Budget 2025: Pacific Ministry faces major cuts, yet new initiatives aim for development

The Ministry for Pacific Peoples (MPP) is facing significant budget cuts of nearly $36 million in the Budget 2025.

This follows nearly $26 million cut from the previous year's budget.

To save money, the MPP will close the Tauola Business Fund. But they will still have $6.3m each year to support Pacific businesses through other initiatives like the Pacific Business Trust and the Pacific Business Village.

The Budget cuts also affect the Tupu Aotearoa programme, which supports Pacific people in finding employment and training, alongside the Ministry of Social Development’s employment initiatives.

While $5.25m per annum will still fund the programme, a total of $22m per year has been cut over the last four years.

The ministry will save almost $1m by returning funding allocated for the Dawn Raids reconciliation programme from 2027/28 onwards.

There are two years of limited funding left to complete the Ministry Dawn Raids programmes, which support the Crown’s reconciliation efforts.

Despite these reductions, a new initiative providing funding for Pasifika Wardens will introduce $1m of new spending over the next four years.

The initiative will improve services to Pacific communities through capacity building, volunteer training, transportation, and enhanced administrative support.

Watch Budget 2025 in Parliament below.

Funding for the National Fale Malae has ceased, as only $2.7m of the allocated $10m has been spent since funding was granted in Budget 2020.

The remaining $6.6m will be reprioritised over the next two years to address other priorities within the Arts, Culture and Heritage portfolio, including the National Music Centre.

Foreign Affairs funding for the International Development Cooperation (IDC) projects, particularly focussed on the Pacific, is also affected. The IDC received an $800m commitment in 2021 from the Labour government.

The funding was time-limited, leading to a $200m annual fiscal cliff starting in January 2026.

Budget 2025 aims to mitigate this impact by providing ongoing, baselined funding of $100 million per year to cover half of the shortfall. An additional $5m per year will address a $10m annual shortfall in departmental funding.

The new funding will support IDC projects, emphasising the Pacific region without being exclusively aimed at climate finance objectives. Overall, $367.5m will be allocated to the IDC over four years.

Finance Minister Nicola Willis presents Budget 2025 to journalists at Parliament. Photo/PMN News/Ala Vailala

Finance Minister Nicola Willis says the Budget addresses a prominent fiscal cliff, especially concerning climate finance.

“The Budget addresses this, at least in part, through ongoing, baselined funding of $100 million a year, focused on the Pacific,” she says in her Budget speech.

“Members will not be surprised to know that the Minister of Foreign Affairs has made a case for more funding, and this will be looked at in future Budgets.”

More funding has been allocated for new homework and tutoring services for learners in Years nine and 10 at schools with at least 50 per cent Pacific students to meet the requirements for the National Certificate of Educational Achievement (NCEA).

About 50 schools across New Zealand are expected to benefit from the initiative, which will receive nearly $7m over the next four years, having been reprioritised from funding for the Pacific Education Programme.

As a result, funding will be stopped for three programmes aimed at supporting Tu’u Mālohi, Pacific Reading Together and Developing Mathematical Inquiry Communities.