Government
The Ministry of Social Development has been told that it is skating on thin legal ice when it comes to making hundreds of pensioners who got stuck overseas during the pandemic repay their pensions. The department is now reviewing every single case.
Jane Wrightson, retirement commissioner, sought legal advice in March after months of “numerous” approaches to pensioners who could not return to New Zealand within six months of their departure, and was asked to repay a 26-week pension.
Seven thousand, three hundred and two payments were suspended and canceled between April 2020 and March 2022. The Superannuation and Retirement Income Act stipulates that if a superannuant does not return to New Zealand within 30 weeks, their payments may cease.
The ministry could not say how many people he asked to repay the payment, but lawyers estimate the number is in the hundreds. It did so on the grounds that return problems to New Zealand related to the pandemic were “fairly foreseeable”.
But the advice of law firm Dentons Kensington Swan did not agree.
“There are strong arguments that the continued application of the policy is illegal in any case. It applies too broad an interpretation of what can reasonably be foreseen on the basis of general and unspecified risk. This broad interpretation is unlikely to be made by a court. preferred, given the simple words, statutory context (which is fundamentally concerned with enabling the payment of pensions overseas) and the severity of the impact on those affected.
“It is also probably not open to MSD about the facts, where the circumstances that seriously aggravated MIQ problems were not quite known at the time of departure (as accepted for the purposes of the October 2021 policy).
“My legal advice is that MSD’s applications of its policies will be vulnerable to litigation through judicial review.”
– Jane Wrightson, Retirement Commissioner
The October 2021 policy referred to the department’s decision to grant an exemption to those trapped in Australia who left New Zealand during the travel bubble but could not return home because the bubble closed .
MSD said it does not stop payments for these people because their predicament could not be foreseen.
However, the legal advice said the October release only contributed to MSD’s shaky legal basis because the department is now in conflict.
“There are strong arguments that the October 2021 policy should be applied in a similar way to other superannuities that left overseas during the relevant period. As a matter of administrative law, it is acceptable to develop a policy to direct the exercise of a discretion. However, it must be applied consistently and evenly.
“Any distinction between those who have traveled to Australia and those who have traveled to other countries appears to be arbitrary and unreasonable in the facts and will be vulnerable to litigation in judicial review proceedings.
“There are good arguments that range from 19 April 2021 to 23 July 2021 are unreasonably narrow and not supported by the timeline of events. At least an inability to secure an MIQ spot for more than six months was probably not reasonably foreseeable until at least late September 2021.
Jane Wrightson shared this advice with Debbie Power, CEO of MSD, and a month later sent her an email asking her to help the superannuities.
“Given the vulnerability of MSD’s legal position, I think the solution is to properly and legally extend the existing October 2021 approach to other pensioners who similarly could not have foreseen what was to come and the impact on MIQ … our lawyers notes that the actual wrongfulness does not stem from the application of the October 2021 policy, but from its application inconsistent and unequal.
“The longer it lingers, the longer pensioners are put under considerable stress due to MSD claims for repayment of pension money. Not only are the individual decisions vulnerable to review, but my legal advice is that MSD’s applications of its policies will be vulnerable. to challenge by judicial review.I am still being contacted by a series of individuals who are adversely affected by MSD’s decisions.It seems highly unreasonable to force them to go through a legal challenge to get a fair result when there is a clear and legitimate path.
“In my opinion, the point of view set out in the legal opinion is compelling. It makes it clear to me that this issue can and should be readily resolved without requiring individual superannuities to go through the added strain and expense of challenging MSD’s policies or pursuing the matter through the BRC and Authority. ”
The BRC – Benefit Review Committee – has already heard a handful of cases from pensioners pushing back against the debt they were asked to pay.
MSD confirmed about 300 customers had requested a review of the decision in the course of the pandemic.
“Pensioners are very stressed and their decisions are very emotional… many of them will just walk away because it is not easy. It was not easy or soft with them. “
– Karen Pattie, Beneficiary Advocate
Beneficiary lawyer Karen Pattie said no one was successful in the BRC, but everyone who brought their cases to the Social Security Appeals Authority (SSAA) – a BRC appeal process -‘s decision was reversed in their favor.
“Which is very confusing… the BRC trial must be consistent. “The SSAA does not have to look at the paperwork and say no, it is not wrong, we will have to turn it around,” she said.
Pattie noted that the BRC decisions were mostly based on MSD’s rationale that the problems of getting home were foreseeable.
But she said the authority decisions were frustratingly closed doors, so neither herself as a lawyer, nor the pensioner whose case is being considered, knew on what grounds the decision was reversed.
“It’s not transparent and I can not use that information at my next BRC trial because I do not know why they decided to just turn it around.”
She said the situation became unnecessarily confusing.
“Pensioners are very stressed and their decisions are very emotional… many of them will just walk away because it is not easy. It was not easy or soft with them. “
She asked anyone who was asked to repay their debt to file with the BRC.
“It’s really simple… and if they lose, they have to take it through the SSAA. Again, that paperwork is really simple, but they all have to do it because they just do not have to accept it.
“All the debt has to be looked at again, because it does not make sense.”
Debbie Power wrote back to Jane Wrightson at the end of May to acknowledge the legal advice and her requests, but maintained that MSD’s actions were – for the most part – correct.
“You have requested that we extend the October 2021 policy to a wider group and timeframe. We do not agree that the timeframe should be extended back to January 2021, but we do agree with your advice that superannuities traveling to other countries during the [travel bubble] period should benefit from the same underlying factual consideration. “
George van Ooyen, general manager of MSD Client Service Support, confirmed that the release will be extended.
“After careful consideration, and taking into account the changing global conditions, MSD has decided that the October 2021 policy should be extended to superannuities traveling to other countries during the Australia-New Zealand travel bubble period.
He also said that at other times during the pandemic, the delays may not have been reasonably foreseeable and MSD will now review all cases where a pensioner’s payment was stopped and all cases where the person was asked to repay the debt.
“We are committed to ensuring that everyone receives their rights, and do so to ensure that the unique circumstances of those trapped overseas during the pandemic are properly taken into account.”
He said decisions currently going through the review process will be reviewed with priority.
“We appreciate the difficult circumstances that many superannuities faced as they tried to return home during a disruptive period of international travel, and we did everything in our power to help those affected.”