Parental leave payments to go up 7.7% in July

Starting July, New Zealand's paid parental leave entitlements will be increased from $661.12 per week to $712.17 per week, before tax.

This is an additional $51 a week or an additional $1,327 for eligible parents taking the full 26 weeks of parental leave, according to Workplace Relations and Safety Associate Minister Priyanca Radhakrishnan.

"The extra $51 per week will help support a large number of families with 56,200 people receiving a payment in 2022," Radhakrishnan said in a statement.

For self-employed parents, the maximum weekly rate of paid parental leave will be hiked to $227 per week or 10 hours of the minimum wage for an adult worker. The 7.7% hike for parental leave payment reflects the "rise in the average wage," according to Radhakrishnan.

The government recently hiked the minimum wage to $22.70 per hour in April, as the country sees rising costs of living. Parental leave payments are government-funded and administered by Inland Revenue to be provided to eligible parents even if they don't qualify for parental leave from their employment.

"Employees and self-employed people may be able get parental leave payments while they're not working so they can care for a new child," Employment New Zealand said in its website.

KiwiSaver contributions

Meanwhile, new parents will also get a three per cent government contribution to their KiwiSaver while on paid parental leave starting mid-2024, Radhakrishnan also announced.

These parents will receive the contribution provided that they continue their own KiwiSaver contributions, according to the associate minister.

"The government is committed to making sure that families receive the support they need with this important investment, enabling parents to focus on their new-borns in the early days," Radhakrishnan said.