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Capping loan sharks is great – now what about the debt the State agencies load onto beneficiaries?

By   /  October 12, 2018  /  19 Comments

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It’s just another feel good promise that hasn’t even been implemented while the Government continues to act just as cruelly as the behaviour they are legislating against.

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Well done on the Government finally doing something to cap loan sharks.

In the future of course.

Not now.

So let’s rephrase that, well done the Government doing ‘something’ at ‘some undefined point’ in the future about capping dirty filthy scum loan sharks.

Like all things this Government does, it’s too little too late.

So while they’re patting themselves on the back over promising to do something about loan sharks in 2020, how about the other evil scum bag when it comes to plunging beneficiaries into debt – the Government itself?

Reports obtained through the Official Information Act revealed that as of March 2018, half a million people are in debt with the Ministry of Social Development, with the total debt being $1.5 billion. Most of the debt comes from overpayments and recoverable advances for basic necessities such as clothing, furniture and petrol. Weekly repayments are set by MSD, with some low-income people expected to pay up to $80 a week which comes out of their benefit.

Add to that the sexist and cruel billions in penalties for child support, the vicious student loan repayment system that keeps students from returning home and which has more tax chasers than the rich white collar criminals get and  the legal aid farce which forces poor people to plead guilt rather than take out debt to get legal representation.

How dare this government clap itself on the back over predatory lenders when the Government is the worst predatory lender of all!

It’s just another feel good promise that hasn’t even been implemented while the Government continues to act just as cruelly as the behaviour they are legislating against.


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  1. CLEANGREEN says:

    Ii’t time Government forced the Global corporates stepped up and finally paid their share of taxes since they have been rorting our system.

    Especially since 2008 when the wheel wheeling John Key Government opened up our public owned assets to the ‘fire sale’ to let them buy our assets we had paid for for generations and never ever got anything back them for robbing our assets.

    The poor and elderly, need a break here now at least in fairness as they were some of those who paid for the assets sold off to the greedy global corporations!!!!!

    • countryboy says:

      Dead right @ CLEANGREEN. Isn’t it a pain in the arse? That you have to suffer the slings and arrows and grunts and squeaks of the terminally stupid to get your sane and perfectly correct points of view across?

      And Jesus. Apologies for the shit grammar in my last comment. Was in a hurry and had blood/sugar jitters. Was straight out of bed, stood on the dog, peed on the toilet seat, burnt my toast, now vacuuming the house because my Girl’s coming to visit ! Yaaaaaaaaayayaya aa aa a ! ! ! ! !
      Just thought I’d share that.
      A question. While I’m here?
      Has anyone thought to ask the ghost person whom we pay to be invisible; The Governor General, what she thinks of the by now well recognised traitorous swindle that selling our tax paid for stuff and things was?
      That swindle was one of our security doors left unlocked by scum like roger douglas that’s led to so much unnecessary suffering in the waged-in-poverty and those out of work or are sick and worn out before they managed to get to 65?
      I wrote to QE2 about that and she said she’d chase up the mythical Governor general…
      I get a reply from HRH QE2, right? But not a word out of her rep here?
      Lets go and find the GV? Fucking ask her what’s what? Get Jonky too. Get them together on TV with a live feed to here @ TDB?
      Why not?
      We must remember, like it or not. We’re a British Commonwealth country. ( Sorry Maori but bear with, bear with. )
      They answer to us, and we obey their laws. Not the fucking yanks? Not the equally fucking Chinese, not the entirely dubious fucking Israeli’s with their hand up jonky’s arsehole, making him pop out brain fart lies for a dollar and to pave the way for a hoard of self titled Zionists to potentially come here and take pot shots at our kids. None of them fuckers.
      What happened, specifically back in the 1980’s fucked us. More than thirty years on and we’re ever more fucked while the scum who did this to us get old while they enjoy the swindled wealth they plundered and they will be hoping they die before we twig on. I say fuck that.
      Put them in prison with the ‘Damaged’ whom they’ve created.
      Make the GV get up of her fat arse and fucking do something.
      Or sack her and give her salary as cash to the homeless.
      What does she earn by the way? Anybody know?
      Ok. I looked it up.
      I have to do everything around here. Joke.
      To quote Wikipedia
      “The current salary is $425,000 and there is a generous pension. Until 2001, Governors-General did not pay income tax on their salary; this was changed after the Queen agreed to pay tax.”
      So? An invisible public servant that appears to do nothing of any real worth is ‘earning’ $425,000.Other than, perhaps, to sit back and watch NZ/AO homeless people starve and go cold of a winter? She watches on, wrapped in money, as we tank in a spectacular fashion across the board? She was shoulder-tapped by jonky?
      You angry as me yet?
      Yes. I bet you are.

