An extra $20 a week will help give Rotorua mum Sarah Murray a bit more breathing room.
Murray, a mother of two, is studying an automotive course and keen for work once her studies are done. For now, she is living off the Jobseeker benefit and while she is grateful, she admits she is "living day-to-day".
"Rent, power, food, that's all taken care of but you can't get clothes or anything extra, generally."
Finance Minister Grant Robertson yesterday announced a $3.3 billion boost to benefits in this year's Budget.
The package will increase main benefit rates by up to $55 a week, which the Government says will lift between 19,000 and 33,000 children out of poverty. The changes will begin with a rise of $20 per week per person from July 1, with a second increase from April 1, 2022.
But some social sector leaders are sceptical whether the boost will make any material difference and political adversaries claim businesses and workers have been left out in the cold.
Murray said an extra $20 a week would help fund unexpected costs such as an extra school uniform shirt, or extra-curricula activities such as karate. It would also help ease the pressure of financially getting through the week.
"It would actually make a big difference."
In Tauranga, Maxine Paterson knows how tight living on a benefit can be.
For years, the mother of three relied on the benefit as her sole source of income but now she has a part-time job as a courier.
An extra $20 a week still did not provide enough for people to live on, she said.
"Twenty dollars isn't enough with rent increases. It's better than nothing and people should be grateful, it will help with rent and stuff, but it's not enough. People need to go out and get a job."
She was glad to be working, as it boosted both her income and her confidence.
She did not think beneficiaries would be less inclined to seek work with the raised benefit.
"If you're a job seeker, you're obliged to go get work anyway."
Te Tuinga Whanau Support Services executive director Tommy Wilson said the increase was huge for beneficiaries, not just because of the money "but because of the hope it gives".
"It gives them potential to get gas in the car, it gives them extra kai on the table, and extra pair of shoes for the kids in winter," he said.
"It's like Lotto for these people."
Te Tuinga Whanau works with many beneficiaries, some of whom were full of high-fives and smiles when they heard the news, Wilson said.
"How cool is it to give something to the broken and the broken-hearted. They've had it just as tough as anyone over the last year."
Rotorua Budget Advisory Services manager Pakanui Tuhura said the Budget was a start in addressing inequities in household income.
"The increase in money that beneficiaries can earn before their benefit is affected has risen and this will advantage those that either can't take on full-time employment or are unable to find full-time work."
Tauranga Budget Advisory Services' Shirley McCombe said the increased benefits were significant and would definitely help "if directed appropriately".
"I hope all those receiving the extra money work with a financial mentor to use this and the previous increases to put themselves in a stronger position for the future. How much it helps will depend on how it is used."
Whanau Ora Commissioning Agency chairwoman Merepeka Raukawa-Tait said the Budget as "a good start to recovery".
"The increase in benefits of $32 to $55 will be welcome and has the real potential to lift thousands of children out of poverty."
Child Poverty Action Group spokesman Professor Emeritus Innes Asher said the increase in income support was a good step towards income adequacy for children in need.
"Many families paying low rent have income below poverty lines by around $100 to $230 a week. The increases ... will mean their incomes will be boosted by around $40 to $115 a week. Families will still have a shortfall, but it will be smaller."
The Salvation Army said in a statement the benefit lifts were welcomed but "we are sceptical as to whether this will, in reality, make a material difference to those who are really struggling with the rapidly rising cost of living".
Robertson said in his speech that the Budget was addressing benefit cuts made 30 years ago and he hoped to restore dignity and hope for some of the lowest-income New Zealanders.
"Budget 2021's boost to main benefits is designed to reduce inequality, at the same time as providing further stimulus to the economy. For too long the incomes of those who receive income support from the Government have been too low. The Government established the Welfare Expert Advisory Group who made a clear argument for change."
Tauranga MP Simon Bridges said while the announcement was good for beneficiaries, "the real reason for the increases is that Labour has lost control of the housing and rental market so they need to chase the ever-increasing rents".
"The only real answer to poverty is housing and Labour hasn't and can't deliver in this area. Meanwhile, there is precious little to help the unemployed into work, so that increase in welfare dependency may be what we see happen.
"As for workers and business people, there is nothing in this Budget for them."
Act leader David Seymour said the Government was making it harder to employ people and easier not to work.
"Actions have consequences. If you keeping socking it to hardworking taxpayers you'll get less of them. If you keep handing cash to beneficiaries, you'll get more.
"There are too many children growing up without the positive example of a parent in work and too many adults suffer from chronic welfare dependency."
Benefit changes
• Weekly benefit rates will be lifted by between $32 and $55 per adult by April 2022.
• Main benefits (including Jobseeker Support, Sole Parent Support, Supported Living Payment) will further increase to levels recommended by the Welfare Expert Advisory Group in 2019.
• Families and whānau with children get an additional top-up of $15 per adult a week.
• 109,000 families and whānau with children will, on average, receive $175 more a week from all changes made since 2017.
• Student support (allowances and loans) will increase by $25 per week on April 1, 2022. Families and whānau with children will also receive a further $15 per adult per week.
• Pensions are not included.
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