BERTA JORGER and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
[2010] AATA 193
•23 March 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 193
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2009/4592
GENERAL ADMINISTRATIVE DIVISION ) Re BERTA JORGER Applicant
And
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
Respondent
DECISION
Tribunal Mr R G Kenny, Senior Member Date23 March 2010
PlaceBrisbane
Decision The Tribunal affirms the decision under review.
...................[Sgd]......................
Senior Member
CATCHWORDS
SOCIAL SECURITY – Benefits and entitlements – Wife pension – Failure to give notification of income – Overpayment of wife pension - Debt due to the Commonwealth – No basis for writing off debt – No basis for waiver of debt – Decision affirmed
Social Security Act 1991 (Cth), ss 8, 23, 1064, 1223, 1236, 1237A, 1237AAD
Social Security Act (Administration) 1999 (Cth), ss 68, 100Groth v Secretary, Department of Social Security (1995) 40 ALD 541
REASONS FOR DECISION
23 March 2010
Mr R G Kenny, Senior Member
BACKGROUND
1. From 1993, Berta Jorger and her partner were in receipt of the wife pension and disability support pension, respectively. These are forms of income support payable in accordance with the terms of the Social Security Act 1991 (Cth) (“the Act”). On 18 March 2009, a Centrelink officer determined that each of them had been overpaid in relation to their pension entitlements in the amount of $52,064.09 during the period from 13 January 1994 until 9 December 2008 (“the overpayment period”). It was also determined that these were debts owed by each of them to the Commonwealth. On 22 May 2009, an authorised review officer with Centrelink, Peter Hugo, varied the decisions by increasing the amount of each of the overpayments and the debts. In Ms Jorger’s case, it was increased to $55,925.79. The Social Security Appeals Tribunal (“the SSAT”) affirmed those decisions on 25 August 2009. Ms Jorger has sought further review by the Administrative Appeals Tribunal. Her partner has not done so and, indeed, has made full repayment of the debt raised against him.
2. It is common ground that, at all material times, Ms Jorger was qualified for the wife pension and that the rate of her payments was dependent on the combined income and value of the assets of Ms Jorger and her partner. Throughout the overpayment period, Ms Jorger’s partner was paid a pension by an authority in Switzerland. No regard was had to this in the assessment of his income as Centrelink was unaware of his receipt of it until November 2008.
CONTENTIONS AND ISSUES
3. Mr Hamilton submitted that the Swiss pension comprised income and that, when this was included in Ms Jorger’s pension calculations, she was overpaid in the amount raised against her as a debt payable to the Commonwealth. He also submitted that Centrelink was not given appropriate notice that Ms Jorger’s partner was in receipt of the Swiss pension and that there was no basis to write off or waive the debt.
4. Ms Jorger contended that she was unaware of the Swiss pension payments at any time before 2009. She did not challenge the calculation of the overpayment amount but submitted that she did not understand the basis relied on by Centrelink to calculate it, in particular, because of what she perceived to be inconsistencies in the calculation records supplied to her.
5. The issues for determination are whether, in the overpayment period, Ms Jorger was overpaid an amount of wife pension; what the amount of any such overpayment is; whether any such amount is a debt owed by Ms Jorger to the Commonwealth; and whether any such debt should be written off or waived.
EVIDENCE
Ms Jorger
6. Ms Jorger gave the following evidence. She and her partner moved to Australia from Switzerland in 1983. For some years, her partner obtained casual employment until he became ill in 1993. Ms Jorger has been mainly unemployed because her Swiss qualifications as an educator have not been recognised in Australia. She has performed voluntary work for various organisations and partly completed an accountancy course in which she achieved good results.
7. Since before 1994, Ms Jorger has cared for her partner who suffers from chronic paranoid schizophrenia. During that time, she has assumed responsibility for all of his affairs including those of a financial nature. Ms Jorger has very little in savings but her partner has several bank accounts, of which some are held jointly between them and others are held independently by him. Ms Jorger is able to conduct transactions under the joint accounts. For those relating to her partner’s accounts, she accompanies him to bank premises and assists him to conduct relevant transactions. Until 2009, Ms Jorger was unaware that the Swiss pension was paid to her husband but has since learned that it was paid into one of her partner’s bank accounts. She had not been aware of any Swiss pension deposits in her partner’s accounts which she identified as amounting to approximately $1,500 to $1,600 per month with variations being due to fluctuations in currency values.
