27 March 2008

Benefits and student allowances increase

Benefits and allowances will increase from 1 April 2008, Social Development and Employment Minister Ruth Dyson said today.

This reflects the government’s ongoing commitment to support vulnerable families and communities. Increases of 3.18 percent in benefits and allowances equates to changes in the cost of living, as measured by the Consumers Price Index.

Examples of the changes include:

- a sole parent will get an extra $8.13 a week
- a couple on Invalids Benefit will receive an extra $11.82 a week
- a sole parent on Invalids Benefit will now receive over $300 a week, up from $293
- a grandparent caring for a 14 year old grandchild will benefit from a change from $153.05 to $157.92 a week.

This government has provided a package of support under Working for Families to ensure that work really pays. Further increases will offer even more support to working families. A family earning less than $1,540 a week before tax with three school age children can now receive up to $210.60 per week to support their child care costs during term time.

Around 62,500 students will also receive increases to their allowances. An eligible student aged 18-24 living away from home will receive an extra $250 a year. Students can now receive a full allowance if their parents’ income is less than $45,744, a total increase of $5441 since last year. And the amount that can be earned before graduates have to start repaying their student loans has increased from $17,784 to $18,148.

These increases are in addition to those I have already announced to New Zealand Superannuation and Veterans Pension that will benefit nearly half a million older New Zealanders.

Our commitment to support New Zealanders is a sharp contrast to the policies of the National party which have been to slash benefits leaving superannuitants, students and families struggling to cope with rising costs.

These tables provide illustrative material about the increase in rates. People should speak with their Case Manager to discuss their individual circumstances to determine their entitlement.

Main benefit rates after tax

Examples Rate as at
1 April 2007 $ weekly increase Rate as at
1 April 2008
Single unemployed adult over 25 $178.49 $ 5.68 $184.17
Sole Parent $255.65 $ 8.13 $263.78
Unemployed Couple, with or without children $297.46 $ 9.46 $306.92
Single 18 years and over, Invalids Benefit $223.10 $ 7.09 $230.19
Couple, with or without children, Invalids Benefit $371.84 $ 11.82 $383.66
Sole Parent, Invalids Benefit $293.08 $ 9.32 $302.40

Orphans and Unsupported Childs Benefit
Rate as at
1 April 2007 $ weekly increase
Rate as at
1 April 2008
14 years old and over $153.05 $ 4.87 $157.92
10-13 years old $144.24 $ 4.59 $148.83
5-9 years old $135.42 $ 4.31 $139.73
Under 5 years old $117.76 $ 3.74 $121.50

Childcare and OSCAR Subsidy

Examples Hourly rate
as at 1 April 2007 $ hourly increase Hourly rate
as at 1 April 2008
Rate 1 $3.40 $ 0.11 $3.51
Rate 2 $2.36 $ 0.08 $2.44
Rate 3 $1.31 $ 0.04 $1.35

Student Allowances Weekly Rates after tax

Student Allowance rates Rate as at
1 April 2007 $ weekly increase Rate as at
1 April 2008
18-24 year old at home $118.98 $ 3.79 $122.77
18-24 year old away from home $148.73 $ 4.73 $153.46
25 years old at home $142.78 $ 4.54 $147.32
25 years old away from home $178.49 $ 5.68 $184.17
Couple allowance – both students eligible $148.73 $ 4.73 $153.46
Single student – one child $255.65 $ 8.13 $263.78

ENDS

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