Voters support extension of tax credits to beneficiaries, poll finds

John Key and Paula Bennett have ruled out extending the credits, saying they were important incentives for parents to get into work. Photo / Mark Mitchell

Just over half of voters support extending Working for Families in-work tax credits of at least $60 a week to beneficiaries - a result that has surprised and pleased the Child Poverty Action Group.

In a Herald-DigiPoll survey of 750 voters taken last month, 51 per cent said they agreed with the Child Poverty Action Group's wish for the tax credits for parents to be extended to parents on welfare. Forty-one per cent disagreed with it.

A Court of Appeal decision on the issue is expected soon after the Child Poverty Action Group mounted a legal challenge in 2008, claiming restricting it to workers was discriminatory. Group spokeswoman Susan St John said the result was significant and surprising.

"I think it's a reflection of the fact we've really been trying to raise public awareness and let people know what it's about. It should send a very strong message to the Government. So many families are unfairly penalised by [Working for Families rules], particularly at a time of redundancies," she said.

"When people lose work, they lose those tax credits and why should the children get less? It's so unjust and so unlike what happens in Australia."

She said a sole parent on the DPB with one child aged under 8 in Australia received about $390 a week in welfare payments - $100 more than in New Zealand - and also got child tax credits of about $200 a week.

Prime Minister John Key and Social Development Minister Paula Bennett have ruled out extending the credits, saying they were important incentives for parents to get into work.

Labour Party social development spokeswoman Jacinda Ardern said the poll results showed that voters believed that something had to be done about child poverty.

She said Labour was reconsidering its 2011 policy of extending the tax credit to beneficiary families, saying it was also looking at whether there were better ways to address child poverty.

Labour set up Working for Families in 2006 and reserved the tax credits for working parents as an incentive for people to get work.

The Green Party supports extending the tax credits to beneficiaries. Co-leader Metiria Turei's private member's bill to universalise the tax credit was defeated last year.

Jonathan Boston, professor of public policy at Victoria University, said the poll showed opinion was divided on the tax credit, but there was no easy way to address the income issue faced by parents on benefits.

Professor Boston co-chaired the Children Commissioner's expert advisory panel on child poverty, and said the panel was divided on the issue of the in-work tax credit.