Marcellino and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2009] AATA 73 (6 February 2009)

Last Updated: 9 February 2009

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 73

ADMINISTRATIVE APPEALS TRIBUNAL )

) No 2008/3975

GENERAL ADMINISTRATIVE DIVISION		)
	Re		ALFREDO MARCELLINO

Applicant

And

SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES & INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal

Ms Robin Hunt, Senior Member

Date 6 February 2009

Place Sydney

Decision

The decision under review is affirmed.

...................[Sgd]...................
Ms Robin Hunt
Senior Member

CATCHWORDS

SOCIAL SECURITY – overpayment – recipient of Australian pension and Italian pension – applicant notified Centrelink of receipt of Italian pension – applicant failed to notify Centrelink of increases from time to time in Italian pension – Centrelink notified applicant every 3 months of requirement to inform of any change in circumstances – Centrelink notified applicant in 2004 onwards that it was not aware automatically of increases to Italian pension – debt to Commonwealth – consideration of special circumstances – special circumstances not established – decision under review affirmed.

Social Security Act 1991 ss 8, 1064, 1100, 1223(1), 1237A, 1237AAD

Social Security (Administration) Act 1999 s 100

Beadle v Director-General of Social Security [1984] AATA 176; (1985) 60 ALR 225

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

REASONS FOR DECISION

6 February 2009

Ms Robin Hunt, Senior Member

INTRODUCTION

1. Alfredo Marcellino applied to this tribunal for review of a decision of the Social Security Appeals Tribunal (‘the SSAT’) that he owed a debt to the Commonwealth because Centrelink had paid him more than the appropriate rate of pension and special circumstances did not exist which made it appropriate not to recover the debt.

REVIEWABLE DECISION

2. On 22 July 2008, the SSAT affirmed the decision of a Centrelink authorised review officer that Mr Marcellino had accumulated a debt to the Commonwealth as a result of overpayment of disability support pension (‘DSP’) and age pension and that Centrelink should raise and recover the debt amount from Mr Marcellino.

ISSUES

3. The issues are whether Mr Marcellino was overpaid $3,085.69 between 8 January 1998 and 4 September 2007 and, if so, whether this constitutes a debt to the Commonwealth, which he should be required to repay.

