New Zealand has now had three “Wellbeing Budgets”: the prototype in 2019, the COVID-19 “Rebuilding Together” version in 2020, and today Finance Minister Grant Robertson announced the Labour government is “Securing our Recovery”.
With Labour governing with an absolute majority, projected debt levels lower than initially forecast and nearly NZ$1 billion from last year’s COVID-19 recovery fund unspent, expectations for housing, health, climate change and welfare have been heightened.
Here, our three experts respond to today’s budget and assess its implications in various crucial areas for the year ahead.
A budget for middle New Zealand
Jennifer Curtin, Public Policy Institute, University of Auckland
The Government increased the benefit by $25 a week last year. From July 1, it will increase by $20 a week, and a second increase will occur again next year, bringing it in line with WEAG s advice. Families and whanau with children will also receive a further $15 per adult per week.
It means in total, weekly main benefit rates will increase by between $32 and $55 per adult by April 2022. The Government expects that 109,000 families and whanau with children will be, on average, $175 a week better off as a result of changes to income support, since 2017.
Prime Minister Jacinda Ardern said it was about reversing cuts to benefits made in 1991 under National Party Finance Minister Ruth Richardson - a Budget nicknamed the Mother of all Budgets.
The fund was allocated $354 million in the 2022 financial year, rising to $608m the following year, funded by the Covid-19 Response and Recovery Fund. “We have the opportunity to build the houses, schools, hospitals and transport networks our country needs, while adding momentum to our economic recovery,” said Finance Minister Grant Robertson.
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The Governemnt has committed $57.3b to infrastructure spending over the next five years. “Budget 2021 sees a 50 per cent increase in the Government s multi-year capital allowance to maintain momentum around job creation and to build the critical infrastructure needed to come out of Covid-19 stronger.” The multi-year capital allowance rose from $7.8b to $12b for Budget 2021 to 2024.