Dear current and future pensioners,

Some of you should have received letters or emails from the Ministry of Social Development (MSD) in the past few weeks, telling you that your partner’s overseas pension will not be deducted from your NZ Super any longer after 9 November.

This is a reason to celebrate the end of the discriminatory Spousal Provision/Deduction which punished pensioners in a relationship with someone who receives an overseas pension higher than NZ Super.

But do we really have reason to celebrate?

Sure, it has been a success that this incredibly unfair legislation has been changed after all the hard work we and others have put into this fight, and 400 to 600 pensioners might really profit from it.

But what does it mean in real terms? While it might make a big difference of several hundred dollars every month for some pensioners, a friend of mine will now receive the gigantic amount of NZ$ 8.76 on 10 November instead of nothing, and a bit over NZ$ 40 per fortnight in the future. And if the exchange rate changes to their disadvantage, they will receive next to nothing again. Or a few dollars more.

This is the reality of the end of the Spousal Provision.

And you don’t know how lucky we are that the Government has changed the law!

Perhaps you remember that there was a hearing on the Spousal Provision at the Human Rights Review Tribunal (HRRT) in Wellington in March 2018. My extensive report on the hearing can be found here:

HRRT hearing March 2018

After more than two and half years the HRRT has published its decision a few weeks ago, and believe it or not: Chairman Rodger Haines QC and the two HRRT members Gillian Goodwin and Paolaga Selma Scott have ruled that there was nothing wrong with the policy, and that it is ok that couples with an earned overseas pension income are cut down to size, so they do not receive more pension money than a couple where no-one has ever contributed to a pension scheme. They didn’t consider the legislation a breach of Human Rights on the grounds of family status.

If you read my report on the hearing, you’ll see that was skeptical towards the outcome, that I had hope but didn’t expect miracles – and it would have been a miracle if a New Zealand court had decided in favour of anything involving migrants.

Here is the decision from 15 October 2020: http://www.nzlii.org/nz/cases/NZHRRT/2020/39.html

As the HRRT is obviously not aware about changes to legislation in New Zealand, they had to release a supplementary decision a few days later! http://www.nzlii.org/nz/cases/NZHRRT/2020/41.html?fbclid=IwAR3_VHO54sPHhhYMTvLe8mLcVIYUg2E334ItvzeT-E5QibfGUXzcTjTuI9Q

In this document from 19 October 2020 they wrote that “the Tribunal received advice from counsel that legislation currently awaiting the Royal assent will amend the Social Security Act 2018, s 189(2) by removing the spousal deduction”.

At the time, of course, this Royal Assent had been given on 24 July 2020 already. Now this “upcoming legislative development“ […] “may require the decision to be recalled and reissued, should the Tribunal see fit.” Finally they noted: “It is a matter of regret this information was not provided to the Tribunal at an earlier date.“

Perhaps, I wonder, such a Tribunal should do some research themselves if they decide on complaints from ages ago. But it doesn’t matter. The Tribunal’s unfathomable decision is, lucky everyone, only academic.

I have not forwarded the decision to the media and newsletter subscribers earlier, neither did the pension experts of the Retirement Policy and Research Centre (RPRC) of the University of Auckland, who also fought hard for the end of the Spousal Provision.

Why? Because the information would have been completely lost in the extensive reporting about the General Election, which, as you all know, has ended in an absolute majority for Labour and PM Jacinda Ardern, and a crushing defeat for NZ First and Winston Peters. And National.

Not even the Government could expect such a scandalous decision

Not even the Government could expect such a scandalous decision of an either incompetent or corrupt (and I don’t mean this in the sense that it would have been bribed, but in the sense that the whole system is corrupt) Tribunal.

Had the Government had any hope that the HRRT would not see any discrimination in the treatment of such couples, they would probably not have changed the law that will come into effect on 9 November. The Government changed the law because it expected the opposite outcome, with Jacinda Ardern and others admitting in the past that the Spousal Provision was in breach of Human Rights.

It is ironic that it took the Tribunal more than two and half years to publish a decision due to under-resourcing by the same Government, a decision that is now academic – as unbelievable as it is. Had there not been this enormous, but totally normal, delay, nothing might have changed and we would still need to fight for justice for these couples.

