Minister brags about the July 1 wellbeing boost but (oblivious to govt’s borrowing) Greens press for even bigger benefits

A swag of Ministers joined in proclaiming a raft of initiatives which kick in today, all intended (but not necessarily guaranteed) to support New Zealand’s economic recovery from Covid, while addressing child poverty, housing, and climate change.

“Together, today’s initiatives deliver on our priorities of lifting more children out poverty, improving the state of rental housing and reducing our climate emissions while supporting our economic recovery from COVID,” Minister for Social Development Carmel Sepuloni said.

The Green Party responded by saying

  • It welcomes the 1 July changes to support families and children, but
  • The main benefit increase must go further to help pull New Zealanders out of poverty.

The Greens’ spokesperson for Social Development & Employment, Ricardo Menéndez March, referenced a new poll published today which shows a majority of New Zealanders from different backgrounds think the Government should increase income support beyond what was announced in Budget 2021.

Did the poll gauge the willingness of these respondents to pay extra taxes to raise the readies?

March said restoring the Training Incentive Allowance will make a positive difference to the lives of many families from today.

“But the $20 lift to main benefits, which starts today, doesn’t do enough to help people put food on the table and a roof over their head.

 “The Government’s approach of staggering main benefit increases does not make sense when we have families desperately in need, using food grants just to survive.

 “$20 now and $15 next year will not go far enough to address the overwhelming hardship people are experiencing. New Zealanders want to see better support, and the Government has the money in the bank to do it.”

The Government has the money in the bank to do it?

What planet is this fellow on?

We suggest he pop up at question time today to ask Finance Minister Grant Robertson about the Government’s debt.

Grant happened to mention this debt when he welcomed the latest set of Crown accounts.

“We are still facing elevated levels of debt and OBEGAL deficits for some years to come as a result of the borrowing needed to support New Zealanders through COVID 19.”

But enough of Greenie grouching.

Let’s check out the July 1 initiatives and their results:

Bigger benefits: Main benefits are increased by $20 per adult (after tax), the first of two main benefit increases announced in Budget 2021 to raise weekly main benefit rates by between $32 and $55 by April next year.

Complementary changes aim to ensure Childcare Assistance for families won’t fall when benefits or supplementary payments rise in the future.

Around 2,100 families will be eligible for more Childcare Assistance and more families will benefit over time, with further improvements in April next year to index Childcare Assistance income thresholds to annual average wage growth, Carmel Sepuloni said.

More parental leave: From today, the rate of paid parental leave will increase 2.5% to from $606.46 a week (gross) to $621.76.

More demands on landlords: New Healthy Homes Standards will come into force, to provide renters with better homes, which in turn will improve their health and wellbeing.

All boarding houses must comply with the healthy homes standards and private landlords must ensure their rental properties comply within 90 days of a new, or renewed tenancy.  All rental properties must comply with the standards by 1 July 2024.

A new ministry: The Ministry for Ethnic Communities begins its work today.

Cheaper electric cars:  The clean car discount scheme for Electric and Plug-In Hybrid Vehicles will make it cheaper for New Zealanders to buy electric and low emission cars. It will prevent up to 9.2 million tonnes of carbon dioxide emissions and will help with the upfront cost of switching over with Kiwis getting up to $8,625 back, said Transport Minister Michael Wood.

More support for caregivers:  Changes announced in Budget 2020 which come into effect today include, improving support for caregivers who take on the care of children outside of the State care system for a short or uncertain length of time. From today, eligible caregivers may qualify for Orphan’s Benefit or Unsupported Child’s Benefit from the Ministry of Social Development, even if the child or young person is expected to be in their care less than 12 months.

Other Beehive statements since we last reported on what our Ministers are up to include  –

