Radio New Zealand broke a story recently about how beneficiaries had been underpaid because WINZ had wrongly calculated when a stand down period ended. Instead of paying a benefit from the day the stand down period ended it paid the benefit from the day after.
The net loss each time is not huge, at least not huge to someone not having to survive on a benefit. But for most beneficiaries the amount is significant. And the cumulative effect of a number of beneficiaries being owed money over a long period of time means that it could cost the Government a considerable sum to correct.
This is a statutory entitlement however and should be paid. Our country is in a bad way if the Government cannot be expected to stick to the law. The bill could be in the millions but the Government takes $70 billion each year in different sorts of tax and I am sure it could find a way to deal with the problem.
The relevant statutory provision appears to be very clear. It states:
If a stand down period applies under this section, benefits commence as follows:
(a) benefits except those described in paragraph (b) commence on the later of—
(i) the day on which the stand down period ends …
It is not as if unclear law has resulted in an unexpected decision. The law appears clear and the administrative practice was clearly wrong.
Already some beneficiaries have applied to have their entitlement paid to them. From Radio New Zealand:
Beneficiaries who were underpaid by a day’s worth of benefit are now getting their money, some receiving hundreds of dollars in back pay.
Work and Income has paid most benefits a day late for almost 20 years and is trying to pass legislation to wipe the debt.
But beneficiaries are claiming back the extra day’s pay and, in some cases, getting it.
Benefits are meant to start the same day a stand-down period ends, usually a couple of weeks after someone first applies.
RNZ reported in September that since 1998, the government had been starting payments the day after stand-down.
Since then, advocates have been helping people claim the extra day’s pay, sending out hundreds of review forms, which are forwarded on to Work and Income.
Aaron Tily, who lives in Ashburton, has just received $93.
“Quite relieved, because it took quite a bit of time,” he said.
“My family was thinking it might have been a bit of a scam, and I was starting to think that as well.”
The Facebook group set up to get people claiming the extra day now has more than 4500 members.Those members have been posting about how much money has arrived in their account, which in some cases amounts to hundreds of dollars.
Beneficiary advocate Kay Brereton said the payouts so far ranged from $40 to $300, depending on how many times people had been on and off the benefit.
“This is what we want to encourage, is people to get off the benefit and have jobs and just use the benefit when they need to, and don’t have a job.
“It’s these people that have been disadvantaged, and it’s these people who are being back paid, so it’s fantastic.”
But there is talk about the Government passing retrospective legislation to take this entitlement away.
The possibility was first reported in this Radio New Zealand article posted on September 16, 2015. Andrea Vance yesterday tweeted that the Government intends introducing retrospective legislation to remove the right to seek the shortfall.
If this is true it will be a clear breach of settled constitutional principles. The use of retrospective legislation can only be justified in limited urgent situations. Owing money to poor people because the Government has been misapplying the law is not one of them.
If you want to see a clear statement of the principle this one from the Legislation Design and Advisory Committee should suffice:
Legislation should not affect existing rights and should not criminalise or punish conduct that was not punishable at the time it was committed.
It will be interesting to see what the Government actually comes up. It seems a forlorn hope but the rights of beneficiaries to receive what they are entitled to by law will be respected.
Update: The bill has been introduced AND has retrospective effect AND is to be debated under urgency. Banana republic stuff.
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