26 May 2016

Budget focuses on housing, families

3:48 pm on 26 May 2016

Finance Minister Bill English has delivered a budget focusing on Auckland housing, social investment and infrastructure.

Finance Minister Bill English delivers Budget 2016.

Bill English's eighth Budget has focused on the much-debated issue of housing. Photo: RNZ/Jane Patterson

It earmarks $300 million to ease the pressure on the Auckland housing market, both providing more social housing and buying Crown land to boost supply.

Within that, there will be $200m for more social housing in Auckland, providing at least 750 more places, and in boosting income-related rent subsidies because of rising rents.

And for general Auckland housing, another $100m will be used to free up surplus Crown land for housing developments. This continues the programme started in Auckland last year.

An empty state house with over grown lawns in Glen Innes that has been empty for 3 months

The Budget earmarks $200 million for more social housing in Auckland. Photo: RNZ / Claire Eastham-Farrelly

Read the full Budget 2016 speech from Bill English here

Children and families

The budget contains a $652m social investment package.

This includes $347.8m over four years for the care and protection of vulnerable children and young people - made up of $199.9m to put in place the recent overhaul of Child, Youth and Family, delivering what the government calls a child-centred approach, and $144.9m to meet an increased demand for services from more children and young people in care.


Hospital corridor

Bill English allocated $39.3 million to a national bowel cancer screening programme. Photo: 123RF

A national bowel cancer screening programme will make a start with $39.3m over four years to begin the roll out, starting with Hutt Valley and Wairarapa District Health Boards. This will be followed by a progressive introduction across the country.

Tobacco excise duty goes up by 10 percent on 1 January each year for the next four years, starting in 2017, bringing the cost of a standard pack of cigarettes to an estimated $30 by 2020.

Whanau Ora will get a boost of $40m over four years, allowing it to substantially increase the number of whanau it can support.


In education, an extra $43m will go to schools to target students most at risk of under-achieving, instead of an across-the-board increase in operations grants.

Schools will get $882.5m to build nine new schools and 480 new classrooms around the country.

In tertiary education $123m over four years will go into tuition subsidies at degree and sub-degree level.


Mt Eden prison

Corrections will get an extra $355.6 million over four years. Photo: RNZ / Diego Opatowski

Corrections gets an extra $355.6m over four years, of which $290m is to make sure the department can cope with the rising prison population and $12m is for managing offenders returning from overseas.

Police get $299.2m in new money, of which $279.9m is set aside for pay increases.

In the largest increase to Justice and Courts in more than a decade, the sector receives an extra $208.4m over four years - including money for access to legal aid and community law centres, operating the Christchurch Justice and Emergency Services Precinct, and restorative justice providers.

Other initiatives

Mr English unveiled a $410.5m boost over four years for science and innovation, including almost $114m for the new contestable Endeavour Fund. The Marsden Fund also gets a 49 percent boost, with an extra $66m over four years and the new Strategic Science Investment Fund gets $63m over four years.

As signalled, Emissions Trading Scheme two-for-one subsidies will be phased out. The budget made clear the timing, with the subsidies ending after three years, with all sectors in the ETS paying the full market price for their emissions from January the first 2019.

The country's spy agencies get a boost in funding, with an extra $178.7m for the SIS and GCSB over four years.

In transport investment, the SuperGold card scheme gets $40.9m for the off-peak travel scheme which the government said was to provide certainty for the 670,000 cardholders. The New Zealand Cycle Trail gets a $25m boost.

A new $100m fund was announced to support projects to clean up rivers, lakes and aquifers


Mr English said the economy was forecast to grow at an average 2.8 percent over the next five years and unemployment was set to fall gradually to 4.6 percent by 2020.

He said a stronger economy was helping boost the Government's coffers, with rising surpluses predicted over the next five years.

Excluding investment gains and losses, the Treasury is forecasting a $700m surplus in each of the June 2016 and 2017 years, before rising to $2.5bn, $5bn and $6.7bn in the following three years.

Some new spending has been brought forward from 2017 to recognise the pressures created from higher population, lifting this year's allowance to $1.6bn.

Capital spending will be reduced by $1.2bn over the next five years to also help repay debt faster, and meet the Government's 2020 net debt target of 20 percent of GDP.

Budget 2016: Read RNZ's full coverage here.

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