8. Ms Jorger agreed that she and her partner had completed Income Review Forms for Centrelink from time to time including one on 18 September 1997[1]. She agreed that, therein, the response to the question relating to receipt by them of any “Superannuation Pensions or Other Income” had been left blank. She also agreed that she and her partner had completed a form for the continuation of their pension payments during an overseas trip they took in 1998 in which they omitted a reference to pension receipt at that time[2]. While unable to explain these omissions, Ms Jorger said that it was not done deliberately but agreed that the blank responses had the potential to affect her pension payments. She said that, if there was some discrepancy in the Centrelink forms, they should have been returned to her by Centrelink for any omission to be remedied by her. Ms Jorger agreed that Centrelink had regularly sent documentation to her and her partner throughout the overpayment period requesting information about their respective income levels. She also agreed that responses to these made no reference to the Swiss pension.
[1] See T22/62.
[2] See T16/72.
9. While pointing out what she saw as discrepancies in records provided to her by Centrelink for the calculation of her overpayment, Ms Jorger agreed that she had attended an interview with Peter Hugo, the authorised review officer who made the decision on 22 May 2009. She found this helpful and agreed that he had attempted to explain the calculations at that time.
10. Ms Jorger described herself as being in good health, apart from the stressful impact she experiences as a result of caring for her partner. She described this as a full-time responsibility. She and her partner own their own home and have no significant debts, apart from that which is under review. Until recently, she has been repaying the debt alleged against her through reductions in her current wife pension.
Peter Hugo
11. Mr Hugo was the authorised review officer who made the decision relating to Ms Jorger’s pension overpayment on 22 May 2009. He has been involved in debt calculation functions with Centrelink for some four years. He met with Ms Jorger at her request in 2009 and explained to her the details of the debt calculation. For that meeting, he completed a lengthy recalculation of the overpayment. This was in evidence[3] and Mr Hugo was confident that it was correctly done.
[3] See exhibit 2.
12. In his evidence, he noted Ms Jorger’s references to discrepancies between amounts declared in Centrelink letters to her and amounts identified in the calculation records for the same periods. He noted that some of these had related to asset values and he explained that these amounts were not necessarily used to calculate the level of Ms Jorger’s pension. This was because the impact of the asset test was compared with that of the income test and the result which had the greater impact on pension entitlement was utilised in the calculation. He said that, in Ms Jorger’s case because of the Swiss pension, the income test had the greater impact and was used in the calculation of her overpayment.
13. Mr Hugo also referred to the discrepancies in the income amounts in letters sent to Ms Jorger during the overpayment period and the amounts identified in the calculation records for the same periods. He explained that the letters nominated the amounts that had been periodically declared by Ms Jorger but which did not include the Swiss pension payments. On the other hand, the debt calculation figures included both the declared income and the Swiss pension payments.
Other evidence
14. Ms Jorger’s partner gave evidence before the SSAT. There, he said that he had received the Swiss pension which was paid into a Swiss bank account in his name from 1994. He said that, over the years, he made an annual transfer from that account into his Australian bank account but that, in more recent times, he had arranged the transfer on a monthly basis. He was unable to recall when the frequency of the transfer arrangement changed. He also advised that his Australian account included an inheritance of approximately $300,000 received by him in 1999.
15. In evidence was an Income Review Form completed by Ms Jorger and her partner on 18 September 1997[4]. It comprises a range of questions about their finances. It records responses except for one question relating to receipt by them of any “Superannuation Pensions or Other Income”. Neither a “yes” nor “no” response is provided.
[4] See T14/62.
16. Also in evidence was documentation from the authority in Switzerland responsible for making the pension payment to Ms Jorger’s partner[5]. Centrelink first became aware of this in November 2008 when it requested information from the authority. The documentation from the authority included a statement, dated 4 December 2008, which nominates the monthly payments to Ms Jorger’s partner in each year from 1994 to 2009 in amounts increasing from 1,282.00 to 1,555.00 Swiss francs.
CONSIDERATION
[5] See T22/87.
Overpayment and debt
17. The wife pension is calculated in accordance with the rate calculator at the end of s 1064 of the Act and this requires the income of both Ms Jorger and her partner to be taken into account. The term income is defined in s 8 of the Act in broad terms and I am satisfied that it includes the Swiss pension received by Ms Jorger’s partner during the overpayment period. I am also satisfied that Centrelink sent numerous notices, which meet the requirements of s 68(2) of the Social Security Administration Act 1999 (Cth) (the Administration Act), to Ms Jorger and her partner advising them to notify Centrelink of their income. I am also satisfied that they did not notify Centrelink of the receipt by Ms Jorger’s partner of the Swiss pension during the overpayment period.
