Benefit fraud crackdown cynical - Labour

Last updated 09:03 21/02/2013
David Shearer
DAVID SHEARER: Crackdown a "cynical political ploy".

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A crackdown on beneficiary fraudsters and their partners is a "cynical political ploy", Labour leader David Shearer says.

Associate Social Development Minister Chester Borrows yesterday announced there would be a new offence created targeting partners or spouses of beneficiaries who are convicted of fraud.

It meant both parties would be charged, not just the person wrongly collecting the benefit.

Shearer said today that every time the Government was in trouble it used a beneficiary-bashing announcement to divert attention.

"I don't like anybody defrauding New Zealand and our system as much as anybody else does," he told TV3's Firstline.

But welfare fraud was worth $20 million while tax fraud was $120-$140m, he said.

"So let's do the same thing to those bankers who have partners who knowingly know about tax fraud and let's say 'you guys can got to jail as well'," Shearer said.

The new offence of relationship fraud would hold people to account for any debt incurred by their partners while fraudulently claiming a benefit.

Partners could face a fine of up to $5000 or 12 months in jail and MSD would be able to seize assets owned or jointly owned by a spouse or partner under the Criminal Proceeds (Recovery) Act to help pay off the debt.

About 700 cases a year were expected.

Borrows said there were few options available to prosecute partners who knew or benefited from such offending, leaving the entire debt with one partner.

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