A campaign seeking action on billions of dollars of overpaid Covid-19 wage subsidies has received support from political parties, and over 13,000 signatures on a petition, but the Government has so far not responded to calls for action.

As part of the campaign launched by Christchurch philanthropists Grant and Marilyn Nelson, a letter was sent on 17 May 2023 to all major political parties asking if they agreed the Ministry of Social Development (MSD) should take action and make businesses who have been overpaid the wage subsidy pay it back. Responses have so far been received from the Green Party, the National Party and the Act Party.

The Green Party response, authorised by James Shaw and Marama Davidson, was: “In general, those who were overpaid the wage subsidy or wrongly retained it should pay it back. We may need a different approach, however, for small businesses who were inadvertently overpaid the wage subsidy and don’t have the cashflow to pay it back.”

The National Party, on behalf of Christopher Luxon and Louise Upston, said: “The National Party supports the wage subsidies provided by the Ministry of Social Development, to better help those in need of employment. We also support the notion that businesses who have been overpaid and/or wrongly retained these subsidies, pay it back to Ministry of Social Development. This is the expectation for individuals who have incorrectly received the benefit, and therefore we believe it should apply to businesses as well.”

The Act Party’s response was non-committal.

The Labour Party did not respond to the 17 May letter. An email sent last month to the Department of Prime Minister and Cabinet and Ministers Hon Carmel Sepuloni, Hon Grant Robertson and Hon Megan Woods has also drawn no response.

The Nelsons launched the nationwide campaign and petition on 18 June 2023 to draw public attention to a lack of action from MSD to seek repayment of close to $10 billion in overpaid wage subsidies. They are asking MSD to write to all recipients requesting they confirm they were eligible to receive the wage subsidy, or to pay it back.

“We don’t think that’s a lot to ask. If the money is not repaid each taxpayer will have to pay thousands of dollars in extra tax to repay the debt incurred in making these extra wage subsidy payments,” Grant says.

“Given the significant response from the New Zealand public and the fact that we’re only asking them to do what’s right, it’s disappointing the Government continues to ignore the issue and hope we’ll go away.”

Grant notes the report recently issued by the Retirement Commissioner severely criticised the MSD for the way they treated and demanded repayments from anyone receiving New Zealand Superannuation or a benefit who was caught overseas and could not get a MIQ place. The Ministry also wrote to all those who received the winter energy payment and said that if they were overseas for more than 28 days, it was really important that they repay as little as $20 per week.

“This is a huge contrast to the way the MSD has failed to do anything about the need for billions of dollars of wage subsidies to be repaid.

“They just don’t seem to want to deal with this issue and it makes you wonder, why? The Minister of Social Development, Carmel Sepuloni, had a potential conflict of interest when she decided to not require businesses to repay billions of dollars of overpaid wage subsidy money. She had investments in Kiwisaver and retirement schemes that would each have included shares in many listed companies that were overpaid the wage subsidy. They have never been asked to provide evidence that they did comply with the declaration they signed or if not, to repay the money received.

“It’s time for the Government to do what’s right and get businesses who have been overpaid the wage subsidy to pay it back.”

Find out more about the Nelson’s extensive research into wage subsidy overpayments at www.theintegrityinstitute.org.nz

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