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Pension shocks for migrants

Pension shocks for migrants

Old Feb 5th 2007, 5:58 pm
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Unhappy Pension shocks for migrants

Hi, New Zealand is indeed nice but recently I regretted coming here. I was 65 a few weeks ago and because I have lived in NZ for over 20 odd years, I am eligible for New Zealand superannuation. Shock and horror when I was told I would have to hand over my British State pension before receiving it. Be very aware that ALLimmigrants having a government pension from their old country will be affected. Even Kiwis returning to NZ after years abroad and paying into UK type state pension schemes will have to hand them over. This scam is not advertised in immigrant literature. My UK state pension consists of contributions by me and employers, merely government administered not funded. It could be classed as occupational. New Zealand is bringing in it's own scheme called Kiwisaver in a few months but those contributing to the scheme will be entitled to NZ super. Discrimination or what? There is a battle going on at present with a petition of around 7,000 signatures from people affected handed into parliament last year. Over 50,000 British Ex pats are affected + people from Ireland, Holland and especially America plus about 28 other countries. Section 70 of the Social Security Act empowers the government through WINZ to enable this legalised theft. If like me, you have worked for say 20 years in the UK and apply for NZ super, you either lose one or the other, a great blow to us elderly. Be very afraid if you have already come here under the false notion New Zealand is a modern country. The government is reviewing this Mugabe type plunder, lets hope they do so for benefit of over 28 nationalities here affected by Section 70. I still love NZ, just loath some of it's appalling loathsome politicians!
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Old Feb 5th 2007, 8:19 pm
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Default Re: Pension shocks for migrants

Originally Posted by Brummie Bob
Hi, New Zealand is indeed nice but recently I regretted coming here. I was 65 a few weeks ago and because I have lived in NZ for over 20 odd years, I am eligible for New Zealand superannuation. Shock and horror when I was told I would have to hand over my British State pension before receiving it. Be very aware that ALLimmigrants having a government pension from their old country will be affected. Even Kiwis returning to NZ after years abroad and paying into UK type state pension schemes will have to hand them over. This scam is not advertised in immigrant literature. My UK state pension consists of contributions by me and employers, merely government administered not funded. It could be classed as occupational. New Zealand is bringing in it's own scheme called Kiwisaver in a few months but those contributing to the scheme will be entitled to NZ super. Discrimination or what? There is a battle going on at present with a petition of around 7,000 signatures from people affected handed into parliament last year. Over 50,000 British Ex pats are affected + people from Ireland, Holland and especially America plus about 28 other countries. Section 70 of the Social Security Act empowers the government through WINZ to enable this legalised theft. If like me, you have worked for say 20 years in the UK and apply for NZ super, you either lose one or the other, a great blow to us elderly. Be very afraid if you have already come here under the false notion New Zealand is a modern country. The government is reviewing this Mugabe type plunder, lets hope they do so for benefit of over 28 nationalities here affected by Section 70. I still love NZ, just loath some of it's appalling loathsome politicians!
Yeah, this happened to my mother in law too. She had a Dutch pension that she lost. It really pees me off - old people don't have enough money to keep themselves but are not allowed that little bit extra that would put them into a comfort zone. A couple of years ago there was a lot of talk about 'Grey Power' but I hardly ever hear anything about them now. There needs to be a concerted effort on behalf of pensioners here but the stock answer seems to be that the population is an aging one and the rest of us can't afford to subsidise them! Hah! we end up subsidising them anyway when 'they' can't afford to get their WOF done
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Old Feb 5th 2007, 9:25 pm
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Default Re: Pension shocks for migrants

