Cost of living payment: National, Labour fire up as latest data reveals number of Kiwis who risk missing out

The start of September doesn't just signal the start of spring this year, but the next round of the Government's cost of living payment.

The second of three $116 payments will be heading into eligible Kiwis' wallets on Thursday, although more than 100,000 risk missing out because they're still yet to give Inland Revenue (IRD) their bank account details.

The payment is automated, meaning New Zealanders don't have to apply to get it. They just need to fulfil the eligibility criteria, including being "present in New Zealand", aged 18 or older, earning $70,000 or less, and not entitled to the Winter Energy Payment.

But IRD also needs to know where to send the money. 

As of Tuesday, 112,917 eligible New Zealanders still haven't provided their bank accounts to the department, meaning they will miss out on the payment if they don't get in touch. That's down, however, on the more than 160,000 people who hadn't given IRD their details prior to the first payment on August 1.

In a statement, IRD said it undertook activities prior to the August payment to reach those who it didn't hold a bank account for. That included alert banners on its website, radio advertising and sending emails and letters asking for people to update their bank account.

"Customers are not required to have a bank account on file with IR however in order to get the payment they need to provide this to us," a spokesperson said.

David Parker, the Revenue Minister, told Newshub some people have little interaction with IRD.

"These days a lot people are so accurate with their tax affairs under new computerised systems, so there is no washout payment or refund at the end of the year," he said.

While the Government touted the payment as likely going to an estimated 2.1 million eligible New Zealanders, IRD's latest data shows just 1.389 million have so far received the money, equal to about $162 million paid out.

IRD expects that number to increase as it receives more 2022 income tax assessments and other documents, but it's only risen by about 70,000 people since early August.

About 5000 people have opted out of receiving the payment, while 428 people have repaid the money.

Revenue Minister David Parker.
Revenue Minister David Parker. Photo credit: Getty Images.

That may be because they weren't meant to receive it in the first place. The delivery of the first payment in early August was heavily criticised after foreigners and expat Kiwis got the money.

IRD said an ineligible person could potentially get the payment if they hadn't told IRD they had left the country or if they had received income into a New Zealand bank account from the likes of bank interest.

The Government was warned in May that ineligible people could get the payment but has this month defended the policy by saying the focus was on getting the money out the door quickly in the middle of a cost of living crisis.

Parker said the only alternative to an automated payment is a costly, time-consuming application process which some Kiwis in need may not take advantage of.

The Auditor-General has been scathing, saying in a letter released this week that the Government prioritised speed over accuracy and should look into how many ineligible people got the first payment. 

National leader Christopher Luxon questioned Prime Minister Jacinda Ardern over the Auditor-General's assessment on Tuesday afternoon, asking whether she agreed with him that "good stewardship of public money required greater care".

The Prime Minister didn't answer the question, but instead used the opportunity to attack National. 

She said the cost of living payment was a "much more targeted and focused way of supporting New Zealanders" than National's proposal of tax cuts - by indexing thresholds to inflation - which would also benefit those making more than $180,000.

Luxon wants the Government to apologise.
Luxon wants the Government to apologise. Photo credit: Newshub.

In response to another query from the Leader of the Opposition about whether the Government will "work out how much taxpayer money has been wasted" due to the cost of living payment rollout, Ardern again took aim at National.

She said National was attacking every one of the Government measures to support Kiwis through the cost of living crisis and that the Opposition's policy was "wasteful".

However, Ardern did say 31,000 people had been identified who received the first payment but won't automatically get the second on Thursday as they could be ineligible. Instead, those people will have to contact IRD.

The Prime Minister's attack on National and Luxon didn't let up through the rest of the exchange. 

Luxon earlier on Tuesday called on the Government to apologise for its "poor use of taxpayer money".

"It is not the Government's money. It is people's who have worked incredibly hard, would have liked to have kept it in their own pocket probably, have given it to the Government and the Government has sprayed it around to dead people, investor bankers and French backpackers."

Neither Parker nor Ardern would apologise. However, the Revenue Minister acknowledged it would have been better to have new screening tests in place from the first payment.

The Government announced on Monday new checks to ensure recipients actually meet the eligibility criteria.  

That includes looking for where an overseas IP address has been used to log into Inland Revenue's website, or where a non-resident individual income tax return has been filed for the last financial year.

Asked by ACT's David Seymour on Tuesday why checks like that weren't in place earlier, Ardern said it was a matter for the Inland Revenue Commissioner. 

"There's a number of refinements that they have continued to make through each stage of this payment. We are, of course, very supportive of them continuing to do that work."

Parker though isn't certain the new checks will stop dead people getting the money. 

"I would be surprised if by the end of this one of the two million people who are getting this payment hasn't died," he told Newshub.