Budget 2026 the coalition Government’s ‘last chance’ to deliver on cost of living - Labour
Tuesday, 26 May 2026
Labour leader Chris Hipkins says the looming Budget is the Government’s “last chance” to convince voters it understands how tough things are.
Finance Minister Nicola Willis has given no guarantees of cost of living supports in Budget 2026, arguing any short-term relief would only hurt the economy in the long term.
Willis will present her third Budget on Thursday, having signalled it will focus on funding core public services and keeping a tight grip on discretionary spending.
Speaking to reporters on Tuesday morning at Parliament, the finance minister said global pressures ‒ like the Iran war’s impact on fuel prices ‒ demanded responsible choices in the Budget.
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“I'm as tempted as anyone to just put a Band-Aid on, provide some short-term pain relief, but we have to be responsible because if we're not there will be long-term consequences for every Kiwi family, every young New Zealander.”
Willis said she was fully aware of how hard things were for many people but that these people also understood the need to spend only on the essentials.
“New Zealanders need us to invest in health services, in our schools, in our police force. These are the essential things that Kiwis rely on and as a responsible Government, we're ensuring that they're prioritised for resources.
“We know it's tough for so many Kiwi families right now. We also know they understand the need for us to ensure this is an economy that supports jobs, where we're not going to inflict higher taxes on you right when you need it least and that this is an economy that can withstand the pressures the world is throwing it.”
Hipkins said many people who were struggling to pay the bills, find work or fill up the car would be looking for relief in the Budget.
“This is [the Government’s] last chance to indicate to New Zealanders that they understand how tough it is.”
Hipkins reiterated Labour would wait until after the Budget to release more policy but it was clear things needed to change.
“Those living in state housing, and we're talking tens of thousands of families, are getting nothing but pain from this year's Budget. Look at the superannuitants living in a state house; their rent increase far exceeds any increase in New Zealand superannuation.
“For those on disability support living in a state house, they're getting something like $2.50 a week in increase of disability support, and their rent is going to go up by $30 a week. How are they going to make ends meet on that? Across the board at the moment, all we've seen so far is more pressure being piled onto Kiwi families by the Government.“
Willis said she would be holding the line on spending to address the longer-term challenges, like debt levels.
“Our goal is always to make New Zealanders better off and what we've seen in recent years, is that you can do something that in the short term sounds like you're better off.
“I recall, for example, the cost of living payment, but if actually all that does is drive prices and inflation higher, then they're worse off in the end.“
The latest Ipsos Issues Monitor survey shows concern about fuel prices has surged 17 points to become the fourth biggest issue for voters.
Labour leads on nine of the top 20 concerns ‒ including on fuel ‒ despite a meagre policy offering.
On potential relief at the pump, Hipkins said Labour would wait to see how the situation developed this year.
“Obviously, this is a very volatile time around fuel prices at the moment. They could continue to go up or they could come back down again. We're waiting to see how that plays out over the next few months before we make our own decisions on that.”