The Tribunal has fallen for the spin of the two MSD bureaucrats (“expert witnesses”) and Crown Lawyer Paul Rishworth who enveloped the Tribunal into a fog of misrepresentations and distortions, despite the Chairman telling Rishworth & Co that he could not see that the three complaining couples were advantaged over lifelong New Zealand couples “but significantly disadvantaged”.

Why the "unit of assessment" changes only for certain couples

This makes you really wonder how the Tribunal could come to the conclusion that the “unit of assessment” must not be the individual – despite NZ Super being universal, individually paid and not income- and asset-tested, “unless an overseas pension is included” – but the “economic unit”, and how they could decide that the unjustifiable treatment of the “significantly disadvantaged” couples wasn’t discriminatory. The MSD witnesses argued: “Both couples have the same amount. The same amount flows into each of the households, just from different sources.”

With their decision, the HRRT clearly accepted the justification, dished up by Crown Law and the two unbearable MSD bureaucrats who held monologues on the unit of the “core family” and said that this family approach should “remain until women have the same income as men”. The wife as the eternal dependant. (And this despite the fact that in one of the cases it was the woman who brought in most of the money in the shape of her overseas pension!)

Due to the chaotic representation of the plaintiffs by the then-Director of the Office of Human Rights Proceedings (OHRP), who couldn’t even explain properly how the Direct Deduction Policy works, the Tribunal members might not have understood what the problem really was.

During the hearing I was never sure if they were impressed, mesmerised or confused by what was presented to them by the MSD officials and the Crown lawyer. They were surely not impressed with the OHRP Director who himself seemed to have problems to understand what he was talking about, as a second lawyer had prepared all the paperwork.

You wonder why the Tribunal has – again – bowed to the Crown, why they have not seen through the transparent attempt by Crown Law and MSD to fool them, and how it can be acceptable in 2020 to defend a pension law from 1955, while pension laws worldwide have a lifespan of 15 to 20 years. (And remember, the Direct Deduction Policy even dates back to 1938!)

However, we have to follow one advice the Chairman has given early into the hearing. He said that the question was if the Spousal Provision was “unfair or unlawful”. And: “If the law is clear, it just has to be tolerated and should be passed back to Parliament.”

Make a submission on the Fair Residency Amendment Bill

This leads to the fight against the Direct Deduction in general. In a newsletter in July I asked you to make a submission to the Finance and Expenditure Select Committee on the New Zealand Superannuation and Retirement Income (Fair Residency) Amendment Bill which suggests to raise the residency requirement from 10 to 20 years. Here is the link to the bill: https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_80767/new-zealand-superannuation-and-retirement-income-fair

The core point of a submission has to be that this bill is a lazy piece of legislation and that the residency requirement can only be raised if, at the same time, the deduction of overseas pension stops.

If you need more arguments, here is the check out the July newsletter with some suggestions.

Either follow the prompts on the bill’s website or send your submission as an email to either of these addresses:

Finance.Expenditure@parliament.govt.nz

fe@parliament.govt.nz

As we can't trust the courts, we need to go the political path

As the 52nd Parliament was dissolved on 6 September, the Finance and Expenditure Committee does not currently exist. It will be re-established when Parliament resumes. But the submission will remain in the inbox and passed on to the new committee when it meets at the start of the 53rd Parliament. [Update 04.11.2020: Andrew Bayly has been named as the MP in charge of the bill and the Select Committee.]

As the example with the Spousal Provision shows, the safest way to achieve justice is to convince politicians that a law change is needed and that social policies should not be anti-social and discriminatory towards a minority. We can’t trust the courts.

It’s a new term in Parliament, so also contact your old and new MPs. The parliamentary debate on the Fair Residency Bill has shown that politicians don’t know much about how overseas pensions are funded, that only eight other countries have a residency-based system like New Zealand, and that NZ Super, despite the official definition, is not really universal. They have to be told and need to know it fast, therefore talk to them and make a submission to the Select Committee.

Diplomats keep the Direct Deduction Policy on the radar

I am also keeping in touch with diplomats in Wellington and Canberra. You can surely imagine that COVID-19 is an overwhelming topic everywhere, and it is difficult for ambassadors and high commissioners right now to get into serious pension discussions with their governments back home. But I have been assured when I met with two ambassadors in Wellington recently, that the pension issue remains on their radar. They agree that the most promising way to achieve a change is the political and not the judicial way.

Take care and stay safe!

Sissi

(30.10.2020)