Fuel Costs Push Home Support Workers to Breaking Point
Rising fuel costs in New Zealand are pushing home support workers to breaking point, as outdated mileage reimbursement rates leave essential workers paying out of pocket to deliver care.
Fuel costs are crushing home support workers in New Zealand
Home support workers across Aotearoa are bearing the brunt of the fuel crisis, forced to absorb skyrocketing petrol costs on wages that were already too low, with a mileage reimbursement that has not been reviewed since 2022.
E tū is urging Minister of Health Hon. Simeon Brown to increase the mileage reimbursement rate for home support workers ahead of a scheduled review of travel payments due before 20 May this year.
Fuel prices surge as global crisis hits locally
Petrol prices have surged past $3 a litre and are still climbing as the conflict in the Middle East squeezes global oil supply. For the thousands of home support workers who rely on their own cars and fuel to visit clients, the crisis is compounding years of chronic underfunding.
Mileage rates fall far behind real costs
Home support workers are currently reimbursed at just 63.5 cents per kilometre, averaged to 3.8 km per visit regardless of actual distance, unless they reach a specific threshold for exceptional travel. The rate was last increased in 2022 and sits well below the IRD’s Tier 1 rate of $1.17 per km for petrol vehicles. Workers receive nothing towards vehicle registration, warrants, servicing, tyres, or insurance, all of which they must cover themselves.
Workers forced to absorb rising costs
Tamara Baddeley, a home support worker in Gisborne, says the situation is taking a serious toll.
“I don’t even want to look at the petrol pump when I fill up,” Tamara says.
“We get 63.5 cents per kilometre, averaged to 3.8 km per job, and that hasn’t changed since 2022. If your clients are further away, you’re spending more but getting the same reimbursement. On top of that, we have to keep our cars warranted, registered, serviced, and insured, and we get nothing back for any of it.”
Risk of workforce shortages and service cuts
She says many workers will be forced to reassess whether they can afford to stay in the job.
“A lot of support workers will probably leave because they can’t absorb the cost. The companies may stop picking up clients in more remote areas because of the travel involved. Coordinators and employers are going to have to work with us to plan rosters properly so we’re not criss-crossing town for no reason.”
Tamara says the Government must urgently review the mileage allowance.
“They need to do a full review on the mileage rate. At the very least, bring it up to the IRD rate. This crisis could last six weeks or six months, but either way, workers can’t keep absorbing it.”
Fuel crisis compounds pay equity concerns
She says the fuel crisis is compounding the damage already done by the Government’s decision to gut pay equity.
“This Government took away our right to pay equity and took away a decent pay rise we should have got. Now we have to absorb more and more expenses, and it just keeps eating into our pay.”
Petrol prices rising faster than workers can respond
Theresa Powell, a home support worker in Rodney, says prices are moving so fast she can barely keep up.
“The cost of petrol has increased by 6 cents at my local petrol station just in the five hours between the times I went past it today. That’s how quickly it’s moving. I wish I had filled up this morning,” Theresa says.
Theresa usually drives over 500 km a week for her work. She says she is chasing every fuel discount she can find.
“I’m always looking for a deal. I’ve got all the petrol station apps, and I make sure I use every deal and discount available. It still isn’t enough.”
Home support workers save the health system money
She says the work home support workers do is keeping older people out of rest homes and saving the system money.
“We’re keeping them in their homes for as long as we can, because they love their home. They don’t want to go into a place where they’re told what to do all the time. It costs so much more to keep them in residential care, so clearly we should be properly funded to keep people in their homes.”
E tū calls for urgent Government action
E tū Director Amy Hansen says the fuel crisis has exposed how badly the home support funding model is failing workers.
“Home support workers are essential to keeping older and disabled people safe in their own homes. Their reimbursement rate was inadequate before this crisis. Now it is completely untenable,” Amy says.
“E tū participated in a review of home and community support payments for travel between clients last year, and was told that Health NZ, MSD and ACC will not be increasing travel payments, despite the funding model being “structurally flawed”. The Minister of Health is set to review the travel payments before 20 May this year, and we urge Hon. Simeon Brown to recognise how much these workers are suffering in propping up the healthcare of our elderly, disabled, and injured New Zealanders.
“In 2025, Health NZ estimated it would cost $45.7 million per annum to meet the IRD rate of $1.04 at the time. By not paying this, home support workers are putting in a combined $45.7 million of their own money so that they can get to their clients each day.
“Asking them to absorb fuel costs that are rising by the day is not sustainable, and the communities they serve cannot afford to lose them.”
If mileage rates are not urgently reviewed, the consequences won’t just be felt by workers — they will be felt by the elderly and vulnerable New Zealanders who rely on them. A system that depends on workers subsidising care out of their own pockets is not just broken, it is unsustainable.
