National has announced it will introduce a childcare tax rebate of up to $75 per week for New Zealand families if it is elected into power at the October election.
Leader Christopher Luxon announced the policy during his State of the Nation address on Sunday morning, arguing families are doing it tough with rising rents, mortgage rates, grocery bills and childcare expenses.
The FamilyBoost childcare tax rebate would benefit 130,000 low- and middle-income families, Luxon said, with families earning up to $180,000 receiving a 25 percent rebate on their early childhood education expenses to a maximum of $3900 per year depending on their income.
The maximum rebate would be $75 per week, which would be available to those earning up to $140,000. It would be paid fortnightly by IRD to the parents' bank account.
The rebate would then gradually reduce as family incomes rise above $140,000. The maximum weekly rebates for families earning $150,000, $160,000 and $170,000 are $56.25, $37.50, and $18.75, respectively.
"Making childcare more affordable will also help families who would like to work more hours. With FamilyBoost, parents have more choices to return to work or extend their hours knowing their children are well looked after and it's not costing the house. Literally," Luxon said.
"The good news is that FamilyBoost will be fully funded by cutting Labour's wasteful spending on contractors and consultants."
National said the FamilyBoost policy would cost $249 million per year and be fully funded from money it expects can be saved by "reversing the blow-out in wasteful spending on public sector consultants overseen by Chris Hipkins as Public Services Minister".
The party expects it can save $400 million per year through reducing "wasteful" spending on consultants and contractors.
If elected to power, National would direct public agencies "to end the culture of relying on contractors at a premium to do the regular job of a public servant". It would require public sector agencies to report their spending on consultants and contractors every quarter, instead of annually.
"The culture of public servants rebranding as contractors – only to do the same job at twice the hourly rate – is chronic in Wellington."
National also wouldn't enact any restructures or mergers, calling Labour "obsessed with creating and merging entities while services on the frontline fall apart".
Restructures or mergers created under this Government include the new HealthNZ and the vocational education provider Te Pūkenga. It also promised to merge TVNZ and RNZ until that proposal was scrapped last month.
The party would slash the use of working groups, taskforces and reviews, Luxon said.
"Labour has created a gravy train for consultants through its obsession with working groups, wasteful spending and expensive public sector restructures that are a boon for partners at the big consultancy firms, but are not delivering better results for Kiwis. Under National, this gravy train will stop at the station."
In 2018, Hipkins lifted the cap on core public servant numbers as a way of reducing reliance on consultants and contractors.
"In removing the cap, this government wants to see the public service re-build their in-house capability and invest in permanent and long term staff, rather than spend millions on temporary contractors," he said at the time.
Hipkins has previously defended spending money on consultants by saying it was necessary to repair damage caused by the former National Government. The Government has also had to deal with major crises, like the COVID-19 pandemic.
But Hipkins has also said that the money needs to be scrutinised to ensure it's justified.
National's public service spokesperson Simeon Brown said the $400 million saving comes from reducing spending on consultants and contractors on a number of government department and Crown entity projects.
"In 2016, Chris Hipkins attacked the previous National Government over consultant spending at the Ministry of Education. On his watch as Minister of Education, spending on consultants has increased by nearly $100 million.
"New Zealanders deserve a government that will deliver better outcomes for their hard-earned taxpayer dollars."
Former Prime Minister Jacinda Ardern also announced a childcare policy at Labour's conference in November. The childcare subsidy income threshold will rise from April after not changing since 2010 and means more than 10,000 additional children will receive support.
Luxon's speech on Sunday was meant to be delivered last month, but it was postponed due to Cyclone Gabrielle. He acknowledged the start of 2023 had been difficult for those in the North Island.
"Many who've lost their houses and livelihoods don't know whether, when or how they can return to the places they think of as home," he said.
"But in the devastation, the best of the New Zealand character continues to amaze and inspire us all. People are on the ends of shovels, or providing food, or a roof over other families' heads. For some, just being there is bringing comfort in a time of despair."
