Budget 05 ? Promising and Disappointing
" This years budget does have quite a bit of good news, but it is also disappointing in its response to some key social
issues, in particular homeownership, our poorest children, and residential care services," said Major Campbell Roberts,
Director of the Salvation Army Social Policy and Parliamentary Unit.
Kiwisave is a welcome encouragement to New Zealanders to be involved in saving for retirement but The Salvation Army is
disappointed in the provisions regarding homeownership. Extension of the Mortgage Insurance scheme and the Kiwisave
scheme will certainly be of some help, but both schemes will be of limited assistance to many low income households in
major metropolitan areas, with high house prices. Low income households will also find significant difficulty in
contributing 4% of their income to join this retirement and homeownership scheme,"said Major Roberts.
"The budget has ignored other proven homeownership options such as equity share. An equity share scheme would have
enabled far more households into homeownership over a shorter timeframe. We need a range of schemes to meet the diverse
housing needs in New Zealand. We are disappointed that a greater number of options were not included in the budget."
The Salvation Army is also uncertain whether the new funding made available to District Health Boards for disability
services will help address chronic under funding in the residential care sector.
"Many not-for-profit residential care providers, including the Salvation Army, have been or are being forced out of
providing this kind of care because of long term under-funding by government. The 32 million extra announced today has
the potential to assist and is welcome, but it is not clear if all this money will go to residential care, this seems to
be at the discretion of DHBs. If this money doesn't flow through to rest home care, this essential service will become
even more insecure into the future" said Major Roberts.
The Salvation Army also has some concerns about the governments Working for Families package which continued to be
rolled out through today's budget.
"Although we do recognise that this package is the biggest hit back against poverty for many years, we are increasingly
concerned about they way in which it discriminates against our poorest children - those living in beneficiary
households. We are also concerned that the push to have most DPB, sickness and invalids beneficiaries in work will see
some people locked into inappropriate, unstable, or low quality employment that places stress on families and does not
raise them out of poverty," commented Major Roberts.
The Salvation Army Social Policy and Parliamentary Unit acknowledges that there are several promising or positive
aspects of the budget.
The raising of the thresholds for tax, especially at the bottom level, and the regular CPI indexing of these thresholds
is viewed as a very sensible and positive policy, especially for low and fixed income households. The Salvation Army is
also pleased to see increased funding to support social housing, prevention services in the area of drugs, alcohol, and
mental health, the rates rebate scheme, early childhood education, OSCAR programmes, legal aid and rehabilitation for
offenders.
"Older people, and those with addictions or mental health problems, are some of New Zealand's most vulnerable people and
this additional support will be helpful. Early childhood education, and childcare also make a huge difference to
families, making this more accessible and affordable is vital," commented Major Roberts
"We are very pleased to see increased spending for legal aid and rehabilitation for offenders. It is important that
everyone has access to justice and that we do more to prevent re-offending."
"This budget provides some positive funding boosts to a number of programmes. But we are disappointed that the
government did not do more to address some of the bigger social issues. It was a budget that both promised and
disappointed. We will be looking for renewed emphasis on the areas that disappointed this time, in any future policy or
funding announcements," concluded Major Roberts.