Data from credit reporting firm Centrix indicates that New Zealand households are increasingly managing to keep up with their financial obligations, with the number of individuals behind on at least one credit contract falling to a four-year low. At the end of May, 432,000 people were overdue on payments such as power bills, car loans, mobile accounts, or other loans, a decrease of 11,000 from the previous month. This suggests some improvement in credit conditions for households and businesses, according to Monika Lacey, chief operating officer at Centrix. She noted that lower mortgage rates have alleviated pressure on homeowners, but renters and those relying on personal loans, credit cards, and Buy Now Pay Later schemes continue to experience significant financial strain.
Despite these indicators of improved financial management, polling conducted by Freshwater Strategy for The Post reveals a contrasting sense of economic pessimism among the population. Over the past year, public sentiment regarding personal finances has shifted negatively, with 34% of respondents expecting their financial situations to worsen over the next 12 months, compared with 24% who anticipate improvement. This contrasts with polling from a year earlier, when 30% foresaw deterioration and 36% expected betterment. Keith McLaughlin, managing director of Centrix, attributed this disconnect to the emotional and psychological aspects of financial confidence, which often lag behind objective measures. He explained that people’s feelings of uncertainty are reflected in reduced willingness to spend or borrow, contributing to weak credit demand and a generally gloomy consumer environment.
The polling also highlights the cost of living as the dominant concern for voters ahead of the November general election, with 40% identifying it as the most urgent issue for politicians to address. Rising prices for essentials such as food and fuel are driving financial stress, with recent data showing significant increases, including a 15% rise in mince, a 40% rise in white bread, and a 16% increase in chocolate prices over the last year. Labour’s finance and energy spokesperson Barbara Edmonds criticized the current government, blaming it for exacerbating the cost-of-living crisis and urging more effective responses. The opposition National Party, according to Edmonds, has yet to provide viable solutions.
On the other hand, analysts point to international factors influencing these price hikes. Fuel prices, for example, have been pushed higher due to geopolitical tensions involving the United States and Iran, while global supply and demand dynamics impact costs for commodities like cocoa and beef. These external pressures contribute to the rising expenses felt by many households, which is reflected in the poll’s finding that just 23% of respondents currently feel confident and able to spend freely, down from 30% a year ago. Additionally, the proportion of people making spending cuts to maintain financial stability rose from 37% to 45% over the same period.
Overall, while hard data shows an improvement in financial compliance among New Zealanders, widespread economic worry persists, driven by ongoing cost-of-living pressures and cautious consumer sentiment.