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Debts cancelled more often for pensioners than beneficiaries

Anusha Bradley, Hawke's Bay Reporter

The government wipes the debts of pensioners who have been accidentally overpaid three times as often as debts accrued by beneficiaries, figures reveal.

Illustration: Lyndon Hood

Last year 752,966 benefit overpayments totalling $168 million were made, creating debts which either had to be paid back or written-off, data from the Ministry of Social Development (MSD) shows.

MSD wiped 1537 of those overpayment debts worth $909,810 - a write-off rate of 0.5 percent.

In the same year, the ministry overpaid New Zealand Superannuation 145,302 times, totalling $37.9m, yet wrote off 1.7 percent of that debt.

Pension debts were written of by the ministry roughly three times more often than benefit debts over the last four years, the figures showed.

Beneficiary groups have long argued the government has a double standard in the way it treats pensioners and beneficiaries when they're accidentally overpaid.

However, MSD said that was not the case.

"We apply the same processes for all those who receive income support from us, whether they receive welfare benefits or pensions," deputy chief executive of service delivery Viv Rickard said.

He was "comfortable" with the difference in debt cancellation rates because the two groups were two very different clients, he said.

"There are times when we write off debt when people have died. Because of the nature of the people receiving Super ... unfortunately a lot of them fit into that category."

"That's what we are trying to do with our organisational culture, we're trying to be more caring and really have a client-centred approach."

That was because MSD dealt with benefit clients more frequently and the nature of their benefits meant adjustments resulting in overpayments or underpayments were made more often than New Zealand Super clients who received more consistent support and had less interaction with the ministry, he said.

National Beneficiary Advocacy Consultancy Group spokesperson Kay Brereton said that was not always the case.

Pensioners were more likely to "challenge" errors in their super payments resulting in debts being wiped more often, she said.

"Superannuitants are generally speaking people who have got a lot more life experience and they know how to fight back when things go wrong."

Kay Brereton said pensioners and beneficiaries were often treated differently by MSD.

"Pensioners are seen as deserving and they do get better treatment. And if you talk to someone who has transferred from a benefit to a pension that is what they tell you.

"Suddenly they have got a nice waiting area, dedicated case managers, and are treated better," she said.


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