Is Working for Families working for families? - NZIER Insight 27

01 April 2011

Working for Families (WFF) was introduced between 2004 and 2007 to “make work pay” and ensure income adequacy for families with children.

The policy has reduced child poverty, drawn an extra 8,100 sole parents into some paid work, encouraged more of them to work 20 hours or more, and reduced the time they receive a benefit. But it also resulted in 9,300 fewer second earners in paid work, and over half of non-beneficiary families with worse incentives to earn more, at an additional cost of $1.5 billion per year. 

The objectives are laudable, but we worry about the cost-effectiveness and poor incentives of WFF. To ensure value for money of government spending, it is time to reconsider WFF. You can read the full NZIER Insight here.


Each year NZIER devotes some of its resources to undertake and make freely available economic research and thinking aimed at promoting abetter understanding of New Zealand’s important economic challenges. The preparation of this paper was funded from those resources.

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