Budget 2025: What you need to know

Officially dubbed the “Growth Budget” - unofficially, the “no BS Budget” - Finance Minister Nicola Willis has unveiled where New Zealand's dollars are being spent. 

From the outset, she promised no frills or excess – saying for months there’s very little left in the kitty. 

Big changes include cuts to Government KiwiSaver contributions, means testing on the financial support parents can access, health investments, and a new tax incentive for businesses.

Listen as we run through the numbers you need to know.

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Host: Chelsea Daniels
Sound Engineer/Producer: Richard Martin
Producer: Ethan Sills

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Episode Transcript

Speaker 1 (00:05):
Fielder.

Speaker 2 (00:05):
I'm Chelsea Daniels and this is a breaking news episode
of the front Page, a daily podcast presented by the
New Zealand Herald officially dubbed the Growth Budget unofficially the
NOBS Budget. Finance Minister Nikola Willis has unveiled when New
Zealand's dollars are going to be spent from the outset.

(00:28):
She promised no frills or access, saying for months is
very little left in the kitty.

Speaker 3 (00:35):
The economic outlook presented alongside this budget is a bright
one after a tough few years. Growth, jobs and wages
are set to rise. The government is not promising that
today's budget will solve all New zealanders problems, but we

(00:57):
do promise that the decisions we are taking now will
sit our country up for a better future.

Speaker 2 (01:04):
So what's been announced today well a big change in
key we Saver, with the Government announcing it'll be harving
its yearly maximum contribution rates for key we Saver to
two hundred and sixty dollars, down from five hundred and
twenty one. It also won't be extending it to those
earning more than one hundred and eighty thousand dollars a year.

(01:24):
Default employer and employee contributions will rise from three to
four percent, phased in over the next three years, although
members can temporarily opt out, and sixteen and seventeen year
olds will become eligible to receive a government contribution. There's
also a new six point six billion dollar tax incentive

(01:45):
for businesses, allowing twenty percent of a new assets value
to be deducted from annual taxable income. This will apply
to assets like machinery, tools and equipment, covering their value
on top of normal depreciation, and is believed to increase
our GDP by one percent. In total, there will be

(02:05):
twenty one point four billion dollars in savings over the
next four years.

Speaker 1 (02:10):
The majority of.

Speaker 2 (02:11):
That is made up of the twelve point eight billion
dollars saved by the controversial changes made to the pay
Equity scheme. There are two hundred and twenty eight spending
initiatives as part of this budget, but here are some
of the highlights. Looking at health, seven billion dollars will
be spent on health over the next four years. People

(02:32):
will now be able to go a year without having
to go to the doctor to get a repeat prescription,
up from the current maximum of three months. That will
cost ninety one million dollars over the next four years
and comes into effect in the first quarter of twenty
twenty six. One billion will be invested in hospital facilities,
including a new emergency department at Wellington Regional Hospital and

(02:55):
a one hundred and twenty eight bed inpatient building in Nelson.

Speaker 1 (03:03):
Onto.

Speaker 2 (03:03):
Families Best Start will be income tested, diminishing four families
with an income of seventy nine thousand dollars a year
and cutting off entirely when a family earns more than
ninety seven thousand dollars. The changes will affect families of
children before April first next year. Those savings will see
one hundred and forty two thousand families get an extra

(03:26):
fourteen dollars a fortnight on average. Under Working for Families changes,
the government is also changing the abatement threshold for eligible
families from forty two thousand, seven hundred dollars to forty
four thousand, nine hundred dollars and the rate from twenty
seven percent to twenty seven point five percent.

Speaker 1 (03:48):
Let's look at education.

Speaker 2 (03:50):
A boost to learning support makes up a large portion
of new education spending two point five billion dollars worth
over the next four years. All primary schools will be
funded for a learning support coordinator from twenty twenty eight.
A new multi studies subject area is being introduced for
years eleven to thirteen, and the government's also revealed it'll

(04:13):
be looking domestically and overseas in its marketing campaign to
bring in more teachers. Meanwhile, funding for private school subsidies
will increase by eleven percent after staying the same for
the last fifteen years.

Speaker 1 (04:31):
And now let's look at benefits.

Speaker 2 (04:32):
A big change to unemployment benefits, including job seeker cuts
for teens. Many unemployed teenagers who do not study will
not be eligible for the benefit from mid twenty twenty seven.
The government says this group should be supported by their
parents or guardians.

Speaker 1 (04:50):
Not the taxpayer.

Speaker 2 (04:52):
Eighteen and nineteen year olds who are unable to rely
on parental support will be eligible for the money. So
much of what was included in today's budget has been
announced over the last month by the government. Here are
just some of those headline figures. More than two billion
dollars was announced to replace the Defense Force's aging fleet

(05:15):
of maritime helicopters, and a nine hundred and fifty seven
million dollar boost over four years in defense, one hundred
and forty million dollars to tackle student attendance, Nearly one
hundred million dollars over the next four years to boost
maths achievement in primary and intermediate schools.

Speaker 1 (05:34):
One hundred and sixty three.

Speaker 2 (05:35):
Million dollars over four years to expand and maintain urgent
and after hours healthcare services nationwide. Five hundred and seventy
seven million dollars over four years to support TV and
film production. Six hundred million dollars in funding for improving
rail reliability, upgrades and maintenance. Seven hundred and seventy four

(05:57):
million dollars is allocated for the cases and improved redress
for survivors of abusing care. Two hundred and seventy five
million dollars over four years will overhaul social services, including
one hundred and ninety million dollars for a Social Investment Fund.
That fund will invest in at least twenty initiatives, including

(06:18):
parental support and preventing vulnerable people from entering state care.
An extra one point five million dollars has been committed
annually to multi wardens, bringing government funding to two point
seven million and thirty five million.

Speaker 1 (06:31):
Dollars over four years.

Speaker 2 (06:32):
Will go towards border protection to support sixty additional roles
to tackle drug smuggling. That's it for this bonus budget
episode of the Front Page. You can read more about
today's stories and extensive news coverage at enzherld dot co

(06:55):
dot nz. The Front Page is produced by Ethan Sills
and Richard Martin, who.

Speaker 1 (07:00):
Is also a sound engineer. I'm Chelsea Daniels.

Speaker 2 (07:04):
Subscribe to the Front Page on iHeartRadio or wherever you
get your podcasts, and tune in tomorrow as we'll be
crunching the numbers with Herald Business Editor at Large Liam
Dan