Hi Batty, sorry to hear about your Mom, she,s one of many thousands robbed by Section 70.
There is hope though, in Labour's last election manifesto, it boasted of equality for all. The usual political election garbage but alas not for us elderly. Our Prime Minister has a particular nasty habit of always referring our letters regarding the pension theft to her Minister for Social Development a Mr David Benson Pope, often referred to as Benson No hope Pope and for good reason too.
This character exhibits all the nastiness of politicians, an arrogant you can't be right attitude, reminds me of a certain Blair I once voted for, forgive me for that!
Anyway, when Labour sqeezed back into power last election, the last minute "Oops I've found $5,000,000 that I can give to students to buy their vote" worked. Such a monaouver didn't quite that well for a good majority, so Labour had to do a deal with the minor parties to get power.
Winston Peters, probably the best politician we have here for looking after the elderly , agreed to back labour on Supply and confidence providing this appalling Section 70 is sorted. No doubt when Helen Clark, our feminist Prime Minister, picked herself off the floor, she agreed.
Mind you, knowing that some of our politicians could make Attila the Hun look a pussy cat, I don't hold my breath.
Any immigration agent worth their salt would give this information out, but where $s are concerned I doubt it. The problem is the wording "State Pension" it makes many here think it residencially based as it is here, 10 years residency, 5 after 20, 5 after 50. It is good. If you have never worked here, been on the dole or your life, or been in prison most your life, it counts a residency and these people are eligible for the Superannuation. Quite right too I think, it shows compassion, however, that magic word is missing in the government's attitude to us migrants and returning Kiwis. I am both, came here from Brum in 1970 but have lived back in Blighty for about 20 years on and off since.
A country can be judged on its attitude to the vulnerable, the young the sick and the elderly. It the last instance, New Zealand has developed an underclass of elderly like me (well 65 ain't old) and rebuffs any alteration of it's stance on the subject.
If fact, many of us have tried to get this problem aired on State TV and radio. Guess what, yes you are right, it's a taboo subject. A sure sign politicians know they are up to mischief.
I do believe however that in the end, this grabbig lot will have to change the rules, after all, this scam has been going on for 40 years.
I once asked my National (Tory) MP, an adequately named fellow Nick Smith, what he thought about it all. It was beyond his programmed brain to understand. His mind is closed tighter that a duck's arse. I well remember his opening phrase, "You people", thinking my delightfull Brummie accent meant I was talking as a Pommie migrant. I reminded him I had been a Kiwi since 1973 and was talking as a returned Kiwi.
Pointless discussion in the end, you'd get more response from a dead animal!
Such is life, my mistake in not knowing these things, information cleverly hidden the immigration department, has put me in a bad position, I work for our local paper delivering news papers (a mobile paper boy) for $12 an hour.
At least this thread will wise people up of the honey trap that is New Zealand for all those with overseas administered (not funded ) pensions.
Regards to all, be ever vigilant!
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Old Feb 5th 2007, 9:35 pm
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Default Re: Pension shocks for migrants

I misread this to be "Penguin shocks for migrants" Sorry, but that was funny to me.
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Old Feb 5th 2007, 11:23 pm
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Default Re: Pension shocks for migrants

I'm confused

If you have a private pension in the UK and bring it over it is still seperate from a NZ govt super?

or are you meaning a UK govt super must be converted into a NZ super not both? - My understanding is that this never changed - it was always a reciprocal agreement so if you retired to NZ you were paid your british pension in NZ via
an NZ super allocation?

Possible resolution cash in pension fund prior to coming over
Buy rental property based on future cashflows
Transfer rental monies across ???
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Old Feb 6th 2007, 12:38 am
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Default Re: Pension shocks for migrants

Hi The bears,
A private pension does not affect entitlement to NZ superannuation.
Here is the rub, I opted once to have my SERPS (UK State earning related pension scheme , National insurance payments) paid into my NHS pension scheme.
The resulting NHS pension, does not affect entitlment ot NZ Super. Crazy, my payments opted into the normal scheme are snafled by WINZ, those same payments opted out, gives my a private pension. The plot gets for ever thicker.
When applying for NZ super, you are asked to state any time spent in another country. WINZ then have an overseas division that gets in touch with the UK or whatever country and that way they can deduce what they can pinch.
Yes, there is a reciprocal agreement. It works well for Kiwis, if a Kiwi who has never worked, been on benefits or in prison, can retire in the UK with a full basic state pension. A poor Brit who has never contributed by National insurance payments gets nowt in their own right.
Confused, yes, I was to start with.
Cheers Bob
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Old Feb 6th 2007, 4:21 am
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Default Re: Pension shocks for migrants

