Anti-poverty groups call out Working For Families overhaul delays

Labour says this year's Budget was simply "not the time" to overhaul Working for Families, but it has promised to spell out its plan - and campaign on it - before the election.

Groups working with those on the breadline say changes are needed now.

The government put the multibillion-dollar welfare scheme under review two years ago due to concerns that the scheme was too complex and penalised stay-at-home parents, but it has yet to implement fundamental changes.

Social Development Minister Carmel Sepuloni told RNZ the government remained committed to the work programme, but this Budget was "just not the time to do it".

"Clearly, this is a very difficult Budget and we had to prioritise," she said. "The Working for Families changes, though, are still under active consideration."

Labour would lay out its response to the review before the election so voters would know its plan, Sepuloni said.

"There is work that will come... it wasn't reflected in this year's Budget, but it will happen."

Sepuloni said she was "really happy" with how the government had helped ease the cost-of-living "in a responsible way" through the Budget.

"We're reducing the cost of childcare, we're reducing the cost of medication, we're building more public housing. All of those things are what anti-poverty groups are advocating for."

Auckland Action Against Poverty co-chair Agnes Magele told RNZ the minister's response was "bulls---" - all talk and no action.

"They spend hours and hours and hours talking and reviewing and doing absolutely nothing. That shows us... they don't give a s--- about the people: working class, all the way down - they don't care."

Magele said people were in desperate need of assistance.

"[Working for Families] needs to be made available for everybody. Staying home to look after kids is a full-time job.

"Everybody's struggling. Prices for everything, even essential costs, have gone up: power, rent. People have nothing left over for food, nothing left over to take care of their children."

Child Poverty Action Group economist Susan St John told RNZ she was disappointed the government had "kicked the can down the road" once again.

"The changes that are needed are quite dramatic and wide-ranging and they need to be embedded with a lot of political consensus and discussion.

"The time was right [for change] when they first came in. The longer they leave it, the harder it is to deal with."

St John said the payments needed to be boosted and all work incentives stripped out of the scheme.

"We've got a brilliant New Zealand superannuation scheme that's simple, people understand it, it's accepted, it's not a political football. It's time we did just as well for children."

Working for Families was introduced in 2004 to help low-income and middle-income families through a network of tax credits.

At the scheme's core is a family tax credit of $127.73 a week for the eldest child and $104.08 for additional children. It also includes an 'in-work tax credit' of $72.50 a week and a 'best start tax credit' of $65.15 a week for the first year of a child's life.

The latest statistics show 345,300 families received some Working for Families support in the 2021 tax year. The average family received $8257.