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Budget 2021

Written By: - Date published: 12:37 pm, May 20th, 2021 - 71 comments
Categories: covid-19, Economy, grant robertson, Politics - Tags:

Budget 2021 is now live: https://budget.govt.nz.

Highlights:

  • Lifting weekly main benefit rates by between $32 and $55 per adult to tackle inequality and child poverty, as well as reinstating the Training Incentive Allowance
  • $300 million to recapitalise New Zealand Green Investment Finance to continue to invest in support of climate change mitigation, with a particular focus on decarbonising public transport, waste and plastics
  • Infrastructure investment totals $57.3 billion over the next five years, and to increase housing supply we are investing $3.8 billion in a Housing Acceleration Fund
  • Just under $1.5 billion allocated for the COVID-19 Vaccine and Immunisation Programme, which provides fully funded, free COVID-19 vaccines
  • Investing $4.7 billion in Health, which includes more funding for PHARMAC, plus the transition to a new health system and establishment of a Māori Health Authority

This post will be updated as details emerge.

 

71 comments on “Budget 2021 ”

  1. coreyjhumm 1

    This budget is kinda make or break. It's the first labour majority budget since the fourth labour govt so we'll see what labour really is today.

    An unprecedented majority, insane public support in polls, no real opposition, people crying out for help with housing and income issues ,the old fears of borrowing and debt are gone and people are crying out for a stronger public service sector and money is as cheap as its ever gonna be with all that and this being the govts fourth budget, with no coalition restraints labour has to be transformational.

    If there's no increases to core benefits for singles and not just family stuff for welfare I'll be fuming. I've been defending this govt all term because I've been excited about some of the reforms and wanted to see what a majority labour govt does in it's budget.

    Benefits can go up atleast $25 with no deductions from other top up benefits. They should go up $50 but $20-25 would have me hopeful. That's really all I want from this budget. That and more money for health, housing and infrastructure.

    My nice to haves would be :

    Students getting winter payment (no reason they shouldn't) , slight increase to student weekly payments and an increase to course costs that students get to buy gear with at the start of the year which haven't gone up in over a decade but costs have

    More subsidized dental

    Massive increase in state housing development

    Massive increase in the health and education budget like we haven't seen in decades

    Public funding for ambulances

    Doubling the ammount of food grants all kiwis can access

    Moves on cheaper gp visits

    Expanding food in schools and mental health in schools to all schools

    Some kind of subsidized dental

    No cuts to art or culture spending

    More rail and concrete plans and dates for it

    I don't expect any of those so my hopes aren't high for a keynesian revolution… my hopes are as high as a small $25 increase to benefits and no real austerity

    What I think we'll get is an austerity lite budget the kind that even conservatives are turning away from overseas that has mild increases to parent and family payments, targeted spending and a lot of virtue signaling on climate, a huge focus on debt and a lot of talk of saving for another rainy day and "now is not the time" "covid has derailed some of our more wellbeing policies"

    However…. A small part of me hopes Ardern and Labour are as ambitious as Arderns good mate Trudeaus new budget but

    As much as this govt has made some decent steps away from the neoliberal status quo

    I just don't think nz has had the threat of populism and anger that other countries have had to scare the bejeezus out of nz labour that the time has come for radical change

    So yeah … $25 on benefits or I'm not gonna renew my membership, not that it matters to them … I'll still like them more than the tories but I won't be raising $2 k for them next election season like I have in the last two and I won't be delivering pamphlets and door knocking in the rain again because if they can't act now… Then when can they? It'd be like FDR refusing to be pushed by his supporters to advocate for the new deal cos "now is not the time , we need to pay down debt sorry some of you lost your lives in the depression and some of you are literally eating your pets to survive but we have to pay down debt for an even Rainier day"

    Come on labour let's do this

    Rant over

  2. Sacha 2

    Core benefits up by $20 gross this year, more in following year. Someone will no doubt work out how much a persons' other payments like accommodation supplement will be reduced accordingly..

    • Rosemary McDonald 2.1

      Blessed be the name of the Lord…

      • Sabine 2.1.1

        One giveth with one hand and one taketh with the other hand.

      • Treetop 2.1.2

        Blessed be the name of the landlord.

