First Labour government takes office

The first Labour government assumed office following the party’s landslide victory in November’s general election. Led initially by the charismatic Michael Joseph Savage, it is best remembered for its landmark social welfare reforms.

One of the most significant aspects of this welfare policy was the 1938 Social Security Act, which has been described as ‘the greatest political achievement in the country’s history’. The Act combined the introduction of a free-at-the-point-of-use health system with a comprehensive array of welfare benefits. It was financed by a tax surcharge of one shilling in the pound (5%). The family benefit was extended to all mothers irrespective of the family’s income, increasing the number of allowances overnight from 42,600 to 230,000. This policy, which was often described as looking after New Zealanders from the ‘cradle to the grave’, was a key reason Labour stayed in power until 1949.

Image: Michael Joseph Savage in 1935