Hughes and Secretary, Department of Family and Community Services [2002] AATA 139 (5 March 2002)

Last Updated: 18 March 2002

DECISION AND REASONS FOR DECISION [2002] AATA 139

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N2000/1344

GENERAL ADMINISTRATIVE DIVISION )

Re WILLIAM HUGHES

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Dr J D Campbell, Member

Date 5 March 2002

Place Sydney

Decision The Tribunal determines that the decision under review is affirmed.

[SGD] Dr J D Campbell

Member

CATCHWORDS

SOCIAL SECURITY - disability support pension - travel to New Zealand - failure to advise - whether rental assistance and pharmaceutical allowance are payable - Reciprocal agreement - matters of concern

Social Security Act 1991 - sections 132, 133, 1064-D1, 1064-C1, 1223(1), 1224(1), 1236, 1237(1), 1237A(1), 1237AAD

- Schedule 4 - Agreement between the Government of Australia and the Government of New Zealand on Social Security (dated 31 October 1988, last revised 2 July 1998)

REASONS FOR DECISION

Dr J D Campbell, Member

1. In this matter Mr William Hughes ("the Applicant") seeks a review of the decision of the Social Security Appeals Tribunal ("SSAT") dated 10 August 2000 which concluded that the Applicant had a debt owing to the Commonwealth arising from the overpayment of rental assistance and pharmaceutical allowance for the period 19 February 2000 to 11 March 2000. The decision of the SSAT varied the decision of a Centrelink delegate of the Secretary, Department of Family and Community Services ("the Respondent") dated 18 April 2000 which had concluded that the Applicant had a debt owing to the Commonwealth of $162.80 arising from the overpayment of rent assistance and pharmaceutical allowance for the period 18 February 2000 to 16 March 2000. This decision had been affirmed by an authorised review officer on 11 May 2000.

2. A hearing was held before the Tribunal in Dubbo on 14 November 2001, at which the self represented Applicant provided oral evidence. The Respondent was not present, the non attendance being notified to the Tribunal in advance. The Respondent was satisfied to rely upon written submissions made to the Tribunal, which had also been made available to the Applicant.

3. The following written material was placed into evidence before the Tribunal:

Exhibit Description Date

T1-T28 pp1-72 Documents prepared pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 ("T-documents")

A1 "Age Pension News" issue 41, p13 March/April 2000

A2 Centrelink letter to Mr Hughes 14 March 2000

A3 Copy of Centrelink document to Mr Hughes 9 May 2000

A4 Centrelink summary of the Agreement between the Government of Australia and the Government of New Zealand on Social Security 26 October 2000

A5 Copy of Centrelink fax to Mr Hughes 8 March 2001

A6 Copy of Re Potamianakis and Secretary, Department of Social Security (1998) AATA 12887

A7 Letter to Mr Hughes from Registrar of SSAT 10 August 2000

A8 Letter to Registrar of SSAT from Mr Hughes 15 August 2000

R1 Respondent's Statement of Facts and Contentions 4 December 2000

R2 Respondent's Additional Statement of Facts and Contentions 14 November 2001

issues

4. The relevant issues in this matter are:

(a) whether the Applicant was overpaid pharmaceutical allowance and rental assistance in the amount of $127.93 for the period 19 February 2000 to 11 March 2000;

(b) whether this was a debt owing and payable to the Commonwealth.

legislation

5. The relevant legislation in this matter is:

* the Social Security Act 1991 ("the Act") and in particular sections 132, 133, 1064(D1), 1064(C1), 1223(1), 1224(1), 1236, 1237(1), 1237A(1), 1237AAD; and

* Schedule 4 of the Act - Agreement between the Government of Australia and Government of New Zealand on Social Security (dated 31 October 1988, last revised 2 July 1998).

background

6. The Applicant was granted a disability support pension on 5 March 1998. The Respondent sent a letter to the Applicant on 17 August 1998 in which the Applicant's rate of disability support pension, his pharmaceutical allowance and his rent assistance per fortnight was detailed. Further the advice to the Applicant stated (T3):

"Under sections 132 and 133 of the Social Security Act 1991 you must tell us within 14 days (28 days if residing outside Australia) if any of these things happen, or may happen. You can tell us by writing to us, by phoning us or you can come in and talk to us at any of our offices...

