Sitting date: 16 September 2025

Third Reading

Hon SIMON WATTS (Minister of Revenue): I move, That the Income Tax (FamilyBoost) Amendment Bill be now read a third time.

I would like to thank the members of the House for engaging with the content of this bill during the committee stage. It is good to see such thought going into the objectives of this bill.

I would like to emphasise one point about FamilyBoost: this scheme is targeted at low- to middle-income New Zealand families. While some higher income families will receive some FamilyBoost, the fact remains that FamilyBoost is targeted at low- to middle-income families. That means that the benefits of FamilyBoost are concentrated on low- to middle-income families. They receive the tax credit with no abatement. The fact that some higher income families will also receive some of the benefit of FamilyBoost simply shows the effect of abatement in action.

Just as with Working for Families, we cannot simply abruptly terminate entitlement. It must be abated to ensure and allow for different family circumstances and incomes. That naturally means that although the focus is on low- to middle-income earners, there is some peripheral benefit to higher income earners.

To remind you, this bill proposes that FamilyBoost credits increase from 25 percent to 40 percent of weekly early childhood education fees, meaning much larger FamilyBoost credits for eligible families on the fees that they pay. We are also making the scheme available to more families by reducing the abatement rate. This will increase the upper limit for households that receive a portion of FamilyBoost from $180,000 per year of income to just under $230,000.

These are good measures which will bring relief to the targeted income earners, and therefore I commend this bill to the House.

ASSISTANT SPEAKER (Maureen Pugh): Members, the time has come for the lunch break. The House will resume at 2 p.m.

Sitting suspended from 12.55 p.m. to 2 p.m.

RICARDO MENÉNDEZ MARCH (Green): Thank you, Mr Speaker. I think it's really telling that so many members of the Government are unable to acknowledge the policy design failures and to adequately own up to them. Kudos, at least, to one of them, Simon Court, for acknowledging that in the previous contribution that he made.

Let's begin by acknowledging the fact that we're debating this bill under urgency due to a complete botch-up by the Government, who, I would say, has gone as far as mischaracterising the policy during the election season, promising that this would provide genuine and meaningful cost of living relief for families with young children. As the months have rolled on, what we have found is that most families have not been able access this support at all, let alone receive the maximum support available. At a time of growing inequality and of growing material hardship for children living in poverty and for the families who are currently being locked out of accessing emergency housing and are living on the streets, the Government's flagship policy seems to be, right now, under urgency, simply expanding the income brackets so that higher-income New Zealanders can access this FamilyBoost payment.

It's not a meaningful intervention in a cost of living crisis that has been, literally, worsened by decisions that this Government has taken to cut thousands of jobs and to deprive people living in poverty of essential assistance from Work and Income. It simply aims to pander to the early childhood education (ECE) companies that are running our early childhood education centres as a for-profit business as opposed to a public good. Early childhood education should be a core public good that is adequately supported, where the workers are well looked after and there are enough workers so that they can look after the children that they care so much about. Right now, what we have is a Government that is simply subsidising corporations at the expense of the future of our children. This policy, unfortunately, does not go any way to addressing the core underlying issues that are preventing so many families from accessing early childhood education.

My colleague Julie Anne Genter talked about some of the design issues that this policy has—particularly, the barriers it creates for low-income families who desperately need support. The fact that the policy has been designed in a way that means that you have to pay first before you can access the rebate, means that, for lower-income families, it still remains a barrier. This is why the Greens, rather than pushing through the technocratic and poorly designed policy, would instead champion ECE as a public good, adequately support the workers, and make it free so that no family in Aotearoa—no matter their income bracket—has to make decisions about whether they can afford early childhood education or their bills.

What is also really clear as well, looking at the regulatory impact statement on this bill, is that this Government chose to not engage with the agencies who have public good ahead of profit when it comes to their interests. Looking at the regulatory impact statement, it is incredibly clear that they chose to simply consult with people in the early childhood education sector as opposed to, for example, the families who have not been able to access this very same policy, or, for example, consulting with the Children's Commissioner who would've, in my view, been a critical agency that this Government should've consulted with to get really important feedback on the impact that this policy is having on families.

This policy is a joke if this is the Government's flagship cost of living relief on top of the tax cuts that will disproportionately benefit high-income earners. They need to turn their faces away from the halls of Parliament and on to the streets to realise that inequality is growing in this country, that more people are living in the streets, and that this FamilyBoost bill will do nothing to alleviate the hardships—many of them caused directly by Government decisions—that they have inflicted upon our communities. The Greens are fighting to not just get rid of this Government but to have a Government that treats early childhood education and things like dental care and things like our GP services as core public goods. Yes, we will make the wealthy few pay for it, as much as it scares the members on the other side.

The Green Pary won't be supporting this bill, because it's a terribly designed policy. It does not meaningfully deliver cost of living relief and does not address, in any way, the fundamental issues within our early childhood education sector. We look forward to working with families affected by the cost of living crisis to put forward alternatives that meaningfully allow families to have what they need to live a thriving life. Kia ora.

Debate interrupted.

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