        • Rosemary McDonald 2.1.2.1

          Blessed be the name of the landlord. Indeedy. For they shall inherit the largesse. Unless, of course, miracles happen and there is a rent freeze. Or electricity prices are frozen.

  3. coreyjhumm 3

    I'm glad I kept my hopes low because that way this really impressed me. If they can find a way to stop deductions from top ups and stop msd deductions for the yearly indexes this is good progress. If I'm not mistaken this is the first govt to increase core benefits since the 90s? And while covidnforced them to do something last year this year and the winter energy payment has me kind of hopeful. I'm a student on supported living so every cent helps. I'm glad to see students getting more and more for health and infrastructure

    It's not enough but I would absolutely call this a decent budget and in no way an austerity budget.

    My real concern for beneficiaries and students is that apart from possible deductions we could have landlords swallowing up that rent so I'd like to see a rent freeze of some kind.

    I'd give this a 7/10.

    I thought we were getting a kind austerity budget. I'm impressed that it's not

    Still a lot of stuff to do and maybe I'm just happy about getting anything but I'm impressed with them for not going full on austerity.

    I do hope this govt reforms rapidly this term, from my assignments I've been researching how he neolib revolution was so successful because at the pace at which they did it, leading no alternative with a majority govt and 12 left wing allied votes they could really do a fast soft revolution and use the covid crisis as a back drop to it

    "There is no alternative" the left could say

    Anyway I'm making no sense. I kept my hopes low and they over delivered for my low hopes and resisted nzs natural urge to worry about nothing other than debt and self reliance.

    Decent. More like this next year please

    • Sabine 3.1

      First increase by 25 NZD since 1977 was in 2015 under National.

      https://www.stuff.co.nz/business/68742199/budget-2015-benefits-rise-in-bid-to-tackle-child-poverty

      so that is not something new.

      In Budget 2021, to tackle inequality and child poverty, we are lifting weekly main benefit rates by between $32 and $55 per adult, to bring these rates in line with a key recommendation of the Welfare Expert Advisory Group (WEAG) and provide an additional boost to families with children. This is expected to lift between 19,000 and 33,000 more children out of poverty on the after-housing-costs measure.

      The report that came out in 2019 and ask for an 'immediate' increase on Job seekers benefits and other benefits. Never mind, better late then never.

      But as Sacha pointed out, if you increase the base benefit or core benefit some other fringe benefits will drop to make up the 'increases in earnings'.

      • Patricia Bremner 3.1.1

        No they have allowed a larger $ in hand before any deductions. You are selective at times.

        The group who were for rail will be bouyed by this budget.

        • Sabine 3.1.1.1

          Any increase in core benefits will to some extend lead to a drop in top up benefits as they now have more income, Patricia. Don't discuss that with me, discuss it with Winz, or some of the commentators here that are on a benefit and can exactly tell you how that works.

          That does not take away from the fact that this small increase will help a bit.

          Nothing selective about that. But then, sometimes the truth is just that truth, not pretty, not sexy, but rather dull and uninspiring.

        • Sacha 3.1.1.2

          They changed benefit abatement levels for part-time work – but I am not aware of anything for disability allowances, accommodation, TAS, etc.

          • Sabine 3.1.1.2.1

            it seems like its only for part time work from here.

            Labour increased them again by $25 a week last year (as Bill English did under National), indexed them to the average wage and adjusted abate rates to allow beneficiaries to earn more before their benefits are reduced.

            https://www.nzherald.co.nz/nz/budget-2021-audrey-young-if-not-now-then-when-for-beneficiaries/C6AJKCJVRT5H7HTJ4SKJJVKHEI/

          • Craig Hall 3.1.1.2.2

            There is a significant increase in the total appropriation for hardship assistance which includes TAS, so maybe that has been heard ($495M in 2021 to $591M in 2022 and an additional $30M each year after that).

          • Treetop 3.1.1.2.3

            They need to treat any benefit increase as not being income so it does not disappear into the landlords bank.

            The energy payment is not treated as income.

            • Pat 3.1.1.2.3.1

              Dosnt matter how its treated I expect a good portion of it will end up there anyway…..and why not dealing with housing means they will continue to chase their tails.

      • Louis 3.1.2

        Labour's $25.00 increase (2020) was for all beneficiaries, that made it new, since National's 2015 benefit increase was targeted, so not everyone received it.