Do you mean you got to the age of 65 *before* you found out what would happen? Shouldn't this have been something that you already researched? Especially given that you have been in NZ over 20 years...
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Old Feb 6th 2007, 5:32 am
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Default Re: Pension shocks for migrants

Originally Posted by Apple12
Do you mean you got to the age of 65 *before* you found out what would happen? Shouldn't this have been something that you already researched? Especially given that you have been in NZ over 20 years...
Not necessarily tbh. My mother in law lived here for 38 years and didn't know until she went to claim it. They had 'retired' to Holland in 1994 and my father in law got both a Dutch Government pension and his pension from NZ. When he died and she returned here, as far as I can remember, she was given the choice of receiving either the Dutch OR NZ pension (or something like that ). I know the currency fluctuation came into her decision to forego the Dutch one. Sorry for not knowing all the details but it's a few years ago now, before we got here. I must ask her again.
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Old Feb 6th 2007, 5:35 am
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Default Re: Pension shocks for migrants

No apple 12,
I really found out about it it after I returned from 11 years in the UK, 5 years ago. Whilst I say shock horror, being involved with the fight via the website and I hope you have read it all, I thought that I could win by claiming the pension as an occupational one. Section 70 names pensions that are granted, in other words, a government residential pension like NZ's or a benefit.
In 2004, a Fijian Indian had his pension removed and he fought it in court. He won, much to the chagrin of the Ministry for Social Development. On appeal by the MSD he still won. The reason the court gave was that there was no government funding involved, they classed it as occupational. See the website. This was the argument I was going to fight with.
As daft as it sounds, it is very well hidden. Nothing was ever mentioned in immigration information up until about 4 months ago. A friend of mine has a brother who worked in the NZ High Commission in London for over 12 years.
He returned 3 years ago to retire here and my Mate paul said that he is surprised to find out about this scam.
To test what he said, I set up a hotmail address and questioned the NZ High commission to see if they did actually know. It took a while but in the end, they said no, it was up to me to contact WINZ.
So many complaints have been made to the Human Rights Commission, a toothless tiger in reality up to now, that finally the HRC are going to pursue the government, I hope!
There are many many people here unaware of this situation, as I said before, it is extremly well hidden.
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Old Feb 6th 2007, 5:13 pm
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Default Re: Pension shocks for migrants

So will my Army pension be safe, but state pension gets transferred?
If so, that's fine with me.
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Old Feb 6th 2007, 6:19 pm
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Default Re: Pension shocks for migrants

Hi haze and steve,
I am not an expert but I would say you would not be affected. My only concern is that I would hate others to get caught, like so many here hence the blog.
Those of us battling this mess are kept up to date by the guy running the website.
This is the latest info, a message put out by the government.

GOVERNMENT RESPONSE TO REPORT OF SOCIAL SERVICES COMMITTEE ON PARLIAMENTARY PETITION 2005/60

Presented to the House of Representatives in accordance with Standing Order 253


INTRODUCTION

1 The Government has carefully considered the Social Services Committee’s report on Petition 2005/60. The Government welcomes the Committee’s report, which highlights the important issue of the treatment of overseas pensions paid to New Zealand superannuitants. The Government responds to the report in accordance with Standing Order 253.

2 The Government is currently undertaking a comprehensive review of the treatment of overseas pensions paid to superannuitants and the payment of New Zealand Superannuation overseas. It is intended that a paper on the treatment of overseas pensions and related issues will be considered by Cabinet in early 2007. Legislative implications, if identified, will be progressed during the life of this Parliament.