18. Wife pension is a social security pension and a social security payment under s 23 of the Act. Where a person in receipt of a social security payment fails to comply with a s 68(2) notice, s 100(1) of the Administration Act provides for a retrospective rate reduction. In the decision under review, this provision was relied upon to reduce the amount of Ms Jorger’s wife pension from the start of the overpayment period. It was determined that she had received $135,163.68, was entitled to receive $79,237.89 and had been overpaid $55,925.79. I have noted Ms Jorger’s concerns about those calculations. However, on the evidence of Mr Hugo, in particular the explanations he gave in relation to Ms Jorger’s concerns, I am satisfied that the calculations were correctly made and that Ms Jorger was overpaid $55,925.79 in the overpayment period. In accordance with s1223 of the Act, this overpayment is a debt due by Ms Jorger to the Commonwealth.
Writing off the debt
19. Provision is made for a debt to be written off under s1236 of the Act. This is the case if the debt is irrecoverable at law; or the debtor has no capacity to repay the debt; or the debtor's whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or it is not cost effective for the Commonwealth to take action to recover the debt. The only component of that provision of potential relevance in this matter is that relating to lack of capacity to repay the debt. Ms Jorger has been repaying the debt to the respondent through deductions from her wife pension payments and I am satisfied that there is no lack of capacity for the debt to be repaid on that continuing basis. In that situation, the debt should not be written off.
Waiver of debt: s1237A of the Act
20.A debt may be waived under s1237A of the Act, which reads:
1237A Administrative error
(1)Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
(1A) Subsection (1) only applies if:
(a) the debt is not raised within a period of 6 weeks from the first payment that caused the debt; or
(b) if the debt arose because a person has complied with a notification obligation, the debt is not raised within a period of 6 weeks from the end of the notification period;
whichever is the later.
21. The first element to be satisfied under s 1237A(1) of the Act is that the debt must be attributable solely to an administrative error made by the Commonwealth. Ms Jorger’s debt arose through failure to comply with the notices under s 68 of the Administration Act. I do not accept Ms Jorger’s evidence that she had no knowledge whatsoever of the payment of the Swiss pension to her partner. I note the evidence that her partner gave to the SSAT that the Swiss pension was transferred from a Swiss bank account to one of his Australian accounts. Initially, this was done annually but, at some time during the overpayment period this was changed to a monthly basis. Ms Jorger’s evidence was that, throughout the overpayment period, she played the responsible role in the management of his bank accounts. I note that, in the overpayment period, Ms Jorger demonstrated capacity to perform creditably in part of an accountancy course. I also note her failure to complete components of Centrelink forms relevant to the receipt of payments such as the Swiss pension. I am satisfied that this failure to advise Centrelink of the Swiss pension was the reason for the debt and not any error on the part of the Commonwealth. The debt may not be waived under s1237A of the Act.
Waiver of debt: s 1237AAD of the Act
22. A debt may also be waived under s 1237AAD of the Act which reads:
s1237AAD Waiver in special circumstances
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, the Administration 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.
23. The Act provides no guidance as to the meaning of the term “special circumstances” in s 1237AAD of the Act. In Groth v Secretary, Department of Social Security[6], Kiefel J observed that special circumstances:
would require something to distinguish ... [the] ... case from others, to take it out of the usual or ordinary case … It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary.
[6] (1995) 40 ALD 541at 545.
24. Ms Jorger and her partner own their own home. Apart from that of Ms Jorger under consideration, they have no significant debt. In particular, I note that the equivalent debt of Ms Jorger’s partner has been repaid by him. Ms Jorger has no particular health concerns. While her partner has a serious condition, it is this for which he received the disability support pension and in relation to which Ms Jorger receives the wife pension. I am satisfied that Ms Jorger’s situation is not one which falls below the standard applicable to the usual or ordinary case of a social security recipient. In that situation, there are no special circumstances such that the debt may be waived under s 1237AAD of the Act.
DECISION
25.The decision under review is affirmed.
I certify that the 25 preceding paragraphs are a true copy of the reasons for the decision herein of Mr R G Kenny, Senior Member
Signed: .......................[Sgd]................................................
Kate Stack, Research Associate
Date of Hearing 11 March 2010
Date of Decision 23 March 2010
Applicant was self-represented.
Respondent was represented by Mr R Hamilton, Departmental Advocate
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