Opinion: Lindsay Mitchell.
For the last four years, the Ministry of Social Development, the main agency for the Wage Subsidy Scheme, has relentlessly reported on people who committed fraud during the Covid period. For example:
You can go here to read names, court case details and outcomes dating back to 2022.
What’s interesting is MSD does not report cases of beneficiary fraud.
Yes, fraud is fraud, but it seems to me that people not on a benefit, who submitted false applications for wage subsidies during covid, get treated differently. They are all being made public examples of, while nothing is reported by the Ministry regarding beneficiary fraudsters.
So I was interested in the following recent court report from the NZ Herald:
“An unemployed mother-of-four involved in a widespread benefit scam will now pay back her ill-gotten gains by using her benefit.” [Editor’s note: a number of the convicted and sentenced covid frausters repaid their debt from their own money.] “The irony of the situation was not lost on Judge Tini Clark as she sentenced Kataraina Fay Matiu on a charge of obtaining nearly $25,000 from the Ministry of Social Development (MSD) by deception.
“It’s a bit of a money-go-round, as far as I’m concerned,” she noted dryly, after handing down a sentence of four months’ community detention and 18 months’ intensive supervision for that, and a separate assault on two court security guards.”
This is a violent woman, an (ex?) methamphetamine user, with two children in state care and two with her mother, and she got 4 months community detention.
Most of the covid fraudsters received longer community sentences. Many will spend months, and even years, behind bars.
It’s not as if there aren’t any benefit fraud cases for MSD to report. According to the ODT in 2024, “Mr van Ooyen [MSD group general manager of client service support] said the number of cases had spiked this year due to more staff returning to work on benefit fraud since the end of the Covid-19 wage-subsidy scheme.”
But MSD doesn’t report on them.
On the evidence, beneficiaries who commit fraud are treated less harshly by both the courts and MSD.
Perhaps because beneficiaries are ‘clients’ of MSD, privacy constraints prevent their being named in the way the covid fraudsters are. But I also believe that MSD has, over time, developed its own moral code – beneficiaries are victims of the capitalist system whereas covid fraudsters are part of it.
Officially this is how MSD approaches benefit fraud:
“MSD’s overall approach is to intervene early when concerns are raised, to make it easy for clients to do the right thing and avoid unnecessary overpayments and debt while still responding appropriately to serious fraud.”
Perhaps all fraud is equal, but some fraud is more equal than others.
Why should you care? Because the ministry’s worldview is such that resistance to a reformist government – if one is ever elected – is almost certain.
MSD’s key message is “We help New Zealanders to be safe, strong and independent.”
Yet most working-age New Zealanders reliant on a benefit are anything but.
MSD has somehow convinced itself that handing out benefits is virtuous, enabling and liberating. Publicly acknowledging recipients ripping them off isn’t comfortable or conducive to their kaupapa.
On the face of it, MSD has no empathy for covid fraudsters but no end of empathy for beneficiary fraudsters.
So much for a neutral public service.
