Labour leader Andrew Little explains how families will benefit.
Labour's freshly announced "Families Package" would scrap tax cuts, boost Working For Families and introduce a universal $60-a-week "baby bonus".
Labour leader Andrew Little announced the package yesterday. He said 70 per cent of families would be better off than under National's package.
This would be done through a further boost of Working for Families by increasing payments and extending it to 30,000 more families on middle incomes at a further cost of $370 million a year - meaning an overall increase for the scheme of $743 million a year.
Little said Labour will use about $890 million of the $1.5 billion saved from scrapping the tax cuts for a more generous Working for Families scheme and other help for low-income families while putting the remainder into public services and infrastructure.
Little said the package would honour the party's commitment to reduce child poverty.
"Labour's priority is about people, backing families and strengthening communities. [But] In the end none of these things get fixed unless we change one thing - and that's the Government."
Labour deputy leader Jacinda Ardern explained the Best Start package was motivated by the one in four children living in poverty.
All parents would receive $60 a week for the first year of the child's life. For parents receiving Paid Parental Leave the payments would start after it ends.
"This recognises how hard and just how important that first year of life is," Ardern said. "I know this package will make a significant difference to those who need it most."
Parents who earn less than $79,000 will get the $60 until their child turns 3.
Labour finance spokesman Grant Robertson said every family that earned less than $62,000 would be better off than they were today.
Labour Party's Jacinda Ardern, Andrew Little and Grant Robertson announce their Families Package. Photo/Sarah Harris
He gave an example of a family with one child earning $50,000 in Auckland. They would be up to $5000 a year better off than they are currently, he said.
Te Whānau O Waipareira Trust chief executive John Tamihere told the Herald any financial increase to low-income families would be good for everyone and grease the economy.
"That money is instantly invested weekly back into the economy. It's not held in cash deposits. It goes immediately on better clothes for the kids."
Tamihere believed that while employment was high many Kiwis were just "treading water" despite working two or three jobs to cover the cost of housing.
Grey Power president Tom O'Connor said the Families Package was well overdue and a sign the Labour Party was heading back to its roots of looking after the country's most vulnerable.
O'Connor supported the Winter Energy Payment of $700 for couples and parents with children at home and $450 for single people. But he wanted it to be implemented as a credit so desperate families wouldn't use it for groceries which left them without money for heating.
"Particularly in the South Island we have some very vulnerable people who really do struggle in the winter. It's really, really tough. What they are talking about is a hell of a lot better than what we've got."
Auckland Action Against Poverty co-ordinator Vanessa Cole said the policies were a step in the right direction but did not go far enough. She criticised the party for maintaining their fiscal responsibility policy which was focused on reducing public spending.
"We need a liveable income for unemployed workers so people can live and not just survive. Paying for heating is all good but some families don't even have a home to heat."
Labour's package
Working for Families
Increase the Family Tax Credit base rate for the eldest child to $5878 from $5303. Adopt the Budget 2017 changes to the Family Tax Credit base rate for subsequent children and new abatement rate.
Raise the abatement threshold for Working for Families to $42,700 from $36,350 - estimated to mean 30,000 more families get Working for Families.
Cost: $743 million more a year (combination of National's Budget changes and $370 million for Labour's extras).
Introduce a Best Start payment of $60 a week for each child in the first year after paid parental leave ends. Families on less than $79,000 will get the $60 until their children turns 3, and it will abate at a rate of 20.8c per dollar for those earning more than that.
Cost: $303 million, partly offset by dropping Working for Families parental tax credit.
Winter Energy Payment
The Winter Energy Payment for beneficiaries and superannuitants will be $700 for couples and parents with children at home and $450 for single people.
