Last resort social welfare payment set for cut, saving nearly $200m over four years, but critic calls it ‘nasty’

Saturday, 23 May 2026

The Government will reduce maximum Temporary Additional Support payments from April 2027, affecting thousands of low-income New Zealanders.

Superannuitants will be exempt from the reduction in the maximum rate, from 30% to 25%.

The changes were part of Budget 2026, and were revealed in the announcement of changes to accommodation support for social housing.

Tucked alongside the Government’s social housing announcement this week was another Budget cut set to impact thousands of low-income New Zealanders.

Housing Minister Chris Bishop announced plans to overhaul the social housing system on Thursday, with the first changes incorporated into next week’s Budget.

Those changes to government accommodation support from 2027 would require social housing tenants to contribute more of their income to accommodation costs, while the accommodation supplement for low-income households in private rentals would increase.

Modelling provided with the announcement showed it would leave 111,000 families in the private rental market better off, but 84,000 families in social housing worse off.

That modelling also included another change coming in the Budget – a reduction to the maximum Temporary Additional Support (TAS) rate.

Under the changes, the maximum TAS rate would be reduced from 30% to 25%, from April 2027. It was expected to save the Government $195.6 million over four years. Bishop said this would “better reflect its original purpose as temporary hardship support”.

Temporary Additional Support, or TAS, is a payment that low-income New Zealanders can apply for to help cover the cost of daily essentials.

Work and Income calculate whether a person is eligible by adding their “allowable costs” (essential expenditures like rent, child support, or transport to work or medical appointments) to their “standard costs” (basic living expenses like food, clothing and utilities), and determine whether those exceed total income.

If they do, the person may get TAS payments for up to 13 weeks. After that period, they have to re-apply and declare they are taking all reasonable steps to reduce their costs, and/or increase their income.

As at September 2025, about 11,000 New Zealanders were receiving TAS assistance.

Currently, the maximum TAS payment was the difference between the recipient’s income and expenses, or 30% of the recipient’s main benefit, superannuation payment or veteran’s pension payment - whichever was lower.

From 2027, the maximum will move down to 25% of the recipient’s main benefit. For superannuitants and those on a veteran’s pension, the maximum will stay at 30%.

The change would also remove child support liabilities that have been mandated by the Government from the list of “allowable costs”.

Because maximum TAS payments were a percentage of a recipient’s income, they would have increased when the previous Labour government boosted benefits by 7.22% in 2023.

Information released alongside the announcement this week noted the change will reverse these “unintended increases in line with benefit increases under the previous Government”.

Green Party social development spokesperson Ricardo Menéndez March said TAS was a last resort for people.

“I have seen first hand the difference it makes for people to meet the cost of food, transport to get to medical treatment, or the cost of medicine,” he said.

Labour social development spokesperson Willow-Jean Prime said cutting TAS showed “just how out of touch Christopher Luxon’s Government is with what people are facing every day”.

“The Government’s priorities are broken – they’re cutting jobs, raising rents for people in social housing, and now, taking away support from the least well-off New Zealanders,” Prime said.

Poverty Free Aotearoa advocate Pat Hanley described the upcoming changes as “nasty stuff”, saying they would impact disabled New Zealanders most acutely.

“TAS is essentially there because the level of benefits is too low to meet the ongoing, everyday needs of many New Zealanders,” he said.

Hanley said increasing transport costs - whether by private vehicle or otherwise - were making it harder and harder for beneficiaries to stay fed, adequately clothed and visit the doctor. While disabled beneficiaries could receive a disability allowance to cover some costs, it often wasn’t enough, he said.

“TAS is used to top up what that support can’t cover. I am very concerned that this reduction means they won’t be able to get the help they need,” he said.