have been welcomed by budgeting group FinCap's chief executive Tim Barnett who applauded the attention on reducing debt, and transitions to work and housing.
He also acknowledged that addressing all recommendations "will take time", adding that it's "vital that the Government put delivery of that front and centre".
He welcomed the Government's removal of the sanction for not naming the other parent, saying it will "make a major difference to the lives of women and families that have suffered because of it".
The Government said removing the sanction will cost $113.4 million over four years.