If you plan to travel outside Australia, you must let us know within 14 days of making the decision to go. You will need a departure certificate from us before you leave or your pension will stop. Please check with us to make sure of your entitlements during your absence. You may not be entitled to your pension or some of the additional payments for the period you are away."

7. The Department of Immigration on 10 March 2000 advised the Respondent that the Applicant had departed Australia on 18 February 2000 (T5). The Respondent requested advice on this departure, from the Applicant, on 14 March 2000 (T6). On 21 March 2000 the Applicant is noted as advising the Respondent that he had returned on 17 March 2000 (T7). On 18 April 2000, the Respondent advised the Applicant that he had a debt of $162.80 due and payable to the Commonwealth, arising from overpayment of rental assistance and pharmaceutical allowance during the period 18 February 2000 to 17 March 2000, as such allowances were not payable while he was in New Zealand (T10 and T11). The original decision was affirmed by an authorised review officer on 11 May 2000 (T18). On review by the SSAT, the decision was varied in so much as the amount of debt owing was reduced to $127.93, as the SSAT was satisfied that the Applicant had returned to Australia on 12 March 2000, and that the period of absence as a consequence, was reduced from 18 February 2000 to 11 March 2000 (T2, p11). The Applicant has repaid the debt by 14 September 2000 (T28).

applicant's evidence

8. The Applicant informed the Tribunal that he was granted a disability support pension on 5 March 1998 and that he received a fortnightly rate of disability pension plus a fortnightly rate of pharmaceutical allowance and rent assistance, the latter relating to his rental of his accommodation in Dubbo. The Applicant stated that he had met an elderly lady at the St Vincent de Paul Society in Dubbo, who had had operations for bilateral cataracts, and who had, at the time, recently lost her second husband from cancer. The elderly lady was in a fragile state and she asked the Applicant if he would escort her to New Zealand to assist in a reconciliation attempt with an estranged son and a 12 year-old granddaughter. The Applicant stated that they departed Sydney on 18 February 2000 and returned on 12 March 2000, with the lady paying for his airfares, and accommodation and a car being provided by the estranged son in New Zealand. The Applicant stated that the reconciliation was exceptional between the son and his mother.

9. The Applicant told the Tribunal that on returning to Australia, he found a notice from Centrelink, which asked whether he had travelled outside Australia. He stated that he notified Centrelink in Dubbo of the circumstances of his trip and the relevant dates, and that he was advised that "the government was not in the business of providing holidays for people." The Applicant stated that he was advised of his overpayment, and that in conversations with Centrelink staff at Dubbo, he felt that he was being accused of fraudulent behaviour. The Applicant stated that he had been advised an apology would be forthcoming, but none has been received.

10. Further, following his hearing before the SSAT, the Applicant was advised by the Registrar that his appeal had been successful. The Applicant on reviewing the reasons for the decision, considered the statement of the Registrar to be less than accurate. The Applicant stated that he later received a letter from the Registrar of the SSAT saying that his earlier decision was incorrect.

11. The Applicant also stated that he had been offered but refused terms of settlement from the Respondent but had refused "on principle", that being the manner in which the issue was dealt with and, in particular, the attitude of some Centrelink staff during the carriage of the disputation. The Applicant stated that he was well aware that he had repaid his debt, and that the issue had continued to be debated because he felt that at times he had been given either incomplete and/or misleading advice.

submissions

applicant

12. The Applicant contended that Centrelink could have taken a more empathetic approach towards the resolution of issues arising out of this matter. The Applicant submitted that later changes to the law in the second half of the year 2000 covered the issues which were central to his concerns, namely the continued payment of rental assistance and pharmaceutical allowances during his absence from Australia in New Zealand.

