Spousal Provision

The Spousal Provision still applies to a small number of couples

Even after the end of the Spousal Provision on 9 November 2020, the Spousal Provision will still apply to couples who...

  1. receive an income-tested welfare benefit such as the Supported Living Payment or the Accommodation supplement, or

  2. have included a non-qualified spouse in their NZ Super application before 1 July 2020. (From 1 July 2020 the non-qualified partner (NQP) provision was removed – which we think, with the exception of a few cases where e.g. a non-qualified partner cares for an ill or disabled pensioner, is only fair.

    The taxpayer should not fund a pensioner’s lifestyle choice of having a relationship with a much younger partner who is still able to work but can enjoy the benefits of retiring on a pension at e.g. age 40, both receiving a similar amount as a couple wh
    ere both have worked until retirement age. For cases of hardship, like in the above mentioned case of caregiving, a different solution must be found by the Government.

    As of June 2019 when the Government hid the removal of the Spousal Provision in its Wellbeing Budget, 6,300 pensioners had included non-qualified partners in their NZ Super application.

Why two children had to pay for their stepfather's NZ Super

The Spousal Provision did not only punish New Zealanders and individuals of other nationalities who were in a relationship with someone who received an overseas pension. It was also applied to so-called dependents. We made one case public where two young children had to pay for their stepfather's NZ Super with their overseas survivor's benefits! More information on this case at the bottom of the main article of this page.

More about the delayed law change

You find more information on why the end of the Spousal Provision was delayed in an unacceptable way in our newsletter from 04 June 2020.

The most dramatic breach of Human Rights


The fight goes on despite the end of the Spousal Provision on 9 November 2020

With the news of the New Zealand government ending the Spousal Provision on 9 November 2020, this page does not become redundant. On the contrary. We'll keep the original article below as an eternal reminder of this blatant breach of Human Rights, as it shows with which contempt the New Zealand government and its bureaucrats have been treating people with overseas pensions for decades.

The end was also remarkable: the Government kept it hidden in its so-called Wellbeing Budget in early June 2019 and we only discovered it by chance because we were searching for it!

Read about the unfathomable secret process in our newsletter from 11 June 2019.

And not to forget: the Spousal Provision still applies in a few cases. See information in the article under the photo.

We pride ourselves to have contributed to this law change not only by assisting affected pensioners, launching this website and lobbying against the injustice for over a decade. We have also assisted the Office of Human Rights Proceedings (OHRP) by finding them several affected pensioners who were then represented by the OHRP at the hearing at the Human Rights Review Tribunal (HRRT) in March 2018.

We are confident that the "modernisation and simplification" of the pension system only happened in anticipation of a negative decision by the HRRT to the Government's unacceptable policy.

But the end of the Spousal Provision is only a small step in our plight for further pension reforms and justice for people with earned overseas pensions. We'll go all the way. Some pensioners might die along the way, and some of the first pensioners who have joined our campaign and were dear to our heart have died, but new pensioners will follow, the issue won't go away.


This was news: 29.01.2018 / 24.07.2020 / 10.11.2021

Prime Minister Jacinda Ardern has been very vocal on the overseas pension issue while in Opposition. The Labour leader, who came into power in September 2017, has not made any detailed comments about the policy since then. But we can remind her of her speech in Parliament in March 2015 in which she labelled the Spousal Provision a breach of Human Rights and the Direct Deduction Policy unfair.


How inhumanely pensioners with the "wrong" partner were treated before the end of the Spousal Provision

The contemptuous attitude of an uncaring Government

Nothing highlights the inhumane and uncaring treatment of pensioners in New Zealand better than the Spousal Provision. This money-grab tool, introduced in 1985 [in parts in 1955, and already applied before that time, as we heard at the HRRT hearing in Wellington in March 2018 by MSD's policy advisor Alex McK.], is part of Section 70 of the Social Security Act 1964 [in the meantime renumbered to Sections 187-191 of the Social Security Act 2018] which allows the Chief Executive of the Ministry of Social Development (MSD) to rule that about every pension of the world is similar to NZ Super and therefore deductible from New Zealand's state pension, NZ Super.

The Spousal Provision goes further than just confiscating an overseas pension. It also robs New Zealanders who have never left the country of a part of or of their entire NZ Super. This happens when they are in a relationship with someone whose overseas pension is higher than NZ Super. The couple becomes an "economic unit" and the single overseas pension is deducted from the couple's combined NZ Super.

