25 Feb 2016

Welfare cost savings estimated at $12b

6:25 pm on 25 February 2016

Finance Minister Bill English has updated cost-savings made by the government's welfare reforms.

Finance Minister Bill English during the half year economic and fiscal update.

Photo: RNZ / Alexander Robertson

The system's future lifetime cost had been cut by $12 billion in the past four years due to the changes, Mr English said.

The government streamlined the benefit system and introduced work obligations and sanctions for some beneficiaries, as well as providing some training and childcare options.

In a speech to the Auckland Chamber of Commerce and Massey University in Auckland, Mr English said the cost savings from the changes equated to beneficiaries spending 900,000 fewer years on welfare.

Keeping a tight rein on spending gave the government options to deal with longer-term spending pressures, such as superannuation and health care.

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