13. The Applicant also submitted that he felt aggrieved by statements made to him by Centrelink staff during his attempts to resolve the issues and that he was disappointed when he did not receive an apology after he had been told an apology would be forthcoming.

respondent

14. The Respondent contended that the Applicant was not entitled to payment of rental assistance and pharmaceutical allowance during his period of absence from Australia between 18 February 2000 and 12 March 2000. As such, any payment of such allowances was an overpayment and as such a debt due and owing to the Commonwealth. Further, it was contended that the Respondent had made no administrative error that led to the creation of the debt, nor were there any special circumstances existing, which would allow discretion to be expressed to write off or waive the debt.

consideration and findings

15. In this matter, the Tribunal notes that there is agreement between the parties as to the facts. The Tribunal finds the following facts:

(a) The Applicant was granted a disability support pension on 5 March 1998, and he received a fortnightly payment from Centrelink comprising the following elements:

(i) disability support pension;

(ii) rental assistance; and

(iii) pharmaceutical allowance.

(b) The Respondent did advise the Applicant that he must inform the Respondent within 14 days of having made the decision to travel outside Australia.

(c) The Applicant did travel to New Zealand during the period 18 February 2000 to 12 March 2000 as a helper to a disabled person. The Applicant accepts that he did not advise the Respondent of his trip until 21 March 2000.

(d) The amount of overpayment of pharmaceutical allowance and rental assistance for the period 18 February 2000 to 12 March 2000 was $127.93.

(e) The amount of $127.93 has been repaid by the Applicant.

statutory framework

16. The Tribunal notes Schedule 4 of the Social Security Act 1991 ("the Act") - Agreement between the Government of Australia and the Government of New Zealand on Social Security, details how income support payments are to be paid if a person is temporarily or permanently absent from their country of residence:

* Article 2 details the legislative scope of the agreement. In relation to Australia the agreement is said to apply to the Act in so far as the Act provides for, applies to, or affects, the following benefits:

"1. (a)...

(i) ...

(ii) disability support pension"

* Article 8A concerning portability of benefits states at paragraph 5:

"A person who, by virtue of this Agreement or otherwise, is in receipt of a disability support pension, a wife pension, a widow B pension or a sole parent pension and who is present but not ordinarily resident in New Zealand, shall be eligible to continue to receive that benefit for up to 4 weeks during a temporary absence from Australia ."

* Article 9 concerning calculation of Rates of Benefits states in paragraph 1:

"Except as provided in paragraphs 2 and 3, if a benefit is payable by a Party under this Agreement, the amount of that benefit will be determined according to the legislation of that Party."

17. The Social Security Act 1991 ("the Act") details the statutory qualifications for the payment of rental assistance and pharmaceutical allowance in the following sections of the Act:

"1064-D1. An additional amount to help cover the cost of rent is to be added to a person's maximum basic rate if:

(a) the person is not an ineligible homeowner; and

(b) the person is not an aged care resident; and

(c) the person pays, or is liable to pay, rent (other than Government rent); and

(d) the rent is payable at a rate of more than the rent threshold rate; and

(e) the person is in Australia; and

(f) either of the following subparagraphs applies:

(i) where the person or the person's partner is receiving family allowance in respect of a dependent child who is an FA child - the standard family allowance rate of the person or partner does not exceed the minimum family allowance rate of the person or partner, as the case may be; and

(ii) where the person is a member of an illness separated couple, a respite care couple or a temporarily separated couple and is the partner of a person who is receiving family allowance in respect of a dependent child who is an FA child - the standard family allowance rate of the partner does not exceed the minimum family allowance rate of the partner.

1064-C1. Subject to points 1064-C2, 1064-C3, 1064-C4 and 1064-C6, an additional amount by way of pharmaceutical allowance is to be added to a person's maximum basic rate if:

(a) the person is an Australian resident; and

(b) the person is in Australia."

18. The Act details in subsection 1223(1) that an amount paid to a person who is not qualified for payment is a recoverable debt:

"1223.(1) Subject to subsections (1A) and (1B), if an amount has been paid to a person by way of social security payment on or after 1 October 1997 and:

(a) the recipient was not qualified for the social security payment when it was granted; or

(b) the amount was not payable to the recipient;

the amount so paid is a debt due to the Commonwealth."

19. Similarly, subsection 1224(1) of the Act provides for the overpayment to be a debt due and payable where a recipient failed or omitted to comply with a provision of the Act and an amount was paid as a result of that omission:

"1224.(1) If:

(a) an amount has been paid to a recipient by way of social security payment; and

(b) the amount was paid because the recipient or another person:

(i) made a false statement or a false representation; or

(ii) failed or omitted to comply with a provision of this Act or the 1947 Act;

the amount so paid is a debt due by the recipient to the Commonwealth."

