Cost of living support is targeted in specific areas, expanding some, shrinking others.
Families receiving Working for Families support will see a bit extra for their fortnightly groceries. Budget 2025 lifts the Working for Families abatement threshold from $42,700 to $44,900 and the abatement rate from 27% to 27.5%. This is offset against savings from BestStart, currently means tested for the second and third income years, now means tested for the first year as well, from 1 April 2026.
Inland Revenue have also signalled some proposed changes to the calculation of family tax credits and simplifying the definition of ‘family scheme income’ for Working for Families purposes. We’ll keep you informed.
Medical costs may decrease, with the maximum prescription length increasing from three months to twelve months possibly from early 2026. The lift in income threshold from $31,510 to $32,210 on 1 July 2025 enables up to 66,000 additional lower-income households with a SuperGold cardholder to get a rates rebate. The Government will cover registration and practising certificate fees for around 115,000 teachers through to 2028.
Parental means testing for single 18- and 19-year-olds receiving Jobseeker Support or the Emergency Benefit will be introduced from July 2027.
Ministry of Social Development (MSD), the New Zealand Food Network and partner agencies will manage $15m in support for food banks. $275m establishes a Social Investment Fund to improve social services delivery to families.
New funding of $128m has been allocated for more social homes over the next four years and $150m to help the Community Housing Funding Agency lower the cost of borrowing for community housing providers. A new Flexible Fund is established with $41m over four years, set to deliver social homes and affordable rentals, replacing existing housing funds such as the Affordable Housing Fund and the Progressive Home Ownership Fund.
