How timely that on the day of the first reading of the Government’s Social Security (Fraud Measures and Debt Recovery) Amendment Bill, TV3 aired an Inside New Zealand documentary – Mind the Gap. The documentary eloquently explained inequality in New Zealand and why the National Party appears to have different rules for different people.
Amongst many other things, the documentary explains that debt owed by beneficiaries totals $23 million while debt owed through tax evasion totals $1-5 billion. The number of people prosecuted for tax evasion was 50 while the number charged for welfare fraud was 800.
There appears to be one rule for the rich and one for the poor.
The Bill will, we believe, further stigmatise the most marginalised people in this country and result in less money in the hands of the poorest New Zealanders. It will treat debtors to the Ministry of Social Development more harshly than other debtors.
Two-thirds of what is believed to be welfare fraud is in fact debt. Much of it is a result of administratively created overpayment and problems with the interface between beneficiaries who are working part time and reporting systems through the Inland Revenue Department. The debt is often advances given to people to pay for some of the absolute essentials in life, including things like fridges, washing machines, tampons and food.
The legislation is far too complicated. It has been amended a mind blowing 131 times, it includes 422 sections, 31 schedules, and there are 50 policies that are at the discretion of the chief executive of the Ministry rather than being enshrined in the law. This makes this extremely hard for staff to know what people are actually entitled to and results in beneficiaries not receiving their full entitlements.
This combined with a loss of funding to so many of the benefit rights organisations who are trying to provide advocacy for people going into the system and the cuts to legal aid for beneficiaries wanting to appeal their lack of entitlement, leaves us with a very dangerous system where the most vulnerable people in this country are very much treated under a different and unfair rule.
Yet the Government’s focus is to introduce this Bill that is focused on the recovery of the debt from the few people who have managed to get their correct entitlements and fed their children or bought a fridge in their house.
Meanwhile the dishonesty of tax evasion destroys our social fabric and the $1-5 billion that isn’t paid must be collected somewhere else in tax increases or reduced services.