More than one million people will be better off from today, thanks to our Government’s changes to the minimum wage, main benefits and superannuation.
Labour is committed to lifting incomes for the lowest paid New Zealanders, and easing the pressure on Kiwi families. Over the past three years, we’ve delivered on this commitment, making changes that have helped put money back into the pockets of those who need it most. We’ve lifted the minimum wage, rolled out the Families Package, increased benefits, and introduced the Winter Energy Payment to help with energy bills.
On 1 April, the next raft of these changes will kick in, helping even more people with their weekly budget. In fact, once the Winter Energy Payment begins again in May, families with children who receive a benefit will be, on average, $150 better off each week than when we came into Government.
There’s still a lot more to do, including building more homes, improving our health system, and investing in education, but our changes are already making a real difference for Kiwi families.
Here’s what changes today, and what this mean for New Zealanders:
The minimum wage increases to $20 an hour
This delivers on a key pre-election promise for Labour, and will see around 175,000 people get a pay rise this week.
During their entire nine years in Government, National only increased the minimum wage by $3.75. Since 2017, we’ve lifted it by $4.25. This means a full-time worker on the minimum wage now earns an extra $170 a week before tax, thanks to Labour’s changes.
Main benefits increase by 3.1%
Almost 400,000 people who are unable to work or are struggling to find work will have more support from today, after we boosted main benefit levels by 3.1%.
This is the second increase to main benefit levels as a result of our new indexation policy – connecting main benefits with average wage increases. The Children’s Commissioner said the single best thing the Government could do for children in poverty was to see child benefits linked to wages. That’s what we’re doing here, and it’ll be a change that sticks, supporting this generation of young people and the next.
Student allowances go up
We’re making life easier for young people as they take the next steps in their education. We’ve increased student allowances from today, meaning 60,000 students will have a little extra to help with their bills.
This is on top of the work we’ve already done to help people who are studying, including introducing first year fees-fee and rolling out free trades training in targeted areas.
More first home buyers can access support
We’re making sure more first home buyers can access Government assistance to get into their own home by lifting the income caps on First Home Loans and First Home Grants from 1 April. With a First Home Loan, buyers only need a 5% deposit, rather than the 20% deposit required by most lenders. First Home Grants provide up to $10,000 to help people pull together their deposit.
People can earn more before their benefit is impacted
We’ve made the largest adjustment to abatement levels in two decades, meaning people who receive a main benefit who are also working part-time can keep more of what they earn.
We know that part-time work can be an important step toward full-time work. By lifting the abatement threshold, we’re strengthening the financial incentive for Kiwis to stay in or take up part-time work.
More support for older New Zealanders
From today, New Zealand Superannuation and Veteran’s Pensions also increase by 3.1%. This means 830,000 older New Zealanders will be better off each week.
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