  2. Michelle says:

    When I was on the DPB benefit and I needed a washing machine or fridge we were given what was called an advance payment and we paid it back @ 5$ a week or more if we could afford it.
    I found this to be good policy. But under the national government the debt racked up is 1.6 billion something like this amount. How did it get so big ?How much of this is from rent to stay in those ugly short term motels and why is the national government saying they will consider erasing the debt when it happened mostly under their watch as they treated beneficiaries and the poor like shit instead of genuinely helping them.

    • Marc says:

      So you found it a ‘good policy’ to pay back out of your ordinary benefit (meant to cover food, accommodation, power, water), which will have been kept low since ‘Ruthanasia’ ruled in this country, at $5 a week?

      They forced you to cut back on food and so, to do that, that is the truth, and that is NOT good policy, for sure, it is unfair, it is creating hardship and enforces a hopeless situation of poverty for a person.

    • SPC says:

      A better approach for those with children would be to advance the money as an interest free loan repayable on employment/re-marriage/etc.

  3. countryboy says:

    ‘Capping’ loan sharks ! Fuck that! Outlaw the bastards!
    The rich don’t need them so loan sharks, by breeding and design, will ever only target the poor.
    And why are the poor struggling? Well, one of the many reasons is because the riche and politicians made off with their stuff and things from which foreigners now make money but should be free to them because, their resource dumb asses! What’s more, that money should stay in NZ/AO. It’s the Nu Zillind riche clogging up the Koru Lounge on the way to the sixteen bedroom, thirty two bathroom, fourteen kitchen, with twenty eight ovens and thirty nine stainless steel fridges with names that remind me of wiffy foreskins and nine car garages and all in the ever ‘trendy’ shist holiday play house in Queenstown dahlings who impoverish those who must seek the loan shark’s vile services. Loan sharks are mafia without the class and the best that can be done to protect us poor people from them is to ‘cap’ their fucking evil greed!? FUCK THAT. Burn the fuckers out like the rats they are since they’ve clearly taken over the kitchen.
    Now? Where was I?
    Oh yeah.
    The foreign banksters.
    Bankster employees? Cheap, loan-shark, mincing nancy, store bought budget mafia types driving leased shiny black European Parnell Tractors ( Tax concessions Mate ) and all hifalutin in their frilly little mini Mc Mansions in Ponsonby. I bet junkies could main-line their toilet water and stay high for months. A riche persons dope shit biscuit anyone?
    ( It’s a thing. Meet Jessa Reed. https://youtu.be/VcMIeyjggbM )
    Bankster owners?
    Hanging from the roofs of their many caverns. Their little stiffies sticking out at the thought of the misery they inflict on the many defenceless millions. And making lots, and lots and lots of lovely money too.
    Bold, direct action by Labour politicians against those scum is well overdue and so, if it must be done? Do it properly.
    NZ/AO could really , actually show the way here.

    • Aaron says:

      You can’t totally get rid of loan sharks because sometimes they’re the lenders of last resort – they actually provide a useful but ruthless) service.

      There would be no need to legislate against loan sharks if people had enough money to live on because loan sharks would no longer be needed. This is a problem the government could fix today – but will probably think about doing tomorrow. Maybe.

      • Sam Sam says:

        You couldn’t sell any of these financial products to any one in Parnel because they go to school a little bit longer than those in south Auckland. Sorry not sorry. Some times in situations like these you have to be cruel to be kind.

    • Marc says:

      Maybe Martyn misspelled the title and meant decapitating instead of ‘capping’?

  4. Siobhan says:

    People are still signing up to what will still be 100% interest loans because no one in their right mind wants to try and deal with winz any more than they have to.

