Response to the Cost of Living Crisis

Today's budget announcement included measures to assist middle income New Zealanders through to cost of living crisis.  These include:

  • For eligible persons earning less than $70,000 a year, IRD will be making a Cost of Living Payment made up of 3 payments of $116 ($350 total) from 1 August 2022.  There will be no application process to receive this payment, it will be made automatically to your bank account listed with the IRD. To ensure you receive your payment, please ensure that IRD have your current bank account. 
  • The fuel tax cuts of 25c a litre and road user charges have been extended by 2 months to the end of August.
  • A 2 month extension of the 50% cost reduction to public transport has also been made with a further announcement that Community Service Card holders will have this extension made permanent. 

 

Health

$13.2b has been promised to the new nationalized health body Health NZ over the next 4 years, with the first $1.8b in the first year.  $11.1b will cover cost pressures and $2.1b is earmarked for new services. 

The addition of 248 new paramedics and front-line staff, 48 ambulances and 13 other vehicles. 

$202m to be spent on specialist mental health services and addiction services.

A new Ministry for Disabled People will be established with funding of $943m to go towards this as well as investing in the regional-based rollout of the Enabling Good Lives approach. 

Pharmac has been given a funding boost of $191m over 2 years to make more well-evidenced drugs and treatments available.

 

Supermarkets

New legislation will be going through the House under urgency to stop supermarkets from essentially blocking other competitors from entering the market.  This will encourage more competition with the intention of reducing prices. 

They will also look at the role of a Code of Conduct and a dedicated regulator could play. 

 

Funding for Small to Medium sized Enterprises

Th Government will look at partnering with retail banks to invest $100m in a Business Growth Fund, to invest in small and medium sized enterprises. 

 

Housing

The house price cap on first-home buyer grants has been lifted in the major centers as follows:

  • Auckland from $700,000 to $875,000
  • Wellington & Queenstown Lakes from $650,000 to $925,000
  • Hamilton urban from $600,000 to $725,000
  • Tauranga from $600,000 to $875,000
  • Christchurch from $550,000 to $750,000

These caps will now be reviewed every 6 months.