Willmer and Secretary, Department of Education, Employment and Workplace Relations [2009] AATA 22 (15 January 2009)

Last Updated: 15 January 2009

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 22

ADMINISTRATIVE APPEALS TRIBUNAL )

) No 2008/794

GENERAL ADMINISTRATIVE DIVISION		)
	Re		NATASHA WILLMER

Applicant

And

SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal

Mr S E Frost, Member

Date 15 January 2009

Place Sydney

Decision

The decision under review is set aside. The Tribunal decides instead that Ms Willmer was qualified for austudy payments from 11 February to 14 April 2006, and then again from 20 July to 2 August 2006, but not for any other part of the relevant period. The matter is remitted to the Secretary to assess the amount of overpayment, and with a direction that the resultant debt is to be recovered.

....................[sgd]...................
Mr S E Frost
Member

CATCHWORDS

SOCIAL SECURITY – austudy payment – applicant undertaking distance learning – whether undertaking at least three quarters of the normal amount of full-time study – whether making satisfactory progress towards completing the course – discussion of study and progress requirements for students undertaking distance learning – whether debt can be written off or waived – decision under review set aside – decision substituted that applicant qualified for austudy for part of the period

Social Security Act 1991 – s 568, 569, 569A, 569C, 569E, 569G, 1236, 1237A, 1237AAD

Social Security (Administration) Act 1999 – s 94(1)

Secretary, Department of Education, Employment, Training and Youth Affairs v Prince [1997] FCA 1565; (1997) 152 ALR 127

REASONS FOR DECISION

15 January 2009

Mr S E Frost, Member

INTRODUCTION

1. Natasha Willmer was granted austudy in February 2006 on the basis of her claim that she was a full-time student, studying by “distance learning” with the Open Training and Education Network (“OTEN”). In 2007, however, Centrelink decided that she had not been a full-time student. As a result, according to Centrelink, she had not been entitled to any of the austudy payments that she had received over a 12-month period ending in February 2007. The amount she had been paid, $10,524.97, was treated as an overpayment which she would have to repay. Ms Willmer disagreed with that decision but it has been affirmed by an Authorised Review Officer and also by the Social Security Appeals Tribunal (“SSAT”). She applied to the Administrative Appeals Tribunal on 20 January 2008 for a further review of the decision.
   

THE ISSUES

2. The principal question for my determination is whether Ms Willmer was qualified for an austudy payment in respect of the period 11 February 2006 to 6 February 2007 (“the relevant period”). If she was not qualified for such a payment, then I will need to consider whether the resulting debt should be written off or waived.
3. The question of qualification for an austudy payment turns on various provisions in the Social Security Act 1991 (“the Act”). The relevant provisions are section 568 (the general rule for qualification), section 569 (which sets out the activity test), section 569A (which explains the meaning of the expression “undertaking qualifying study”), section 569C (which explains when a person is a “full-time student”), section 569E (which explains what is “the normal amount of full-time study”) and section 569G (which explains when a person satisfies the progress rules).
4. The issues that arise under those provisions are:

(a) whether, during the relevant period, Ms Willmer was a full-time student – which depends on whether she undertook at least three quarters of the normal amount of full-time study in respect of the course (s 569A(c) and 569C(a) together with section 569E(1)(b)); and
(b) whether, in the opinion of the Secretary (or, on review, the Tribunal), she satisfied the progress rules – which depends on whether she was making satisfactory progress towards completing the course (section 569A(d) together with section 569G(1)).

5. For reasons which will become apparent, it is convenient to deal with those questions together, rather than separately.

