Abel and Secretary, Department of Social Services
[2013] AATA 766
•25 October 2013
[2013] AATA 766
Division GENERAL ADMINISTRATIVE DIVISION File Number(s)
2011/2691
Re
Walter Abel
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Deputy President PE Hack SC
Date 25 October 2013 Place Perth The decision under review is affirmed.
...................[sgd].....................................................
Deputy President PE Hack SC
CATCHWORDS
SOCIAL SECURITY – Newstart allowance – connection failure – reconnection failure – penalty period – whether delegation of Secretary’s power – whether notification of consequences of non-attendance – decision affirmed
LEGISLATION
Social Security (Administration) Act 1999, ss 42E, 42G, 42H, 42K, 42L, 42U, 63(2), 234
REASONS FOR DECISION
Deputy President PE Hack SC
Introduction
In early 2011 the applicant, Mr Walter Abel, was receiving Newstart allowance. By letter of 25 February 2011 Mr Abel was required by CRS Australia (an agency within the Department of Human Services) to attend an appointment on 2 March 2011 with that agency. Mr Abel did not attend that appointment, indeed it appears that he did not bother to open the envelope in which the letter of notification was sent. The failure to attend that appointment was treated by Centrelink as a “connection failure” as that expression is used in the Social Security (Administration) Act 1999 (Cth) (the Administration Act). Mr Abel was then required to attend a “reconnection” appointment on 10 March 2011. Again, he did not attend. That failure led Centrelink to impose on Mr Abel a “penalty amount” for his “reconnection failure”, an amount of $369.42 which was deducted from Mr Abel’s payment due on 6 May 2011. Mr Abel attended a re-engagement appointment on 21 March 2011.
The decision to impose the penalty was affirmed on internal review on 13 May 2011 and by the Social Security Appeals Tribunal on 21 June 2011. Mr Abel then sought review in this Tribunal. On 9 March 2012 the Tribunal, differently constituted, affirmed the decision[1].
[1]See [2012] AATA 155.
Mr Abel appealed the Tribunal’s decision to the Federal Court of Australia. It was remitted to what was then the Federal Magistrates Court of Australia. On 7 March 2013 that Court set aside the Tribunal’s decision and remitted the matter for reconsideration[2]. The question of law agitated by Mr Abel on the appeal was whether there was power for the respondent Secretary to delegate to CRS Australia the capacity to require Mr Abel to attend the 2 March 2011 appointment and, if the power existed, whether there was any evidence of the fact of such delegation. Federal Magistrate Lucev held that the Secretary had such power[3] but that there had been no evidence before the Tribunal that would have permitted the conclusion that there had been such a delegation. Thus, on the evidence before the Tribunal, the failure to attend the 2 March 2011 appointment could not have been a connection failure, the failure to attend the 10 March 2011 appointment could not amount to a reconnection failure and there was no basis upon which a penalty could have been imposed. Hence the appeal was allowed and the decision remitted[4].
[2]See [2013] FMCA 124.
[3]At [45].
[4]At [50].
The hearing
Mr Abel was not present in the hearing room when the matter came on for hearing. Telephone contact was made with him and he made it plain, in fairly blunt terms, that he did not desire to participate in the hearing. His comments will no doubt be recorded in the transcript. I determined that I should consider the matter on its merits rather than dismissing the application because of Mr Abel’s non-attendance. I was satisfied that the Secretary’s solicitor had provided to Mr Abel the additional documentary evidence that was intended to be relied on to deal with the conclusions of the appeal and would be provided with, and be given an opportunity to respond to, any further material lodged on behalf of the Secretary following the hearing.
Additionally, and after considering the legislation in greater detail after the conclusion of the hearing, I arranged for the Acting District Registrar to write to the parties seeking submissions on one aspect of the matter that had not been dealt with in the hearing.
The statutory setting[5]
[5]Considerable amendments were made to the Administration Act, in relation to notifications made on or after 1 July 2011, by the Social Security Legislation Amendment (Job Seeker Compliance) Act 2011, No 48, 2011. The legislation quoted is in the form it was in February and March 2011.
