Wealthy can opt out of winter payments, PM says

Prime Minister Jacinda Ardern says “We will have to make sure we act in a fiscally prudent manner and we believe we have allowed ourselves room to operate.” (photo: Jerry Yelich-O'Connor)

Prime Minister Jacinda Ardern on the universality of the government’s winter payment package

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Prime Minister Jacinda Ardern is defending the universality of the government’s winter payment package by saying people can opt out of it.

Ms Arden said she was “incredibly proud” of the government’s families package announced today, adding it will benefit more than 380,000 families and cost less than National’s tax cuts.

“The way we are doing it is by not giving people like myself a tax cut when we need investments in infrastructure and health and education.”

Alongside increased payments to families, payments for new parents and accommodation supplements, pensioners can get grants during winter to help with electricity payments.

Costing $1.81 billion over four years, the winter energy payment will be available to every New Zealander over 65 who receives superannuation or a veteran’s pension and people who receive a benefit.

When fully implemented, the annual payment will be $450 for single people with no dependent children and $700 for couples or single people with dependent children.

However, living standards research by the Ministry of Business showed sole parents or working parents with dependent children were more likely to put up with feeling cold to pay for essentials.

Ministry research found 4% of people over 65 would put up with feeling cold “a lot” to pay for other things while, in contrast, 30% of beneficiaries with dependent children said they would feel cold a lot so they could provide other essentials.

“The reason is our superannuation system is universal, so we made a deliberate decision that the winter energy payment should be easy to administrate and widely available.

“Many of our superannuants do differ in the winter months because of the cost of power and, if they believe they don’t need it, they can opt out.”

The policy was welcomed by the Electricity Retailers’ Association of New Zealand, which said it will help promote the programme. Chief executive Jenny Cameron says “it will make a real difference to many.”

Ms Ardern was upbeat about the figures released today, saying she was confident despite a tighter operating allowance.  

“We will have to make sure we act in a fiscally prudent manner and we believe we have allowed ourselves room to operate.”

The coalition also announced it would resume contributions to the $37 billion NZ Super Fund. It says it will put $7.7 billion into the NZ Super Fund between now and June 2022, with the first payment to be made on Friday.

The Guardians of New Zealand Superannuation said at the projected peak of withdrawals from the NZ Super Fund in 2078, the fund will be covering 12.8% of the country’s net superannuation bill. The projected tax paid by the fund will equate to a further 8.5% of the superannuation cost.

Chairwoman Catherine Savage said: “We welcome the resumption of contributions to the NZ Super Fund and note the apparent progression toward funding in accordance with the formula in the NZ Superannuation and Retirement Income Act.”


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55 Comments & Questions

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Fresh positivity after voting to put pressure on fiscal targets for aged citizens by supporting euthanasia?

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Yeah I'll just bet next to no-one is going to opt out of being given free money. I suppose it will be a few free nights at the pub for many. After all it can be spent on anything.

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Especially since this is replacing what was originally planned tax bracket shift. I won't be opting out, I'll bank this as part of getting some of my tax back

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Wow! It's a shame how one can complain about not getting a tax cut but rather see others suffer.

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It's not "free money", it has been uplifted from someone else under threat of criminality for non-compliance.

Can I opt out of paying taxes?

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They can opt-out, for the greater good!

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"settle" Moose. Remember; Blood pressure.
Might be best if you think of it as $700 for two votes and $450 for one vote?
The economics of it will then make more sense?

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Can you see Winnie the Pooh opting out of this ? Nah....

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Wealthy looked after but hard working home owners savaged by stolen equity and envy politics.

Working class are working hard to pay the mortgage on the family home whilst a handfull of snotty nosed first home buyers are getting everything their way.

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Stolen equity.
It's a zero sum game. If the housing market goes up $400 a day, and someone is losing $400 to the market, and someone is making it in equity, who can afford to take the haircut?

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Just like heaps of oldies opt out of universal super. Yeah right.

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And Working for Families.

I’ve thoroughly enjoyed working for other people’s families.

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Super is opt in, not opt out.

And yes, heaps of rich oldies opt in to receive super and then boast about it to their kids.

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Where is your proof, rather than a generaliseation

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They have done their hard yards so I think they deserve it!

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Please take some time to educate yourself on the matter. The average New Zealand retiree who commenced work at age 18, who retires at 65 and who lives the average life expectancy will have received more in superannuation payments than they will have contributed through PAYE over their lifetime.

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What has the Labour government done for single people and couples living in poverty or on low wages? The answer, absolutely nothing apart from canceling their tax cuts and putting the cost of petrol up for them to get to work on, in Auckland at least. And now they can also pay a heating subsidy to rich superannuants while they huddle under the blankets in their cold damp unheated homes.

