The more a family spends on childcare, the higher the rebate.
Labour released a scathing statement, saying the number of families who received the maximum credit was too low and it indicated the Government’s flagship cost of living programme was “in tatters”.
Finance Minister Nicola Willis during a press conference in her Beehive office. Photo / Mark Mitchell
“A year in, only 153 people have received the [maximum] FamilyBoost entitlement for the entire year. National has broken its promises and is making life harder for New Zealanders.
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“National is completely out of touch with what our communities need.”
Finance Minister Nicola Willis flatly rejected the accusation National had broken a promise, saying they had delivered on “every promise that we made in relation to FamilyBoost“.
“We were very clear prior to the election that how much you would get under FamilyBoost depended on how much you spent on ECE fees and what your income was.
“Everyone who has applied for a FamilyBoost rebate under the scheme has received their full rebate, as it was advertised to them, prior to the election.”
She said Labour had “made clear it would remove the FamilyBoost payment”.
Willis said more than 60,000 families had claimed FamilyBoost, and Labour’s plan would rob them of much needed cost of living relief.
Recently, Willis announced the Government had tweaked the eligibility settings meaning ”thousands” more people would be able to make a claim.
The maximum rebate has increased from 25% to 40% of a family’s weekly childcare costs and the income cap has been raised from $180,000 to $230,000.
Willis said about 16,000 more families are expected to enter the scheme as a result of these changes.
“Those numbers are annual and we will monitor uptake each quarter to see whether the expected uplift is occurring.
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“I am confident that these more generous provisions will encourage more families to apply for FamilyBoost and will be welcomed by the families already benefiting from the scheme who can look forward to more generous rebates in future.”
Families are required to keep copies of their early childcare invoices to submit for a payment, which has raised questions about how many eligible families would end up receiving the payment.
When launching the policy in March 2024, the Government explained it had to weigh up waiting years so a direct childcare tax credit could be implemented or get going with payments that year but make parents wear the “administrative burden”.
Willis says IRD is looking into whether a direct refund model can be established. This could include automating payments with ECE providers.
Julia Gabel is a Wellington-based political reporter. She joined the Herald in 2020 and has most recently focused on data journalism.