The Government will scrap a disciplinary sanction imposed by the former National-led government as part of an "overhaul" of the welfare system.

The sanction cuts income to women and their children if the name of the child's father is not declared. The Government has labelled the sanction "discriminatory".

But a welfare expert advisory group also wanted to abolish sanctions for failing or refusing drug-testing and for breaching arrest warrants - which the Government did not act on.

The announcement followed the public release on Friday of the Welfare Expert Advisory Group's report containing 42 recommendations to improve welfare in New Zealand.

Social Development Minister Carmel Sepuloni said responding to all 42 recommendations made in the report could "take years", but she said the Government has made "good first steps to improving the system".

Removing the sanction will cost $113.4 million over four years, she said, as part of three pre-Budget announcements that will cost $286.6 million over those years.

Sepuloni claimed National was briefed in 2016 that there was insufficient evidence to support the sanction as it "didn't achieve its initial purpose to get money from the partner that's not named in the birth certificate".

The Government will also be lifting the abatement threshold in line with minimum wage increases - that's the reduction of beneficiaries' payments when they earn more money.

Increasing the abatement thresholds of main benefits over the next four years will cost $97.1 million over those years and will come into effect on April 1 2020.