DECISION ON THE PAPERS

Transcription

1 [2016] NZSSAA 018 Reference No. SSA 073/15 IN THE MATTER of the Social Security Act 1964 AND IN THE MATTER of an appeal by XXXX and XXXX of New Plymouth against a decision of a Benefits Review Committee BEFORE THE SOCIAL SECURITY APPEAL AUTHORITY Ms M Wallace - Chairperson Mr K Williams - Member Lady Tureiti Moxon - Member DECISION ON THE PAPERS Introduction [1] The appellants appeal against a decision of the Chief Executive upheld by a Benefits Review Committee to suspend Ms XXXX s New Zealand Superannuation for one fortnight due to Mr XXXX receiving a deferred lump sum payment of a retirement pension from the United Kingdom Pension Service. Background [2] Mr XXXX is aged 71 years. He has been in receipt of New Zealand Superannuation since 12 September His partner Mrs XXXX is aged 69 years. She has been in receipt of New Zealand Superannuation at the half-married rate since 12 June [3] Mr XXXX was born in the United Kingdom and is entitled to a pension from the United Kingdom paid by the United Kingdom Pension Service. Ms XXXX was born in New Zealand. We understand she has no entitlement to a United Kingdom pension. [4] When Mr XXXX was granted New Zealand Superannuation he was required to test his eligibility for a pension from the United Kingdom. While it seems Mr XXXX

2 2 completed a United Kingdom pension form at the time, it was incomplete and for reasons that have not been explained there was a significant delay in the United Kingdom Pension Service processing his application. It was not until 28 August 2014 that Mr XXXX was advised that he had been granted a United Kingdom retirement pension from 7 August 2013 of a week, which would be paid into the Special Option bank account relating to payments from the United Kingdom. [5] In March 2015, the Chief Executive received advice from the United Kingdom Pension Service that as the appellant had not claimed his State pension until 7 August 2013, despite becoming eligible on 12 September 2009, he was entitled to a gross lump sum payment of 7, An amount of $14, was paid into the Special Option bank account in the appellant s name. [6] A decision was made to deduct the amount of this payment from one fortnightly instalment of New Zealand Superannuation for each of the appellant and his partner. As a result of this decision, for the period 25 March 2015 to 7 April 2015 neither the appellant nor his partner received a payment of New Zealand Superannuation. The lump sum amount of $14, was paid into Mr XXXX s bank account. [7] Mr XXXX objects to Mrs XXXX s New Zealand Superannuation being suspended for the week in question. He says that she is not his wife (she is his partner) and has no entitlement to his United Kingdom pension. Decision [8] Section 70 of the Social Security Act 1964 provides for benefits, pensions and periodical allowances received from overseas to be deducted from entitlement to New Zealand benefits in certain circumstances. The essential elements of s 70 are that where: a benefit or pension or periodical allowance granted overseas, which forms part of a programme providing benefits, pensions or periodical allowance, is paid to the recipient of a benefit in New Zealand or that person s spouse, partner or dependent; and the programme provides for any of the contingencies for which benefits, pensions or periodical allowances may be paid under the Social Security Act 1964 or the New Zealand Superannuation and Retirement Income Act 2001 or the Veteran s Support Act 2014; and

