Budget 2025

The story so far

Before the Budget, Treasury estimated $2.5 billion was needed to maintain current service levels, nearly double Finance Minister Nicola Willis's $1.3 billion operating allowance, so only limited new spending was expected.^{19 May 2025} The Government is funding business tax relief, health and education partly with savings from pay equity and KiwiSaver changes, including raising default contribution rates from 3% to 4% by April 2028 and halving government contributions.^{22, 23 May 2025} Other measures include an $18 million RNZ funding cut over four years, $15.7 million in new private school subsidies, and a parental assistance test for 18 and 19-year-old benefit claimants from July 2027.^{22 May 2025} Opposition parties have criticised the Budget as austerity, and the Greens claim it has an uncosted funding gap of $633 million to $714 million.^{22, 26 May 2025}

Latest

KiwiSaver members have until 30 June to claim the maximum $521 government contribution, which requires contributing at least $1042.^{6 Jun 2025} The Greens' claim of an uncosted gap remains their claim, and the Government's response is not reported in these stories.^{26 May 2025}

What's next

The parental assistance test for 18 and 19-year-old benefit claimants starts in July 2027, but its income threshold has not been decided.^{22 May 2025} Default KiwiSaver contribution rates are due to rise from 3% to 4% by April 2028.^{23 May 2025}

Key moments

1. 19 May 2025Treasury estimate of $2.5 billion gap versus $1.3 billion allowance
2. 22 May 2025Willis unveils Budget 2025, calling it a 'No BS Budget'
3. 22 May 2025RNZ faces $18 million funding cut over four years
4. 22 May 2025Parental assistance test for 18 and 19-year-old benefit claimants announced
5. 22 May 2025$15.7 million in new private school subsidies, first increase in 15 years
6. 23 May 2025Default KiwiSaver rates to rise to 4%; government contributions halved
7. 26 May 2025Greens claim uncosted Budget gap of $633 million to $714 million
8. 6 Jun 2025KiwiSaver government contribution claim deadline set for 30 June

Written from the stories below; each sentence links to its sources.