New Rules Require Parental Support for Young Jobseekers

Parents earning more than $65,000 will soon face new obligations to financially support their 18- and 19-year-old children as part of a government initiative to tighten the eligibility criteria for Jobseeker and emergency benefits. Starting in November 2026, a new Parental Assistance Test will be implemented, determining whether young jobseekers can receive government support.

The announcement was made by Social Development and Employment Minister Louise Upston, who indicated that the policy aims to ensure that parents financially capable of supporting their children will do so, rather than relying on state assistance. This initiative was originally set to launch in July 2027 but has been expedited.

The Parental Assistance Test will consist of two components: a parental income test and a parental support gap test. The income threshold will match the cut-off point for couples with children receiving the Supported Living Payment, currently established at $65,529, and will be adjusted annually. Upston estimates that approximately 4,300 young people will lose eligibility for Jobseeker support, while 4,700 will remain eligible during the 2027/28 financial year.

“We want to be clear with 18- and 19-year-olds—and their parents—that our expectation is they are in education, training, or work. Welfare should be far from their first option,” Upston stated. Exceptions will be made for young people who are estranged from their parents or those who have dependent children.

As of June 2025, there were 15,045 18- and 19-year-olds receiving Jobseeker support. Upston has characterized dependency on youth welfare as a “trap,” emphasizing that individuals who begin receiving Jobseeker benefits before age 25 may spend an average of 18 years on welfare throughout their lives.

Prime Minister Christopher Luxon supported the initiative, describing it as a mutually beneficial arrangement between parents and young individuals. “We’re saying we care about you and we love you, but we also want you to realize your potential,” Luxon remarked. He expressed that allowing someone to remain on welfare for life is unacceptable.

The policy is projected to save the government $163 million over four years. In comparison, the student allowance income threshold currently stands at $69,935.32 before tax, tapering off for higher parental incomes. Students are ineligible for the allowance if parental earnings exceed $127,701.81 for those living at home or $137,187.86 for those living away.

Additionally, Upston announced a $1,000 incentive for young people aged 18-24 who enroll in the Ministry of Social Development’s job coaching program and successfully maintain employment for 12 months. This initiative will begin in October 2026 and expand on the current 4,000 available placements. Luxon stated, “This payment recognizes those who choose personal responsibility over dependency.”

As of the June 2025 quarter, the unemployment rate was 5.2%, slightly below Treasury’s forecast of 5.4%. Projections indicate that unemployment may decrease to 5% in 2026 and further to 4.8% in 2027. Upston expressed confidence in job availability for young people, stating, “Employers are stepping up, and as more opportunities open, we want to see young people take that next step—whether through work or training.”

Criticism of the policy came from Labour’s social development spokesperson Willie Jackson, who accused Luxon of “shutting young people out of the future they deserve.” He expressed concern over the government’s economic management, stating, “It’s time they fixed the mess they created and backed good, well-paid jobs here in New Zealand.”

Conversely, ACT leader David Seymour welcomed the changes, advocating for a return to personal responsibility. “The best way to get teenagers working is to stop paying them not to,” he asserted, emphasizing the importance of earning and learning for young adults.

This policy shift marks a significant change in the landscape of youth welfare in New Zealand, reflecting ongoing debates about family responsibility and government support.