Social welfare measures

Some of the headline social welfare measures introduced in Budget 2023 include:

1. Free and discounted public transport

„ From 1 July 2023, children aged between 5 to 12 will incur no fares while travelling on public transport. In addition, fares for passengers between 13 and 24 will be charged at half price. Along with existing programs, almost 1.6 million New Zealanders should be saving money by travelling on public transport. This will cost the government $327 million over 4 years.

2. Scrapping prescription co-payments

„ Removal of the $5 co-payment for prescription medicines which will cost $619 million over the next 4 years. The change is estimated to impact 3 million New Zealanders. In 2021–22, an estimated 135,000 adults did not collect their prescriptions due to cost being a barrier, especially for low-income families. This should ensure that New Zealanders are able to access the medicines prescribed by their doctors.

3. Extending early childhood education (ECE) subsidy

„ Currently, the subsidy of 20 hours of ECE is available for 3- to 5-year-olds. Budget 2023 extends this to include 2-year olds. At a cost of $1.2 billion over 4 years, the extension of the ECE subsidy should result in families receiving childcare subsidies saving an estimated $133.20 a week in childcare costs where the child attends ECE for at least 20 hours a week.

4. Paid parental leave KiwiSaver contributions

„ Paid parental leave recipients will receive a matching KiwiSaver ‘employer’ contribution from the government. Payment of the ‘employer’ contribution recognises the unpaid nature of childcare responsibilities and incentivises parents to save for their retirement. Women on average have lower KiwiSaver balances than men and one cause is because of parenting. The payment of the ‘employer’ contribution helps address this gender inequity. This will cost the government $20 million over 4 years.