Pensioners with an overseas pension - which is always a partial pension, as it was accumulated by individual contributions in the years this person lived overseas - have to pay twice for their pension: once while working overseas, the second time they have to fund their own NZ Super, and on top of it they pay for their partner's NZ Super. And while living and working in New Zealand they have also funded other New Zealanders' NZ Super by paying taxes. Later they are denied NZ Super.

The hidden income-test of immigrants and returning Kiwis

While not a single New Zealander who is married to someone without overseas pension is income-tested when claiming NZ Super, these pensioners are. Were they not in a relationship with an immigrant or a returning Kiwi but to a New Zealander who has never left the country, they would receive the full amount of NZ Super.

This means that the application of the Spousal Provision constitutes discrimination on grounds of family status and therefore is in breach of Human Rights.

Let's talk about Mary...

The absolute perversion of this law - which is unfair and discriminatory in itself - is the treatment of New Zealanders who move overseas in retirement. The case of Mary (name changed) highlights everything that is wrong with Section 70 [Sections 187-191 since 2018] in general and the Spousal Provision in particular.

Mary married a German man late in life and moved overseas to be with him. This man has never lived in New Zealand and therefore isn't eligible for NZ Super. However, his German pension is deducted from Mary's NZ Super, leaving her with NZ$ 6 (six!) a week. (Due to the exchange rate the amount can go up a little but also go down to zero.) MSD even told Mary that nothing would change if she moved to New Zealand and her husband stayed overseas. They would continue to treat them as a couple and she would still receive NZ$ 6 per week.

The problem was that they lived in Ireland which has an old Social Security Agreement with New Zealand; this still allows deductions under the Spousal Provision policy.

The marriage broke down under this pressure. No couple can live on one NZ Super, and surely no individual can live on NZ$ 6 a week. The separation - which led to Mary receiving NZ Super again - was forced upon the couple by MSD. Congratulations, MSD! [Update: In the meantime, in 2017, MSD has reversed its decision, and Mary and her husband have found back together again.]

The definition of couples, according to MSD

Mary's case surely is an extreme case, due to the couple's residence overseas. If they lived in New Zealand, Mary could include her husband as a non-qualified partner in her application for NZ Super, and they would receive the married rate for such couples - which is slightly lower than the married rate of two fully qualified individuals. The husband's overseas pension would be deducted from their combined NZ Super and not just from her single NZ Super.

Had Mary moved straight to Germany after turning 65 and already receiving NZ Super, her husband's overseas pension would not have been deducted from her NZ Super either because Germany has no Social Security Agreement with New Zealand.

The Ministry tells couples where one partner receives an overseas pension that a married couple is expected to support each other financially. But why does it apply only to people where one partner paid into a superannuation scheme overseas? Why are people who often live on a minimum income punished while New Zealand millionaires and their partners living in mansions are both entitled to full NZ Super?

Clearly the “single economic unit” expectation is only apparent where overseas pensions are involved. It is an attempt to scale down the universal character of NZ Super and make it look as if NZ Super were a special needs benefit. If this were the case, every couple would need to be income-tested, and NZ Super should surely not be paid to millionaires.

The discriminatory factors are clear:

  • Only couples with overseas pensions and their partners are income-tested while lifelong New Zealanders are not.

  • Only couples with at least one overseas pension are treated as a single economic unit while lifelong New Zealanders are not.

NZ Super and ACC are based on individual entitlement

The New Zealand tax system is, and this is a quote from a study of the Child Poverty Action Group, “founded firmly on the premise that it is the individual who pays tax, not an aggregated unit such as the couple or household. […] Just as the tax system is based upon an individual as the unit, so are many parts of the welfare state. New Zealand Superannuation (NZS) and earnings-related Accident Compensation are based on individual entitlement. This means that the amount paid to the individual is not affected by the income of a partner and is taxed at the individual’s tax rate…”

In New Zealand law the only benefits affected by the single economic unit rule are income-tested benefits such as Jobseeker Support - and NZ Super only when a pensioner wishes to include a non-qualified spouse in his/her application. A non-qualified spouse might, per definition, be under 65 years old or not have fulfilled the residency requirement of 10/5 years.

The latter example highlights the injustice of Spousal Provision even more drastically. While a couple with a non-qualified spouse receives close to the full amount of NZ Super (married rate), a fully qualified New Zealander married to the "wrong" person receives a fraction of it, or nothing, and the partner with the overseas pension who is also fully qualified after living in New Zealand for ten years receives NZ$ 0. Zero.

Punishment for pensioners who live with the "wrong" partner

There are couples with a non-qualified spouse who received NZ$ 562.60 a week (rate as of 1 April 2016) while a couple, both fully qualified for NZ Super, received NZ$ 40 or NZ$ 200 or nothing at all every week. This is a difference of up to NZ$ 562.60 a week, just because someone has married someone who was forced by an overseas government to save for his/her retirement by making huge contributions into a compulsory superannuation scheme, and the contributions directly deducted from their wages and salaries.