  5. Marc says:

    Capping debt recovery to 100 percent per annum (incl. fees) may seem like an improvement to some of us, but to be damned blunt and honest, this is not the improvement needed, it falls far short of putting into force controls for credit companies and what we consider as being loan sharks.

    100 percent maximum interest and fees per year is still double the amount of what a person received in credit, be it a loan or something similar, and it is still extortionist a practice and exorbitant for an amount, for this to be allowed.

    It should be something more like 50 percent maximum, or I would prefer 30 percent per annum, not 100 percent. The banks do usually charge no more than about 25 to thirty percent maximum for higher risk loans and credit, that should be a guideline for such a law change.

    And regarding WINZ, they do what the government has instructed them to do, they are merely cold hearted, at times less so, executers of government policy, the law and orders.

    What is needed is a change in law, so that ‘special needs grants’, such as for necessary home appliances (fridges, washers), for urgent needs (having something repaired), for even dental treatment, are no longer recoverable. So far, for many years that is, most special needs grants are expected to be paid back. But the benefit people get is already so meagre, it is tightly set, so to cover only basic needs for food, perhaps cheap clothing, electricity, water and possibly some basic transport costs (I would actually challenge this even being covered on present rates).

    Hence when getting a special needs grant, that must be paid back, WINZ do basically force beneficiaries to cut down on other essentials, to pay back the advance or ‘loan’ given by WINZ, as there will for most be NO other way to do so. But perhaps the idea is, that benefits should only be very ‘temporary’, so people are expected to move off them and get back to work, in order to be able to pay back such debt.

    What about long term sick and disabled persons though? They cannot work, so they should for a start not have to pay back advances. This government has now the chance to address these injustices, and increase benefits (base or main rates) by at least 20 percent, and/or to stop the policy and practice to force beneficiaries to pay back advances that only working persons not being on benefits could be able to pay back, at some time.

    Let us watch this space, but going by their record, if any one minister moves too fast, he or she may upset the MSM, and then the PM, and be disciplined or even be out of a job.

    Hence they call in further advisory groups to buy time, to mellow the public and to delay decisions, that may not even address any of the serious issues and injustices we have, many created by nine long years of a nasty Nat led government, that only really looked after its better off clientele, to exploit the rest as desperate servants in precarious employment, or on poverty creating benefits.

    • SPC says:

      If it felt more motivated, the government could have chosen to put a chunk of its current $5.5 billion surplus into Kiwibank, to enable the bank to offer the kind of micro-loans (in the $500-2500) range that comprise the bulk of loan shark lending. All very well for PM Jacinda Ardern to talk about wanting to eliminate child poverty – but her government isn’t doing much to confront the predators feeding upon the incomes of the families in question. When the accidents of fate strike those with little or no income stored away in reserve, the government needs to be on hand to help. Yet before and after the GFC, the regulatory emphasis has been much further up the socio-economic ladder.

    • SPC says:

      It’s no more than 200% of the loan in repayments, the loan plus no more than 100% in costs – interest, and all fees and charges. This is to ensure that unsecured loans are still available to the working poor but they will not be financially ruined repaying them.

      The alternative is to provide the seed capital for non profit lending to low income earners.

      As for Work and Income changes

      1a sole parents and the unemployed with children should not repay the grant till they go off the benefit
      1b those who made repetitive claims, above the norm, should go onto a spending card
      2. those on permanent benefit (invalids) support should get the needs based grants without need to repay them.
      3. those going onto a benefit while with children should get a loan to help them adjust to their lower income status (to refinance – pay off credit debt and hire purchase).

  6. Grandma Moses says:

    NZ debt clock climbing.
    Everyone get ready!

  7. DennyPaoa DennyPaoa says:

    Hold on a minute! Was that $5.5b slurplus made up from -$1.5b of WINZ debt!!

  8. Denny Paoa says:

    Hmmm? There’s 212 wealthy peeps who pay no more than 1.115% tax on income and nothing on their combined untaxed Capital Gains of more than $200b.
    Time to fuck them up!

  9. SPC says:

    The move is welcome, though why it starts in 2020 rather than 2019 is beyond me.

    The 100% total repayment idea is sound. Loan finance will continue but hardship derived from it will end.

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