Today's Budget will relieve some of the growing pressures on health, education and other core services stretched by New Zealand's swelling population.

But the National-led Government is now downplaying the scale of the housing initiatives in its eighth Budget.

As the issues of rising house prices and homelessness dominate debate in Parliament, Prime Minister John Key warned yesterday that the new housing measures would be "tools in the toolbox" rather than instant fixes.

In all, $76 billion in funding will be allocated in Budget 2016. Of that total, $1.6 billion will be new spending.


Finance Minister Bill English has indicated that most of the new money will address the pressure points caused by record migrant numbers and New Zealanders returning from overseas. That means more funding for schools, hospitals, and police.

The Budget will also focus on those most in need, the Government has said. A large investment is expected in National's "social investment" approach, which aims to detect families at high risk of welfare dependence or crime and make an early intervention.

The new funding for the housing sector will focus on the social housing sector, emergency housing, and freeing up more surplus land in Auckland for housing developments.

Mr English was at pains yesterday to underline the Government's existing housing policies.

"It's important to understand that any initiatives come on top of $2 billion that is spent this financial year ... to support 300,000 people on the accommodation supplement and 60,000 households on income-related rent.

"That is in addition to the Government's $20 billion worth of houses where it owns one in every 16 houses in New Zealand."

His comments came as the Government comes under increasing pressure over housing.

A Newshub-Reid Research poll published this week said that 76 per cent of New Zealanders believed the Government was not doing enough to control the housing market. Among National voters, 61 per cent said the Government was not doing enough.

Ahead of the Budget, the Labour Party pointed to new data which showed that suburbs with the highest levels of housing speculation had experienced the biggest falls in home ownership.

The data showed that in Otara - which has long been considered Auckland's poorest suburb - investors were responsible for 80 per cent of the house purchases in 2015.

Labour leader Andrew Little said his Budget wishlist included a massive house-building programme run by the Government.

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