Despair, detention, determination and debt

It has been only a week since my last newsletter that I had to send out ahead of other information due to Social Development Minister Carmel Sepuloni’s shocking announcement that the Spousal Provision will not end on 1 July but only on 9 November 2020. And let me just repeat: this legislation has not passed Parliament yet, and the General Election is on 15 September.

We are in the unique situation that not even a government made up of three parties (the Labour/NZ First coalition plus the Green Party) that have all supported our cause while in Opposition, has made life any better for people suffering from the Direct Deduction Policy. Not even for the 400 to 550 pensioners who are in a relationship with the “wrong” partner.

I have published the story of one of those desperate pensioners on the Pension Protest website (link under point 8 of today’s newsletter). My estimate, based on various numbers published by MSD, is that in total more than 130,000 people are directly affected by this unfair policy (see under point 3 of this newsletter).

MSD has even put some of you into significant debt. An affected couple with legal background has found out how to have such debt waived. This is possible when MSD has made a significant mistake. Together we have written up the framework for such an application. You find all the information under point 5 of today’s newsletter, and more detailed information on a new page on the Pension Protest website.

You also find a new video on our YouTube channel.

List of contents:

  1. New Zealand, a prison trap for pensioners

  2. Working well beyond retirement age out of necessity

  3. MSD numbers hide the truth

  4. Winston Peters’ costly legal fight

  5. MSD has to waive debt if they have made a significant mistake

  6. The chief hypocrites of New Zealand politics

  7. Listen to Grant Robertson’s promises from 2014

  8. Links to stories

1. New Zealand, a prison trap for pensioners

While we have arrived at Alert Level 1 of life with the Corona virus in New Zealand and can – in theory and with the exception of international travel – do whatever and whenever we want, nothing has changed for pensioners affected by the Direct Deduction Policy.

These pensioners did not even need a lockdown like the one we have just had to sit out due to the Covid-19 pandemic, to feel like in prison. Thanks to being robbed of parts or their entire NZ Superannuation many cannot afford to travel anyway, not even domestically.

I regularly receive emails from pensioners, saying that they cannot visit their New Zealand-born children who moved overseas when growing up, and their grand-children. When, as a couple, you lose NZ$ 15,000 or more every year to the New Zealand government, it is just not possible to fly to Europe or America.

Therefore the Government is not only indirectly confiscating overseas pensions but also restricting access to close family. This is quite cruel if you think that the elderly would be in a position to enjoy life if the NZ government did not treat people with overseas pensions as cash cows but as valuable individuals who have fulfilled the age and residency requirements for receiving NZ Super by living and working here two or three times and longer than required by law.

Others, usually born-and-bred Kiwis, cannot move back to New Zealand in retirement despite having worked here for e.g. 20 years and lived here for 40 years – but not the five years after age 50 that are required to be eligible for NZ Super.

These enquiries usually come from people who have lived 20 years and more in Asia where life is cheap, and find themselves without any pension. They would need to wait five years until they become eligible for NZ Super despite having previously lived in New Zealand 20 or 25 years after age 20.

Again others are unhappy here but cannot leave before receiving NZ Super because under the Portability rules they would not receive a cent of NZ Super if they left at e.g. age 62 after working and paying taxes here for 20 or 30 years. How should they make up for such a huge pension gap after dedicating such a big part of their lives to New Zealand, its economy and society?

One such person wrote to me: “My wife and I attended three seminars by Immigration NZ in London before moving to New Zealand, and at no time this pension law was mentioned. To be honest, I feel trapped.” I receive more and more such emails.

2. Working well beyond retirement age out of necessity

Many pensioners who have to keep working well into retirement to make ends meet due to the indirect confiscation of their overseas pensions are very anxious in light of the severe unemployment figures due to the lockdown. And then authors like Susan Edmunds - who has been ignoring the overseas pension issue in the Fairfax media constantly despite being made aware of it several times - come and write articles like the one on 9 May under the headline: “Over-65s ‘could quit to ease unemployment’”.

While some surely could, others who do not receive NZ Super can’t. Just this week a pensioner who suffers from the Spousal Provision due to her husband receiving a contributory US pension, wrote to me in an email: “I am 70 and still have to work in a job which is very demanding and heavy work.”

In her article Edmunds quotes independent economist Tony Alexander, saying: “They are, after all, being paid national superannuation.” No, you ignorant: There are many over 65s who are not paid a cent of NZ Super and need a job to survive, and an increasing number of elderly still have a mortgage, as the article correctly states. In many cases it will take many years to become debt-free because it is hard when you don’t receive a cent of NZ Super and depend on your overseas pension to cover the basic costs of living.

MSD statistics say that it is becoming increasingly common in New Zealand to continue in paid work beyond age 65 and that the trend is projected to continue. From 6% in 1991 the numbers have risen to 24.5% in 2018. MSD admit that many of the 766,500 people receiving NZ Super stay in paid work out of necessity. And this includes people who do receive NZ Super.

