The Ministry of Social Development are playing down calls it operates a toxic culture in the wake of a damning report by the Office of the Privacy Commissioner. 

The investigation has found that benefit fraud investigators have misused their powers and unjustifiably intruded on the privacy of beneficiaries, with a review of MSD files found text messages between people in a relationship of a sexual, familial or otherwise intimate nature.

Infringements of individual privacy were discovered during the inquiry, particularly in relation to the collection from third parties. In one instance, the MSD obtained an intimate picture shared by an individual with their sexual partner from a telecommunications company.

The picture was then produced during an interview by MSD investigators who sought answers for the picture.

Under section 11 of the Social Security Act, MSD has powers to collect any information about a person on a benefit in order to assess their entitlements.

MSD is first required to seek information from a beneficiary client directly before seeking it from a third party, as per the Privacy Act and MSD's Code of Conduct, unless doing so would prejudice the maintenance of the law.

However, in 2012, MSD advised its fraud investigation staff they could bypass the requirements due to an amendment to the Code.

Following its inquiry, the Office of the Privacy Commissioner recommended MSD cease its blanket application of the prejudice of the maintenance of the law exception.

Following the inquiry, MSD deputy chief executive for service delivery Viv Rickard said the organisation accepted the recommendations.

However, he told Heather du Plessis-Allan he doesn't accept that employees working in New Zealanders' best interests in toxic.

"Can we improve how we do things today, can we be better for our clients, can we do better for New Zealanders? Of course we can." 

On the matter of the naked photos, Rickard says that they are allowed to collect electronic information, but it should meet a threshold that a common person could look at and understand why it was done. 

He says that this is not okay with him, but did not say that it would never happen again.

"We do use electronic information to support whether someone who is maybe getting $10,000 extra a year because they are indicating they aren't in a relationship but they are. A text in itself won't help that but it may be a piece of a puzzle." 

Rickard says that New Zealanders expect them to ensure that people are being paid fairly. 

Changes the MSD made in line with the OPC's current views:

• Amending processes to make sure staff make a case-by-case decision on whether to first go to the client, or to a third party and to make sure the right amount of information is collected.
• Suspending all requests for information to telecommunications companies and police, pending review of the Code of Conduct.
• A commitment to review the Code of Conduct that applies to the section and continuing to work with the Office of the Privacy Commissioner.
• Commissioning an independent assessment of fraud practices and policies.