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This doesn't come as a surprise to anyone that's been around for a while. It's what you get from a Labour govt. The trick is to not vote for them in the first place. After nine years of a Nat govt, people have got a bit complacent and thought that a change might be a good thing. Now those same people can't wait for the next election, so they can fix the error of their ways. It's going to be a long three years.

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Well I think this government is doing fantastic for the people of NZ. My teenage days, maybe I've seen a few families struggle to get by but not this many within a couple of years. Our old people are the roots to our existence, so look after them as we do for our babies. What would we gain from earning more money but live unhappy?

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People who vote Labour need to know they are voting for a high-benefits economy which are disastrous for long term prospects of the country's economic well-being and skills base.

Everybody wants to know why there are massive skill shortages in New Zealand, the people that are available for employment are mostly no-hopers who don't know how to tuck in their high-vis vests. Where did all NZ skilled, competent, keen workers go to? They were tossed onto the inter-generational high-benefits bonfire by decades of successive left-wing policies that encouraged people to rot on the dole instead of keeping themselves gainfully employed, active, motivated and skilled-up for the modern workforce.

You can't stay skilled sitting on the couch collecting benefits.

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Have you not watched the news??? This government is doing far more for the people including you and your family than recent times.

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Fake news and alternative facts, buddy. NO, it is NOT!

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I thought we couldn't afford National Super in the first place? So why then is this government spending an extra $1.8 billion on them?? And why is no-one in the media asking them these basic questions instead of brown nosing and fawning all over them?

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If National Super is unaffordable then free Uni fees, and increased WFF is to.

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Well mate! Maybe people were mislead by the previous government. I am glad to see my tax go towards a good cause.

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It was Labour that was saying it, mate!

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I will opt out when Winnie opts out and repays the super he has received to date. Til then I will book another overseas trip and soak up the sun. Might as well enjoy the lolly scramble before we go bust.

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This welfare folly is going to end very badly for this Government (aka NZ). Just the cost of the bureaucracy to administer and manage this behemoth, makes me shudder.

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Just think of the governments purpose and the positive outcome, that should stop the shudder.

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The definition of irony...maybe comrade Taxinda could ‘opt out’ of 50% of her salary to lead the way, after all, she ‘doesn’t need it’....puh....lease....

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Why couldn't they means test this? What a waste of taxpayer money.

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How is this linked to heating costs?

Last time I checked the cost to heat a single superannuitant’s house and a superannuitant couple’s house was the same, and yet the couple get nearly twice as much.

More appallingly designed, inefficient, wasteful public policy.

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It's about the boomer and retirees votes mate. National had the 1 April 2018 $680 for couples Super uplift, Labour the $700 for couples heating bribe, and NZ First the "new generation gold card".
They all know the way to this group is through their back pocket, regardless of whether they need it or not. They are all guilty of it.
It is costing the country billions in debt, and the voters know it, but vote accordingly regardless. Unfortunately it is how politics and human nature works. Me and my overseas holidays first, the future good of the country someway further down the list.
If any of parties step out of line and try to address the issue they get well and truly hammered at the polls, as happened to Labour in 2014 when they tried to raise the super age.
So it continues...
The only way it stops is when the voting age demographic tilts, or we get to the state of emergency that Greece found itself in.

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At least i will not now need the freebie handout of chick peas and tinned tomatoes. Will welcome them in between when my beneficiary entitlements need a boost.Was great to find out our wee family, will now be eligible for at least $163 Dollars per week. Many thanks to NZs taxpayers who will be making this extra money and payout a reality.

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This is going to really help my 65+ year old parents (I cant say retired as they aren't yet) through the cold Auckland winter. For $700 they will be able to afford to spend an extra week in the holiday house they own on the Sunshine coast.

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That's right and I'm certainly keeping mine. two months supply of baccy there. Mind you what with the amount of tax on baccy, maybe I am sending it back!!

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Bill English claimed his household is $100 better off. Can anyone explain how, love to get on that bandwagon. I appreciate he is a beneficiary but at best the is $700.

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Sorry $10k

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The government could really help large, poor families that use a lot of electricity by allowing lines companies to levy a single, fixed charge for distribution and transmission services to all residential customers. This would place the costs where they lie and be economically efficient as well as fair. The same principle should be applied to gas distribution and transmission - but I'm not holding my breath.

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Come on Labour lets be fair, in Winter the cost of vegetables goes up and we can't afford to get our 5 per day. From June 2018 all beneficiaries and those getting the Family supplement should get an extra $100 per week, oh and when the All Blacks are playing and the coverage is only on Sky each beneficiary will get a top up of $30 per month so they can feel part of the wealthy set.

