8% interest rate on Legal Aid will please Private Prisons


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Upset as legal aid bill to charge interest
A Timaru man paying off his legal aid bill at $5 a week is upset that from March he will be charged 8 per cent interest.

In November 2009, Scott Keown faced a charge of assault. He initially pleaded not guilty but, following an evidence depositions hearing, was offered diversion.

He was given legal aid and accumulated a bill of $9000, as he had initially planned to challenge the charge.

“One of the witnesses didn’t turn up and they offered me diversion. If I had fought it, it was going to cost me a lot more so I took the diversion.”

He had been paying it off at the minimum of $5 a week, opting to do that as he had been told it would be interest-free. He also had to pay $4000 reparation to the victim and paid that off at $50 per week

This month Mr Keown got a letter stating he would be charged 8 per cent interest from next March. He currently owes $5500 and is one of 50,000 people affected.

What many do not realize is that Legal Aid is a loan. You have to pay it back and the Government’s plan to charge 8% interest as a penalty on Legal Aid is an abomination, especially when you consider that’s a penalty rate far above the inflation rate.

The Government intend to make a profit off the legal aid debt, just consider how appalling that position is.

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It’s an outrage that Legal Aid is a loan and that its eligibility is set so low that anyone earning the minimum wage wouldn’t qualify. The thresholds need to be significantly lifted and Legal Aid should be seen as a cost of a socially just society and not a user-pays loan to make a profit off.

Those who take Legal Aid so that they can defend themselves with the cheapest lawyer Legal Aid will pay for are now going to have to pay a crippling 8% interest on top of that debt. What are the ramifications of policy as brutal as this? The working poor and beneficiaries face either a life of poverty if they are brought before the Courts or they simply choose to plead guilty rather than face a life of debt servitude.

We have the money to pay the richest NZers billions in tax cuts but we don’t have the money to properly fund Legal Aid so that the poor can obtain Justice when the Police use their vast new spying powers to charge them.

The only people happy with this are the Private Prisons who will be waiting for the new influx of prisoners too poor to plead innocent.

Justice is blind and just became bankrupt.

Welcome to NZ 2013.


    • A $9,000 legal aid bill, even though the case wasn’t contested in the end! Does his lawyer use a diamond-encrusted gold pen?!

    • Some basic, general info on legal aid by Citizen’s Advice:


      As far as I heard, the regime has been tightened, so yes, one can get legal aid while earning above the minimum wage, but that depends on necessary outgoings for reasonable causes, like rent, housing costs, childcare, and so forth, but as I understand it, it is not that generous anymore.

      it also depends on the type of charge and so, whether aid will be granted, same of course, whether a person has substantial assets or not.

      Hence the greater effort by the Ministry of Justice to recover aid where possible.

  1. It’s simple, if the state funds the prosecution, it should also fund the defence. Both are equally important facets of the judicial process.

    NZ’s broken judicial system requires a complete overhaul and this overhaul needs to include the creation of a body to review criminal convictions which independent of the judiciary.

  2. And who is responsible for the idea to charge 8 % interest on legal aid ?

    That individual is the person to whom we all must focus our outrage . They are making us personally accountable . We must therefore make them personally accountable in return .

    Does it make you ponder that Westpac is the IRD’s prefered banker ? It’s also the bank of choice for the Police to whom you pay your traffic fines .

    Westpac is Australian owned . You’d think that the NZ government would at least prefer a New Zealand owned banking institution .

    I’ve suggested this before . Lets kick the banks out of NZ . What’s the worst that could happen ? We wouldn’t starve to death . The cat wouldn’t suddenly disappear . The sun would still rise . Life would go on . The difference would be that you wouldn’t have a faceless enemy sucking us dry , stealing our lives and creating the army of criminals that are chocking up the courts and prisons .

    Oh yeah . Drone attacks and american corporate aggression . Sorry , I keep forgetting .

    I also noticed on the news the other night that the Insurance Scum are getting jumpy about people in CH Ch buying perfectly livable albeit uninsurable houses and saying ‘ up you ‘ to the risk of not being ‘ insured ‘ . We’ve become so effectively indoctrinated by bank and insurance propaganda that we can no longer believe that life is possible without them . It’ll be the Banks behind this 8% swindle I can guarantee it .

  3. Hang on a minute, Scott Keown was clearly found guilty. He has the nerve to pay back his taxpayer funded loan at the rate of $5 per week. Damn right he can pay interest on it! And that goes for anyone else found guilty and expecting me to fund their defence. Not only should we charge interest but they should have their benefit or other income docked a significant amount each week to repay their debt to us. The minimum should be $50. It’s about time we got serious about the consequences of crime.

    • Hang on a minute! He’s paying off his debt to the victim at $50 a week. First things first, surely?

      And dear old Bridgecorp paid out at 10c in the dollar, with chunks off for IRD. Didn’t see no +8% interest tacked onto that…

  4. And those that cannot keep up with their payments, they will end up before courts again, get yet more of a fine, and will forever be placed in modern day “servitude” and “slavery”, owned by the state, to do any forced work that will be remunerated so lowly, they will never get out of it.

    Those that dare rebelling or escaping, they will be locked away permanently, in chains, and if they do not voluntarily plead guilty, they will face “water boarding” to deliver the “truth” the state wants.

    Freedom and democracy? Ahem, that is only our “100 per cent pure” aspirational window dressing, towards the rest of the world.

    It is dictatorships that work, that is what John Key learned through his close ties with the top leaders on global summits. He also “loves” to learn how the Chinese do it so successfully.

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