3 3 the programme is administered by or on behalf of the government of the country from which the benefit, pension or periodical allowance is received; then that payment must be deducted from the amount of any benefit payable under the Social Security Act 1964 or the New Zealand Superannuation and Retirement Income Act 2001 or the Veteran s Support Act [9] The provisions of s 70(1) are very wide. It is not necessary, for example, for the overseas pension or benefit paid to be identical to one of the benefits paid in New Zealand. The comparison is not between individual types of pension but between programmes for income support payable for any of the contingencies covered in the New Zealand income support legislation. 1 [10] The Authority and the High Court have previously found that payments received from the United Kingdom Pension Service and payable pursuant to the Social Security Contributions and Benefits Act 1992 (UK) and related legislation, meet the criteria of s 70 and must be deducted from entitlement to any benefits received in New Zealand. 2 [11] In addition, the reciprocal agreement on social welfare with the United Kingdom requires benefits and pensions received from the United Kingdom to be deducted from New Zealand entitlements. Of particular significance in this case is that both the provisions of s 70 and the reciprocal agreement provide that any benefits received in New Zealand (including New Zealand Superannuation) must be reduced by both the amount of overseas pension received by the New Zealand beneficiary and any pension received by that person s spouse. The deduction of the United Kingdom pension from entitlement to New Zealand benefit is not limited to the person entitled to the United Kingdom pension. Where the amount received exceeds the benefit entitlement of the recipient, the excess must also be deducted from any New Zealand benefit entitlement the spouse or partner receives. [12] Mr XXXX makes the point that Ms XXXX is his partner and not his wife. Nothing turns on that distinction. Section 70(1)(c) uses the term spouse or partner. It provides that anyone who is entitled to receive a benefit in New Zealand, or if their spouse or partner is entitled to receive a benefit in New Zealand, and if they or their spouse or partner is entitled to receive a benefit from elsewhere than in New Zealand, and the other qualifying criteria of s 70 are met, then the amount of the overseas pension received 1 2 See Hogan v Chief Executive of the Department of Work and Income (HC Wellington AP49/02, 26 August 2002); Tetley-Jones v Chief Executive of the Department of Work and Income (HC Auckland CIV , 3 December 2004). See, for example, Dunn v Chief Executive of the Ministry of Social Development [2008] NZAR 267 (HC); and [2008] NZCA 436 and [2009] NZAR 94 (CA).

4 4 must be deducted from the entitlement of the recipient and that person s spouse or partner to New Zealand benefit. [13] Moreover, s 63B of the Social Security Act 1964 gives the Chief Executive a discretion to regard as married any two people who, not being legally married or in a civil union, have entered into a relationship in the nature of marriage. Mr XXXX does not dispute Ms XXXX is his partner. [14] In this particular situation, where the appellant acknowledges that Mrs XXXX is his partner and the couple are paid a married rate of benefit, whether Mrs XXXX is referred to as the appellant s wife, spouse or partner is a matter of semantics. [15] In this case, the Chief Executive has treated the lump sum payment received by Mr XXXX as one instalment of overseas pension which must reduce the New Zealand benefit in the week the payment was received. On behalf of the Chief Executive, it was submitted that the half-married fortnightly rate of New Zealand Superannuation as at 1 April 2015 was $ This was the amount that he was required to deduct from the lump sum payment of overseas pension received by the appellant. The lump sum was first deducted from Mr XXXX s gross rate of New Zealand Superannuation, giving him no entitlement. The excess of the lump sum was then applied and deducted from Mrs XXXX s gross rate of New Zealand Superannuation. As a result, she had no entitlement to New Zealand Superannuation payable on 7 April [16] This approach is very fair to the appellant. The payment the appellant has received relates to the period Throughout that time the appellant was receiving New Zealand Superannuation. Had the Ministry ensured that his application for a UK pension was processed promptly, a weekly amount would have been paid into the Special Banking Option account throughout the period over which this lump sum payment accumulated. [17] Arguably, it would have been appropriate for the Chief Executive to conduct a backdated review of Mr XXXX s benefit entitlement under s 81 of the Social Security Act 1964 in respect of the period 12 September 2009 to 7 August 2014 and deduct the weekly amounts set out from his entitlement to New Zealand Superannuation. This is because the lump sum represented an accumulation of pension entitlement which was paid in respect of a backdated period. Had the United Kingdom pension been paid from 2009 onwards, then the appellant would not have received any arrears at all. [18] In summary: (i) Mrs XXXX is the appellant s partner. She and Mr XXXX l receive a married rate of New Zealand Superannuation.

5 5 (ii) (iii) The Chief Executive is entitled, as a result of s 70 of the Social Security Act 1964 and the reciprocal agreement with the United Kingdom, to deduct any United Kingdom pension received by Mr XXXX in excess of his benefit entitlement in any week from Mrs XXXX s entitlement to New Zealand Superannuation in that week. The deduction of the lump sum payment from one fortnightly instalment of New Zealand Superannuation is to the advantage of both Mr XXXX and Mrs XXXX. [19] There are no circumstances in this case where the discretion to defer commencement of the deduction under s 70(2) of the Act should be applied. [20] The appeal is dismissed. DATED at WELLINGTON this 11 th day of March 2016 Ms M Wallace Chairperson Mr K Williams Member Lady Tureiti Moxon Member SSA doc(jeh)