Poverty dramatically reduced

The Working for Families package takes aim at child poverty and will reduce it dramatically, says Social Development and Employment Minister Steve Maharey.

Speaking this morning at a post-Budget breakfast hosted by the Child Poverty Action Group and the Public Health Association, Steve Maharey said yesterday’s Budget signals the biggest change to New Zealand’s social assistance system in over a decade.

“Depending on which internationally recognised measure is used, the package will reduce child poverty by either 30 and 70 per cent. The government will regularly monitor these statistics and report them publicly so New Zealanders can see the progress being made.

“Budget 2004 directly responds to issues raised by groups like the Child Poverty Action Group and the Public Health Association. It squarely targets child poverty, gives families more assistance and ensures this support is regularly adjusted for inflation in future so it’s value is not eroded over time, boosts housing assistance for all low-and-middle income New Zealanders, provides real financial incentives for parents in beneficiary families to move in to paid work and extends quality health care to more New Zealanders.

“By 1 April 2005, 260,000 families will be benfiting from the family support increases.

“By 2007 there will be 480,000 New Zealand families with dependent children. Yesterday’s Budget will lift living standards of 290,000 – or 61 per cent – of these families. In other words we are targeting the low-and-middle income families most in need of support.

Examples include: A three-child family on the North Shore. Mum looks after the kids and dad works, bringing in $52,000 gross per annum. The Working for Families package will boost their weekly income by $170; A four-child family living in Timaru. Dad brings home $58,000 gross per annum and is paying off a student loan. The Working for Families package will boost their weekly income by $150; and

. . / 2 A sole-parent with one child living in Onehunga who receives the Domestic Purposes Benefit, but works part time, will receive $101 more a week. However with the introduction of the new In-Work payment in the The Working for Families package from 1 April 2006 this person would immediately receive an additional $161 per week if they moved off benefit altogether.

Steve Maharey said National leader Don Brash’s favoured approach – tax cuts – would National would make no real appreciable difference to families in need.

“The highly publicised middle-income four-child family earning $55,000 would receive $39 extra income per week on a flat tax-rate of 20 per cent – compared with the $150 per week they will receive as a result of Budget 2004. Unlike the Working for Families package, tax cuts target benefits at the people who need it least: those on higher incomes without dependent children.

“Through the Working for Families package the government is delivering a social dividend from our growing economy to those hard working New Zealand families who need it most,” Steve Mahaery said.

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