Section 63(2) of the Administration Act permits the Secretary to require a person receiving a social security payment (Newstart allowance is such a payment) to, amongst other things, “attend a particular place for a particular purpose”[6]. Notification may be given by sending the notice by prepaid post addressed to the person at his or her postal address last known to the Secretary or in any other way the Secretary considers appropriate[7]. In some circumstances, and by virtue of s 64 of the Administration Act, a failure to comply with a requirement under s 63(2) can result in a benefit not being payable at all. This case does not involve that regime; it falls to be considered under the different regime in Division 3A of Part 3 of the Administration Act. Under that regime a person who commits what is described as a reconnection failure is liable to have a penalty amount deducted from the person’s participation payment until the requirement imposed on the person is complied with.
[6]See s 63(2)(c) of the Administration Act.
[7]See s 63(5) of the Administration Act.
The starting point is s 42E of the Administration Act. Where, relevantly[8], a person fails to comply with a requirement notified to the person under s 63(2) of the Administration Act the Secretary may determine that the person “commits a connection failure”[9]. The Secretary must not do so if the person satisfies the Secretary that the person had a reasonable excuse for the failure[10]. Whether a reasonable excuse exists was to be determined by reference to s 42U[11] of the Administration Act and the Determination made by the Secretary on 10 May 2009 in accordance with that section.
[8]There is no suggestion that the requirement in s 42E(1)(b) of the Administration Act was not satisfied.
[9] See s 42E(1) of the Administration Act.
[10]See s 42E(4)(a) of the Administration Act.
[11]The Secretary’s statement of facts and contentions (exhibit 2, paragraph 28) made reference to s 42UA of the Administration Act. That section was introduced by the amending act, Act No 48 of 2011, and had no application at the time of these events.
If the Secretary determines that a person has committed a connection failure, then the Secretary may require the person to comply with a requirement, called a “reconnection requirement”[12]. Section 42K of the Administration Act dealt with the notification requirements of a reconnection requirement. It provided,
(1) The Secretary must notify the person that a failure to comply with a reconnection requirement or a further reconnection requirement imposed on the person might result in a penalty amount being deducted from the person’s participation payment.
(2) The notification does not have to be in writing, but must occur before the day the person is required to comply with the reconnection requirement or the further reconnection requirement.
[12]See s 42G of the Administration Act.
Where a person is required to comply with a reconnection requirement and fails (again, without satisfying the Secretary of a reasonable excuse) to comply with that requirement, the Secretary may determine that the person commits a “reconnection failure”[13]. Where the Secretary has determined that a person has committed a reconnection failure a “penalty amount” is deducted from amounts otherwise payable[14]. It is not necessary for present purposes to examine the mechanism by which this is done nor the method of calculation of the amount; Mr Abel has never put those matters in issue.
[13]See s 42H of the Administration Act.
[14]See s 42L of the Administration Act.
The Secretary’s power of delegation is found in s 234 of the Administration Act. There is power, subject to an irrelevant exception, to “delegate to an officer all or any of the powers of the Secretary under the social security law”. “Officer” is defined in s 234(7) of the Administration Act to include,
…a person engaged (whether as an employee or otherwise) by:
(a)an Agency (within the meaning of the Public Service Act 1999); or
(b)another authority of the Commonwealth; or
(c)an organisation that performs services for the Commonwealth.
…
Additionally, there is a power, subject to the same irrelevant exception, in s 234(2) of the Administration Act to delegate to the Chief Executive Officer or an employee of the Agency all or any of the powers of the Secretary under the social security law.
Consideration
Some further matters of fact need be noticed. On 26 February 2010 the Secretary (Ms Paul) made an instrument of delegation pursuant to s 234 of the Administration Act[15]. By that instrument, Ms Paul delegated to “[e]ach person engaged by an employment services provider to perform functions or to provide services under a relevant arrangement” various powers including, relevantly for present purposes, the powers of the Secretary under s 63(2) of the Administration Act. The term “employment services provider” was defined in the instrument to mean
an organisation that performs functions or provides services for the purposes of the social security law under:
(a) a relevant arrangement …
The term “relevant arrangement” was defined to include the Memorandum of Understanding between Department of Education, Employment and Workplace Relations and Department of Human Services as represented by CRS Australia 2010-2012 (the Memorandum of Understanding)[16].