3. MSD numbers hide the truth

The statistics in the April 2019 MSD paper “NZS Reform Package” give an indication of how many pensioners do not receive any NZ Super at all. The General Manager J. C. writes that 766,500 people were receiving NZ Super, and that this was 95% of the population. This would mean that 100% were 806,842 people over 65. This would leave 40,342 people of pension age without NZ Super.

From MSD’s NZ Super statistics we know that they deducted 93,760 overseas pensions (at the value of NZ$ 396,112,359 million) in March 2019, and we also know that these statistics only count the pensions of people who receive some form of NZ Super. It does not count those who do not receive anything.

Not regarding the negligible number of over 65s who don’t receive NZ Super because they are in prison, we just have to add these 40,342 individuals to the MSD count of 93,760 pension(er)s who receive some NZ Super after the deductions, and get to the number of 134,102 pensions that are deducted. As MSD has started counting the number of deducted pensions and not pensioners affected by the Direct Deduction Policy a while ago, the March 2019 number was a bit lower, let’s just say 130,000. (And this is the department that says it cannot do certain things because it wants to keep things simple!)

But count the savings on NZ Super which is listed as NZ$ 396,112,359 million in March 2019. If these more than 40,000 people received full NZ Super, this would save the Government another 40.000 x NZ$ 17,000 (the lower couple rate of NZ Super after tax) = NZ$ 678,080,000! Add this to the savings through deductions, the Government is saving more than $1billion by indirectly confiscating overseas pensions. They can correct me if I am wrong.

But back to the official statistics:

After rising to 98,923 pensions and savings on the cost of NZ Super of NZ$ 440,128,105 in June 2019 due to the high NZ dollar, the official numbers fell in accordance with the lower-valued NZ dollar to 95,160 pensions and NZ$ 429,872,123 in March 2020. The real savings are far beyond this amount, as shown above.

This is your money and the continued deductions cause grief and stress, exacerbated by the recent announcement that the discontinuation of the Spousal Provision will be postponed from 1 July to 9 November 2020, on the condition that the legislation passes Parliament.

After mailing this information to our newsletter subscribers last week, I received emails from pensioners who are afraid that not even this will happen – that the parliamentary process will be filibustered and not pass before the General Election on 19 September and then go to the scrap heap, worse than in 2007/2008 and again under a Labour government.

So… we can only hope that Minister Carmel Sepuloni and her colleagues are not as treacherous as the Clark/Cullen/Dyson administration. Or even more, as Clark’s government had not given a starting date and made the announcement on the condition that the money would be “found”!!! in the Budget. As many of you remember, this money was used for election bribes.

4. Winston Peters’ costly legal fight

As we all know, money gets wasted in other places. You have surely read that the taxpayer had to shell out more than NZ$ 1million in legal costs for the defendants in Winston Peters’ failed privacy lawsuit at the High Court against former National Ministers Paula Bennett and Anne Tolley, then-MSD CEO Brendan Boyle, State Services Commissioner Peter Hughes (= former CEO of MSD) and MSD.

And it goes on! The NZ First leader has lodged an appeal because he is sure that he now knows who has leaked the information on the overpayment of his pension. He had been paid the single rate for seven years despite living in a longterm relationship. Peters paid back NZ$ 18,000 and MSD did not open a fraud case.

While I totally agree that the leak was a deliberate attempt to embarrass Winston Peters before the General Election in 2017, it is unfathomable how much this certainly justified fight against MSD is costing the taxpayer.

While Peters is wealthy enough to foot his own bill, “normal” pensioners who suffer injustice by MSD have no means to pay for legal fees. That’s why so very few pensioners who are robbed by the Government can afford to go to court AND be represented by a lawyer. (More on suggested class-action suit and international complaints in the next newsletter.)

According to the NZ Herald from 21 April Crown Law’s cost were estimated to be more than NZ$1 million, with Paula Bennett claiming Winston Peters should stump up this cost and not leave it to the taxpayer.

While she has a case, it is a bit rich for someone to say who has breached a beneficiary’s privacy in the past and not even apologised for it despite the Director of Human Rights Proceedings finding that the (former) MSD minister was wrong to release details about a beneficiary’s income to the media.

On another note, the NZ First Foundation is still under investigation by the Serious Fraud Office (SFO) after the Electoral Commission found that money passed to the foundation should have been treated and disclosed as donations to the NZ First party. On 21 April the SFO said the investigation was on track to be completed before the September 19 election date.

5. MSD has to waive debt if they have made a significant mistake

It is hard to read all these words of despair and frustration, and not being able to really help, as we are running against a brick wall of nastiness, ignorance, contempt and heartlessness of successive uncaring governments and advisors who feather their nests with high incomes and, later in life, several taxpayer-funded pensions.

For that reason it was a very pleasant surprise when I got news from a couple who have fought the Ministry of Social Development (MSD) successfully. They had incurred a huge “debt” due to MSD not deducting an overseas pension despite knowing about it, and then demanding the “over-payment” to be paid back in monthly instalments over decades. Thanks to their legal knowledge they were able to have the debt waived.

This was possible because they knew about Section 208 in the regulations for the New Social Security Act 2018. This clause says that MSD has to cancel debt if MSD has made significant mistakes that have led to the debt.

