By MSN NZ Money staff
Following a tough economic year Finance Minister Bill English has delivered the 2011 Budget. This is what was revealed:
Members will have to pay three per cent of their earnings as a starting point, a rise of one per cent. The sweetener for workers is that employers will have to match it.
FULL COVERAGE: Budget 2011
The government will keep its $1000 kick start but its maximum contribution of $20 a week, in the form of a tax credit, will be halved to $10 a week.
This will cut its contributions by $2.6 billion over four years.
So far more than 43 per cent of all contributions have been funded by the government, mainly primarily through member tax credit and kick start payments.
Working for Families
Tax credits this year will cost the government $2.8 billion - about double the amount in 2005/06.
By 2014/15 the figure will have reduced to $2.6 billion.
The threshold for incomes will be lowered slightly from $36,827 to $35,000 and families with incomes above this threshold will receive fewer tax credits.
The government says changes, which will be staggered from April 1, next year, will be "better targeted to the most vulnerable families".
Families below the new income threshold will receive an extra $7 a week.
There will be restrictions on student loan eligibility for those with an overdue student loan repayment of $500 or more who are in default for more than one year.
There will be restricted borrowing for people aged 55 and over to tuition fees only.
The entitlement for part time full year students to borrow for course related costs will be cut.
Suspending inflation adjustments to the student loan repayment threshold until April 1, 2015.
Shortening the repayment holiday for overseas based borrowers from three years to one year and requiring borrowers to apply for the repayment holiday and provide a New Zealand based contact person before they go overseas.
The changes will bring savings of $277 million over five years and capital savings of $170 million.
Canterbury Earthquake Recovery Fund
A $5.5 billion provision with $740 million being funded from government agencies' existing budgets.
The health sector will receive $1.7 billion new operating and $40 million capital funding over the next four years.
An additional $1.3 billion new operating and $109 million capital funding for the education sector.
The government hopes to generate up to $7 billion by extending the mixed ownership model to four state owned electricity companies and by reducing its majority shareholding in Air New Zealand.
The electricity companies are: Mighty River Power, Meridian, Genesis and Solid Energy.
The government will own more than 51% of each company.
The changes, subject to the election result, would take place over three to five years from 2012.