[15]Attachment 1 to exhibit 3.
[16]Exhibit 5.
The letter of 25 February 2011[17] was sent by CRS Australia. The content of that letter, together with the evidence of Mr David Philip, the Regional Manager of CRS Australia, permits me to infer that the person sending that letter was Mr David Ranson. The letter of 14 June 2013 from CRS Australia[18] satisfies me that in February 2011 Mr Ranson was employed as a Senior Rehabilitation Consultant with CRS Australia and that his duties included performing functions and providing services under the Memorandum of Understanding. I am thus satisfied that the instrument of delegation of 26 February 2010 delegated to Mr Ranson the Secretary’s power under s 63(2) of the Administration Act to require Mr Abel to attend a particular place, CRS Australia at Cannington, for the purpose of assessing his employment needs in the terms set out in the letter. I am also satisfied that Mr Abel failed to comply with that requirement and thus committed a connection failure. He has not satisfied me that he had a reasonable excuse for that failure. It seems difficult to see how he could do so where his evidence in the earlier hearing was that he received the letter from CRS Australia but did not open it[19]. I do not accept his assertion, conveyed to CRS, that he was not obliged to deal with that organisation and could only be required to deal with Centrelink. Nor do I accept that he could not be required to undertake any obligation outside those specified in his Employment Pathway Plan.
[17]Attachment ST2 (page 2) to exhibit 2.
[18]Exhibit 6.
[19] [2012] AATA 155 at [13].
Mr Abel was notified of the reconnection requirement, that is, the requirement to attend an appointment on 10 March 2011, in the course of a telephone discussion with a Centrelink employee on 8 March 2011[20]. In the course of the hearing I raised with the solicitor for the Secretary whether there was evidence of the delegation to that employee of the Secretary’s power under s 42G of the Administration Act to require Mr Abel to comply with the reconnection requirement. Although Mr Abel declined to attend the hearing and appeared not to have raised this as an issue in the earlier hearing it seemed desirable to ensure that the issue was dealt with expressly. Leave was given to the Secretary to lodge additional evidence and provide further written submissions after the hearing to deal with this aspect. Mr Abel was given the opportunity to respond to any additional material provided by the Secretary. Additionally, and after the conclusion of the hearing, I was concerned whether the material demonstrated compliance with s 42K of the Administration Act, that is, whether, when Mr Abel was required to comply with the reconnection requirement, he was notified that a failure to do so might result in a penalty amount being deducted from his payment. Further submissions were sought from the Secretary with Mr Abel again being given an opportunity to respond.
[20]Exhibit 1, at page 59.
The Secretary lodged additional submissions together with evidence of delegation on 2 October 2013. Mr Abel lodged a single page of vulgar abuse, together with an extract from the Australian Public Service Code of Conduct, on 11 October 2013. I am unable to discern the relevance of Mr Abel's “submissions” or what use he seeks to make of the Code of Conduct in the context of the present case however he appears not to put in issue the matters raised in the Secretary’s supplementary submissions nor suggest that I ought not have regard to that material.
The material establishes that the author of the file note recording the 8 March 2011 conversation was appropriately delegated the Secretary’s power to impose a reconnection requirement on Mr Abel on that day. Moreover, the material[21] satisfies me that Mr Abel was notified that a failure to attend the appointment on 10 March 2011 might result in the loss of payment for each day that he failed to comply. I had been concerned about this aspect because the file note of the conversation of 8 March 2011[22] makes no reference to Mr Abel being notified of the consequences of a failure to attend. But Mr Abel has not put in issue the fact of compliance with s 42K of the Administration Act. In those circumstances I am satisfied that it was complied with.
[21]Exhibit 1, page 54.
[22]Exhibit 1, page 57.
I am then satisfied that the statutory scheme was complied with and that the penalty was properly imposed on Mr Abel. The decision under review will be affirmed.
I certify that the preceding 16 (sixteen) paragraphs are a true copy of the reasons for the decision herein of Deputy President PE Hack SC ................[sgd D Brodie]........................................
Associate
Dated 25 October 2013
Date(s) of hearing 25 September 2013 Date final submissions received 11 October 2013 Applicant In person Solicitors for the Respondent Australian Government Solicitor
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