'Confused, embarrassed': Kiwis abroad eligible for $350 cost-of-living payment

Newstalk ZB / NZ Herald,
Publish Date
Mon, 1 Aug 2022, 7:03am
Photo / Getty
Photo / Getty

'Confused, embarrassed': Kiwis abroad eligible for $350 cost-of-living payment

Newstalk ZB / NZ Herald,
Publish Date
Mon, 1 Aug 2022, 7:03am

Overseas-based Kiwis are "confused" and "embarrassed" at being told they would receive the Government's cost-of-living payment tomorrow and critics say including those living out of New Zealand in the scheme is "disrespectful" to hard-working taxpayers.

Kiwis as far afield as the Netherlands, Sydney, London and Dubai have expressed their concern to National's Nicola Willis, who said many of them felt guilty and that they did not deserve the money.

One man working in Dubai had not been a New Zealand resident for nearly 22 years, yet received the same email as more than 2.1 million Kiwis: that his first payment would be in his account within the next two days. His mother contacted the Herald irate at what she said was "incredible wastage of our taxpayers' money".

Numerous members of a Facebook group for French travellers in New Zealand also received the payment email despite no longer being in the country. One person had been away for 13 months while others' visas had been cancelled so they couldn't see how they were eligible.

An Inland Revenue spokesperson acknowledged it was possible people no longer living in New Zealand could get the payment.

"If someone has left the country and hasn't told Inland Revenue they're not living here currently we will have treated them as resident and they may receive the cost of living payment."

They also said people who weren't in paid work in New Zealand during the 2021/22 tax year could receive the payment if they have income from bank interest.

The spokesperson said that IRD is "using a variety of information" to determine eligibility, including addresses, bank accounts and tax residency status.

"People must have had a 2022 tax assessment with eligible income such as salary and wages or bank interest," the spokesperson said.

The cost of living payment was a surprise addition to the May Budget.

Eligible New Zealanders will get roughly $27 a week for three months, adding up to $350.

To be eligible for the payment, you had to earn no more than $70,000, not be receiving the Winter Energy Payment, be 18 years or older, a New Zealand tax resident and be present here and not be in prison.

The first payment will be $116.67, followed by another payment of the same amount on September 1. The final payment of $116.67 will be on October 3, the first business day of that month.

The projected cost of the rollout is $816 million.

Willis, who is National's deputy leader and finance spokeswoman, said people outside New Zealand receiving the funds showed "how cavalier" the Government had become with taxpayer cash.

"The Government should be treating every taxpayer dollar as carefully as the taxpayers spending it right now, we are in very tough times, wages are not keeping up with prices, Kiwis are doing it tough and they have a right to expect that the Government will be careful with their money."

Willis maintained that this was "disrespectful to taxpayers who work hard, who are suffering with the cost of living and are now learning that the Government is spraying their money around offshore".

She had received many messages over the last few days from people saying they were "embarrassed" to receive the underserved money.

Some were "very confused", saying that they were not only paying tax to another country, but also paying off student loans, so surely this would have alerted something within the IRD's system.

"The Government was explicitly warned that ... by doing this policy on the fly, there would be all sorts of unintended consequences," Willis said.

"They were warned that it would be difficult to target people effectively, warned that people who shouldn't be eligible for it would get it regardless and that is exactly what's happening."

The payments are designed to help Kiwis battle the rising cost of living, with annual inflation hitting 7.3 per cent in the June quarter.

Prime Minister Jacinda Ardern yesterday didn't accept that the payments would themselves help stoke inflation and said they were expected to have minimal impact on any rise.

"The advice that we got from Treasury is that because it was time limited and targeted would lessen the potential impact on inflation," she told TVNZ's Q+A.

"The responsibility we have is to help New Zealanders get through it and that's where you'll see that we've been so squarely focused on where we can take that pressure off.

"You'll see that we've tried to be agile to the circumstances we see and we'll continue to see what impacts these are having on New Zealanders and do what we can, we have a way to go with getting the food costs down which is another big project for us."

Ardern said she'd be prepared to take an "honest" look into the drivers of inflation in New Zealand but reiterated that the country is in company with the rest of the world.

She said the main cause of inflation was global drivers rather than government spending.

- Rachel Maher, NZ Herald