ARNOLD and SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

[2011] AATA 618

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2011] AATA 618

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2010/5220

GENERAL APPEALS DIVISION		)
Re		KIMDELIA ARNOLD

Applicant

And Secretary, Department of Education, Employment and Workplace Relations

Respondent

DECISION

Tribunal  Senior Member Bernard J McCabe

Date 2 September 2011

Place Darwin

Decision  The Tribunal affirms the decision under review.

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Senior Member

CATCHWORDS

SOCIAL SECURITY — benefits and entitlements — parenting payments — overpayment of benefits — applicant failed to disclose income in a timely manner — no basis to waive Commonwealth’s right to recover debt — decision affirmed

Social Security Act 1991 (Cth), s 68, s 1237

REASONS FOR DECISION

2 September 2011 Senior Member Bernard J McCabe

1.Centerlink says Ms Arnold, the applicant, was overpaid parenting payment in the period 25 September 2004 to 30 June 2006. It says the overpayment came about because Ms Arnold did not keep Centrelink informed of her earnings. Ms Arnold says she did keep Centrelink informed of her earnings in a timely way, and that any overpayment is Centrelink’s fault. She adds that the amount of the debt is wrong because the calculations did not take into account the fact that some of the earnings attributed to her were in fact advances on commission rather than wages. Ms Arnold says that makes a big difference to the outcome. There was also a discussion of whether any debt that was found to exist should be waived.

2.I have decided to affirm the decision under review for reasons I will explain.

The facts

3.Ms Arnold worked for a variety of employers in the period under review. She says she diligently reported her income to Centrelink each fortnight using its automatic telephone voice recording system. She says she also attended her local Centrelink office on a regular basis to ensure the necessary information was provided because she said she did not want to incur a debt. Ms Arnold noted her payments were reduced on a couple of occasions, apparently in response to information she provided.  She pointed out that Centerlink’s documents tendered at the hearing include information provided by her. She says Centrelink simply failed to take into account what she had dutifully told them.

4.The applicant also said the debt figure was not properly calculated because it did not distinguish between wages and commissions. Although she did not pretend to understand the significance of the distinction, she said an authorised review officer told her that payments of commission were treated differently to payments of wages. She said she understood that a much smaller debt would be owed if that distinction were taken into account. As far as she was concerned, this whole mess was of Centrelink’s making.

5.Ms Arnold also spoke about her personal circumstances. She said she had been experiencing depression in recent years owing to stress, most obviously the stress associated with her son’s bad behaviour and drug addiction. She mentioned another family member who was also dealing with a drug problem.  Ms Arnold agreed the problems with her son had been reduced now that he was serving time in gaol in Western Australia. Her health is otherwise acceptable. She referred to significant financial problems: she owes a lot of money on her mortgage and personal loan and credit cards.

6.In response, Mr Hamilton said the Centrelink records include information about Ms Arnold’s income, but explained that the information was obtained at first instance from the Australian Taxation Office and subsequent investigations carried out by Centrelink. He said Ms Arnold did not provide the information she was required to provide in a timely way, pursuant to notices issued under s 68 of the Social Security Act 1991 (Cth) (“the Act”). He added there is no record of information being provided through the automated telephone voice recording and reporting system. I note Centrelink has discontinued the use of that particular system.

7.Mr Hamilton conceded there were a number of errors in the debt calculations that might have led to confusion. However, he said the process was unusually tortured because of the way in which information about Ms Arnold’s earnings was effectively “drip fed” to Centrelink. While Centrelink may have experienced difficulty in calculating the debt, he argued the overpayment arose in the first place because Ms Arnold knowingly failed to provide timely information about her earnings to Centrelink. It was submitted Centrelink’s failings, if any, occurred in connection with its attempts to accurately quantify the debt.

8.I am not prepared to conclude Ms Arnold actively or knowingly concealed her earnings from Centrelink. She says she does not specifically recall receiving letters from Centrelink containing notices of her obligation to disclose information, but I have no reason to doubt those letters were despatched or received and read. I also accept she spoke with Centrelink officers at her local office on a number of occasions in relation to her affairs. I am not satisfied Ms Arnold’s disclosures were as detailed as might have been required. By way of example, I note her evidence to the effect that she told Centrelink of her intention to get work in security but there is no evidence that she informed Centrelink of her success in getting a position or deriving extra income in a timely way. While there may have been problems with the telephone voice recording system that Ms Arnold says she used to report her earnings, it is difficult to believe the system failed to record her messages on each and every occasion she used it.

9.At least part of the information Centrelink required from Ms Arnold was not provided in a timely way, and only after Centrelink had started to make enquiries. Even if Centrelink made errors in recording and processing some of the information provided by Ms Arnold, those errors were at least partly caused by the applicant’s less than diligent approach to providing information. As I say, I am not prepared to say that is because she was dishonest. I accept her attention to her obligation to report information to Centrelink might have been diverted by other events going on in her life at the time.

10.I accept Centrelink has properly taken into account the distinction between wages and commissions in the final calculations performed by the authorised review officer in the decision dated 5 July 2010.

11.In the circumstances, I am satisfied the overpayment debt has been calculated correctly.

12.I turn now to the question of waiver. Given I have concluded that the overpayment amount cannot be attributed entirely to administrative error on Centrelink’s part, it would be inappropriate to waive the debt under s 1237A(1) of the Act. But what of special circumstances under s 1237AAD of the Act?

13.I have already indicated I am not inclined to find the applicant knowingly failed to disclose information to Centrelink. But I do not think it ultimately matters because the applicant did not identify anything in the course of her evidence that would amount to special circumstances within the meaning of the circumstances. As the Social Security Appeals Tribunal correctly observed in its decision below, “special circumstances” are circumstances that are unusual in a way that marks this case out as being different. I accept Ms Arnold is under financial strain, but that is not enough on its own to justify the exercise of the discretion: s 1237AAD(b), and there is nothing unusual about that hardship in any event. Ms Arnold’s family circumstances are unfortunate, but I do not think any of the other matters she referred to in the course of the hearing suggest her case is unusual so that the discretion ought to be exercised in her favour.

Conclusion

14.Ms Arnold received money to which she was not entitled. She got the money as a result of miscommunications between her and Centrelink. She was at least partly responsible for those miscommunications. Persons who receive money they were not entitled to receive should pay it back, unless there is an acceptable reason for not doing so in the circumstances. I am satisfied Ms Arnold should return what she should not have received, albeit that I understand she is repaying the debt on favourable terms.

15.The decision under review is affirmed.

I certify that the 15 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member Bernard J McCabe

Signed: .....................................................................................
  Associate

Date of Hearing  25 August 2011
Date of Decision  2 September 2011
Applicant  Self-Represented

Advocate for the Respondent    B Hamilton, Centrelink Program Litigation and Review Branch