        "Benefit rates for families with children will rise by $25 a week "

        https://www.beehive.govt.nz/release/budget-2015-glance

        How many actually got it I wonder, with the number of hoops National made people jump through.

        The Labour govt have gone beyond what WEAG recommended

        • Descendant Of Smith 3.1.2.1

          While they have painted this as reversing Ruth's mother of all budgets and correcting the wrongs of that budget they are either stupid, liars, naive or all three.

          Ruth Richardson's changes.

          1. $20-00 per week off – fixed belatedly after Helen Clark's Labour Government put it back on NZS only
          2. Youth rate for under 18 year old's extended to 24 – not fixed
          3. Aligning benefit rates away from 60% of the average wage to CPI increases – not fixed
          4. Compensation for the years of neglect and indebtedness that have occurred as people were forced to apply for advances on their benefit to meet costs that should have come from a decent benefit rate- zilch

          Benefit rates used to be the same as NZS – 3 above was the most damaging of all the changes.

          The least they could do is back-date and give everyone a lump sum or clear their benefit debt so they can receive the full amount that they need to survive.

          The only redeeming feature is that it is $20-00 and it isn't targeted. We are a first world country we need to stop this targeting bullshit – that's for third world countries with enormous problems where you have to start somewhere. First world countries can afford universality.

          Just like we used to – universal family benefit, NZS….

          It is a token gesture cause they have been backed into a corner and was the simplest option.

          Just don't portray it as reversing Ruth's budget cuts – doesn't come close.

          Still neo-liberal junkies.

          • Louis 3.1.2.1.1

            @ Descendant Of Smith, My comment was about addressing the claim that Labour's $25.00 benefit increase (2020) was "not something new" and Robertson said it was about undoing some of the damage of Richardson's budget of 30 years ago, he pointed out that there's more work to do. IMO I didn't see this budget as tokenism, quite the opposite.

            • greywarshark 3.1.2.1.1.1

              DOS That point about getting clear of welfare debt would be an excellent one, and at the same time perhaps linking bennies with a pair of case managers, so not seeing just one person. And be able to change once a year on request. And the case managers try to help not hinder, to encourage and coach, with a view to small steps to better self satisfaction and capability. What do you think? Used to be.

            • Sabine 3.1.2.1.1.2

              yes, and both things are two pair of different shoes.

              Firstly the first to raise the benefit by that princely sum of 25 NZD was National in 2015. I hope we don't have to re-discuss this here, it was amply discussed at the time in 2015. I think it was called 'cynical' at the time.

              And Robertson talking about someone who literally is only known by those that follow politics or are in a certain age groups is a bone the good man through at you the Labour member, the rest of us see the numbers and are just meh.

              But then to some shoes are just that shoes and it matters not if it is a sneaker or a heel. its shoes.

              • Descendant Of Smith

                “Thirty years. That’s how long it has taken to get benefits back to the rates they were before the Mother of all Budgets,“ Ardern said.

                It's this bullshit I'm calling out. No you haven't – not until they are the same rate as super – and compensation paid to all those who have suffered as a result.

              • Louis

                You did bring it up Sabine and details matter.

                Pretty sure there are some non-political types that would know of Richardson's mother of all budgets, it deeply affected NZ. Grant Robertson gave context, that today's budget is set against that. You don't know whether I am a Labour party member or not, that's an assumption on your part and is irrelevant. imo it's not just meh to beneficiaries, who will benefit from today's budget, when it means extra money in their pockets.

          • Hilary 3.1.2.1.2

            Number 3 aligning benefits back to the average wage was done in 2019. Here is the link https://www.beehive.govt.nz/release/main-benefits-increase-line-wages

            • Descendant Of Smith 3.1.2.1.2.1

              I was referring to the fact that the gap as a result of the change has not been addressed i.e. putting the actual rates back to 60% of the average wage. Sorry if that wasn't clear enough.

              That change made in 2019 just allows for future increases to be a bit bigger. Tinkering.

              • greywarshark

                I keep thinking that if all we progressives concentrate on outcomes and look beyond words, statements, theories and hopes – then we will be able to see more clearly than previously.

