An Auckland woman says she was denied some of her benefit because she got a loan from her uncle to help build a wheelchair friendly home.
The woman described trying to get support from Work and Income as a "living hell". Photo: RNZ / Eva Corlett
It's another case that's come to light after a High Court decision this week that found the Ministry of Social Development was wrong to class a beneficiary's personal loans and credit card as income.
The West Auckland woman, who is wheelchair bound and a single mother of four, has described trying to get support from Work and Income as a "living hell".
After an accident that left her unable to walk five years ago, her husband left her and their four daughters. Soon after that, the bank forced them to sell the family home.
At that time, the woman had an accommodation supplement coming in, but that stopped when she got a $120,000 ACC payout for losing the use of her legs.
"That payment caused me a big issue around being penalised, even though it was for my legs," she said.
"It was upsetting because it was a small payment to lose your legs and try and get on with your life."
"I tried to fight them but it was just impossible."
The family went from rental to rental, but finding an affordable house for four children and someone with a wheel-chair was "impossible", she said.
The woman said she needed her payout, and the funds from her house sale, to build an accessible house but the family was dipping into the money every day to survive.
Her parents stepped in after the family started living in a basement and allowed her to build a small granny-flat at the back of their property.
She saved every dollar of what remained of her payout to build the tiny flat. The downstairs bedroom, living room and kitchen are squeezed into one space. Upstairs, the girls share a couple of bedrooms.
But when the bank refused to loan the woman the money to finish it, she went to an uncle for help.
When she recently tried to get the accommodation supplement again, she said WINZ told her the uncle's loan counted as income.
"Trying to better myself has not been to my advantage at all," she said.
'It's been a battle'
The woman receives a supported living benefit and an IRD payment for her two youngest daughters - a total of $557 a week
Her older children, one who's a student and the eldest, who's her carer and also works part time, help cover her costs.
"It's been five years of living hell," she said.
"Trying to live with your injury and all the other issues around that - it's been a battle."
"Anyone could be in my position, it's just been bad luck."
Her 21-year-old daughter, who is also her carer, said financial pressure took its toll on the whole family.
"I find myself worrying about how we're going to get money for the next thing that comes up, or mum's car."
"I know it's going to be a problem. You kind of have to start worrying about stuff you shouldn't have to be when you're the kid," she said.
However, Viv Rickard from the Ministry of Social Development said the loan from the uncle was not the reason her accommodation supplement was refused.
He said the cash from the ACC payout and the house sale meant that the woman was ineligible.
"Once you earn over a certain amount... we don't have the discretion over and above that," he said.
At the time of her payout, he said, MSD understood the woman was in a difficult position and so they sought legal advice to find out if there was any exception they could make on compassionate grounds.
"Unfortunately, after exhausting all efforts, we were bound by the law to stop her Accommodation Supplement."
It said the woman told WINZ about the ACC payment two years after she received it, but they decided not to pursue overpayment.
Despite what Mr Rickards said, the woman maintained MSD told her it was the loan that was to blame the second time she sought their support.
WINZ has been in touch with the woman since RNZ requested an interview.
It said she might be eligible for support again and had set up an interview with her today to determine what that might be.
