(shame about the heating cash)
In November 2017, I encouraged retirees to put out their hand and claim the $700 Winter Energy Payment as soon as Work and Income allowed you to. After all, it was an election promise and the outgoing Government intended to pay the money without an application or a cold-granny label.
December 2017 arrived and the new Government had its ears on. You no longer needed to apply and rich people could pay it back if they objected (high-five, both points were mentioned in this newspaper).
In the announcement on the Beehive website, it was noted that payments would be made over 13 weeks in 2018 (a late start in July), whereas in 2019 it would begin in May for 22 weeks.
Innocently, I figured this was a systems issue. New Government, new payment and Work and Income needed time to get it up and running. Surely they’d just divide $700 by 13 weeks. It was a gold-plated election promise and Winnie would surely be a guard dog on this one.
Errr no. In all that innocence I missed the words ‘‘When fully implemented, the annual payment will be…’’ They’re talking about 2019 being the full implementation date.
The election promise was clearly a 2018 winter warmer. Can you imagine Labour going head-tohead with National’s $680 increase and proudly parading a $413 kilowatt floppy carrot?
A financial haircut of $287 is a substantial amount in kilowatt hours – 1190 kWh to be exact (going by my own anytime-rate). It’s at least a month’s power in winter to most pensioners.
I didn’t discover this until I had a chat with a disgruntled firewood collector who looked more closely at the Work and Income website. Let’s just say my father is most displeased and dismayed I hadn’t informed him of this ‘‘diddling’’ (his words, not mine).
I might have been slow on the literacy test, but not on the maths. The financial cynic in me quickly saw the calculation. Over the next two years Labour’s energy payment will remain fiscally neutral. They wanted to pay 80 per cent of couples $1400 over two years.
Making you apply for this winter treat would see a fifth of people fail to claim it. The Julymanoeuvre means they’re now paying you $1113 over two years. Voila, the new payment is 79.5 per cent of the promised payment. Well done, bang on budget boys and girls!
What happens in the winter of 2020? Who cares, it’s pensioners promise time again on the eve of a new election.
On a final note, watch out for the winter holiday clause. Those of you travelling overseas with your hard-earned savings are going to get pinged. Stay away more than four weeks and your Winter Energy Payment stops. You need to apply for reinstatement if you get home before October. Janine Starks is a financial commentator with expertise in banking, personal finance and funds management. Opinions in this column represent her personal views. They are general in nature and are not a recommendation, opinion or guidance to any individuals in relation to acquiring or disposing of a financial product. Readers should not rely on these opinions and should always seek specific independent financial advice appropriate to their own circumstances.