New Zealand will start giving out cash payments to nearly 150,000 low-income families to ease the pressure caused by rising petrol prices since the start of the Israel-US war on Iran.
Announcing the world’s first such fuel relief package, prime minister Christopher Luxon on Tuesday said low-to-middle-income workers who have children will get an extra payment of NZ$50 (£21.80) a week from 1 April in response to the global fuel crisis.
Some 143,000 families will be eligible to receive the cash payment with the government’s boost to the existing in-work tax credit, which was designed to give extra financial support only to families who are working.
An additional 14,000 families with slightly higher incomes will also be eligible for payments, but will receive less than $50 per week.
Mr Luxon and finance minister Nicola Willis unveiled the cost-of-living relief package earlier this afternoon which will last for one year or until the price of 91 octane petrol – the standard, widely available fuel – drops below $3 (£1.30) a litre for four consecutive weeks.
It excludes beneficiaries, superannuitants, and those without children.
Ms Willis said the scheme has been carefully devised to target families in the “squeezed middle” who were working hard but had modest household incomes and are not eligible for main benefits.
“This temporary boost will deliver support to working families who are under significant cost-of-living pressure, without making inflation worse or further driving up government debt,” she said in a media release.
“We know these families will be hit particularly hard by the global fuel-price shock. We are delivering them timely relief.
“The government will implement these changes at pace.”
She said the change would take effect from 1 April and most eligible households will start receiving the payment directly in their bank accounts starting 7 April if they are paid weekly and 14 April if they are paid fortnightly.
Petrol prices have increased roughly 40 to 50 cents a litre in the country, raising the average price of unleaded fuel to over $3 since Israel and America’s joint strikes began in Iran. Some petrol stations have reported running out of petrol as people tried to stock up on fuel. The country has 47 days of combined petrol, diesel and jet fuel stocks, according to the government.
Latest figures from MBIE show we have 47 days of fuel supply left, 23 on the ground in Aotearoa, and the rest on the way.
The opposition parties have said the measure falls short in addressing everyone.
Labour leader Chris Hipkins said the package was “a start” to ease pressure, but the majority of New Zealanders would miss out.
“For those who are getting a bit of extra support, I know they’ll welcome that,” Mr Hipkins said. “But the real question for the government now is, what are they going to do to support super annuitants, students — the many other New Zealanders, those who don’t have kids, who are not going to benefit from this.”
Green co-leader Marama Davidson also criticised the government said situation demands far more than what was announced today
“The Luxon government has turned its back on hundreds of thousands of New Zealanders, asking them to foot the bill for Trump’s war on Iran,” she said.
“The government showed today it is not prepared to match the scale of what people are facing and the crisis New Zealanders are dealing with.”
