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Budget 2016 Home Page Budget Speech - Budget 2016

Delivering better public services

Mr Speaker,

The Government is committed to delivering better public services.

Four years ago, the Prime Minister gave the public service a set of challenging targets covering welfare, education, crime and health.

Since then, significant progress has been made.

For example:

  • More than 40,000 fewer children now live in a benefit-dependent household.
  • The proportion of 18-year olds achieving an NCEA Level 2 qualification has increased from 74 per cent to over 84 per cent.
  • Total crime has dropped by 16 per cent, with youth crime down by almost 40 per cent.
  • And rheumatic fever rates have fallen by 45 per cent.

Child abuse in New Zealand, however, remains too high.

Mr Speaker,

The Government is investing in new ways of supporting more New Zealanders off benefits and into work, so they can lead better lives.

As a result, the number of people on a benefit is the lowest for eight years, and the lifetime cost of the welfare system has fallen by $12 billion since 2011.

This is an example of our Social Investment approach, which uses data-driven investment techniques to determine when and how to intervene to change lives for the better.

Budget 2016 includes a comprehensive and wide-ranging Social Investment package, with extra funding of $652 million over four years.

There are a number of parts to this package.

The Government recently announced major state care reforms and a complete overhaul of Child, Youth and Family to improve the long-term life outcomes for New Zealand's most vulnerable population. A new system will be in place by the end of March 2017.

The Budget provides funding of $200 million for these reforms over the next four years.

This includes developing an independent youth advocacy service, raising the age of care and protection, caregiver recruitment and training, workforce training and development, and better access to support for caregivers.

This is the Social Investment part of new Budget funding for the care and protection of children. In addition, a further $145 million will meet increased demand from more children and young people in care.

Mr Speaker,

Another part of the Social Investment package provides $61 million to extend the Youth Service to 19-year old parents, and to 18 and 19-year old job seekers at risk of long-term welfare dependency.

If we do not take action, the average 19-year old sole parent will spend 18 years on a benefit.

It is our responsibility, both to families and to taxpayers, to do more to help these sole parents gain independence.

The Social Investment package also includes $50 million to reduce barriers to employment, including for people with complex health conditions who would otherwise spend significant time on a benefit.

The package includes an extra $43 million for schools to increase support for around 150,000 students most at risk of educational failure.

The Whānau Ora programme, which focuses on self-determination, receives another $40 million to support around 2,500 more whānau and families in areas such as managing health and disability issues, improving financial literacy and reducing household debt.

I acknowledge the advocacy and support of the Māori Party for this new approach.

Another $20 million from the Social Investment package is to support offenders at a particularly vulnerable time when they leave the controlled routine of prison and return to the community.

The package also provides $36 million to ensure more New Zealand families live in warmer, drier and healthier homes.

Half of this funding is targeted at insulating around 20,000 rental homes occupied by low-income families through the Warm Up New Zealand programme. This will take the total number of newly-insulated homes since 2009 to well over 300,000.

The other $18 million - delivered through the health system - focuses on reducing preventable illnesses among young children who are living in cold, damp and unhealthy homes.

By addressing the drivers of demand for public services, and helping people become more independent, Social Investment also reduces the long-term costs of providing public services.

As I've said many times, what works for communities also works for the Government's books.

Mr Speaker,

Budget 2016 contains a significant increase in funding for core public services that New Zealanders rely on every day.

This extra investment comes with a clear expectation that public agencies must strengthen their focus on delivering better results.

The health sector is a particular priority and the Government will invest over $16 billion in health in the coming year.

Over the next four years, $2.2 billion of additional funding will be provided for new health initiatives and to meet demand.

Pharmac, for example, will receive an additional $124 million over four years to provide more New Zealanders with access to new medicines.

As Pharmac has announced, it proposes using this funding to provide new treatments in a range of areas, including for melanoma and hepatitis C.

The Budget also provides $39 million for a national bowel screening programme which, when fully implemented, is expected to screen over 700,000 people every two years.

As well as that, a further $96 million over four years will increase the number of elective operations.

This is part of a continued effort to increase elective operations. Around 50,000 more surgeries are now performed each year than in 2008.