  • Building and Construction Minister Poto Williams relished the release of the highest annual number of residential building consents on record, saying this was a measure of Government support for and investment in the construction sector.
  • Finance Minister Grant Robertson brandished the Crown accounts for the 11 months to the end of May and crowed they show the New Zealand economy is continuing to display resilience in the face of the ongoing impact of COVID-19. This confirmed “that the Government’s ongoing response to the pandemic is the right one” (although he acknowledged the outlook “remains uncertain”, and “we are still facing elevated levels of debt and OBEGAL deficits for some years to come” as a result of the borrowing needed to support New Zealanders through COVID 19).
  • Diversity, Inclusion and Ethnic Communities Minister Priyanca Radhakrishnan has welcomed the launch of the Ministry for Ethnic Communities. “Our Government wants to ensure that New Zealand is a place where everyone feels safe, valued, heard, and has a sense of belonging,” she said (although only one ethnic group can be assured of always being heard and of having a guaranteed place around the tables of a growing list of decision-making bodies).
  • The first woman Chair of the Fire and Emergency New Zealand Board was appointed.  Former Labour Minister Paul Swain, Chair for five years, is stepping down.
  • The Government has released new child poverty targets, set at rates required to keep New Zealand on track to meet its longer-term 10 year targets. Reducing child poverty remains a key priority, said the PM who had emphasised the importance of the targets by giving herself the job of Minister for Child Poverty Reduction.  Will she sack herself if the targets are missed?
  • Associate Foreign Affairs Minister Aupito William Sio  addressed the Pacific Cooperation Broadcasting Ltd General Managers Conference.
  • The Primary Maternity Services Notice has been upgraded, to better fund care for women and families in rural areas and those with complex clinical or social needs.  Budget 2020 included $85 million over four years to boost primary maternity care for these women.

Latest from the Beehive

Ethnic communities

Speech at the launch of the Ministry for Ethnic Communities

Diversity, Inclusion and Ethnic Communities Minister Priyanca Radhakrishnan recalled  that 20 years ago, Helen Clark’s Government established the Office of Ethnic Affairs.  At that time, in 2001, ethnic communities made up around 8 per cent of the population. It was a small office that grew to around 17 people by 2018.

Over the years, the Office has supported 16 Ministers and numbers of ethnic communities have grown significantly.

Last term, the Government funded a number of changes to strengthen the functions of the Office, including community engagement.

Today, the Office has over 40 staff working in communities from Whangarei to Dunedin.

The Government increased the Ethnic Communities Development Fund eightfold and expanded the criteria of what it could support.

Today, almost 1 million people identify with an ethnic community, comprising almost 20% of New Zealand’s population – an increase of 45 percent since the 2013 Census.

More than 213 ethnicities are represented across the country and speak over 160 languages.

Mervin Singham is the inaugural Chief Executive of the new Ministry for Ethnic Communities.

New Ministry for Ethnic Communities launched

In her press statement to welcome the launch of the new Ministry for Ethnic Communities, Diversity, Inclusion and Ethnic Communities Minister Priyanca Radhakrishnan said this is the first time in its history that New Zealand has had a Ministry and Chief Executive solely focused on improving outcomes for our ethnic communities, which make up nearly 20 per cent of our population.

The Government committed to establishing the Ministry last December, as part of its response to the recommendations of the Royal Commission of Inquiry into the terrorist attack on Christchurch masjidain on 15 March 2019.

The Ministry will continue to deliver the functions of the Office of Ethnic Communities, but will also look to build additional functions and influence across the public sector.

The Ministry’s priorities will be:

  • Promoting the value of diversity and improving the inclusion of ethnic communities in wider society
  • Ensuring government services are accessible and for ethnic communities
  • Improving economic outcomes for ethnic communities, including addressing barriers to employment
  • Connecting and empowering ethnic community groups.

Housing

Historical high numbers of annual building consents issued

 Building and Construction Minister Poto Williams welcomed Estimates from Statistics New Zealand released today which show –

  • In the year ended May 2021, the actual number of new dwellings consented was 43,466.
  • The annual value of non-residential building work consented was $7.9 billion, up 21 per cent from the May 2020 year.
  • The number of new townhouses, flats and units consented in May 2021 is 1,380.

“New building laws announced last month will go even further to support housing supply and affordability and enable the use of new, innovative and efficient building methods such as offsite manufacturing.”

The Building Amendment Act now includes the provision of a new certification scheme for modular component manufacturers, which will streamline the building consenting process for new and innovative building techniques that have the potential to reduce building costs while delivering high quality, affordable homes.

Meanwhile the Construction Sector Accord, a partnership between industry and government, supports greater pipeline certainty so participants across the sector can have confidence to invest for future skills and technology.

Government’s finances

Economic resilience shown in Crown accounts

The Crown accounts for the 11 months to the end of May show the operating balance before gains and losses (OBEGAL) was a deficit of $3.6 billion, $5.8 billion better than forecast by the Treasury in Budget 2021 in May.

Tax revenue was $89 billion, $4.1 billion above forecast due to higher than expected corporate and income tax, and GST revenue.

Net core Crown debt was 31.2 per cent of GDP, $6 billion less than forecast.

 “The balanced approach we took in Budget 2021 is appropriate as we work through the uncertainty. This Government will continue to keep a lid on debt while targeting support to where it is needed most to accelerate the recovery and tackle long-standing issues around climate change, housing and child wellbeing,” Grant Robertson said.

