MEDIA RELEASE
17 MAY 2007

Government Budget Offers No Assistance to Family Budget

Budget 2007 has offered no relief to families in their ongoing battle to meet their weekly bills and one-off major costs such as car repairs and children’s uniform costs.

“Because of the latest consumers’ price index showing a big rise in the cost of home basics, including costs which are effectively passed on at the retail level to the consumer, the financial squeeze on families will start to strangle many families,” says Bob McCoskrie, National Director of Family First NZ.

“The Working for Families package seems to have been swallowed up in the increasing costs of rents (3%), gas (10.6%), electricity (6.9%), food (4%), fruit (34%), and increasing house prices and interest rates. This is why some budgeting organisations have seen a tripling of struggling families seeking help. Cumulative inflation for the last 8 years has been over 22%. Much of this is being absorbed by families, including through tax ‘bracket creep’.”

“Families on benefits have also been the most affected because of not qualifying for the Working for Families package. They cannot avoid these price increases because they are ‘essentials’ – not optional luxuries.”

“Despite the Government's operating surplus of $6.5 billion for the eight months ending February, (almost $1.5 billion ahead of forecasts), families in Auckland and Wellington rushing their kids around to sports and music practices and doing family trips and grocery shopping will face an extra cost of an increase in petrol tax by 10c.”

“Although there is increased funding in health, schooling, and Police in the Budget, this will not grant any relief to parents trying to meet the daily needs and expenses of their families,” says Mr McCoskrie.

“When the family earns more income, they lose their entitlement to the level of the Working for Families payment. Yet when the government earns more income, they keep it!”

“The irony in this Budget is that the removal of the $1890 rebate threshold on donations made by individuals to charities and other non-profit organisations will simply mean that generous NZ’ers will give more to the very worthy organisations who are working tirelessly and constructively with families in need of assistance.”

ENDS

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