RECOMMENDATION AND GOVERNMENT RESPONSE

Background

3 Rules for the treatment of overseas pensions paid to New Zealand superannuitants are set out in section 70 of the Social Security Act 1964. This policy ensures that New Zealand shares the cost of providing a retirement income with the country where an overseas pension recipient has lived. When a person is entitled to New Zealand Superannuation, the effect of this is to top up their relevant overseas pension to the level of New Zealand Superannuation entitlement so that a person (or couple) living in New Zealand receives a pension entitlement which is the greater of either the overseas pension or the New Zealand Superannuation entitlement. The Government is currently conducting a review of the treatment of overseas pensions paid to superannuitants and the payment of New Zealand Superannuation overseas.

4 The Social Services Committee considered Petition 2005/60 which requests a select committee inquiry into the appropriateness of, and the administration of, the provisions contained in section 70 of the Social Security Act 1964.

5 The Minister for Social Development and Employment provided a response, dated 16 August 2006, to a Committee question on the Petition.

6 The Social Services Committee presented its report on the Petition to the House of Representatives on 7 September 2006. In its report the Committee made the following comments.

“We understand that aspects of New Zealand Superannuation, including the direct deduction provisions contained in section 70 of the Social Security Act 1964 which impact on equity issues for those with private overseas contributory pension schemes, are currently being reviewed by the Government.

We believe that it is inappropriate for the committee to duplicate the work of this review. However, given the ageing population and immigrant component of New Zealand’s current demographics and the widespread concerns conveyed by the petitioners, the Government’s review should be accorded urgency.”

Recommendation

7 In its report the Social Services Committee recommended:

“that the Government make plain the aims, scope and timing of the review.”

Response

8 The aims, scope and timing of the Government’s current review of the treatment of overseas pensions paid to New Zealand superannuitants and the payment of New Zealand Superannuation overseas are outlined below.

Aims of the Review

9 The aims of the Government’s review are to:

• review the current policies relating to the treatment of overseas pensions paid when a New Zealand superannuitant is receiving an overseas pension similar to New Zealand Superannuation to ensure that they meet today’s requirements and those of the future
• consider issues raised with the payment of New Zealand Superannuation overseas.

10 These objectives encompass the Government’s commitment, under its Confidence and Supply Agreement with New Zealand First, to “investigate ways to improve options for senior citizens who may be eligible for foreign pensions as well as New Zealand Superannuation”.

Scope of the Review

11 There are two areas of focus to the review: the treatment of overseas pensions paid to New Zealand superannuitants, and the payment of New Zealand Superannuation to people resident overseas. The legal provisions relating to these components are set out in section 70 of the Social Security Act 1964 and sections 21 to 35 of the New Zealand Superannuation and Retirement Income Act 2001.

12 The specific criteria guiding the review are to:

• ensure adequate incomes for persons eligible for New Zealand Superannuation
• provide consistent rights that are fair and equitable
• ensure that policies are fiscally sustainable and administratively effective
• ensure that policies are acceptable to the international community.

Timing

13 Officials have reported on the various issues under the scope of the review and further work is currently under way. Cabinet is due to make decisions in early 2007. The proposals will be assessed against other initiatives in relation to the Budget process. Legislative implications, if identified, would be progressed during the life of this Parliament.

Conclusion

14 The Government is aware of the interest in the current work on the issues related to the treatment of overseas pensions and the payment of New Zealand Superannuation overseas. The current review of these provisions has a high priority and Government is progressing this review with urgency.

15 The Government would like to thank the petitioners and the Social Services Committee for highlighting this important issue.

