The budget is the government's annual announcement of upcoming yearly expenses and savings, and forecasting income and expenditure.
In the last few weeks leading up to today's announcement, the government has made a series of pre-budget announcements. Here is what’s already been announced.
Last year fees-free to be scrapped
For would-be or current students, the final year of free fees will no longer be available. The scheme - initially introduced by Labour as first-year free - was changed to final year of tertiary education free to incentivise students to finish their studies.
However, the Government said the scheme wasn’t reaching the targeted groups, so it was axed.
Loans for businesses looking to turn away from gas
The Crown will be guaranteeing 80 percent of each loan given under the scheme, in return for banks passing on lower interest rates to businesses. To be eligible for the scheme, the borrower must be using NZ natural gas with an annual consumption of 1000 Gigajoules.
$48 million dollars will be set aside in the upcoming budget to cover potential losses.
$180 million dollar injection to Otago Central Lakes healthcare
$25 million in new operating funding is expected in 2027/28, with a further $103 million over the following three years. $52 million in capital funding will also be given to the region to upgrade existing facilities.
Health Minister, Simeon Brown says this will ensure people in Wānaka, Cromwell, Queenstown, and across Otago Central Lakes can access the healthcare services they need, closer to home.
Rotorua to see two new courthouses
$100 million will be allocated towards the Rotorua Law Courts which includes the High Court, District Court, Coroners Court, and tribunals. The rest of the funding will go to the Rotorua Māori Land Court.
“For too long, Rotorua has been left with court buildings that are no longer fit for purpose. Longstanding issues including leaks, mould, and poor ventilation have created unacceptable conditions for court users and staff,” says Courts Minister Nicole McKee.
Funding changes for social housing
Social housing tenants will be expected to contribute 30 percent of their income - up from 25 percent - during a 12-month phase in period starting April 2027. This will cost 84,000 households about $31 per week. This money will be reinvested in raising the Accommodation Supplement between 10-30 dollars per week, leaving more households better off.
Housing minister Chris Bishop says these changes are to make the social housing system fairer for all, while encouraging housing independence.
Thousands of public sector jobs to go
Public sector jobs will be cut back to one percent of the population. Currently it sits at 1.2 percent with 67,000 workers, but the government aims to have it back down at 55,000 by 2029.
“The overhaul will reduce the number of government departments, increase the use of AI and other digital tools, and deliver significant savings,” Finance Minister Nicola Willis says. Jobs not under threat are teachers, doctors, nurses, Health NZ staff, police, and defence staff.
These changes are projected to deliver 2.4 billion in savings over the next four years.
Extra year of Healthy School Lunch programme funding
$212.4 million will go towards funding the extension of the school lunches for 2027. The programme delivers lunches to around 242,000 students every school day.
“$2.9 million from Budget 2026 will go towards exploring new approaches to make the Programme better,” says Associate Education Minister David Seymour.
Literacy and maths to receive boost
$131 million in funding will be directed towards reading, writing and maths.
“Today’s literacy and maths package delivers substantive investment into twelve key initiatives that will help to embed generational reforms in our primary and intermediate schools. Our focus is ensuring that young people are set up for success at high school and well prepared to achieve secondary school qualifications," Education Minister Erica Stanford says.
Wilding pine control
Over 3 years an additional $79 million will be invested into wilding pine control taking the total investment up to $109 million.
More than two million hectares of New Zealand are affected by wilding infestations, with untreated areas expanding by an estimated five per cent a year. “Wilding pines threaten productive farmland, water supplies in sensitive catchments, and native biodiversity - and they significantly increase the impact of wildfires,” says Biosecurity Minister Andrew Hoggard.
Ambulance services funding
$35 million over four years will be invested into ambulance services to strengthen the road ambulance team and deliver immediate improvements for patients and frontline staff.
This funding will be put towards 2 new hubs in Auckland, one confirmed for South Auckland, and will improve training, equipment, staff, and support.
Children with life threatening and terminal illnesses to receive better care
$15.5 million will be invested over four years to establish a nationally consistent specialist paediatric palliative care service, delivered through dedicated specialist teams in both the North and South Islands.
The new services will begin rolling out from mid-2027, with both specialist teams expected to be fully operational by mid-2028.
