Source: New Zealand Parliament – Hansard
Question No. 2—Social Development and Employment
2. Hon MARAMA DAVIDSON (Minister for the Prevention of Family and Sexual Violence) to the Minister for Social Development and Employment: Does she agree with the recent Working for Families review that it presents “the best opportunity in the coming years to achieve substantial reductions in measured child poverty and to make significant ‘headway’ towards achieving the ten-year targets”?
Hon CARMEL SEPULONI (Minister for Social Development and Employment): Yes. This Government has consistently increased Working for Families to make everyday life more affordable for Kiwi families. Our Families Package increased the family tax credit and introduced the Best Start payment, dedicated to supporting parents with extra costs in a child’s first three years. We have expanded access to the in-work tax credit to ensure more families receive this support. Our increases to the Best Start payment and family tax credit in 2022 meant 346,000 families are better off by an average of $20 per week and an estimated 6,000 children have been lifted out of poverty. And, on 1 April, we adjusted Working for Families tax credits in line with inflation, supporting Kiwi families with the cost of living. Is there more to do? There certainly is.
Hon Marama Davidson: When will her Government stop discriminating against children of parents on a benefit, who are left in poverty while awarding extra support to working families?
Hon CARMEL SEPULONI: It’s not discrimination. Fifty percent of children living in poverty are living in households that are working. They are low-income households. They have expenses associated with working, whether it be getting to work, the travel associated; whether it be childcare costs. We want to ensure that those families are looked after. That doesn’t mean that we have neglected our responsibility to those that are on benefit. We have significantly increased benefits during our time. When we lifted main benefits, we’re estimated to have lifted between 19,000 and 33,000 children out of poverty. By doing things like child support pass-on, we also have lifted children out of poverty—for that particular initiative, between 6,000 to 14,000 children lifted out of poverty. We are focused on families that are on benefit but also low-income families that are working and trying to get ahead.
Hon Marama Davidson: And that is good, but is it fair that single parents who are caregivers don’t get the in-work tax credit despite caregiving for children being essential unpaid work to households?
Hon CARMEL SEPULONI: We absolutely respect the role of parents that are staying home, including those that are on sole parent support. As I said, one of the things that we did do was change the discriminatory policy where sole parent beneficiary recipients were not getting the child support passed on to them. That will make a significant difference to them and their children, and I’m very proud that we as a Government have been able to do that.
Hon Marama Davidson: Will tweaking the Working for Families abatement threshold and the in-work tax credit have any impact on child poverty targets when half of children in poverty are in households in receipt of a benefit?
Hon CARMEL SEPULONI: We are expecting that the report-back to Cabinet for the Working for Families review will occur at the end of this year, and at that point more consideration can be given to Working for Families and any potential changes.
Hon Marama Davidson: Does she agree with advice given to her by her own officials that “there are significant issues with the design of in-work assistance, particularly with the minimum family tax credit but also to a lesser extent the in-work tax credit.”, and, if so, will she simplify Working for Families and create one child-centric payment which goes to all struggling households?
Hon CARMEL SEPULONI: I do believe that there needs to be structural reform with Working for Families, and that report-back will go to Cabinet at the end of this year.