PRELIMINARY COMMENTS – THE DIFFERENCE BETWEEN FACE-TO-FACE LEARNING AND DISTANCE LEARNING

6. For a student undertaking face-to-face learning, the amount of study that is being undertaken – see [4](a) – is easy to calculate. It is, generally, the number of hours per week in which the student participates in face-to-face classes. As far as progress is concerned – see [4](b) – this can be evaluated, generally at the end of the semester or academic year, by a simple analysis of the student’s examination results. If the student passes, then progress is satisfactory; if the student fails, then progress is not satisfactory.
7. However, it is not so simple in the case of a student undertaking distance learning through an organisation such as OTEN. There is no class to attend; there is no attendance roll to mark. The student spends as much or as little time studying as he or she needs to do to understand the subject. Subjects at OTEN are made up of modules. Once a particular module of the subject has been studied and the student feels competent to complete an assignment, the assignment will be attempted, submitted and assessed. In broad terms, if the assessment is satisfactory, then the student will proceed to the next module within the subject and complete further assignments, one at a time. By the end of the semester or academic year, the student will be expected to have submitted a certain number of satisfactory assignments. The expectation is that the assignments will be submitted on a regular, continuous basis from the commencement of the course throughout the semester or academic year, although, as I understand things, it is at least theoretically possible for a student to submit no assignments for some period, and then submit a number of them in a rush. This period of non-lodgement of assignments may occur either because the student simply stops studying, or because, although the student continues to study, he or she does not feel competent to submit an assignment. In any event, once all the assignments are completed satisfactorily, the student will have passed the subject.
8. What this means for a person studying by way of distance learning is that, at least in a practical sense, the question whether the person is making satisfactory progress – s 569A(d) of the Act – will be a major factor in determining whether he or she should be treated as a full-time student under s 569A(c) of the Act. This will not be the case for the student undertaking face-to-face learning, who will generally be treated as a full-time student so long as he or she maintains that enrolment status.

WAS MS WILLMER A FULL-TIME STUDENT MAKING SATISFACTORY PROGRESS?

9. The Secretary says that Ms Willmer was not a full-time student for any part of the relevant period. At paragraph 5 of the Secretary’s Supplementary Submissions it was put this way:

The respondent submits that self-paced courses, such as OTEN, are courses where the student can progress at a pace which suits their individual learning needs, rather than the pace of other students in a class. The normal study load would be the average study needed to complete the course in the minimum time. The minimum time for the course will have been considered as part of the course approvals process. In New South Wales, the full-time hours notified by TAFE New South Wales is 16 hours. Therefore to achieve the 75% rule, 12 hours must be completed.

10. One immediate problem is how to convert this “12 hours per week” requirement into the flexible learning approach that is the hallmark of the OTEN program. It could be measured by reference to the number of hours the student spends in reading, and preparing to attempt assignments; or it could be the time spent in actually attempting the assignments; or it could be the sum of the two. Any of those measurements suffer from the obvious problem, at least from the Secretary’s perspective, that there is no way of checking or verifying the time that a student claims to spend in any of those activities.
11. Ms Willmer gave evidence that from February 2006 until around July or August of that year, she studied at home for five to six hours, seven days a week. That evidence was not challenged by the Secretary, even though it differed from the evidence that Ms Willmer gave to the SSAT that she had studied “for around 20 to 25 hours a week” (T2-4, paragraph 9). I find that she studied for no less than 4 hours a day, 5 days a week, for the period February to August 2006, or roughly half of the relevant period. When one compares that with the TAFE-notified requirement of 12 hours per week (see [9]), it seems, on the face of it, that for that period at least, Ms Willmer has met the “three quarters of the normal amount of full-time study” requirement in s 569C(a) of the Act. But it is not as straightforward as that.
12. The major difficulty, according to the Secretary, is that she did not complete all her assignments for any of the subjects. It is now necessary to discuss her enrolments with OTEN in some detail.
13. Around 1 February 2006 Ms Willmer enrolled in the OTEN course 6505 – HSC Studies (T4-47). At around the same time she also enrolled in the OTEN course 3294 – Children’s Services (T6-49). Upon becoming aware of this latter enrolment, Centrelink assumed that she had stopped the HSC course (T20-108), but it seems that she was enrolled in both courses, at least for part of the 2006 academic year.
14. Ms Willmer enrolled in five “preliminary” subjects in the HSC course. Each subject undertaken through OTEN is allocated a number of “module/unit hours”. Her five subjects were allocated 120 hours each, with a total of 600 module/unit hours. The number of assignments to be completed totalled 35, split among the subjects as follows: English (5); Food Technology (8); General Mathematics (8); Personal Development/Health/Physical Education (PDHPE) (8); and Senior Science (6).
15. In addition to that, her Children’s Services subjects had 105 module/unit hours allocated to them, and there were nine assignments required in total for the four subjects.
16. The document at T10-56, relating to the HSC course, shows that she completed none of her English assignments; four of the eight for Food Technology; four of the eight for General Mathematics; two of the eight for PDHPE; and two of the six for Senior Science. She is therefore, according to the Secretary, not entitled to claim that she has completed 120 hours for any one of the subjects she undertook. At worst, she gets no credit at all – Secretary’s Supplementary Submissions dated 8 October 2008, paragraph 21 – or in other words, for practical purposes, she was not a student, let alone a full-time student. At best she would get credit in proportion to the number of assignments she completed for each subject, as a fraction of the total number of assignments set: Secretary’s Statement of Facts and Contentions, paragraph 45. On this second alternative, she would be credited with 190 hours out of a total of 600 hours, which equals 31.6 per cent. As for the Children’s Services course, she completed one assignment, and that is at best 11 per cent. Even on the best case she has done less than the three quarters, or 75 per cent, required, and so, according to the Secretary, she had no entitlement to austudy. The full amount paid is a debt.
17. OTEN’s record of Ms Willmer’s assignment history (Annexure to Secretary’s Statement of Facts and Contentions) shows that in the HSC course she successfully completed her assignments as follows:

