Citizenship fee hikes aim to stop record deficit in government account
The government’s citizenship account faces its largest deficit ever, prompting fee increases of 14.4% in August after a 19% rise last November.
The citizenship account, which finances New Zealand’s naturalisation services, recorded a $22.6 million shortfall in April 2026 and is projected to reach more than $68 million by June 2033 if fees remain unchanged. To curb the gap, the Department of Internal Affairs raised citizenship fees by 14.4% in August, following a 19% increase in November 2025, and introduced a per-test charge. Minister Brooke van Velden obtained Cabinet approval for these measures and for a plan to reduce Life and Identity Service Officer staffing by 10% starting 2026/27.
The account’s deficit is the highest on record, driven by rising CPI, wages, IT upgrades, ceremony costs and higher rent at the Wellington Waterloo Quay facility. The department expects a surge in grant-by-citizenship applications as 2021 resident-visa holders become eligible, potentially boosting applications by about 140% to over 102,000 in 2027/28. Further fee reviews are scheduled for 2028.
Why it matters
Rising citizenship fees affect applicants and reflect broader fiscal pressures on government services.
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