You find the information in the document named Social Security Regulations 2018. This is the link:


The title of Section 208 is:

“Debts caused wholly or partly by errors to which debtors did not intentionally contribute”.

I have uploaded a new page named “Debt and over-payment” on the NZ Pension Protest website where you find the wording of Section 208 and much more:

How to have debt and over-payment waived

The main point is that MSD cannot recover a debt that was caused wholly or partly by a significant error by MSD and to which the debtor (pensioner) didn’t contribute intentionally.

If you think this has happened to you, the first thing to do is request your entire file from MSD and compare it to your records. The state of the file and its contents will give an indication right away if the MSD processes have been sloppy or not.

There are many ways in which MSD might have made mistakes and caused the situation.

On the website we have listed the most common mistakes MSD and WINZ make and lead to a lifelong (and longer!) debt for people with overseas pensions. This list will be updated continuously when new information is provided.

Based on the emails I receive from pensioners the top five mistakes are:

1. You have declared the overseas pension but WINZ didn’t deduct it from your NZ Super, then notices it with a huge delay and asks the money back.

2. MSD has not deducted your overseas pension or the correct amount because they have lost your paperwork. This happens more often than you might think.

3. There has been info slippage between MSD and WINZ? Example: MSD tells you, you will receive one amount and WINZ comes up with a different figure. Miscommunication between WINZ (where you apply for NZ Super) and MSD happens frequently. We hear it all the time from pensioners who have been given a hard time by MSD staff.

4. MSD have refunded you off-the-top deductions made over a certain period and then demanded the money back.

5. The review contains errors of fact.

The full list on the website gives you the framework for an appeal. It is impossible for me and the legal whizzes who have alerted me to the possibility of such an appeal, to directly assist people in this process. But it is not very difficult if you have kept your records, as a second successful case within a short time has shown – and despite the fact that the appeal was made well outside the usual 3-month timeframe because the affected pensioner didn’t know Section 208 of the regulations any earlier.

If you are not able to work on an appeal yourself, ask a family member or friend, or, if you can afford it, hire a lawyer, give him the legal framework and the list of errors, this should make the process rather simple.

Do not even think of appealing an MSD decision on the re-payment of debt if you have lied to MSD and not declared an overseas pension in your NZ Super application!

6. The chief hypocrites of New Zealand politics

In my previous newsletter last week I wrote about the chief hypocrites in New Zealand’s current government, PM Jacinda Ardern and her Deputy, Winston Peters, who were very vocal in their fight for pension justice while in Opposition but who seem to be suffering from amnesia while in power now.

This is the sequel to this forgetfulness that obviously befalls politicians, once they get the chance to make things better, or as some of them call it: kindness, wellbeing, fairness. Oh, forgot: Wash your hands, wash your hands, wash your hands…

Jacinda Ardern’s past efforts that have evaporated within a few short years are even available on Parliament’s website.


and here:

PM Jacinda Ardern on www.nzpensionprotest.com

7. Listen to Grant Robertson’s promises from 2014

It is always helpful to keep evidence of past promises, and thanks to Bob Newcombe’s audio recording I have been able to upload Grant Robertson’s whole-hearted support for people whose overseas pensions are indirectly stolen by the New Zealand government to NZ Pension Protest’s YouTube channel.

During the contest for Labour’s leadership in 2014 (which he lost by a tiny margin against Andrew Little) our current Minister of Finance and Sport made clear that people with an overseas work history should be able to benefit from the money they have earned overseas. This is the link to the video/audio:


The list of hypocrites is long and stretches across almost all big and minor parties.

Take National who would so love to get back into power. I have written to their new leader Todd Muller to find out if they have changed their attitude from the days when John Key said that people should keep their overseas pensions “if they have paid for it”, and then categorically ruled out any changes to the Direct Deduction Policy.

I received this answer from a staffer of the National Leader’s Office:

“I have referred your email to the Office of Hon Tim Macindoe, as our Seniors spokesperson, for their consideration.”

I don’t hold my breath.

8. Links to stories

Finally two links to stories which have gathered huge attention in the media in the past week:



New victim’s story on the Pension Protest website, written by a New Zealander who has to live on credit card debt due to the deduction of his wife’s overseas pension, and not receiving the Winter Energy Payment due to the further postponement of the legislation that would end this travesty of justice:

Victims story: Old lives don't matter

More information is in the pipeline, stay tuned.

Until then, take care and stay warm!


#newsletter #nzpensionprotestcom #www.nzpensionprotest.com #directdeductionpolicy #spousalprovision #spousaldeduction #newzealand #newzealandgovernment #unfair #injustice #pension #overseaspension #nzsuper #nzsuperannuation #retirement #retirementage #hypocrites #chiefhypocrites #generalelection #19september #jacindaardern #carmelsepuloni #grantrobertson #toddmuller #labourparty #greenparty #greens #nzfirst #nationalparty #section70 #sections187-191 #ripoff #dontmovetonewzealand #warning #ministryofsocialdevelopment #msd #winz #workandincomenewzealand #debt #debtrecovery