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370,000 Families Getting Working For Families Tax Credits

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Fuseworks Media
Fuseworks Media

The Government spent about $2.2 billion on Working for Families tax credits in the year ending in March and more than 370,000 families are claiming the benefits.

Prime Minister Helen Clark today released an evaluation report on the package which says 371,300 families were getting Working for Families tax credits. It had been estimated that 360,000 families would be receiving the Working for Families tax credit by the end of the March 2008 year.

The three most commonly reported uses of the extra money were "groceries and food, school costs and clothing," the report said.

It also said the package was reaching the target group of low to middle-income families, with about three quarters of families on incomes of less than $50,000 a year.

More than 80 percent of recipients were on an income of less than $59,000 a year.

Families were mostly getting $125 to $150 a week under Working for Families.

A working family earning $45,000 a year with two children received $317 per fortnight more in tax credits since before Working for Families was introduced.

Miss Clark said the report showed the package was making a "big difference" for low and middle-income families with children.

The Working for Families tax credit was designed to help people take up and stay in employment.

The report said that since the package was implemented, "New Zealand has experienced the largest fall in numbers receiving the DPB since the benefit was introduced in 1973".

The number of families receiving the domestic purposes benefit had fallen by 12,500 -- from 109,700 at August 2004 to 97,200 as at August 2007.

The numbers of sole mothers going into jobs had increased from 47 percent in the 2001 census to 52 percent in the 2006 census, it said.

Working for Families was also aimed at helping address one of the barriers to employment for those with children -- the cost of childcare.

The average weekly payment for childcare assistance had increased from $50 in August 2004 to $78 in August 2007.

Some 30,000 (21,200 of which were not receiving a benefit) families received childcare assistance at the end of February 2008 compared to 18,700 in February 2004.

There were 113,200 families with children receiving the accommodation supplement at the end of February 2008 compared to 108,400 in February 2004.

Work was under way to evaluate the effect of Working for Families on employment and incomes. Preliminary results of this would be available in early 2009.

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