A Christchurch woman suffering breast cancer, has also had the ignominy of being told by Winz that her reason for not working was classed as "sexual activity".

A Christchurch breast cancer patient was mortified when she found Work and Income noted her inability to work was down to "sexual activity".

The woman Louise, who asked her surname not be published, was "horrified" when she saw the note on her case file, and asked for it to be removed.

While her case manager at the time assured her it would be, a second phone call confirmed that it was not.

CHRIS SKELTON/FAIRFAX NZ Labour social development spokeswoman Carmel Sepuloni says Louise' treatment has been "appalling" and symptomatic of a "flawed Government policy".

"I just felt, it was too far. I'm annoyed they never took it off, and they're just so dismissive of people on benefits," she said.

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The single mother of one said she did not like the way it "wasn't a big deal for them not to remove it".

KEVIN STENT / FAIRFAX NZ Social Development Minister Anne Tolley.

"I definitely don't want it there - they're my personal records. And what kind of a reason is that to even have for not working?"

Following inquiries to the Ministry of Social Development, National Commissioner Penny Rounthwaite said a coding error was made.

"We have fixed this, and have apologised to [Louise] for any distressed caused."

"Work and Income maintains a list of over 42,000 codes. These codes are not limited to describing reasons for work incapacity.

"A code could be used to describe anything from parental marital problems, to exercise habits, to health conditions," Rounthwaite said.

Louise has a permanent part-time job for a furniture removal company, which she is able to go back to once her treatment has finished.

But her treatment required a few months away from work and a planned mastectomy would extend that, so she was on unpaid leave.

"It still feels a little bit surreal to be honest. I think I'm positive because we've caught it early, but it's a big thing to get your whole breast removed.

"I've got good support around me, but that doesn't include Work and Income."

The offending note on her file was not the only issue she claims she had to deal with. Louise said Work and Income had given her conflicting information from the start.

Work and Income initially refused to accept a medical certificate dropped in by her partner, as Louise was sick in bed - but a separate case manager eventually said it was fine.

She was later told she'd still have to attend seminars on how to look for work, even though she was employed.

"Then I got a letter saying my benefit had come down $100. Early on, I had told them I'd be back at work at a certain date.

"But since then I'd taken a second medical certificate in, so rather than looking into my file, she'd taken it upon herself to just charge me 20 hours work. "

Rounthwaite said Louise's file had been updated however, before there was any impact to her benefit.

"Work obligations do not apply to people whose medical conditions or circumstances prevent them from working or looking for work.

"We understand that illnesses can have a significant impact on the ability of a person to continue working, which is why work exemptions can be made on the advice of medical professionals," Rounthwaite said.

Labour Social Development spokeswoman Carmel Sepuloni said Louise had been "treated appallingly".

"She's done everything right; she has been working, she's gotten sick and then she's gone in there for support.

"And they've treated her offensively, really."

Sepuloni said she did not know why sexual activity would be a reason to collect a benefit, but Louise' experience was symptomatic of a wider policy flaw.

"It's not an isolated case and this is the issue with the way in which the Government has structured the welfare system.

"So people like Louise are forced to go on a jobseekers benefit, which is disingenuous given she does actually have a job to go back to, but she's unwell and temporarily having to access the welfare system."

Sepuloni has a bill in the ballot to expand the criteria of the Supported Living Payment, to include medical patients who need longer term, but temporary support.

Social Development Minister Anne Tolley said an "unfortunate administrative error" had clearly been made.

Work and Income made decisions based on the medical advice supplied by clients.

"If this advice states that they cannot work then the client is not expected to look for work, regardless of the name of the benefit, and this should be conveyed properly to them."

Tolley said she expected all case managers to be "both professional and sympathetic" to all clients.

"Work and Income has had discussions with the Cancer Society and the department knows it must be sensitive to the issues being faced by cancer sufferers, many of whom are coming into contact with Work and Income for the first time."