Budget 2026 steals from low-income families and slashes public services, making working people and their families worse off in a cost-of-living crisis. Nicola Willis's final Budget is a visionless one that does nothing to help working people and their families.
"The Budget does nothing to secure New Zealand's future. The government is pouring billions of dollars into military hardware, prisons, and roads but doing almost nothing to relieve cost-of-living pressures for those doing it hardest. The summary of initiatives is a summary of cuts", says Sandra Grey, President of the New Zealand Council of Trade Unions Te Kauae Kaimahi.
"On Treasury's forecasts, unemployment is set to rise to 5.5%. Around 227,000 people are expected to be on Jobseekers this year. The cost-of-living crisis is going to get worse, with inflation expected to rise to at least 4%. Real wages are forecast to fall across 2026. Child poverty is increasing. Treasury's forecasts appear very optimistic and out of line with RBNZ and the commercial banks.
"Despite this grim economic picture, the government has slashed the incomes of the most vulnerable households. $380 million taken from social housing tenants. It has reduced Temporary Additional Support by $200 million, which will hurt the very poorest New Zealanders. It has set out a cumulative real terms cut of at least 18% to public services. These cuts will impact every Kiwi.
"A report out today finds we have the highest level of homelessness in our history. Yet the social housing builds announced today won't start until 2028/29. In the meantime, housing precarity and homelessness will continue to grow as the government reduces support for emergency accommodation.
"This government promised New Zealanders it would fix the cost-of-living crisis. Electricity and gas prices are out of control, food prices are sky-high, council rates, insurance, public transport, they've all become unaffordable for ordinary Kiwis. There is no meaningful answer to any of these problems in Budget 26.
"The Budget fails to invest in health and education. Early Childhood Education sees a 2.5% real terms cut in subsidies. Schools' operational grants see a 2% real terms cut. The health system gets only enough to maintain current state - which is one of extreme stress.
"In a time of growing climate disaster, the government has once again neglected to invest in resilience. There is nothing in this Budget to support managed retreat or to support our water systems cope with extreme weather. This is the very opposite of securing our future. Vulnerable communities are being hung out to dry by this government's lack of action.
"Lacklustre investment in health and education contrasts with a huge spend up on prisons, military hardware, and roads. $477 million in operating spending is poured into growing the prison population, while $982 million goes into the Defence Force. A total of $4.5 billion in new capital expenditure is allocated to the armed forces and to building roads we don't need - this is almost 80% of total new capital expenditure.
"The Government is continuing to make all the wrong choices", says Grey.
"We need to remember that in its first year, this government gave away billions of dollars in tax breaks to landlords and tobacco companies. It could still choose to reform the tax system so the wealthy pay their fair share." "Nicola Willis's final Budget leaves a legacy of destruction. It will make the country poorer, more divided, and more precarious for working people and their families for years to come. Christopher Luxon and Nicola Willis need to urgently change course," says Grey.