Where is the fairness, where is the justice?

Instead the Government's spin continues, the facts are misrepresented and pensioners complaining about the deductions are bullied. The New Zealand public is made to believe that the Government is incredibly generous by topping up lower overseas pensions to the level of NZ Super, so everyone receives a “minimum government-provided standard of living”. The opposite is true, as NZ Super is reduced by deducting the overseas pension. It is an exercise to save money for the New Zealand government.

The Government's spin of "No-one must be better off..."

Prime Ministers and their ministers have said and written it for decades because some mandarins from the Ministry of Social Development (MSD) write their letters. MSD and WINZ employees are trained to say and write that nobody must be better off than a New Zealander who has never left the country, and that nobody who has not made “a fair and equitable contribution via their working life to the New Zealand tax base and to New Zealand society” should receive full NZ Super.

New Zealanders who happen to be in a relationship with someone with an overseas pension have surely made a fair and equitable contribution to the New Zealand tax base and to New Zealand society during their working lives. Or they have raised children and done considerable volunteer work.

Exactly the opposite is true: New Zealanders fortunate enough NOT to be married to someone with an overseas pension are better off than immigrants and returning Kiwis whose overseas savings are legally stolen.

Ordinary Kiwis reap the benefits of never having contributed to compulsory superannuation schemes. They can invest the money people overseas were forced to set aside for their retirement into property, shares, life insurances, private pension schemes etc.

It is like paying a 100% income tax on overseas earnings

Deducting contributory overseas pensions from both partners' NZ Supers is like paying a 100% income tax on earnings from overseas – which is ruled out by New Zealand tax laws and tax rates, and by the Double Taxation Agreements (DTAs) New Zealand has with many countries.

But it gets even crazier: If someone were married to an Australian or a Chinese pensioner these partners' contributory overseas pensions would not be deducted from NZ Super because of, in the case of Australians, an unbelievable Social Security Agreement between the countries and because their contributory pensions are paid out as a lump sum; in the case of the Chinese the cheap excuse is used that Chinese pensions are not administered by the state but by local authorities (which, as we have found out in the meantime - 2017 - is not true) and that "there is no agreement" to do so. As if there were any agreements with the countries whose contributory superannuation schemes are misused for reducing the cost of NZ Super!

By making a pensioner with an overseas pension pay for his/her own and his/her partner's NZ Super, New Zealand evades cost-sharing with other countries and leaves retirement provision even for its own citizens who might never have left New Zealand, entirely to other countries.

The myth of giving everyone a fair go

In no other country of the world would anyone deduct an overseas pension unless it is a state pension and unless it is agreed upon in a Social Security Agreement. In all other countries of the world occupational superannuation payments are added up if a person has contributed to compulsory schemes in different countries.

New Zealand is the only country in the world that deducts such employer/employee-funded pensions from its state pension. But declaring a compulsory overseas pension a state pension based on the regularity of the payments and the nature of the administrator does not make it any more similar to NZ Super.

New Zealand, the friendly country that gives everyone a fair go. Yeah, right! It is the only - more or less civilised - country that punishes people for loving the "wrong" person.

A brief look into the more recent history

Labour didn't "find" the money

Subsequent governments have failed to stop the punishment of pensioners for being in a relationship with the "wrong" partner. But Labour had the best chance to do it.

Ruth Dyson was the Labour minister in charge who could forward the good news that Cabinet had agreed on 23 October 2007 to scrap Spousal Provision - and the bad news that the change of policy was subject to the availability of funding. This "was not found" in the Budget 2008.

The dire consequence of this unsuccessful search for money was that the National Government distanced itself from this agreement when Labour got swept out of power at the end of 2008, and the fight for justice had to start at the very base all over again.

We should not forget that the Labour Government did not find less than NZ$ 2 million the abolition of the Spousal Provision would have cost at the time, but it found the funding for major tax cuts before the 2008 election.

Read more about Labour's hypocrisy here:

PM Jacinda Ardern

The Labour Party

Read some of the victims' stories based on Spousal Provision:

Ruth - who married the "wrong" man

Jack - who has never left the country

Sissi - who is not "better off"

Jan - who describes the "Joys of Marriage"

Malcolm - who feels "like a much-diminished man"

Donna - who says she has lost her independence


Steps and scandals on the way to the end of the Spousal Provision


Spousal Provision to go on 9 November 2020

The first tiny goal in our fight against the Direct Deduction Policy has been reached: the Spousal Provision will end on 9 November 2020.