                Outcomes, net outcomes, after adjustments here and sideways steps there, what will be in people's hands which they can actually spend on their immediate needs, or even start saving for something?

                No doubt many of you know that no matter how a bennie scrimps and saves for some future good, if an unforeseen problem occurs they will have to spend their savings gained from denial. till all gone. And they may get a grant which has to be repaid, though even in Ruth's time bennies were entitled to a grant of about $200 each year which acknowledged the paucity of the regular benefit.

                That is why people are a bit sceptical.

              • McFlock

                Which benefits were 60% of the average wage in 1990? Unemployment seems to be half that (Link to pdf. table 1. although the links to 1991 unemployment rates were hard to find).

  4. Sanctuary 4

    Today, I rejoined the Labour party. or rather, Labour rejoined me.

  5. woodart 5

    so, after hoskings threat to bugger off, I presume he will be a man of his word .

    • ghostwhowalksnz 5.1

      He'll backtrack for sure …once his contract is re-resigned…

      • woodart 5.1.1

        well, the scruffy little worm should be constantly called out on it. he sees himself as an expert in all things(hmm, that sounds familiar), and purveyor of the truth. if we cant beleive him now, when can we ever? I dont bother with dorktalkradio, but would hope he gets plenty of phone calls asking for his flight number.

    • Patricia Bremner 5.2

      We live in hope xx

  6. Ad 6

    Great stuff Minister Robertson.

    I don't know how Kiwirail does it with so much bid success for so minor improvements.

    • ghostwhowalksnz 6.1

      So new rail wagons, 1000s of them are a trifling cost . Same goes for Locos, which are big ticket items.

      Tracks and signals upgrades are just a normal ongoing costs, which were done even when English was finance minister

  7. mickysavage 7

    National is not enjoying Ruthenasia having a stake driven through its heart …

      • McFlock 7.1.1

        Jesus christ, she thinks increasing benefit levels to roughly half the minimum wage for a 30 or 40 hour week "could cause people to think staying on a benefit was more attractive than a job".

        Sometimes I forget just how abnormal the fiscally far-right are.

        Most people prefer to contribute to something for a fair wage than live on nothing and do little in abject poverty.

        But I suspect some tories really would sit there on fuck-all just to spite the taxpayer.

        • weka 7.1.1.1

          tbf, for some people it is more attractive when a job is minimum wage, no security and shitty work conditions. It's not like the National imagined jobs that apparently appear if people pull themselves up by their bootstraps are proper jobs with meaning and a decent standard of living.

          • KJT 7.1.1.1.1

            Amazing that in the 60's and 70's when unemployment allowance was a greater proportion of average wage, and enough to live on, most people chose to work.

            Maybe nothing to do with welfare levels, and everything to do with jobs on offer with decent conditions?

            • Descendant Of Smith 7.1.1.1.1.1

              Though the predominant welfare system then was a job in the public service.

              Each year the public service took on young people, Maori and Pacific Island cadets, employed people with disabilities and pyschiatric problems, addictions and so on.

              In short the public service absorbed those the private sector couldn't. Young people in particular. It was deliberate government policy to employ those people – many of whom when made redundant were ever able to find work again. Employers for instance wouldn't touch those with disabilities in particular.

          • McFlock 7.1.1.1.2

            True enough. Especially with jobs where the employer is reckless about actually paying even minimum wage – and keeping up with paye, holiday pay, sick leave, etc etc etc. During a "labour shortage" lol.

            But I don't think a little bit more in the benefit will increase the defensively unemployed (seems as good a term as any) by a detectable level.

    • Patricia Bremner 7.2

      Ruth was so smug before and during that delivery if you watch the old videos.

  8. Byd0nz 8

    Looked like Collins had been crying when she had her TV moan.

    Must be a good budget then.

  9. KJT 9

    One of the real pluses of this budget.

    Watching Richardson spinning in her grave.

    • Anne 9.1

      Hang on, she's not in her grave yet. devil

      • woodart 9.1.1

        she is anne, but doesnt realise it. her brand of voodoo economics has been dead for yrs. from memory, her last big-noting was being asked for economic advice by the arginetinians , just before their economy tanked .

        • Anne 9.1.1.1

          her last big-noting was being asked for economic advice by the arginetinians , just before their economy tanked .

          Yep. I remember that. She dined out on it until things went belly-up then she sank into relative obscurity.