CONSIDERATION AND FINDINGS

4. The background events that led to Mr Marcellino’s application are set out in the Secretary’s statement of facts and contentions and are not disputed. Mr Marcellino received and was entitled to receive a pension from Italy and a reduced pension from Centrelink adjusted to reflect his Italian pension. These adjustments were not made during the period in issue and led to overpayment. Mr Marcellino, however, feels that he was not at fault in not checking and reporting details of his Italian pension and should not be required to repay to Centrelink consequential overpayments of Australian benefits. The overpayments occurred as Centrelink did not take into account small increases in Mr Marcellino’s Italian pension over the nine year period in question.
5. There is no suggestion that Mr Marcellino did not do the right thing in the beginning. Mr Marcellino gave evidence that he went to Centrelink when he claimed Australian social security benefits and did inform Centrelink about his Italian pension. He gave evidence that he took ‘the Article 10 letter’ to them in 1996. This letter dealt with payment of the Italian pension and mutual arrangements between Italy and Australia under Article 10 of an agreement. Centrelink has a record of the grant to him of an Italian invalid pension on 1 December 1991 and notification by the Istituto Nazionale Previdenza Sociale in 1993.
6. On 28 May 1993, Centrelink wrote to Mr Marcellino telling him that his pension would be reduced from 3 June 1993 due to his change in circumstances. The letter did not say what had changed but, below the Centrelink officer’s name, mentioned his overseas income under “payment details”, which included other income and reference to Mr Marcellino’s bank account. On 1 July 1994, Centrelink sent him a similar letter advising him his pension had increased.
7. Mr Marcellino further claimed to have taken a letter from the Italian government to Centrelink every year up until about 3 or 4 years ago when he said he stopped receiving them. He said he used to receive an Article 10 letter around March or April every year and took it to Centrelink but he kept no copies of these and had no copies stamped by Centrelink. He said the same officer at Leichhardt always simply said “leave it there”, when he tendered the Article 10 letters, and there were always lots of other people waiting to see the same officer. Mr Marcellino was emphatic that the same officer dealt with these matters for many years and that he used to see him in the local cafes as well but Mr Marcellino did not remember his name. Mr Marcellino recounted how he saw the same officer recently when seeking an adjustment to deduction from his pension as he could not afford to buy food. Mr Marcellino said the officer’s actions left him even worse off. Instead of adjusting the reduction upwards, as Mr Marcellino expected, he said his pension was further reduced. He had to enlist the help of an interpreter and speak to someone in Hobart before his pension was restored. Mr Marcellino said this was another mistake the officer made in his case.
8. When it was pointed out that Centrelink records indicated he had seen at least 8 different officers at Leichhardt, Mr Marcellino agreed that was probably so but said he always saw the same man about his Italian pension. He had seen other officers at times when he had women in his life and advised Centrelink in order to adjust his entitlements. He said women moved on because they could not cope with his health problems.
9. Mr Marcellino acknowledges that he may have received increases in his Italian pension from time to time but did not keep track. Mr Marcellino gave evidence that it was easier to keep track when he received cheques but since the pension payments were sent directly to his bank account he could not readily notice any changes. He did not ask for bank statements because of the bank charges. He admitted he was aware of his obligation to Centrelink through community radio but did not do anything in the later part of the period because he thought Centrelink already knew of the Italian pension changes.
10. Centrelink sent Mr Marcellino a number of letters throughout the debt period about changes to his pension payments. He gave evidence that, when Centrelink sent him notices of adjustments to his Australian pension, he thought Centrelink was taking any changes to the Italian pension into account. The notices from Centrelink did refer to the Italian pension but Mr Marcellino was wrong in thinking adjustments relating to the Australian pension reflected increases in the Italian pension. The adjustments Centrelink set out in the notices pertained to changes in currency exchange rates and not changes to the actual pension.
11. The Centrelink practice changed in 2004 and standard notice letters explained the reason for the changes from time to time in the rate of pension notified. From 2 February 2004, the exchange rate statement letters included a paragraph explaining that Centrelink was converting Mr Marcellino’s pension in accordance with exchange rates and the statement was not about changes to the Italian pension rate. The Centrelink letters continued as before in reminding Mr Marcellino of his obligation to inform Centrelink of any change in circumstance.
12. When Mr Marcellino’s Article 10 letters stopped arriving, Mr Marcellino said he assumed the information was going directly to Centrelink, partly because of the regular exchange rate adjustment letters he received and misunderstood. Mr Marcellino could not remember exactly when the Italian government letters stopped coming to him and put this poor recollection down to health problems he had experienced over recent years. The regular Centrelink notices about adjustments reinforced his impression that Centrelink was fully informed. This was a wrong assumption and Centrelink eventually asked him in 2007 what was going on with his Italian pension. Mr Marcellino then saw the ‘patronato’ who organised a letter for him around September 2007 and he took it to Centrelink. He had received a similar letter for 2008 a little later and took it to Centrelink as well.
13. Centrelink wrote more letters to Mr Marcellino in 2007 advising him of how his payments were calculated and inviting him to contact Centrelink if any of the information in the letters was incorrect. On 17 August 2007, Centrelink wrote to Mr Marcellino asking him to provide information about the Italian pension he was receiving so they could calculate the correct rate for his age pension. Mr Marcellino provided the information on 10 September 2007. In the meantime, Centrelink had become aware of changes to the Italian pension when it conducted an audit of Italian pensions in 2007. The Secretary’s representative advised the tribunal that such audits are conducted from time to time and are not a regular occurrence. The overseas branch of Centrelink carries out investigations of this sort, but there are a lot of countries which provide pensions to Australia and not all of Centrelink’s information is up to date.
14. Centrelink has not been at fault in any way and has not brought about Mr Marcellino’s debt unless some fault can be attributed to the officer to whom Mr Marcellino says he gave the annual notice from Italy of his pension changes. The SSAT did not accept Mr Marcellino’s evidence that he always supplied these letters to the same officer except for the last three or so years during the debt period. Mr Marcellino was adamant in evidence before me that it was indeed the same officer whom he saw every year with the letters. While this may be correct, on balance, I am not reasonably satisfied that this occurred because Mr Marcellino has not called any corroboratory evidence and has not named the officer or produced copies of any of the letters let alone copies stamped with a Centrelink receipt.
15. When asked about his circumstances, Mr Marcellino gave evidence about his financial difficulties and other problems he had experienced, including his poor health over recent years. Dr Peter Piazza, on 30 September 2008, wrote that Mr Marcellino had a medical history which included myocardial infarction in 1990 and some other serious conditions which required hospital admission in 2005, 2006 and 2007. He also was due to have some further medical investigation in 2008. As well, Mr Marcellino has other debts about which he supplied evidence. He gave further evidence that he had reduced his debts when he received special payments from Centrelink such as a recent bonus payment to pensioners.

IS THERE A DEBT?