This change is part of the package of the New Zealand Superannuation and Veteran's Pension Amendment Bill that received the Royal Assent after its third reading in Parliament on 24 July 2020.

The sad thing about it is that Carmel Sepuloni, the Minister for Social Development, brought in a Supplementary Order Paper (SOP) in which all the changes to the NZ Superannuation and Veteran's Pension Legislation Amendment Bill were postponed from 1 July to 9 November 2020. The explanation was MSD's huge workload due to the Covid-19 crisis.

While the Government has pushed through laws under urgency without following the proper process, this bill had passed all stages correctly but only got its third reading in Parliament on 21 July 2020.

The changes to the legislation which include the end of the Spousal Provision had been published on the MSD and WINZ websites since June 2019. The amendment bill doesn't include any suggestion to backdate the payments to 1 July. This just shows that the Government and its Minister didn't really care about ending this injustice and breach of Human Rights.


Spousal Provision to go from 1 July 2020

(changed to 9 Nov 2020)

As part of the 2019 Budget the Ministry of Social Development (MSD) has made contradictory announcements about ending the Spousal Provision from 1 July 2020. However, in a statement to the NZ Herald Minister Carmel Sepuloni confirmed that this part of Section 70 will be discontinued under the condition that the law change passes Parliament.

The confusion started because only the WINZ website clearly stated that a persons's overseas pension won't affect their partner's NZ Super any longer, suggesting that the Spousal Provision will be discontinued. The statements on the MSD website could be interpreted in the way that the deductions only stops for pensioners whose partner is not qualified for NZ Super in their own right. So far we have not received any explanation for the numbers mentioned on the MSD website.

Another change - which we consider fair - is that non-qualified partners cannot be included in NZ Super payments any longer after 1 July 2020. However, those who are already receiving payments for their non-qualified partner will continue to receive these payments until their circumstances change (e.g. separation and new non-qualified partner).

Detailed information on the WINZ website:


The information on the MSD website:


Children pay the pension for their stepfather

... and it goes on and on and on. The most draconian aspect of the Spousal Provision/Deduction policy has just come to our attention (Feb. 2018). The Ministry of Social Development (MSD), in all earnest, deducts two young children's survivors benefit (in this case from the USA) from their stepfather's NZ Super.

The decision is based on Section 69G of the Social Security Act which allows the deduction of dependants' overseas benefits and pensions.

Despite the fact that US Social Security insists on the money of their late father's insurance being used for the children only, MSD feels fit to confiscate it and deduct it from the NZ Super of their mother's new husband who happens to be quite a bit older than her. Two young teenagers abused for the funding of NZ Super. Unbelievable but true. What next?


Decision Reversed

After the above case appeared on our website and was discussed at the Spousal Provision hearing at the Human Rights Review Tribunal (HRRT) in Wellington, the family got a call from MSD, telling them the decision had been reversed. The official obviously said that "too many people were getting involved" and that he was sorry they had made a mistake.

We were not surprised by the news.

Despite the happy ending the family went public. Good on them! Here is their story in the NZ Herald from 15.03.2018:


The CEO's discretion...

At the HRRT hearing the Crown lawyer and an MSD official pointed out several times that it is in the discretion of the CEO of MSD to defer the deductions, so the big question was why they don't do it in such dramatic cases.

A witness at the hearing told the Tribunal that her husband's overseas pension is deducted from her NZ Super alone, as the husband has not lived in New Zealand long enough to be eligible for NZ Super. As a consequence the woman receives zero dollars of NZ Super and needs to work at age 70 to make ends meet.

There are only 20 such cases in New Zealand, we heard from MSD. And again we ask: Why does the CEO not use the discretion to defer the deduction - particularly as he has been ordered by the Social Security Appeal Aurhority (SSAA) to do so in a similar case?

We have the impression he only stops the deductions if a case becomes public. MSD fight so hard to keep the spousal deduction in place because they are afraid - and rightly so - that it would be the step to being forced to put the entire direct deduction policy into question.

Story on exactly such a case and Spousal Provision in general in the Sunday Star Times from 06.05.2018:

Link to the story in our Media Coverage section

MSD's page of shame

Before the end of the Spousal Provision the Ministry of Social Development explained how the Direct Deduction Policy worked. Examples three and four were about the application of the Spousal Provision.

Example four, the deduction of a non-eligible partner's overseas pension - which was the scenario that applied to Mary in the main text on this page - had been sneakily added to MSD's website on 14 January 2016.

(Last update: 24.11.2021)

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