Four years ago, Bay of Plenty meatworker Johnny Taewa tragically died of the occupational disease leptospirosis.
After a lengthy battle, ACC eventually accepted cover for Johnny’s death and agreed to pay weekly compensation to his widow Cathy. ACC weekly compensation payments upon death can be aggregated into a lump-sum payment – an option that Cathy Taewa chose to take up. After all, she had lots of debt to clear and only one income coming in.
Shortly after, Cathy herself became ill and attempted to apply for a Work and Income benefit. She was then told she was not only ineligible for a benefit, but wouldn’t be eligible for five years because the lump sum payment she had received, and largely expended clearing debt, was treated as income.
She has had to struggle on attempting to work when she is not fit to work ever since, and at times has even become suicidal.
The way Cathy has been treated seems to be a particularly cruel and unfair interface between the ACC and benefit systems. So I have a few questions for ACC Minister Nick Smith and Social Development Minister Paula Bennett:
- Why was Cathy not told by ACC that future disqualification from receiving a welfare benefit was a potential consequence of her accepting the lump sum payment?
- Why was Cathy’s aggregated lump sum compensation as low as $35,000 when she could have received weekly compensation at a rate of 48% of her late husband’s pre-injury earnings for five years (or longer if she still had dependent children) had she chosen to not aggregate the payments?
- Why does a lump sum payment of $35,000, which would likely have been less than one year of her late husband’s wage, disqualify her from benefit for five years?
- Is it fair and reasonable for Work and Income to penalise Cathy for deprivation of income when, at the time she made the decision to aggregate the compensation payments, she could not possibly have anticipated getting sick herself and requiring benefit assistance?
- Is it fair and reasonable for Work and Income to penalise Cathy for deprivation of income when she was never told by ACC of the potential consequences for future benefit entitlement of her aggregating the weekly compensation payment?
Even though Paula Bennett was very forthcoming last year in putting personal information about beneficiaries into the public domain when it suited her politically, I’m not holding my breath for answers.