April 1 changes deliver on core pledges
Pay increases for superannuitants and key changes to the student loan scheme and take effect from this Saturday (April 1), along with an annual inflation adjustment to preserve the value of benefits, Steve Maharey said today.
From April 1 superannuitants will have their pensions increased in line with the commitment card to reverse National's 1999 superannuation cuts. Student loan changes taking effect tomorrow include the freezing of the current student loan interest rate for the coming tax year and a significant increase in the income part-time students can earn while still qualifying for a full-interest write off. In addition, all benefits will rise by 0.51% in line with inflation for the year to December 1999.
"Labour and the Alliance have a clear commitment to ensuring that all New Zealanders are able to participate in their society and achieve their potential.
"April 1 sees many of our core commitment card pledges delivered. We are determined to restore public confidence in the electoral system by keeping our word with the electorate.
"National was prepared to let the position of older New Zealanders get steadily worse but this Government believes that the guarantee of an adequate income in retirement is amongst the most fundamental duties for any Government.
"Students too suffered nine long years of hostile indifference during which time student debt levels spiralled out of control. We have moved quickly to cut the costs to students of tertiary education.
"Using combination of effective economic policies and sound social policies this Government will provide greater security and opportunity. We have inflation-adjusted all benefits to preserve their existing value and we are presently working on a range of initiatives to improve the position of low income New Zealanders," Steve Maharey said.
Attached is a schedule of April 1 changes in the education and social services portfolios.
Schedule of April 1 changes in the education and social services portfolios
New Zealand Superannuation
the 1999 cuts to superannuation rates have been reversed. New Zealand Superannuation will not be allowed to fall below 65% of the net average ordinary-time average wage.
married superannuitants will receive $347 net per week, an increase of $21.42 a week
single superannuitants living alone will receive $225.55 net per week, an increase of $12.86 per week
single superannuitants sharing accommodation will receive $208.20 net per week, an increase of $12.36 per week
no further interest will be charged on the debts of current full-time or low-income students.
the income threshold at which part-time students qualify for a full student loan interest write-off is raised from $14,768 to $24,596
the student loan interest rate for the 2000/01 tax year is frozen at the current rate - 7%. A review of the interest rate setting methodology is presently underway. Had the present methodology been used the interest charged for the 2000/01 tax year would have risen from the current 7.0% rate to 7.6%
the student loan repayment threshold increases from $14,716 to $14,768
Benefits, Student Allowances, and War Pensions
all benefits, student allowances and war pensions increased by 0.51% in line with inflation for the year to December 1999. Examples of the increases in after-tax weekly rates for benefits, student allowances and war pensions that rise in line with the CPI from April 1 are:
for an unemployed person, or a full-time student living away from home aged 25 or over, up 75c to $148.64
for a married couple on the community wage with no children, $1.26c to $247.72
for a single person over 18 years receiving the invalids benefit up 94c to $185.79
for a sole parent with one child up $1.08c to $212.90
for a war disablement pensioner receiving 100% disability rate, up 75c to $146.90.
a Disability Assistance Programme has been established to preserve existing disability entitlements for the New Zealand Superannuation and veterans pensioners who would otherwise have lost entitlement due to the raising of the New Zealand Superannuation rates.
Annual inflation adjustments have been reinstated for the Training Incentive Allowance (TIA), which pays the tuition fees and other costs of those in receipt of the domestic purposes, widows and invalids benefits and the emergency maintenance allowance.