Around 164,000 Kiwi workers and their families are expected to benefit following the increase in the minimum wage that takes effect from April 1.

The Government is committed to improving the wages and conditions for working New Zealanders, says Workplace Relations and Safety Minister Iain Lees-Galloway.

"We are making good on our commitment with this increase in the minimum wage by 75 cents to $16.50 per hour on 1 April."

The rise in the minimum wage is estimated to inject $129 million into the economy through the wages of low income workers, circulating back into the economy because people on lower incomes are more likely to spend their wages on essential items like doctor's visits, keeping on top of bills, buying more healthy food – things that far too many Kiwis struggle to afford, says Iain.

'The best time to raise the minimum wage is while the labour market is strong and tightening.

"Now is that time: Government forecasts unemployment will keep falling towards 4 per cent over the next three years, while average wages will rise about 3 per cent a year over that time due to a tight labour market.

'In announcing this move in December last year, we have signalled clearly to employers our plans to incrementally raise the minimum wage and spread the increases as evenly as possible each year, taking economic conditions into account, on our pathway toward a $20 p/h minimum wage by 2021."

Iain says this consistency minimises potential negative effects of increasing the minimum wage too sharply.

The starting-out rate and training wage will continue to be at 80 per cent of the minimum wage, increasing to $13.20 per hour.

'Raising the minimum wage is part of this Government's ambitious agenda to improve pay and conditions for Kiwi workers, and ensuring those on lower incomes get to share in our economic prosperity."