July 1 initiatives

Government actions deliver a better future

 The raft of initiatives which take effect today include:

  • Main benefits increase by $20 per adult, per week (after tax).
  • Training Incentive Allowance will support higher-level study for sole parents on benefits, and carers and disabled people on Supported Living Payment.
  • Unsupported Child’s Benefit and Orphan’s Benefit extends to short-term caregivers of children who are unable to live with their parents.
  • Increasing paid parental leave rates: The maximum rate for eligible employees and self-employed persons will therefore increase 2.5 per cent from $606.46 per week (gross) to $621.76.
  • Healthy Homes Standards will require landlords to provide properties with insulation, at least one fixed heating device capable of heating the living room to at least 18 degrees, openable windows in most rooms and extractor fans in bathrooms and kitchens
  • Ministry for Ethnic Communities begins operating
  • New rebates for electric and plug-in hybrid vehicles start July 1 with up to $8,625 for new vehicles and $3,450 for used.
  • Tourism businesses operating on public conservation land will have a further six months of fees waived to help them adjust to the downturn in international visitors in the wake of the COVID-19 pandemic.
  • The second round of changes to the rating of Māori freehold land will come into effect following the passing of the Local Government (Rating of Whenua Māori) Amendment Act 2021 earlier this year.
  • Security Guards added to Schedule One of the Employment Relations Act helping protect their employment conditions.
  • Introduction of the new Migrant Exploitation Protection Visa to protect migrants and help them leave exploitative situations.

Fire board appointment

First Female Chair for FENZ Board

Rebecca Keoghan will be the first woman Chair of the Fire and Emergency New Zealand Board. She has been the Board’s Deputy Chair.

Wendie Harvey and Malcolm Inglis have been reappointed to the Board.

A separate appointments process is under way to fill the remaining two Board positions by late August this year.

Child poverty 

Government releases second set of child poverty targets

The second set of official three-year child poverty targets, as required by the Child Poverty Reduction Act 2018, cover the 2021/22, 2022/23, and 2023/24 financial years and are set at rates required to keep New Zealand on track to meet its longer-term 10 year targets.

Achieving the new targets for 2023/24 would see the following reductions from the 2017/18 baseline rates of child poverty:

  1. Reduction in the before-housing-costs measure from 16.5 to 10 percent – lifting around 70,000 children out of poverty
  2. Reduction in the after-housing-costs measure from 22.8 to 15 percent – lifting around 80,000 children out of poverty
  3. Reduction in the number of children experiencing material hardship from 13.3 to 9 percent – lifting around 40,000 children out of hardship

Jacinda Ardern, Minister in Charge of Child Poverty Reduction, said:

“Our plan is based around making progress in three key areas: increasing incomes for families, reducing housing costs and other pressures on low-income households, and changes to support the wider wellbeing of families.

“Budget 21, which included main benefit increases of between $32 and $55 per person, is an important part of this.”

Since the Government introduced child poverty reduction targets, reductions have been achieved across all nine child poverty measures, Ardern said, and the first three-year target for the after-housing-cost measure has already been exceeded by lifting 43,300 children out of poverty.

Broadcasting

Speech to the Pacific Cooperation Broadcasting Ltd General Managers Conference

Associate Foreign Affairs MinisTer Aupio William Sio said he wants more Pacific stories being told by Pacific peoples,

“… using our cultural lens, cultural intelligence and languages. This will require support and collaboration and understanding. I also want to see those stories reflected back to us here in Aotearoa New Zealand.

“Partnering together to support a strong and resilient media sector in the Pacific allows us to work together to highlight and tackle issues facing the Pacific and our people.”

Maternity services

Upgrade to funding tool for community maternity services

The Primary Maternity Services Notice has been upgraded, to better fund care for women and whānau in rural areas, and those with complex clinical or social needs.

The Notice sets out how self-employed primary maternity care providers are paid, and remunerates midwives for services provided from the beginning of pregnancy until six weeks after the baby is born.

The updated Notice will introduce rural practice, travel, and additional care payments, to more equitably fund travel and provision of maternity care.

Budget 2020 included the largest ever funding boost for primary maternity services. The Government invested $242 million over four years so maternity service providers, women and their babies can receive more support.

Water

Government water reforms to build economic resilience and save ratepayers money

 The Government is proposing to establish four publicly-owned entities to take responsibility of drinking water, wastewater and stormwater infrastructure across New Zealand, saving ratepayers thousands of dollars and better ensuring the $120 to $185 billion investment in services can be made.

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