__________________________________________________ ___
Immigration is a big step, but in todays world so much easier. It is so easy to spend time here and try. Many people now house swop. So easy, just pack a suitcase, hop over and try the place out. Then make the decision. We are house swoppers, we are in Nelson and have swopped with Auckland, Birmingham and Bristol. If anyone is interested, we are heading back to Blighty around April, we have 2 kids in London, and are looking for a swop within about 100 miles of it. We are going over for about 6 months. Our house can be seen @ http://www.warmfit.com/home.exchange.htm One thing I will say, the housing and enviroment available here are superb. Buy a piece of land and build your dream house. We bought this place for its location and difference. Oh, and one more thing, if you are coming over and have a house full of furniture, bring the whole lot out. Sit down over a glass of wine one night and list all the things you own. Then see what they would cost to replace if you got rid of them. We have moved back and forth between the UK 4 times and have always used containers, a 20 footer cost us about £1,400, it would cost hundreds to to send a personal things in a few boxes anyway. Make sure your container is not a pallet container, they do not have the securing rings all along the top and bottom. Any thing else I can help anyone with just ask. Cheers
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Old Feb 7th 2007, 10:14 pm
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Default Re: Pension shocks for migrants

This is a really brilliant, helpful thread. Karma to you.

I will be one of those that will be effected by this. I paid in for 30 years before coming to NZ. I contracted in and also out of SERPS . I was aware that UK state pension would be frozen as an ex-pat and not entitled to rises in line with inflation.

Thanks for all the info.
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Old Feb 8th 2007, 12:26 am
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Default Re: Pension shocks for migrants

Thing is BEVS here, when did you come out here, because it would be interesting to hear if the immigration dept or any body else knew about this?
I think that New Zealand is having to face reality.
It is trying hard to do a deal for closer ties to Australia and Cullen, our Minister for tax and grab anything, is over there talking to his opposite about this problem, here called portability of pensions. They both are into pension pinching. Australia operates the same kind of scam but slightly different. I could be wrong but I read some time back that after nicking your overseas pension as NZ does, it gives it you back on reaching 75 and taxes it @ 40%. Hmm! like slightly withdrawing the knife it embedded in your back. Clever though, how many get to that age but at least it's something NZ doesn't do, it leaves the knife firmly embedded.
The group that is fighting the NZ government is just ticking over, our government are supposed to be reviewing the practice, but who in modern life believes everything politicians say?
If it doesn't, it stands a chance of a class action against it in the courts by many of us and that indeed will be interesting.
Another line of attack being considered will be a petition to the international body that oversees this kind of legislation.
We will wait and see, not too long I hope as I am losing £76 a week, that's NZ super @ $203 week.
Cheers!
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Old Feb 8th 2007, 4:01 am
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Default Re: Pension shocks for migrants

You might be interested to know that as a kiwi moving to the UK about 15 years ago, there were many companies advertising to opt me out of SERPS, which I then did. I think the logic used (it was awhile ago so my memory is a bit poor) was that if you were likely to retire to NZ, then there was no way you could get any net value from contributing to the UK scheme.

Anyway, good luck with your lobbying, it is clear to me that people's own contributions should be ringfenced from the reciprocal clawback arrangements, as probably should employers'.
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Old Feb 8th 2007, 5:01 am
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Trying to keep this in simple terms, clearly a lot of people feel hard done by these rules, but they are IMO fair. My understanding is because of the dual taxation arrangement between NZ & UK, you can only claim one State pension. It seems a little unfair to suggest that NZ is robbing people of their UK pensions as that is not the case.

If you haven't paid UK National Insurance contributions for the period you were away from the UK, then you would not be entitled to a full UK State pension. Having spent the missing 20 years in NZ, you would also not be entitled to receive a full NZ pension. Assuming then that one is due half a pension from UK and the other half from NZ; whilst living in NZ the State here will in effect collect your UK pension, make up the difference and pay you an NZ pension.

Seems pretty fair way of doing it to me and makes things less complicated, instead of getting two seperate pensions from two differing countries you just receive the one. UK State pensions for expats are not index-linked so if you retire on £x pounds at aged 65 you would only ever get the same amount until the day you die.

I hope that makes sense.
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