Budget 2016 provides $169 million more for disability support services and a further $73 million for primary healthcare. This includes extra support for the free doctors' visits and prescriptions for under 13s that we announced in Budget 2014.

District Health Boards will receive $1.6 billion over four years to invest in services, meet population growth and deliver better results.

Mr Speaker,

Increasing the price of tobacco is the single most powerful tool to reduce smoking.

The Budget confirms that tobacco excise duty will rise by 10 per cent on 1 January each year for the next four years.

I want to thank the Māori Party for continuing its advocacy for this effective approach to reducing smoking.

Mr Speaker,

This Government measures success by the results achieved for New Zealanders, rather than the amount of money spent.

Since 2008, the proportion of children in early childhood education has increased to almost 97 per cent.

As I've mentioned, the proportion of 18-year olds with NCEA Level 2 qualifications has also grown considerably.

Children are starting school better prepared to learn, and leaving school better equipped to succeed.

The Budget continues this focus on results.

The Government will invest a total of $11 billion in early childhood, primary and secondary education in 2016/17. Together, these sectors will receive an extra $1.4 billion over this year and the next four years.

$397 million of this will meet growing demand for early childhood education and provide places for a further 14,000 children.

Additional funding is directed at students most in need of assistance.

Instead of an across-the-board increase in operations grants, schools will receive $43 million over four years to target students most at risk of under-achieving.

In addition, $42 million will be provided for students with high and special educational needs.

As I mentioned previously, the Budget provides $883 million for new school property.

It also includes funding for around seven new Partnership Schools in 2018 and 2019.

I want to acknowledge David Seymour for his advocacy for this initiative.

Mr Speaker,

This Government is providing considerable support for initiatives to improve the education and skills of Māori and Pasifika New Zealanders.

We have provided almost $10 million more over four years for Māori and Pasifika Trades Training. This will increase the number of training places to 3,400 next year - up from just 1,200 in 2014.

In addition, the Budget allocates $6 million over four years for other Pacific peoples initiatives, such as helping Pacific youth in Auckland find work, education or training opportunities.

Mr Speaker,

The Justice sector faces a number of challenges, including the rising prison population, preventing crime and prisoner rehabilitation.

Overall, this sector receives $837 million over the next four years, plus $56 million in 2015/16.

Police receives $299 million, including $49 million from Budget 2015, which will primarily be used to meet wage increases.

Funding of $208 million supports a number of justice sector initiatives, including addressing family violence, increasing access to legal aid and ensuring the justice system better caters for victims of crime.

Corrections receives $356 million to protect the safety of the public, reduce reoffending and accommodate higher numbers of prisoners.

This includes funding to manage offenders returning from overseas and to continue 24-hour GPS electronic monitoring for the highest risk offenders.

Mr Speaker,

$303 million is provided over four years to combine urban and rural fire services into one organisation from the middle of next year.

As announced previously, this will come from a proposed increase in the fire levy from 2017/18, as well as government funding.

I want to thank Peter Dunne for overseeing these changes.

In addition, the Ministry of Civil Defence and Emergency Management will receive an extra $6 million over four years to ensure New Zealand is well prepared for future natural disasters.

Mr Speaker,

A fundamental responsibility of the Government is to protect the safety of New Zealanders.

The Budget provides $301 million of new funding over four years for the New Zealand Defence Force to concurrently undertake domestic, regional and international security tasks.

The New Zealand intelligence community will receive new funding of $179 million over four years.

This will ensure it can provide essential intelligence and security services and remain effective in a rapidly-evolving environment.

As announced previously, the Government is investing $20 million over four years on a new Computer Emergency Response Team to combat cyber-attacks and cyber-crime.

Mr Speaker,

Recognising the importance of the arts, the Budget provides an additional $12 million over four years for the New Zealand Symphony Orchestra, Royal New Zealand Ballet and Te Matatini Kapa Haka Aotearoa.

Budget 2016 also provides $16 million over four years for High Performance Sport to support athletes and enhance our medal prospects at the Tokyo Olympics in 2020.

A further $4 million over four years will go to Drug Free Sport New Zealand.

Mr Speaker,

The Government supports the SuperGold card scheme and is providing $41 million of additional funding to provide certainty for more than 670,000 cardholders across New Zealand.

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