          • Descendant Of Smith 9.1.1.1.1

            Lest we forget her connections.

            Key, Unions and Pinochet

            "Pepe Pineda, somewhat unsurprisingly, was a friend of Roger Douglas and made regular Business Round Table visits to NZ in the 1980s and 1990s before his death. Ruth Richardson, the main instigator behind the ECA, was also an admirer of Pineda. These two individuals, with their direct and immediate past dictatorial connections and coalition relationship with National, are believed to be the prime movers behind this attempt to return to the ECA as the framework in which the social relations of production are determined. In other words, National is proposing changes to the labour relations system that have their origins in the Pinochet dictatorship, and which were suggested by people with direct links to that dictatorship. Beyond the violations of ILO convention 87, that alone should give reason for concern."

          • Sanctuary 9.1.1.1.2

            She has a sinecure at the University of Canterbury. Our thoroughly colonised corporate universities are shaping up to be the last bastions of of the neoliberal model, with VCs on 600K+ vigorously defending their meal ticket stamping machines and revenue streams even as our tertiary institutions tumble down all objective rankings.

        • greywarshark 9.1.1.2

          Ruth's face and expression somehow reminded me of the recently defrocked knight wotsisname Brierley. Both without much in the way of laugh-lines and drawn tight round the mouth. That she should speak up about this Budget as she did, is an indication of a sad, mad Tory.

  10. Pat 10

    a very conservative budget…not bad but opportunity missed

  11. Stuart Munro 11

    We always hope for more of course – but it was better than expected. And, it was a Labour budget, catering to issues important to our constituency, and consistent with a move away from the worst elements of neoliberalism.

    So, well done.

    • GreenBus 11.1

      Exactly. Labour has brought in 3 new policies in the last month that will help roll back neoliberalism and a budget to help the battlers and Maori too. Looking bloody good so far. It will take time change everything as the entrenchment goes deep. Well done Labour some transformation at last but worth the wait.

  12. Tricledrown 12

    Next to nothing for low income workers

    • ghostwhowalksnz 12.1

      Minimum wage rates have risen from $15.75 in april 2017 to $20 per hr April 2021. That 25% increase

      Extra sick leave of course means extra money for those who need the time off work which would have been without pay before

  13. greywarshark 13

    I was reading earlier about what compost worms eat and so efficiently too. Perhaps we should save those scraps for low income workers, whom it appears work efficiently on whatever they get thrown by a loving business manager. Perhaps the government has washed its hands of them and they are SEPs.

    • Stuart Munro 13.1

      The measure that will do the most for people on low incomes, is action on rents.

      But such action is not part of budget. Real rent reform could make the rest of the budget reasonably effective, and a lack of rental action will, like as not, soak up the rather modest improvements on offer.

    • KJT 13.2

      Low incomes are being addressed with labour law reforms.

      The whole package is much better than I expected.

      So. "Giving credit where it is due".

      • greywarshark 13.2.1

        Yes the spoonful of sugar but the medicine that Stuart refers to has not been administered so we end up with a sugar rush.

  14. Jackel 14

    Just think, if this budget actually works and things really do take off in this country, where does that leave the tories and the neoliberals with their voodoo economics? lol

    • Peter 14.1

      In Australia with Hosking?

      • ghostwhowalksnz 14.1.1

        With its capital gains tax, higher tax rates on income over $150k…

        Maybe Hoskings mate John Key has hooked him up with Silicon Valley people and they are looking for media experience

      • Jackel 14.1.2

        Which would raise the IQ of both countries.

  15. Pat 15

    I have just listened to a half hour interview of the Finance Minister by Kathryn Ryan and dont recall hearing the words 'climate change' once.

  16. Forget now 16

    16,000 is 4 times 4,000 over 4years. Why that particular number though? And what happens if more people apply than there is funding for?

    Anyway Yay! Training Incentive Allowance certainly does what it says. Though still not as good as abolishing the fees and loans trick for all students. Certainly a big deal for me from this budget.

    https://www.beehive.govt.nz/release/training-incentive-allowance-support-16000-new-zealanders-jobs

  17. Tricledrown 17

    Next to nothing for low income workers may be Labour are hopeful that new wage bargaining will lift wages.

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