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March 26, 2026
#national: Families on benefits pushed deeper into crisis as fuel and energy costs surge
Dale Husband
Posted On March 26, 2026
Download AudioChild Poverty Action Group is warning that whānau already living on the edge are being pushed further into hardship as fuel and energy costs continue to climb, with little relief from current government support settings.
Spokesperson Isaac Gunson says families reliant on core benefits are facing a cost-of-living crisis that has moved beyond pressure into survival mode, as everyday essentials become increasingly unaffordable. Reports from communities across Aotearoa point to households cutting back on basic needs, limiting travel, and struggling to keep homes warm as petrol and electricity prices rise sharply.
The spike in fuel costs, with increases reported between 40 and 80 percent in recent weeks, is having a direct flow-on effect for low-income families. For many, access to work, school, healthcare, and essential services depends on being able to afford petrol. At the same time, rising energy prices are forcing difficult decisions about heating, particularly as colder months approach.
Child Poverty Action Group argues that current income support settings are failing to keep pace with real-world costs. The latest benefit adjustment of just over three percent is seen as inadequate against the scale of price increases being experienced on the ground. For families already stretched thin, the gap between income and expenses continues to widen.
The organisation says the impact is most severe for the estimated quarter of a million children living in households supported by core benefits. In these homes, financial strain is not temporary but ongoing, with cumulative pressures from housing, food, transport, and utilities compounding daily.
Calls are now being made for immediate and targeted government intervention. Child Poverty Action Group is advocating for a significant increase to the Winter Energy Payment, proposing a 30 percent boost alongside an extension of the payment period to better reflect the realities of colder seasons and higher energy use.
The group believes this measure represents one of the fastest and most effective ways to deliver relief directly to those most in need, particularly as winter approaches. Without action, there are concerns that more whānau will be forced into unsafe living conditions, including under-heated homes, increased debt, and greater reliance on emergency support.
Advocates warn that failure to respond risks entrenching hardship for vulnerable families and deepening inequities already present across the system. As costs continue to rise, the pressure is mounting on decision-makers to ensure support mechanisms reflect the lived realities of those most affected.
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