Make them pay: New Zealand has the meanest companies in the west, budget mentors tell MPs
Wednesday, 11 February 2026
The Government is short-changing budgeting services for struggling families, MPs have been told, and some of our biggest companies should be made to pay levies to close the $30 million funding gap.
At a hearing of the Finance and Expenditure Select Committee on Wednesday, MPs were told how that funding gap had led to the closure of 25 budget services in the past two years, and had seen some budget mentors working for free just to help under-pressure families in their communities.
But there were a raft of companies that were being effectively subsidised by budgeting services helping families who had got into debt through the loans and services they provided, budget mentors said, and they should be made to pay levies to close the funding gap.
“There's a gap of over $30 million in steady funding for financial mentoring,” said Jackie Lilley, senior policy adviser from the Fincap budgeting umbrella group. “This is best filled by small levies on industry who benefit from financial mentoring.”
Australia and the UK both used industry levies to partially fund budgeting services, he said.
Loan providers, including banks, telecoms companies, power companies, and gambling companies all sold services that left some struggling families in debt, and they should help pay for the budgeting services that help them claw their way back into the black.
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Often they repaid their loans faster after budget mentors worked with families to help them balance their books, MPs were told.
Fincap chief executive Fleur Howard said there were 762 financial mentors at 184 services across the country assisting families struggling under $933 million of debt.
Some services had been recently defunded by MSD, which provides the $19.5m of funding that keeps budget services going, and 25 services had shut their doors over the last two years.
“We're also hearing from more and more services with no option but to close their doors soon, some of them in isolated communities,” Howard said.
Some budgeters had entirely lost their incomes because of funding decisions, but had continued to provide budgeting services for free to help their communities, she told MPs.
“One service shared that after losing their MSD funding, two of their 11 staff decided to become volunteers, while four kept working for their communities while agreeing to a reduced income,” she said.
The solution was to levy banks, casinos, and other companies.
“We need parliament to help us to establish ongoing industry contributions to financial mentoring, as well as an increase in our government funding,” Lilley said.
“Energy companies, telecoms companies, financial services, especially KiwiSaver providers, the gambling industry, all benefit from, refer to, and create work for financial mentors,” he said.
Howard referred MPs to a 2019 report, which compared NZX 50-listed companies’ charitable donations to overseas peers.
“They trail well behind other developed countries in corporate philanthropy, giving on average 0.07% of pre-tax profits,” she said. “That's compared to 1.75% for FTSE 100 companies in the UK, 1.69% for large companies in the US and 0.59% for Australia's 50 largest companies.
“We trail well behind.”
MPs showed interest in the idea, with National’s Ryan Hamilton asking Fincap to prepare a proposal to send to the committee.
The briefing also revealed just how hard some families were struggling, and the extent of hardship withdrawals from KiwiSaver
One-in-eight people walking in the door were looking at a KiwiSaver hardship, Howard said, but hardship withdrawals were taking an average of 41% of financial mentors' time.
KiwiSaver hardship withdrawals have surged in number and value. But withdrawal rules are tight and it is difficult for struggling families to get the money - designed to generate retirement nest eggs.
Claudette Wilson from North Harbour Budgeting Services told the committee: “We believe in the context of dealing with financial hardship in our communities, the Government has failed,” she told them bluntly.
“We understand the need for fiscal restraint,” she said. “But as we tell our clients, you need to prioritise the here and now.”
She said: “Too much of the current government spending is being directed to the nice-to-haves rather than the immediate needs of our communities.”
“Without properly funded budgeting services, the Government is shifting risk and responsibility onto our communities who are already stretched to breaking point,” she said.