Relatively speaking, it is far more common for people to be underpaid by MSD thanks to bureaucratic error, or through being ill -informed by MSD about their true entitlements. The relatively low take-up rates for some targeted benefits is a genuine scandal. The current Winston Peters overpayment kerfuffle isn’t one – and currently, he looks more like he’s the target of the scandal than the guilty party.
Also, very few people who are overpaid by MSD are quite as well situated as Peters, when it comes to paying back the excess. As the head of a political party with twelve MPs, Peters earns $195,000 a year plus allowances, and his long time partner Jan Trotman, heads a pharmaceutical company. So, while Peters settled his debt immediately, one’s sympathy has to go out to those people badly placed to cope with the payback consequences of departmental error.
Because… on the evidence to date on the Peters affair, it does look like the mistake lies with MSD. According to Peters, when he applied for his pension he was upfront about being in a relationship but somehow got put on a single person’s rate. How did this happen? MSD says it can’t discuss the details unless Peters waives his privacy rights. Given this would be an all-or-nothing waiver – where added personal data including his tax details might well be released – Peters has understandably refused to waive those rights. Logically though, if Peters had wilfully misrepresented his status, wouldn’t MSD have proceeded to prosecute him for fraud? The fact they didn’t, but readily accepted his repayment and declared the matter closed, all suggests that this was a case of departmental error, not applicant fraud.
All we have to go on right now is the circumstantial evidence. More may come to light, given that the original leaker of the information is still out there, presumably armed with documentation. The second strand of this issue has to do with how the matter came into the public domain.
Who Knew, and Why?
Reportedly, MSD Minister Anne Tolley was notified of the matter on July 31 by her chief executive as something potentially affecting the department. A fortnight later, she was told the matter had been satisfactorily resolved. The PM’s chief of staff Wayne Eagleson had also been informed under the same ‘no surprises’ procedure created to protect ministers from media disclosures about operational matters. Reportedly, Eagleson claims to have told no-one, not even the PM.
Less explicably, State Services Minister Paula Bennett was also informed. Obviously, this Tolley-Eagleson-Bennett network widens the range of possible sources of the leak targeting Peters. The rules under which the ‘no surprises’ provision is supposed to operate were set out in an ‘expectations letter’ jointly signed by Bill English and Jonathan Coleman back in July 2012 and the measures were adopted by the State Services Commission here.
The gist of both documents is this :
No surprises” means that the Government expects a board to:
• be aware of any possible implications of their decisions and actions for wider government policy issues;
• advise the responsible Minister of issues that may be discussed in the public arena or that may require a ministerial response, preferably ahead of time or otherwise as soon as possible;
• inform the Minister in advance of any major strategic initiative.
Plainly, the pension and tax situation of the leader of a rival political party falls outside almost all those conditions. Moreover, if it qualifies only under the “may be discussed in the public arena” condition, then this really goes to show how unacceptably broad that catch-all phrase can be. Literally anything that might interest the media would fall into that category. In reality, gunshy officials would be far more inclined to over-share with the Minister, rather than risk being accused later, of having left them unprepared.
This politicisation of state-gathered and state-managed information should be a concern to everyone. As the government’s web of surveillance expands, and the inter-departmental sharing of electronic information increases, the temptation to use private information for political purposes will increase. If you’ve got the info, it will be used, somehow. And the media can always be relied on to be a willing conduit, especially since financial constraints have left the media more reliant on what it’s given, as opposed to what it discovers.
When this feeding of juicy info happens on the eve of an election, New Zealand First supporters have every right to feel suspicious. Forty years ago, a previous National Prime Minister used state-gathered information to try and destroy the career of a political opponent, Colin Moyle. When Moyle made his political comeback in Hunua in 1981, he defeated a young rising star in the National Party, one Winston Peters. I think Peters knows how this stuff can be used.
Footnote: Sure, MSD processes million of payments for people whose jobs, income and relationship status can shift constantly, making errors in entitlements all but inevitable. Mistakes will happen, on both sides. That said, MSD is far more zealous about recouping overpayments than it is in ensuring underpayments do not occur. Gauging the extent of overpayments – and separating the extent to which departmental error as opposed to conscious fraud is to blame – is no simple matter.
Unfortunately, a targeted welfare system increases the complexity of the qualifying criteria and multiplies the potential for people in need (a) to give up on trying to figure out the rules involved in securing their entitlements or (b) making mistakes that come back to bite them later when MSD’s demands for repayment land in the letterbox. Sure, ignorance of the law can be no defence, but knowledge of the rules shouldn’t require a law degree, either.
For example and apropos of Peters’ situation, how easy would it be for an applicant to misread the MSD website information about including your spouse/partner in your pension payments, as actually being advice to misrepresent your relationship status when applying for a pension per se. As in:
If your spouse or partner is included in your payments, you can earn up to $100 (before tax) a week between you, before your New Zealand Superannuation is affected. If you earn more than $100 (before tax) a week your payments are reduced by 70 cents for every dollar of income over $100 (before tax)….
Please note that if your combined income is equal to or more than $27,519.89* (based on the rates as at 1 April 2016), then it may not be to your advantage to include your spouse/partner.
Some people could honestly take that as being MSD advice not to mention that you have a spouse/partner at all. There would be consequences.
Near the end of the Jim Jarmusch vampire movie Only Lovers Left Alive there’s an unforgettable café interlude featuring the Lebanese singer Yasmine Hamdan. From earlier this year, here’s a live version of “Iza” a track from her recent Al Jamliat album
And here’s footage by Jim Jarmusch from his movie set…
And here’s “Samar” from her Ya Nass album…