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Prime Minister John Key opened his weekly press conference in "the winter wonderland that is Wellington" discussing the second round of the Governments' technology development grants, plans to hold a Cabinet meeting in Christchurch on 5 September, and the weekend's announcement on planned welfare changes for young people.

He answered questions on aspects of this planned 'complete wraparound service' including direct payment of recipients' bills, payment on cards which allow limited spending, and incentives for private organisations delivering services. Mr Key had 'anecdotal' reports of youth benefits being misspent and was concerned young mother might be targeted as a source of money by others. He said the welfare system should provide "clearer obligations on both parties", and was determined money given for children should be spent on children.

The Prime Minister also had anecdotal evidence of good results from the technology grants, which he preferred to Labour's R&D tax credit scheme.

Other questions included Mr Key's optimistic expectations on NZ's trading environment and his deputy Bill English making jokes at his expense during the National Party conference. Key described English as "in good form".

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