Subsidies will not solve the issues, they only transfer $s from one sector (those who pay tax) to another. In some respects this is a merry go round, subsidy to beneficiaries to pay for power, power companies charge rates that maximize their returns, and then pay dividends to the Government. This is back to the bad bad old days when subsidies were handed out to help companies export, the cries (and justifiable) were that subsidies were simply handing $s to the owners of business. They were right, Labour is taking us in a new direction back to the distant past. The outcomes aren't pretty.

Why doesn't the Government force people who own rental properties, or build house for sale, to do better. Not just built to the "Minimum" standard that the current codes allow. Minimum standards should only be there for someone who is building for themselves and can not sell within 5 years. But at least the houses that are rented, and are developed for Pensioners will be less costly to RUN, its the running cost that nobody considers till its too late.

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Bleh. And we have a PM that thinks the verb is "Administrate" when she means "Administer". Mercifully free from the ravages of education.

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Fiscally loose as a bull in a China shop this one!!! Here’s hoping there’s something to salvage in 3 yrs time

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This exemplifies what Labour Governments always do: they assume they know better than an individual on how to manage public finance (ironic given that the current Labour team have never made a cent in private enterprise). Self reliant people don't want the Government forking out money because they know that those reliant on hand outs will be kept relatively poor. Labour, by contrast, wants to be the master of public destiny and subsidises lifestyles - an expensive and dangerous route for the economy in the long run.

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Scribe's gone strangely quiet. Must be too hard to defend the indefensible. Give the money back ?! How naive is the woman ?

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Perhaps Scribe is too busy delivering the mini-budget in Parliament?

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Why not $700 per household for heating allowance? It costs just as much to heat a house with one person living in it, as it does if two people live in the house.

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But surely they need to pay something for the second vote purchased?

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Many seem to miss the point: The money paid to superannuants is income and therefore taxed and the superannuants rate for me that’s 33%. So I loose a 1/3 in taxes, therefore my return for a single person is $268. So a claytons gift and everyone s focusing on the big numbers. The policy cost is halved with the taxes. This is not like the free for all tertiary costs, which I notice prime minister is not mentioning

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Tell the PM and those supporting euthanasia to plead guilty to a charge of conspiracy to commit murder/ pea bargain manslaughter. Alternatively plead to a charge of crimes against humanity.
They should be held in contempt of the House for failing to uphold the welfare of citizens.
They have failed even an elementary understanidng of the Health and Safety Act with regard to the consequences of their decisions and are grossly abusing their Parliamentary immunity.
Criminal Charges should be brought at once to uphold the law protecting life.
These people have no moral judgement and this Parliament should be dissolved for moral bankruptcy.

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If passed, it will be voluntary. It gives the individual choice.

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Are you not intelligent enough to foresee the impact on vulnerable elderly people John? Or do you refuse to acknowledge it? Or do you find it an acceptable risk/cost?
If you change the law you say its ok and so to all our young people who are committing suicide at an alarming rate you are sending a very clear message.

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Question. What percentage of superannuitant and beneficiary households will actually spend their heating allowance on heating, as opposed to spending it on something else like lotto, booze, holidays, P, the grandkids, fixing the car? And of that number, what percentage will then approach WINZ or the Salvation Army or the City Mission for an emergency grant, handout or food parcel because they can't afford to heat their homes and buy food because they have run out of money?

This is not smart public policy, it's neither intelligent nor an efficient use of overtaxed payer's money.

If you want to subsidise heating then the government should negotiate directly with the electricity suppliers to either reduce the cost of electricity to beneficiaries and superannuitants, by an agreed upon amount equal to the intended subsidy or at least have a credit placed onto their electricity accounts at the beginning of the winter. At least this way the money is actually spent on what it is intended to be spent on. Currently, Labour's approach is really just another example of their special kind of stupid when it comes to wasting the country's money.

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So rich superannuiants who still have business, profitable farms etc will still get this to put in their next overseas holiday fund or pocket money ,doesn't seen right .Should be income tested

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Instead of people being given this money to spend on what they want, why can't they just be able to take their power bill into somewhere like a post shop, and the govt will just pay it for them, until the required amount was used up.
At least it would be spent on what it was designed to do.... go towards heating costs. I suppose it's easier for the Labour govt to just dole the money out. Lets face it, how much of that money will actually be spent on the power bill, stuff all.

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Hi,
This socialistic policy is tipiclay communistic, they are also thinking about buying back the part of the power companies that were sold of. Can't wait to dump them at the next election.

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