16. A person’s other income and assets are taken into account in determining eligibility for and the rate of payment of DSP and of age pension. Several legislative provisions combine to mean that Mr Marcellino’s Italian pension was rightly taken into account by Centrelink in deciding his entitlements under sections 1064 and 1100 of the Social Security Act 1991 (‘the Act’). Section 8 of the Act defines “income” and Mr Marcellino’s Italian pension comes within this term. Section 1100 sets out how the value of a foreign currency payment is determined. Section 1064 contains provisions about how to determine the rate of pension. In addition, section 100 of the Social Security (Administration) Act 1999 provides for a retrospective rate reduction when a person fails to comply with recipient notification and information notices. Mr Marcellino, by his own admission, did fail to comply with these notices for at least part of the debt period. He took no action during the three years or so when he received no letters from the Italian government.
17. Subsection 1223(1) of the Act provides that where a person receives social security payments to which he or she is not entitled, the amount of the payments made constitutes a debt owing to the Commonwealth. Various provisions of the Act allow write off or waiver in particular circumstances but Mr Marcellino does not satisfy any of these. Particularly, pursuant to section 1237A, the debt was not solely attributable to an administrative error on the part of Centrelink as Mr Marcellino was partly responsible by not contacting Centrelink when invited to do so and did not furnish information when his letters from the Italian government ceased. He made an incorrect assumption when he thought Centrelink received updates directly from Italy. In other words, Mr Marcellino does have a debt to the Commonwealth.

ARE THERE SPECIAL CIRCUMSTANCES?

18. Discretion is available pursuant to section 1237AAD of the Act to waive all or part of a debt in special circumstances if the person has not knowingly failed or omitted to comply with a provision of social security law. I have examined whether Mr Marcellino’s debt might be excused under this provision.
19. The phrase “special circumstances” is not defined in the Act, but has been considered on numerous occasions in connection with the above provision and similar provisions. For example, in Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the tribunal suggested:

... that the circumstances ... must have a particular quality of unusualness that permits them to be described as special.

20. The Full Court on appeal approved the tribunal decision and held:

... special circumstances in this context must include events which would render the (strict application of the rule in question) unfair or inappropriate.
Beadle v Director-General of Social Security [1984] AATA 176; (1985) 60 ALR 225.

21. The result of the overpayments in Mr Marcellino’s case placed him in a somewhat better financial position than he would otherwise have been had he kept Centrelink informed. He continues to be slightly advantaged by receipt of two pensions, although the Australian one is reduced to take account of the Italian income. I also note that he will be disadvantaged once he is required to make repayments of the debt, having already used up his previous payments and having run into debt.
22. Factors that Mr Marcellino has pointed to as being special in his case are his age, ill health and financial circumstances. Unfortunately for Mr Marcellino, these factors are common to most social security recipients of his age. His health, while poor, is not suffering further because of lack of funds as he has received treatment for his heart condition, gall bladder surgery in 2008, knee surgery in 2007, a shoulder operation in 2006, and had cataracts removed a few years ago. He is on a waiting list for a heart operation but unfortunately this also is not an uncommon position for heart patients to endure. While Mr Marcellino does suffer a range of debilitating conditions, in my opinion, these are not enough to bring his case into the category of special circumstances for waiver of his debt.
23. Even when considering his financial situation, I note that Mr Marcellino is in debt but, on the other hand, he receives the age pension and the Italian pension and lives in public housing as well as having access to Medicare benefits. He also holds a health care card and a pensioner concession card. While his financial position is difficult, he is not in a dire situation.
24. In conclusion, I find Mr Marcellino’s circumstances do not constitute special circumstances as this phrase generally is understood in connection with section 1237AAD of the Act. Therefore, I do not find special circumstances in order to warrant waiver of any part of his debt.
25. In addition, I consider that Mr Marcellino had some knowledge of his obligations to report changes to his Italian pension to Centrelink and that, although his assumption about the extent of Centrelink’s information is not entirely unreasonable, he made no effort to inform or check with the Italian government or patronato or Centrelink after he stopped receiving the Article 10 letters. This may be partly attributable to his poor health but there is still a failure to demonstrate special circumstances as I have found above. This means Mr Marcellino should not be accorded waiver or reduction of his debt. He may be able to arrange for repayment to Centrelink in small instalments from his pension.

DECISION

26. The decision under review is affirmed.
    

I certify that the 26 preceding paragraphs are a true copy of the reasons for the decision herein of Ms Robin Hunt, Senior Member

Signed: .........................[Sgd]............................

Jennifer Wong, Associate

Date/s of Hearing 16 December 2008

Date of Decision 6 February 2009

Solicitor for the Applicant Self-represented

Solicitor for the Respondent Ms R Harlock, Centrelink Legal Services and Procurement Branch