Election 2026: Labour promises to reinstate pay equity, but only costs one claim, leaving $8.5b out of plan
The New Zealand Labour Party has released its 2026 fiscal plan, which includes a pledge to restore pay equity but omits specific costings for these claims. The party maintains it can meet its spending goals and return to a budget surplus by 2028/29 without increasing current operating allowances.
Why it matters
Fiscal transparency and the funding of public sector pay equity are central issues in New Zealand's upcoming election, impacting both government debt and public service delivery.
The Labour Party published its fiscal plan on Sunday afternoon, reiterating a pledge to restore the old pay equity regime, but declining to include a specific cost for this in its spending plan.
A Treasury estimate from 2025 suggests restoring the old regime would cost about $11 billion over the forecast four-year period. Labour has costed an “interim” settlement for care and support workers at $2.5b but left costings for the claims out of its plan.
Labour has stuck to the coalition Government’s forecast of operating allowances of $2.4b a year. This is the “new” money for discretionary spending allocated each Budget. This plan spends some of that money but leaves $10.5b unallocated, which will be used to fund future promises, such as cost pressures in public services.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in