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Andrew Dickens: Cost of living payment a badly designed, bureaucratic mess

Andrew Dickens: Cost of living payment a badly designed, bureaucratic mess
Aug 1, 2022 · 4m 59s

Just at the moment when New Zealand should be getting back to business, the wheels keep falling off for this Government. On Sunday, we finally opened up completely to the...

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Just at the moment when New Zealand should be getting back to business, the wheels keep falling off for this Government.
On Sunday, we finally opened up completely to the rest of the world.  After two and a half years the so-called hermit kingdom was over. There's even a cruise ship scheduled to arrive in a few weeks
We should be emerging triumphant, but we're not.
Today we're bickering over a government handout that's supposed to help with the cost of living crisis but is proving to be a thorn in the side of the Labour Government.
And it is probably just going to make inflation worse.
Nicola Willis and the National Party are claiming that overseas residents are going to be getting the three instalments of $116.67, even though they don't live here.
Ms Willis claims a man living in Dubai who has not been a NZ resident for 22 years is going to be getting the payments and he's feeling embarrassed.
This is an outrage, if it's true. But you should never totally believe a politician.
So 2.1 million people are in the process of getting a payment or an email from the IRD, who have been charged with running the scheme.
The letter says all sorts of things. Only people who have filed their IR3 returns or taxed at source will get the money. So you need to have earned taxable income from NZ to be eligible and to have paid it.
You have to be a tax resident.
You also have to have a current functioning New Zealand bank account. And all the way through it says YOU MAY BE ELIGIBLE. Which is not to say you will get the money.
There are many reasons why many people will get the money around the world.  It is because they are taxpayers and therefore their taxes are being used to be given back to them.  But I'm picking that Mr Dubai will not get a cent. However, Handout Shame was the headline in the paper.
So this is a badly designed bureaucratic mess that rewarded tax residents, not just physical residents. Add to that the people who most need it are denied it. The poorest beneficiaries and the OAPs who are paid the winter energy payment
But that is not its worst crime. Before we even come to who gets it or not, this pork barrel exercise will barely help ease the cost of living while at the same time add fuel to the inflation fire.
Because, despite what the Prime Minister said on Q and A yesterday, it will be inflationary.
Just for the record. All excessive spending is inflationary. Government spending, corporate spending, excessive profits and even private spending
It all spills cash into an economy, increasing demand at a time when supply is limited.
So the lesson from today is carry on with business but remember all politicians never tell the whole truth.
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