• Food Technology – 14 February 2006 (2 assignments), 23 February 2006 and 15 March 2006;
• General Mathematics – 23 February 2006, 1 March 2006, 2 August 2006 (2 assignments);
• PDHPE – 15 March 2006 and 17 March 2006;
• Senior Science – 14 February 2006 and 23 February 2006.

18. In Children’s Services her only acceptable assignment was credited on 16 February 2006, but for the purposes of assessing whether she was a full-time student making satisfactory progress, this assignment can be disregarded.
19. Ms Willmer’s assignment history shows that there was an objectively measurable level of activity, and progress, during the months of February and March 2006, and then no further submission of assignments until August. In fact, Ms Willmer completed half the required assignments for Food Technology, a quarter of the assignments for General Mathematics, a quarter for PDHPE and one-third for Senior Science in the space of about five weeks from early February until the middle of March 2006.
20. How does that compare with the requirement that she undertake at least three quarters of the normal amount of full-time study?
21. The only reasonable way to measure Ms Willmer’s study load, in my view, is to credit her, for the first five weeks of the 2006 academic year, with one-half of 120 hours (60 hours) for Food Technology, one-quarter of 120 hours (30 hours) for each of General Mathematics and PDHPE and one-third of 120 hours (40 hours) for Social Science. That amounts to 160 hours over five weeks, or 32 hours per week. That is well over the 12 hours per week referred to in [9]. If she had continued to submit her assignments at that rate, then she could be expected to have completed all five subjects in the HSC course in about 19 weeks – certainly within one semester. Given that OTEN allows a full year to complete the “preliminary” subjects, it is my opinion that Ms Willmer’s progress towards completing the course was satisfactory, at least for the first five weeks of the academic year.
22. The next question is how to treat the period immediately after she submitted her PDHPE assignment on 17 March 2006. I have already found that she continued to study for no less than 20 hours per week, but the more important question, during this period when she was no longer submitting assignments, is whether she was making satisfactory progress towards completing the course. She said that she was having trouble with some of her subjects and the reason that she did not submit assignments was that she did not feel that she understood the material well enough. The reasonable approach to take in these circumstances is to allow her some latitude, by accepting that for some further short period, she was continuing to make satisfactory progress even though there are no assignments to show for her efforts. If one takes the alternative approach of accepting satisfactory progress only upon completion of a satisfactory assignment, then every student undertaking distance learning will fail the progress rules for the entire period between one assignment and the next. That is neither fair nor logical. In my opinion, for a further period of four weeks after 17 March 2006 Ms Willmer continued to make satisfactory progress towards completing the course, despite the non-lodgement of assignments in that period.
23. In relation to the two remaining General Mathematics assignments, which were assessed on 2 August 2006, she should receive credit for a further 30 hours (one-quarter of 120 hours). Allowing her two weeks to prepare for, and then attempt, these assignments gives her a notional study load of 15 hours – very close to the full-time load of 16 hours – for each of the two weeks leading up to 2 August 2006. On that basis I conclude that for the two weeks leading up to 2 August 2006, Ms Willmer was a full-time student and it is my opinion that her progress, for those two weeks, towards completing the course was satisfactory. There is no scope for further latitude after 2 August 2006 because it was about this time that Ms Willmer admits that she reduced the number of hours she spent studying. I am not satisfied that she was spending sufficient time to warrant a finding that she was undertaking at least three quarters of the normal amount of full-time study.
24. For completeness, I need to deal with s 94(1) of the Social Security (Administration) Act 1999 (“the Administration Act”), which provides as follows:

