Though Finance Minister Bill English appears to be ruling out any new initiatives in this Budget it is still likely it will feature a “significant” sum to alleviate child poverty.

Mr English’s comments appear to be part of a Government plan to play down expectations on the move in advance of the Budget to heighten the impact of the announcement when it is made.

That may have also been the reason they didn’t want the housing capital gains tax in the Budget in case it crowded out the child poverty message.

But sources say that despite that the move will be significant.

How it will be done using existing schemes is uncertain.

On Sunday the Prime Minister pointed out the difference between NZ Super which was adjusted according to rises in the average wage whereas schemes the Family Tax Credit was adjusted according to movements in the consumer price index.

This Budget may well address that anomaly.

For the 2014/15 year  the Government is spending about $2 billion on the Family Tax Credit, otherwise known as Working for Families, but $11.6 billion on NZ Super.

But there other smaller benefits such as payments to solo parents.

A heavy hint that something is being planned came during Question Time in Parliament today.


Labour List MP, Jacinda Ardern asked Social Development  Minister, Anne Tolley whether she stood by her statement in December last year in relation to child poverty that the Government was “working on a comprehensive plan”  on child poverty.

“If so, will that big piece of work be in Budget 2015?”asked Ms Ardern.

Ms Tolley: “Yes, and the member will have to wait until tomorrow.”

Prime Minister John Key has asked his officials for fresh ideas on tackling child poverty.

On his first day back at Parliament after being re-elected last year, Mr Key said he had ordered Treasury and Department of Prime Minister and Cabinet officials to start presenting new ideas on child poverty.

‘‘The recognition I think we all have is that there are some extremely poor children who are missing out,’’ Key said yesterday.

‘‘And so then the question is how do you resolve those issues, it’s not straightforward but there will be more you can do.’’

Mr Key said it needed to be done without narrowing the gap between the incomes of those on benefits and those working, to ensure people were still encouraged into work.

Breakfasts in schools, free doctors’ visits for young children and tax credits for low and middle income families were examples of policies that could be used to tackle the problem, as could programmes such as Whanau Ora.

Professor Innes Asher of the Child Poverty Action Group said to tackle child poverty, benefits and Working for Families tax credits needed to be tied to inflation and wages, while the minimum wage needed to catch up to the increase in the cost of living.

Polling by the Wellington company, UMR, presented to the Victoria University of Wellington post election conference last year showed that National was most vulnerable on child poverty.

81% of those who voted Labour gave it as the reason they did so.

It was the most popular reason for voting Labour.