Families Package

Families Package. The Families Package is a suite of social welfare and tax measures introduced by the New Zealand Government to increase financial support for low- and middle-income households with children. Announced in 2017, it was a central policy of the Labour-led coalition formed following the 2017 New Zealand general election. The package aimed to reduce child poverty and improve well-being by significantly boosting family tax credits and introducing new allowances.

Overview

The policy was developed as a key alternative to the previous National Party government's planned tax cuts, redirecting fiscal resources toward targeted income support. Its design was influenced by recommendations from the New Zealand Treasury and the Child Poverty Reduction Act 2018, which established official measures and reporting requirements. The package represented a major shift in social policy under Prime Minister Jacinda Ardern and Finance Minister Grant Robertson, focusing on the Wellbeing Budget approach. It consolidated several existing forms of assistance into a more streamlined system of payments administered by the Ministry of Social Development and Inland Revenue.

Key components

The primary element was a substantial increase to the Working for Families tax credit system, particularly the Family Tax Credit and the Best Start payment for newborns. A new Winter Energy Payment was introduced to assist seniors and beneficiaries with heating costs during colder months. The package also included the reinstatement of the Independent Earner Tax Credit for some middle-income earners without children. Furthermore, it raised the Accommodation Supplement to help offset rising housing costs in areas like Auckland and Wellington. These changes were complemented by increases to several core benefits, including Jobseeker Support and Supported Living Payment.

Legislative history

The policy was first detailed in the Budget Policy Statement 2018 and subsequently formalized in the Families Package (Income Tax and Benefits) Act 2018. This legislation passed through the New Zealand House of Representatives with support from coalition partners New Zealand First and the Green Party. The act amended previous statutes, including the Income Tax Act 2007 and the Social Security Act 2018, to enact the new payment rates and eligibility criteria. Its passage followed the 2018 New Zealand budget, which allocated billions in new spending over several years. The legislative process was overseen by then Minister of Social Development Carmel Sepuloni and Revenue Minister Stuart Nash.

Impact and reception

Initial analysis by the Ministry of Social Development estimated the package would lift tens of thousands of children above the official poverty line. Organizations like the Child Poverty Action Group and the Salvation Army welcomed the targeted approach, though some advocated for more universal support. Critics, including the Opposition and the New Zealand Initiative, argued the measures disincentivized work and increased complexity. Subsequent reports from Stats NZ on child poverty indicators showed modest improvements, though challenges remained in regions with high deprivation like Northland and the East Coast. The New Zealand Council of Trade Unions praised the focus on low-wage families.

Implementation and administration

Payments commenced on 1 July 2018, with Inland Revenue automatically adjusting tax credits for most recipients enrolled in Working for Families. The Winter Energy Payment was administered by the Ministry of Social Development to beneficiaries and New Zealand Superannuation recipients. Public information campaigns were launched via Work and Income service centers and the IRD website. Implementation required significant coordination between government agencies, including the Ministry of Health for data sharing related to the Best Start payment. The package's rollout was monitored by the Social Wellbeing Agency and the Children's Commissioner.

Category:Social welfare in New Zealand Category:2018 in New Zealand law Category:Jacinda Ardern