Subject to subsection (2), if:
(a) a person who is receiving a social security payment is given a notice under subsection 68(2); and
(b) the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period); and
(c) the event or change of circumstances occurs; and
(d) the person does not inform the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and
(e) because of the occurrence of the event or change of circumstances:
(i) the person ceases to be qualified for the social security payment; or
(ii) the social security payment ceases to be payable to the person;
the social security payment is cancelled, by force of this subsection, on the day on which the event or change of circumstances occurs.

25. It might be argued that Ms Willmer’s austudy payments were cancelled, by force of s 94(1), as soon as an “event or change of circumstances” occurred (perhaps around the middle of March 2006) which she should have notified to Centrelink but did not. The possible “event or change of circumstances” might be her ceasing to be a full-time student, or her ceasing to make satisfactory progress. She was certainly given a number of notices under s 68(2) of the Administration Act – there was one as early as 21 February 2006, another in March, one in May, and one in October. They all instructed her that she should notify Centrelink “if your study load changes or if you cease study”. They did not tell her to notify Centrelink if, on a temporary basis, she stopped submitting assignments.
26. Given the uncertainty surrounding the practical requirements placed on a person studying by distance learning, I do not accept that s 94(1) applies in Ms Willmer’s case. She was, as I have found, devoting at least 20 hours a week towards her study for six months from the beginning of February until the beginning of August 2006. It is understandable that she might consider herself, in those circumstances, to be a full-time student. In addition, she could reasonably take the view that her progress, although slow and patchy, was “satisfactory”, because it was, after all, a course designed to allow students to move at their own pace. In summary, I do not agree that her payment was cancelled by force of s 94(1) at any time prior to the submission of her last two General Mathematics assignments in August 2006.
27. But that is not to say that she remained entitled to austudy payments throughout the relevant period. Apart from the five-week period in February/March 2006, the further four-week period noted in [22] and the two-week period in July/August 2006, Ms Willmer was not a full-time student making satisfactory progress, and for that reason she was not qualified for an austudy payment. She has therefore been overpaid, but not to the extent that the Secretary contended. The amount of overpayment will need to be re-assessed by the Secretary, unless it can be written off or waived.

CAN THE DEBT BE WRITTEN OFF?

28. Write off of debts is determined by s 1236 of the Act. However, the debt cannot be written off under s 1236 because the debts are not irrecoverable, Ms Willmer has the capacity to repay, her whereabouts are known and it is cost effective to recover the debt.

CAN THE DEBT BE WAIVED?

29. Waiver of debts is dealt with in s 1237A(1) and 1237AAD of the Act.
30. Under the first of those provisions, s 1237A(1), any proportion of the debt that is “attributable solely to an administrative error made by the Commonwealth” must be waived, provided the debtor received the payment in good faith.
31. Ms Willmer says that the Commonwealth made an error in continuing to pay her austudy after August 2006, when, she says, she informed Centrelink that she had ceased, or was about to cease, her studies. The original Centrelink record of the relevant telephone discussion on 18 August 2006 (T20-106) notes:

Cus[tomer] queried when to advise finishing study, advised when she signs out of school/course.

