Tight times for ‘squeezed middle’
New Zealand knows it has poverty issues, and an emerging class of working poor, but we’re not paying enough attention to the ‘‘squeezed middle’’, Jacinda Ardern says.
Today, the prime minister and Finance Minister Grant Robertson will deliver their first Budget.
Ardern has spoken extensively about rebuilding the foundations of good health and education systems, but there are specific groups of Kiwis she hopes the Budget will help.
Yesterday, Ardern said as well as helping those in poverty, and the working poor, the Government also needed to help those middle New Zealanders feeling the pinch.
‘There is this other cohort of people who just feel like some of these services aren’t accessible, and we don’t pay enough attention to that,’’ she said.
Ardern was referring to people who were working, but were feeling the squeeze because of a range of factors, like high housing costs.
Other costs, like the upkeep of a car and petrol, school-related costs, and things like GP visits added to the daily struggle.
And, while unemployment is at its lowest in a decade – at 4.4 per cent in March – wage growth has stagnated.
Almost 50 per cent of Kiwi families say they’re just getting by day-to-day, according to the Salvation Army.
Ardern said the Government had changed the threshhold of Working for Families payments, to try to capture more of the country’s working poor and squeezed middle.
The payments would mean 380,000 families would have an average of $75 more in their pocket a week.
In its December mini-Budget the Government announced its changes to Working for Families tax credits, Winter Energy Payments, and Best Start payments for people with new babies.
These changes were aimed at making a notable difference to those in low to middle-income brackets, Ardern said.
National Party leader Simon Bridges said the way to help was to make sure spending was targeted. It wasn’t all about spending more, it was about spending smart, and effectively, he said yesterday.
‘‘This Government, if they’re anything like the last [Labour] government, will be spray and walk away.’’
The working poor, and the ‘‘squeezed middle’’, were being hurt, not helped by Labour’s plans, Bridges said, referring to things like regional fuel taxes.
‘‘A big tax, spend, borrow and hope, is not the way to go.’’
However, Labour said lowerincome households consumed less petrol, so the impact on them was lower. Meanwhile, the same families would receive more on average from the Families Package.
Salvation Army Lieutenant Colonel Ian Hutson said the Government needed to focus on the ‘‘forgotten poor’’.
Poverty creep meant more Kiwis were feeling the squeeze.
However, those in the greatest need were the ones at the bottom of the pile, ‘‘the ones who are more than feeling the pinch’’.
There were people who were struggling to find a house, and to find food, Hutson said.
Salvation Army statistics said four out of 10 households skipped meals or went hungry.
Hutson said he hoped there would be a substantial social housing announcement in today’s Budget.