- DIRECTORY
- Home
- The Direct Deduction Policy
- A Culture of Deception
- The Mandarins
- Discretionary Powers
- A Shocking Admission
- The Nation Betrayed
- Rewarding Service
- The Infamous Roe Case
- Portability: Retiring Overseas
- Kiwis in the US/Americans Down Under
- Kiwis Retiring in Australia Beware!
- CPP: Canadian Pensions Pirated
- A New Victim
- Dual Entitlement: British Pensions
- Dutch Pensions
- Kiwisaver
- Human Rights Commission
- Special Banking Option
- MSD: Deceiving Parliament and the Public
- New Crackdown on the Elderly
- Pension Equality
- About This Site
Discretionary Powers
Under Section 70 of the Social Security Act, the chief executive of the Ministry of Social Development is granted exclusive discretionary powers to determine if - in his opinion - an overseas pension is analogous to NZ Superannuation, and therefore subject to direct deduction from NZ Super entitlements.
It means that overseas pension deductions are determined exclusively by the "opinion" of one senior civil servant.
It is surprising in what is ostensibly a democratic nation that NZ governments past and present would grant such sweeping powers to a single civil servant and neglect to establish any monitoring system to safeguard against possible use of authority.
Foreign benefits in the form of government-funded retirement income granted to persons in need or to anyone fulfilling basic residency criteria can properly be likened to NZ Super. If the chief executive had confined himself to deducting pensions of this nature he would have been exercising, responsibly, the extraordinary authority invested in him - and there would have been no need for this website.
Unfortunately, the chief executive has been allowed to abuse that authority, capturing virtually all overseas pensions, most of which are quite different from NZ Super - without censure, with no questions asked.
The majority of overseas pensions coming into New Zealand are second-tier (contributory, earnings-based) pensions - for example, the Canadian Pension Plan and US Social Security. These pensions are essentially different to first-tier (universal flat-rate) pensions such as NZ Super. They are paid only to those persons who have contributed to the program, the monthly amount dependant on the individual's contribution. They should be treated as personal annuities or personal retirement savings.
The US Social Security program serves as a perfect example of a system that, acting on his "powers of discretion", the chief executive has seriously misrepresented.
There are two forms of US Social Security. The first, known as Social Security Insurance (SSI) is indeed a form of government support, a minimal amount paid to persons in dire need. SSI is the form of US Social Security that the chief executive has seized upon to warrant the abatement of US Social Security payments from NZ Super entitlements (refer: The Roe Case).
The second form of US Social Security is quite different: it is not granted to anybody but paid only to those who have contributed to the program. Returning to the situation of Ruth; the Social Security payment her husband is receiving from the US is from a government-protected account that he paid into throughout his working life. The amount of his monthly payment is dependent on his personal contribution and is identical to a privately purchased annuity in this sense. His pension is neither funded nor subsidized by the US Government - but funded exclusively by his personal contributions.
If Ruth qualified for US Social Security in her own right and returned to the US, she would receive Social Security payments in direct proportion to the amount she had paid into the American program. It is interesting to note that, unlike the NZ Government, the American Government would not require Ruth to apply to her country of origin for any pension due to her - then reduce her Social Security payments by the amount of her foreign pension. She would be permitted both.
In contrast to NZ, the United States (and indeed nations around the world) does not rely on other countries to subsidize its state pension program. In this respect alone, US Social Security cannot be considered analogous to, or have like contingencies with, NZ Super.
The chief executive has disregarded the true nature of the US retirement scheme and maintains, falsely, that it is a form of government support granted to those in need. As a result, NZ authorities have been depriving hundreds of elderly people of their underlying property rights to money they have invested in the US. It is a similar situation with most other overseas retirement schemes.
Parliament provided the chief executive with discretionary powers to determine those overseas benefits that may be deducted from NZ Super entitlements. At no stage has Parliament ever given the chief executive discretionary powers to deduct people's retirement savings from NZ Super. In doing so, the actions of the chief executive may be considered unlawful.
Furthermore, the law does not support the capture of any pension which, in the chief executive's opinion, does not resemble NZ Super (refer: A Shocking Admission).
Those overseas pensions to be deducted are determined exclusively by the ‘opinion' of one senior civil servant (the MSD chief executive).
With no monitoring system to safeguard against abuse of authority, the ‘opinion' of the chief executive has resulted in the capture of virtually ALL overseas pensions - with no questions asked.
Most of the overseas pensions subject to direct deduction bear little resemblance to NZ Super.
NZ authorities have been depriving thousands of elderly people their underlying property rights to personal retirement savings.
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