Govt unveils slim poverty-tackling package

02:32, May 16 2013

The government has unveiled a modest package of anti-poverty measures, with promises more help is on the way.

Among the Budget proposals are housing and welfare schemes targeted at low-income families.

And Finance Minister Bill English said that in the next few weeks government will announce plans to help children who come to school "hungry and ill-prepared", signalling a food in schools scheme is in the pipeline.

New legislation, introduced to Parliament today, will extend income-related rent subsidies to community housing providers, meaning tenants will be moved into homes provided by private organisations rather than the government.

English said there will be an extra $46.8 million for the income-related rent subsidies over four years. 

The way people are assessed for housing will be done by the Ministry of Social Development (MSD), not Housing New Zealand (HNZ).


Social Development Minister Paula Bennett said this meant housing needs could be integrated with other services, including mental health, disability or addiction needs.

English confirmed about 3000 out of 70,000 tenants could be shifted out of state housing.

"We want to shift the focus to assisting those most in need ... State housing is there to support those in need but it can become a trap," he said.

"We are treading carefully here because we realise we are dealing with vulnerable people. We are also dealing with other people who are trapped by the system and need some support to get up and out and into independence.

"There won't be any wholesale shifting of tenants, there will be a house by house process to deal with those, and only those - it's a small minority - an estimate over three or four years of 3000 out of 70,000 who could start moving."

HNZ will invest $2.9 billion over three years - $1.6b will go towards developments and repairs in Canterbury.

The project 324 scheme, announced earlier this week, will put 2000 bedrooms on existing houses and build 500 two-bedroom homes on subdivided land.

A trial of a 'warrant of fitness' for HNZ properties and other social housing providers is also part of the package. Policy work will begin on rolling this out to other rental properties.

About $100m will be channelled into a programme to insulate low-income households, particularly those with children or health needs.

More than $21m will go to tackling the high rates of rheumatic fever, while an extra $1.5m will go towards budgeting services in the next year.

The Budget also includes a scheme to get whiteware through preferred suppliers at lower costs and with a guarantee. Beneficiaries can already get repayable grants from MSD for the equipment but Bennett said "they often buy old equipment which, if it breaks down, has to be replaced and this increases their debt to Work and Income".

The government will also explore establishing partnerships with community organisations and financial institutions to offer low or no-interest loans. More details will be announced by September.

Bennett said she also wanted to promote financial literacy.

"Some families are struggling with huge debt, often as a result of huge borrowing from finance companies that charge incredibly high interest rates, or due to poor financial management or literacy."

English said paid employment was the best way to lift vulnerable families out of poverty. An extra $188.6m will go to implementing the next stage of the government's welfare reforms, while Work and Income will hire an extra 354 staff.

"Budget 2013 delivers on the government's commitment to ongoing support for families in need, while ensuring the effective use of taxpayers' money during tight financial times," he said.

The Dominion Post