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MSD welcomes ASA decision on misleading wage subsidy advertisements

28 July 2023.

The Ministry of Social Development (MSD) has welcomed the Advertising Standards Authority’s decision to partially uphold its complaint over misleading advertisements about the COVID-19 Wage Subsidy Scheme across multiple platforms.

The Complaints Board found the Institute had breached the Advertising Standards Code in relation to Principle 2, which requires "advertisements must be truthful, balanced and not misleading", in relation to Rules 2(b) and 2(e).

The Rules say that advertisements must not mislead or be likely to mislead, deceive or confuse consumers, abuse their trust, or exploit their lack of knowledge; and that in advocacy advertising, opinion in support of the advertiser’s position must be clearly distinguishable from factual information.

The Board said some of the factual statements made in the wage subsidy advertisements were misleading because they had not been adequately substantiated. It ruled that the advertisements should be removed and not used again in their current form.

MSD’s Deputy Chief Executive of Organisational Assurance and Communication Melissa Gill thanked the Authority for providing clarity.

"There is a substantial ongoing programme of work at MSD to provide assurance that those who received wage subsidy payments were entitled to them.

"Wage subsidy repayments recently topped $820 million as more continue to come in. We’ve also brought 37 people before the courts in relation to about $3m in payments, and referred 11 significant and complex cases of wage subsidy misuse to the Serious Fraud Office."

MSD had also suggested the complaint be considered under Rule 2(c), on Use of Data. However, the Board Chair said it was more appropriately considered under 2(b). The Board accordingly found there was no breach of Rule 2(c).

About the Wage Subsidy:

  • The Wage Subsidy was a high-trust scheme that provided rapid payments up front to businesses affected by COVID-19 restrictions to help prevent job losses and business closures.
  • About $18.8 billion was delivered through the scheme in 2020 and 2021 to support more than 1.8 million jobs.
  • Overall, 47 per cent of New Zealand jobs (excluding sole traders) received at least one of the 2021 wage subsidies.
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