Ombudsman appeals to reason and fairness

Knighted in 1961, Guy Powles was made New Zealand's first Ombudsman in 1962.

Sir Guy Powles passionately sought justice for New Zealanders who had worked overseas.

The following extract on Powles’ efforts to reform overseas pension legislation is taken from Michael Bassett’s “The Ombudsman in New Zealand”:

“One lengthy battle the Ombudsman lost was over the reduction by the Social Security Commission of New Zealand superannuation benefits in the cases of pensioners, qualified as of right, also entitled to overseas benefits.  The Commission ruled that they receive in total the greater of their overseas pension or a New Zealand pension.  Powles argued that, although it was allegedly a long-standing practice, the Commission had no statutory authority to make a blanket discrimination against overseas pensioners, to thus ‘cut down to size’ pensions not otherwise means-testable, and that the Act which allowed this was also unjust.  The superannuitants were entitled to the full benefits from both sources.  The Commission, supported by the government, rejected his recommendation.  Powles refused to accept that as a matter of principle the Commission could lawfully overlook the merits of the individual cases and refuse to exercise a discretion expressly granted by statute.  The issue simmered long, but Powles felt that his hands were now tied over this ‘unjust policy’ with ‘harsh’ effects.

“He expressed his views in evidence before the McCarthy Commission, which concluded that overseas pensioners should not be better off than their New Zealand counterparts, but did limit the Department’s discretion to determining whether the overseas benefit was analogous to a New Zealand one.  Powles argued that substantial injustice would still remain.

“In 1972, the injustice was compounded by the Department’s decision to deduct from the New Zealand pension the gross amount of the overseas pension, disregarding tax already paid, reducing the overseas pensioner below the New Zealander.  Powles’ representations resulted in discussions between Social Security and Inland Revenue.  A reasonable solution was finally reached whereby tax adjustments returned overseas pensioners to the same footing as lifelong New Zealand residents.

“He also failed to budge Social Security over its recovery of overpayments, regardless of circumstances.  Following the Judicature Act 1908, Powles objected where it caused hardship and the person concerned had changed their living circumstances because of the overpayment.  He won a limited concession concerning altered circumstances, but the department imposed an arbitrary rule that it would recover in all cases where the person affected had certain levels of cash assets.  Powles regretted this ‘explicit shackling of a discretion’ which contradicted an express statutory provision.

“These examples revealed that if a department remained obdurate then the Ombudsman’s appeals to reason or fairness could ultimately be resisted."

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