32. According to that record, Ms Willmer did not notify that she had ceased studying, although it might be inferred that she notified that she would be ceasing shortly.
33. Ms Willmer has consistently maintained that that record is an incomplete, and therefore inaccurate, summary of the discussion that took place. She requested, under the Freedom of Information Act 1982, that the record be annotated to include a statement to the effect that “the customer rang to change her study load”. Centrelink agreed to that request, and the original record now includes a statement to that effect.
34. However, that annotation does not alter the position under s 1237A(1) of the Act. Even if I were to take the view that the continued payment of austudy to Ms Willmer after 18 August 2006 was attributable solely to an administrative error made by the Commonwealth, the debt can only be waived if Ms Willmer received those later payments in good faith.
35. As Finn J emphasised in Secretary, Department of Education, Employment, Training and Youth Affairs v Prince [1997] FCA 1565; (1997) 152 ALR 127, the question in what is now s 1237A of the Act is not whether Ms Willmer acted in good faith, but whether she received the payment in good faith. His Honour said (152 ALR at 130) that the waiver provision is concerned with:

the state of mind of a person concerning his or her receipt of the payment: if that person knows or has reason to know that he or she is not entitled to a payment received – ie is not entitled to use the moneys received as his or her own – that person does not receive the payment in good faith. Absent such knowledge or reason to know, the receipt would be in good faith.

36. The reason for notifying Centrelink that her study load had changed, or was about to change, was that it would have an impact on the amount of payment she received. If Ms Willmer continued to receive the same amount of austudy payment after the notification as before, then it can hardly be said that she received the payment in good faith. She did nothing to correct the error that she says Centrelink continued to make. She did not receive the payments in good faith, and therefore the payments made after 18 August 2006 cannot be waived under s 1237A(1) of the Act.
37. That leaves two further periods of overpayment: one period is from 18 March 2006 (the day after submission of the last PDHPE assignment) to 19 July 2006 (two weeks before submission of the last two General Mathematics assignments), and the second is from 3 August 2006 (the day after submission of the last two General Mathematics assignments) to 18 August 2006 (the date of notification). In respect of these two periods, there is no “administrative error” on the part of the Commonwealth, and therefore, waiver under s 1237A(1) of the Act is not possible.
38. The second waiver provision is s 1237AAD of the Act. This requires as one of its elements that there be “special circumstances” that make it desirable to waive the debt.
39. Ms Willmer claims that “special circumstances” arise from the death, by suicide, of a friend of hers in July 2006. Ms Willmer says in her written submissions that, if it had not been for her friend’s suicide, Ms Willmer “would have been able to complete her course within the minimum time”. There is a statement from the friend’s fiancée (T34-153/4) which shows that Ms Willmer provided emotional support to the fiancée after the friend’s death and that she “placed her own life (which included her studies) aside” for a period of time. I accept that this occurred, and I also accept that the friend’s death was a major factor, at least during a period of some months from July 2006 onwards, in Ms Willmer’s failure to submit assignments.
40. However, the question is not whether there are special circumstances to explain why Ms Willmer’s studies did not progress. It is whether there are special circumstances that make it desirable to waive the debt. Ms Willmer has obtained the benefit of austudy payments to which she was not entitled. Unfortunately, I cannot identify anything special about Ms Willmer’s circumstances that make it desirable to waive the debt.

CONCLUSION

41. Ms Willmer was qualified for austudy payments from 11 February to 14 April 2006, and then again from 20 July to 2 August 2006, but not for any other part of the relevant period.

DECISION

42. The decision under review is set aside. Instead I decide that Ms Willmer was qualified for austudy payments from 11 February to 14 April 2006, and then again from 20 July to 2 August 2006, but not for any other part of the relevant period. The matter is remitted to the Secretary to assess the amount of overpayment, and with a direction that the resultant debt is to be recovered.
    

I certify that the 42 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S E Frost, Member.

Signed: ...........[sgd].....................................................................

Associate

Date/s of Hearing 4 September, 25 September, 30 October 2008

Final Submissions received 5 November 2008

Date of Decision 15 January 2009

Applicant self-represented

Solicitor for the Respondent Ms G Heggen, Centrelink Legal Services