Parents earning more than $65,000 will soon be required to financially support their 18 and 19-year-old children, as the government moves to tighten eligibility for Jobseeker and emergency benefits. Reported by Giles Dexter | RNZ
From November 2026, a new Parental Assistance Test will determine whether young jobseekers can receive government support. The change, first outlined in the Budget, aims to ensure that “parents who can afford to support their children do so, instead of the state,” according to Social Development and Employment Minister Louise Upston.
Originally planned for July 2027, the government has brought the policy forward. Upston said the test would involve two parts — a parental income test and a parental support gap test. The income limit will align with the cut-out point for a couple with children receiving the Supported Living Payment, currently set at $65,529, and will be adjusted annually.
Upston estimated that about 4,300 young people would become ineligible for Jobseeker support, while 4,700 would remain eligible in the 2027/28 financial year.
“We want to be clear with 18- and 19-year-olds — and their parents — that our expectation is they’re in education, training, or work. Welfare should be far from their first option,” Upston said.
Exceptions will apply for young people who are estranged from their parents or have dependent children.
As of June 2025, there were 15,045 18- and 19-year-olds receiving Jobseeker support. Upston described youth welfare dependency as a “trap,” noting that modelling suggested people who start receiving Jobseeker under 25 may spend an average of 18 years on benefits over their lifetime.
Prime Minister Christopher Luxon defended the policy as a “pretty simple deal” between parents and young people.
“We’re saying we care about you and we love you, but we also want you to realise your potential,” Luxon said. “Consigning someone to a lifetime on welfare is unacceptable — we’re not doing our job if we let that happen.”
When first announced, the policy was expected to save $163 million over four years. For comparison, the student allowance income threshold currently sits at $69,935.32 before tax, with the rate tapering off for higher parental incomes. Students receive no allowance if parental earnings exceed $127,701.81 (living at home) or $137,187.86 (living away).
Upston also revealed a $1,000 incentive for 18–24-year-olds enrolled in the Ministry of Social Development’s job coaching programme who find and maintain employment for 12 months. The initiative will launch in October 2026, expanding on the current 4,000 available placements.
“This payment recognises those who choose personal responsibility over dependency,” Luxon said.
The unemployment rate stood at 5.2% in the June 2025 quarter, slightly below Treasury’s 5.4% forecast. Treasury expects unemployment to ease to 5% in 2026 and 4.8% in 2027, according to Budget projections.
Upston said she was confident there were jobs available for young people. “Employers are stepping up, and as more opportunities open, we want to see young people take that next step — whether through work or training,” she said.
Labour’s social development spokesperson Willie Jackson criticised the move, accusing Luxon of “shutting young people out of the future they deserve.”
“His government has driven record numbers overseas, stalled the economy, and pushed up unemployment,” Jackson said. “It’s time they fixed the mess they created and backed good, well-paid jobs here in New Zealand.”
Meanwhile, ACT leader David Seymour welcomed the change, calling it a return to personal responsibility.
“The best way to get teenagers working is to stop paying them not to,” he said. “If an 18-year-old is capable, they should be earning, learning, and building their future — not relying on the taxpayer.”