Government's fiscal fiascos: New cost of living payment, scrapped KiwiSaver tax revelations

Newshub can reveal that on the day of the first cost of living payment officials identified thousands of clients with overseas addresses who still managed to receive it.

Internal messages also reveal an IRD staff member accused Kiwis of trying to game the system.

Newshub has also uncovered details of another fiscal fiasco we could've avoided.

Australia's a good 4000km away from New Zealand, so when some Kiwis living there got the Government's first cost of living payment, they were left wondering why the bloody hell they got it.

"I've not paid taxes in a very long time," Charlotte Castle, a Kiwi living in Australia, told Newshub in August.

Internal communications obtained by Newshub show on the day the first lot of cash went out, officials identified more than 6500 people who'd already told them they were living overseas, but still received the payment.

One IRD staff member even laid the blame at the public's feet, writing: "In any population, there will be some small minority that attempt to game the system".

Nicola Willis, National's finance spokesperson, wants Revenue Minister David Parker to "front up and tell New Zealanders how many ineligible people received this".

Inland Revenue told Newshub the 6500 people had met the criteria for the cost of living payment but had requested their mail be direct overseas, which should surely be enough for the tax department to question their eligibility.

Parker said they've now added an extra screening process to catch anyone not actually in the country.

Hot on the heels of that cost of living cash catastrophe, the Government followed up with its Kiwisaver tax conundrum.

Newshub's uncovered that officials saw the public backlash coming, so proposed options to soften the blow. They included an increase to government KiwiSaver contributions or tax cuts if the policy went ahead. 

But they never made it into the final paper.

"Because we hadn't done any policy work on developing them up and we wouldn't until after we had that revenue secured into the future," Parker said. 

Willis said: "This is typical Labour. Tax first, answer questions later."

They're fiscal fiascos following Parker, our tax man, around.