Budget 2021: Prime Minister Jacinda Ardern hits back at jobs, middle New Zealand criticism

Prime Minister Jacinda Ardern and Social Development Minister Carmel Sepuloni on a tour of Wellington City Mission's Social Supermarket. Photo / Aaron Dahmen

Prime Minister Jacinda Ardern has batted away criticism the Budget didn't deliver for middle-income earners, saying addressing poverty was something "all New Zealanders want to see".

Budget 2021 saw an increase of $3.3 billion worth in benefit increases over the next four years, estimated to lift 33,000 children out of poverty, as well as more than $1b in funding for Māori, including a Māori housing package.

While it's received qualified praise from welfare advocates, the Government's Māori ministers are being celebrated for delivering an unprecedented level of investment to address crippling inequities.

But it's come under criticism from opposition parties, National Party leader Judith Collins saying it was "a Budget for benefits, not jobs" and would do very little for the economic growth the country needed as it emerged from Covid.

Ardern spent this morning at Wellington City Mission checking out the "social supermarket", an innovative take on the food bank but where people can collect donated food with "pride and dignity".

The visit was also a nod to the Budget's focus on improving welfare and reducing inequality in Aotearoa.

Prime Minister Jacinda Ardern with a staff member this morning at Wellington City Mission's Social Supermarket in Newtown this morning. Photo / Aaron Dahmen

Ardern told reporters she regularly heard from New Zealanders they wanted to see everyone doing well.

"People from all walks of life have often raised with me the issue of poverty."

Speaking the morning after the Budget on how it delivered for business, Ardern said there was support for businesses amid the environment Covid-19 had caused, such as digital support and training and the wage subsidy scheme.

Asked what was there for "middle" New Zealand, Ardern said the best thing for New Zealanders as a while was job creation, pointing to the 200,000 estimated from this Budget and over the forecast period.

"For all New Zealanders, they want to see our economy doing well, they want to see jobs created, they want us to be safe and well through the pandemic, they want us see us reconnect with the rest of the world - all things that this Budget is driving us towards, but of course we need to make sure that we are meeting the circumstances of all New Zealanders and their needs as each year comes upon us."

Prime Minister Jacinda Ardern showing Social Development Minister Carmel Sepuloni "canned butter", which she used to eat as a child. Photo / Aaron Dahmen

There was also "significant health spending", she said.

Despite the boost in benefit levels, which Social Development Minister Carmel Sepuloni said meets some key Welfare Expert Advisory Group recommendations from 2019, there has been some criticism with rising living costs it will not make a huge difference, and others have called for increases to Working for Families and disabilities support.

"We've been looking across the board at tools we have to support children - we know representative in our child poverty statistics are working families for instance," Ardern said.

"That's why we've committed to doing work on Working for Families and the accommodation supplement.

"People have raised the question 'will these increases in main benefits go directly to rent increases or cause rents to go up?' We went back through the evidence through recent times we've had changes to the amount of assistance people receive and we haven't seen a correlation that rents go up as a result."

Prime Minister Jacinda Ardern meeting Wellington City Missioner Murray Edridge. Photo / Michael Neilson

While there was no set timeline for the Working for Families review, Ardern said changes were made when they first came into office and it would be completed this term.

On the disability allowance, Sepuloni said the Government could not do everything as per the WEAG at once, but there was "policy work coming my way around the disability allowance".

The Government was also doing work around household debt and food security, Ardern said.

For superannuitants, she said things like the winter energy payment were still appreciated and "highly valued".

"Keep in mind, Super is adjusted through indexation to try and keep pace with those extra costs they face."

They would also continue to try and see "movement in the support" to reflect rising costs, she said.

In the Budget, Treasury had predicted housing price growth to fall substantially. Asked if Ardern wanted it to fall, she said they wanted balance in house price growth and home ownership.

"Treasury now is saying they believe we'll be successful, because those massive house price increases were not good for anyone, including for those who already own homes.

"We don't want massive house price growth but also for many New Zealanders once they are entering the housing market, their house is often the most important asset they have, so if you see a sudden dive in the value of that asset that equally creates problems for the New Zealand economy and homeowners."

With Labour MP Kieran McAnulty describing himself during a Parliamentary debate last night as "proud socialist", Ardern was asked if she too was a socialist.

"I"ve always described myself as a democratic socialist," she said.

"But I have never found those terms particularly useful in New Zealand because we do not tend to talk in those terms here. Here it is more common to say progressive, or member of the Labour party, people tend to know what that means."

Asked when she would get the Covid-19 vaccine, Ardern said the timing was a balance between the vulnerable and exposed needing it first, and doing so herself to "demonstrate it is considered a priority and safe".

She couldn't give a date, but said it would be before the general roll-out begins in July.

After delivering the Budget, Ardern said she spent "a bit of time with the team, and the Minister of Finance" before going back to work to "finish some papers".

"It was not a time for celebration."

Asked if it was her favourite Budget as Prime Minister, Ardern said it was "an important one".

"I think I'll look back on this one and see it as a real milestone for us in just making sure that New Zealand is a place that we believe it to be, fair, a place when you need help and support that you're able to access it."