Ignorance no excuse for benefit fraud

Diane Bruin

Tauranga beneficiaries are illegally claiming hundreds of thousands of dollars in welfare payments each year.

Ministry of Social Development (MSD) figures show 34 Tauranga beneficiaries were prosecuted for benefit fraud in the year to June 2013, for payments totalling $1.2 million.

The amount was up from the previous financial year, when 47 benefit recipients were successfully prosecuted for $1.1 million.

Te Tuinga Whanau Support Services Trust social worker Jenna Young said insufficient welfare payments played a significant role in benefit fraud.

Beneficiaries in New Zealand received about equivalent to working a 40-hour week for $7 to $8 an hour - which was not nearly enough to live on, she said.

"The benefit only covers rent, minimal food and power. And if you've got other debts, it's impossible."

Benefit payments had fallen far behind inflation, Ms Young said.

"It's not Work and Income's fault - the Government needs to be held accountable for that."

Ms Young welcomed a new law coming into effect next month that will hold both partners in a relationship equally responsible for benefit fraud.

"The women always get reprimanded - the males just get a slap on the hand and that's it."

Claiming ignorance was no excuse, she said.

"If you're in a relationship, you should know what the other person is doing. You should both be held accountable."

Tauranga Budget Advisory Service co-ordinator Diane Bruin said welfare benefits were the basic amount required to cover rent, food, power and other essentials, but not pay for any frills.

Mrs Bruin said the service saw people every day who could not cope with rising costs, and often previous debt compounded the problem.

At least 20 beneficiaries convicted of benefit fraud were referred to the Tauranga service each year, but the service took a non-judgmental approach, she said.

"But we do talk to them about what led to their offending and, if we find there are underlying issues such as addictions or a gambling problem, we also refer them on to other agencies.

"We offer our clients a total money management programme which includes educating them on the different ways of shopping, credit contracts and how to save for the future," Mrs Bruin said.

Nationally, 906 beneficiaries were successfully prosecuted last year resulting in more than $32.6 million worth of debt.

The total fraud debt owed to the Crown currently stands at $128 million.

Ministry for Social Development deputy chief executive of student, seniors and integrity services Iona Holsted said the ministry had powers to recoup the benefit debt which included stopping offenders from leaving the country.

Associate Social Development Minister Chester Borrows slammed the suggestion benefit fraud was linked to the rate of welfare payments.

"I completely refute the idea that people can blame the dollar value of benefits for welfare fraud, and I find the suggestion offensive." additional reporting Sandra Conchie