Prime Minister Jacinda Ardern announced the detail of the April increases at her post-Cabinet press conference before leaving for Fiji. Photo / Mark Mitchell
Prime Minister Jacinda Ardern announced the detail of the April increases at her post-Cabinet press conference before leaving for Fiji. Photo / Mark Mitchell
The Government has announced the details of the first social welfare benefit rises from indexation to the net average wage, which will boost the state assistance of 310,000 families reliant on a benefit, as well as superannuitants.
The increases to benefits are larger than they would have been if they remained indexed to the consumer price index, 3.09 per cent instead of 1.66 per cent.
For example, a person on a sole parent support benefit will have an increase of $10.48 a week.
Under the previous indexation, it would have been only $5.64 a week.
A single disabled person will get an extra $8.44 a week more, and a jobseeker beneficiary aged 25 or over will get $6.78 more.
The increases will take effect on April 1, but Prime Minister Jacinda Ardern made the announcement at her post-Cabinet press conference before leaving for Fiji and before the first release on Tuesday of figures by Statistics New Zealand under the Child Poverty Reduction Act.
Indexing benefits to the average wage was announced in last year's Budget although the Ministry of Social Development is not yet able to say what the annual cost of the actual increases will be.
Increases in New Zealand Superannuation are already indexed to the average wage.
Its increase this year will be 3.08 per cent, rather than the 3.09 per cent of beneficiaries.
However Social Development Minister Carmel Sepuloni said super would remain at the 66 per cent of the average wage, the guaranteed minimum for superannuation.
Social Development Minister Carmel Sepuloni says the pension will remain at 66 per cent of the net average wage. Photo / Mark Mitchell
Overall, increases will be made to over 1.2 million people – either the 800,000 receiving New Zealand superannuation or the veteran's pension; or 310,000 on main social welfare benefits, including jobseeker support, sole parent, supported living payment, and youth payment.
The 60,000 students receiving a student allowance or 70,000 receiving supplementary assistance such as an accommodation supplement will receive a lesser increase – they are still indexed to the consumer price index.
The increases are the largest since the Bill English Budget of 2015, which increased benefits by $25 a week for beneficiaries with dependent children.
Not counting that increase, it is the largest increase in benefits in nine years.
April 1 will also see an increase in abatement thresholds in line with movement in the minimum wage, meaning that beneficiaries will be able to earn more in part-time work before their benefit starts being reduced.
For example, sole parents will be able to earn $115 of other income a week instead of $100 before their incomes start abating.