20. In relation to issues concerning non-recovery of the debt:

* section 1236 of the Act details the particular circumstances in which write off may occur. These include debt irrecoverable at law, the debtor has no capacity to pay or his whereabouts are unknown, or the debtor is not receiving a social security payment and it would not be cost effective to recover the debt;

* section 1237A(1) states that the debt must be waived in part or in whole where an administrative error is solely responsible for the debt creating and the debtor has received such payments in good faith; and

* Section 1237AAD of the Act details the circumstances in which a debt may be waived:

"1237AAD. The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

(a) the debt did not result wholly or partly from the debtor or another person knowingly:

(i) making a false statement or false representation; or

(ii) failing or omitting to comply with a provision of this Act or the 1947 Act; and

(b) there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

(c) it is more appropriate to waive than to write off the debt or part of the debt."

21. In addressing the facts in this matter against the statutory framework the Tribunal makes the following further observations and conclusions:

(a) The Applicant was in receipt of disability support pension, rental assistance and pharmaceutical allowance.

(b) The Applicant had a duty to notify the Respondent of his intended trip to New Zealand prior to departure. This he did not do.

(c) Schedule 4 of the Act - Agreement between the Government of Australia and the Government of New Zealand on Social Security, is specific in detailing that the agreement covers the payment of disability support pension for a period of four weeks for an Australian resident temporarily residing in New Zealand. The Applicant was entitled to the payment of his disability support pension during his temporary absence from Australia.

(d) Section 1064-D1 of the Act states amongst several qualifying factors that an Applicant must be in Australia to qualify for rental assistance. The Tribunal concludes that the Applicant was not in Australia during the period in question and hence does not qualify for rental assistance during that period.

(e) Sections 1064-C1 of the Act states that pharmaceutical allowance is payable where the person is both an Australian resident and is resident in Australia. The Tribunal concludes that the Applicant did not qualify for payment of pharmaceutical allowance during his absence from Australia.

(f) As a result of the its observations and findings the Tribunal further concludes that there has been an overpayment of $127.93 arising from payment of rental assistance and pharmaceutical allowance to the Applicant during his period of temporary absence from Australia between 19 February 2000 and 11 March 2000. Further, the Tribunal finds that such overpayment arose from a failure by the Applicant to notify the Respondent of his intended departure from Australia prior to leaving. The Tribunal also finds that there was no administrative error made by the Respondent which led to the overpayment.

(g) The Tribunal further concludes, that as the Applicant was not qualified to receive both rental assistance and pharmaceutical allowance during his period of absence from Australia, and had failed to notify the Respondent of his intended departure from Australia, the overpayment is a debt due and payable to the Commonwealth pursuant to both section 1223(1) and section 1234(1) of the Act.

(h) The Tribunal does observe that following the raising of the debt, the Applicant considers that he had been subject to particular adverse comments from Centrelink staff and that they were uncalled for. Further, the Tribunal notes that it would appear on the documents before it that an apology was to be made to the Applicant, but this has never been forthcoming. The Tribunal also notes the misleading advice from the Registrar of the SSAT concerning the outcome of the Applicant's appeal to that Tribunal. In such circumstances the Tribunal is able to understand why the Applicant continued to pursue his matter despite an offer of settlement by the Respondent. The Tribunal, in acknowledging that hindsight is a valuable commodity, would wish to stress that disputes such as this matter are best worked through at the earliest opportunity and in an environment of cooperative and mutual understanding of the problem, with each party endeavouring to appreciate each others concerns.

(i) The Tribunal, in noting the provisions of sections 1236, 1237A(1), 1237AAD, concludes that it is neither appropriate to write off the debt, nor waive the debt for either sole administrative error or special circumstances, as neither the Applicant nor the Respondent have raised any evidence of circumstances which would permit the Tribunal to further consider these sections.

determination

22. The Tribunal determines that the decision under review is affirmed.

I certify that the 22 preceding paragraphs are a true copy of the reasons for the decision herein of Dr J D Campbell, Member

Signed: .....................................................................................

Associate

Date/s of Hearing 14 November 2001

Date of Decision 5 March 2002

Representative for the Applicant Self

Representative for the Respondent Ms Fahey