Debtfix pleased Budget 2022 recognised lower income is under $70k

The Crew at Debtfix were pleased to see the Government’s Budget 2022 recognised that people earning less than $70k are making ends meet on a low income.

The announced $350 cost of living package will give New Zealand’s lower earners a buffer while they struggle to pay for everyday living, resorting to higher interest credit to cover household expenses.

Debtfix director, Christine Liggins, says she’s surprised the Wellbeing Budget 2022 didn’t give the $350 to beneficiaries, too.

“This would have helped relieve the stress on food banks, which we need to refer our clients to when their personal debt is unmanageable, and they are desperate. Maybe a better offering could have been a threshold of $50K and included beneficiaries.”

Liggins was pleased that child support will go directly to sole parents now and not Work and Income – though the knock-on effect will be that it will be classed as income.

“Other allowances will drop, and it looks like the Budget gives with one hand and the Ministry of Social Development takes with the other.”

Extending the petrol duty reduction, increasing dental grants and half price public transport for ever for community service card holders, are welcomed moves.

“Many people Debtfix help with problem debt are employed and the compounding impact of Covid and inflation, is seriously stressing out many ordinary New Zealanders,” says Liggins.

“Reduced public transport costs are great for those in city areas, but not really much good for those in rural and outer areas where this is lacking.”

Debtfix’s caseload has steadily increased since its foundation in 2018. The Crew anticipates problem debt will continue to grow as New Zealanders grapple with the long-term impact of Covid and global economic fallout.

“Homeownership makes a real difference to how well people can manage financial ups and downs so the Budget improvements for first time home buyers are good news. But I’m not sure on actual affordability as house prices are way higher than they should be.”