The Government will spend more than $400 million on boosting defence personnel’s wages in the coming for years, as it battles record-high attrition in the armed forces.

After a week-long trip to London for the King’s Coronation, Prime Minister Chris Hipkins was back in Wellington on Monday to give a pre-Budget announcement on defence spending.

Hipkins said the current wages of defence personnel were “unfair” and leading to attrition.

“It's also putting at risk our ability to make necessary deployments whilst also responding to events such as Cyclone Gabrielle,” Hipkins said.

The Defence Force has lost 30% of its uniformed staff in two years, amid a tight post-pandemic labour market. Wages paid to many personnel are considerably lower than that in the private market – most defence jobs are at least 5% below their civilian equivalent, some as high as 18%.

The total package to be allocated to defence at the May 18 Budget would include $243m for defence assets and infrastructure, reported by The Post earlier on Monday, as well as $419m for wages, and a further $85m for housing on defence bases.

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The $243m the Government will allocate to defence capital spending will be for improvements to the navy’s two frigates, which have in recent years been overhauled; upgrades to 43 recently acquired Bushmaster vehicles; and the construction of a new refuelling facility at the air force's Ohakea base.

The $85m for housing build up to 50 new buildings at the Waiouru army base, and a “pilot” for renovating six houses at Burnham, and seven homes at Linton and Ohakea bases. Ownership of the homes built at Waiouru will be transferred to local iwi Ngāti Rangi, which will in turn lease them back to the Defence Force, as part of a 2019 settlement with the iwi.

Defence Minister Andrew Little, speaking alongside Hipkins, said defence housing had been “left to run down”.

“It’s important that we support our NZDF personnel to do their job.”

The $419m, four-year boost to defence wages effectively boosts the Defence Force's annual $1 billion wage bill, initially, by 10%.

Hipkins said the boost would mean 90% of personnel would be paid at, or close to, market rates. It would translate in a boost to wages by between $4000 to $15,000 a year for personnel, depending on their role and rank.

"There's a clear link between remuneration and attrition particularly when the private sector are offering more and we haven't been competing on an even footing with them,” Hipkins said.

There was no target for lowing attrition, Little said. The Government wanted to “stop attrition” and bring the Defence Force back to its “full complement”.

Chief of Defence Air Marshal Kevin Short in April said defence was offering its staff $60m in one-off payments to stop them walking out the door, and suggested at least $60m more will be needed in the coming Budget to boost wages and retain personnel.

National Party defence spokesperson Tim van de Molen said the Government had “seriously neglected” the Defence Force in the past three years. The announced funding was “encouraging”.

“I have repeatedly called for this funding shortfall to be addressed; as well as for the improvement of other conditions of service, like the standard of facilities & equipment.”