Beverley Colley and Secretary, Department of Social Services

[2015] AATA 439

[2015] AATA 439  

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2014/4942
Re	Beverley Colley
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Dr Alexander, Member
Date	24 June 2015
Place	Sydney

The decision under review is affirmed.

...........................................

Dr Alexander, Member

Catchwords – SOCIAL SECURITY - pension bonus – work test – bonus period – date ceased work – whether claim for age pension and pension bonus made in prescribed time – whether special circumstances to extend time for lodging claim – claim not made in time – no special circumstances – decision affirmed

Legislation

Social Security Act 1991 s 92A, 92C, 92N, 92T, 92V

Social Security (Administration) Act 1999 ss 21, 22, 23

Cases

Groth v Secretary Department of Social Security (1995) 40 ALD 541
Boscolo v Secretary Department of Social Security [1999] FCA 106; (1999) 53 ALD 277
Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634

Secondary Materials

Guide to Social Security Law

REASONS FOR DECISION

Dr Alexander, Member

BACKGROUND

1. On 20 August 2010 Ms Colley lodged an application to register as a member of the pension bonus scheme (PBS). Pursuant to section 92H(3) and (4) of the Social Security Act 1991 (SS Act), which sections have since been repealed, her registration for the scheme was granted with effect from 14 January 2008.

2. At the time of her registration, Ms Colley was self-employed as a full time service station owner and operator. During 2010, Ms Colley stopped working and was supported by her husband who continued working until his death in February 2014.

3. On 20 March 2014, Ms Colley lodged a claim for age pension and pension bonus. On her claim form she stated that she ceased to meet the work test on 31 July 2011.

4. Ms Colley was granted the age pension on 20 March 2014, which was subsequently cancelled when she was able to access her husband’s superannuation.

5. Ms Colley’s claim for pension bonus was rejected by Centrelink, both initially and on internal review, on the basis she had ceased work on 31 July 2011 and did not claim age pension or the pension bonus within 13 weeks of that date.  On 11 September 2014 the Social Security Appeals Tribunal (SSAT) affirmed Centrelink’s decision on the basis she did not claim pension bonus within 13 weeks of ceasing work on 31 July 2011, and there were no special circumstances which would allow for a longer period in which to make a claim.

6. Ms Colley seeks review of the SSAT decision.

7. Ms Colley attended the hearing by telephone on 19 March 2015; she represented herself and was able to give oral evidence.

8. At the hearing certain issues were raised which led to an adjournment to allow the advocate for the respondent to seek further instructions and provide written submissions.

9. The hearing was resumed on 18 May 2015 in order to allow Ms Colley an opportunity to address any new issues raised in the respondent’s supplementary written submissions.

10. For convenience the respondent in this matter will be referred to as Centrelink.

    The Legislation

11. The relevant law is contained in the:

    Social Security Act 1991( the SS Act)

    Social Security (Administration) Act 1999 (the SSA Act)

12. The provisions of Part 2.2A of the SS Act enables a person who reaches the qualification age for age pension to continue in gainful employment, defer claiming the age pension and be eligible to receive a single lump-sum pension bonus.

13. Section 92A of the SS Act provides a simplified outline of the pension bonus part of the legislation as follows:

    A person who qualifies for an age pension but defers claiming that pension may be able to get a single lump-sum pension bonus.

    A person who wants to get a pension bonus must register as a member of the pension bonus scheme. An application for registration cannot be made on or after 1 July 2014.

    To get a pension bonus, a person must accrue between 1 and 5 bonus periods while deferring age pension.

    Generally, a bonus period runs for 1 year.

    To accrue a bonus period, the person must pass the work test for that period.

    To pass the work test for a year, either the person, or the person’s partner, must gainfully work for at least 960 hours during that year.

    The amount of a person’s pension bonus depends on the number of accrued bonus periods and the person’s annual rate of age pension. A person may get a bigger bonus by accruing more bonus periods. [emphasis in original]

14. Section 92C of the SS Act relevantly provides that a person is qualified for a pension bonus if:

    (a)   …

    i.    the person starts to receive an age pension at or after the time when the person makes a claim for the pension bonus; and

    …

    (c)    the person is registered as a member of the pension bonus scheme; and

    (d)   the person has accrued at least  one full year bonus period while registered as a member of the pension bonus scheme;

    …

15. There is no dispute that at the time of her application for pension bonus Ms Colley was a registered member of the scheme in satisfaction of section 92C of the SS Act.  The question to be determined is whether Ms Colley lodged her claim for pension bonus within the prescribed period.

16. Section 22 of the SSA Act provides that “[i]f a person’s last bonus period is a full-year period, the lodgement period for a claim by the person for pension bonus is the period of 13 weeks immediately following that bonus period”.

17. Section 23(1) of the SSA Act provides that “[i]f a person’s last bonus period is a part-year period, the lodgement period for a claim by the person for pension bonus is:

    (a) the period of 13 weeks beginning at the end of that bonus period; or
    (b) if the Secretary allows a longer period - - that longer period”. 

18. It is accepted Ms Colley is an accruing member as defined by section 92N of the SS Act.  A full-year bonus period is therefore the full-year for which she satisfied the work test beginning the date her registration took effect, that is, from 14 January 2008: s 92T(1) of the SS Act.  A part-year bonus period is the last bonus period immediately following a full-year bonus period that accrues to a person who satisfies the work test for that period and who specifies the period in the person’s claim for pension bonus: s 94T(2) of the SS Act. 

19. The work test is satisfied for a full-year of a person’s accruing membership when the Secretary is satisfied the person worked at least 960 hours during that period.  The work test for a part-year period is at least the pro-rated number of hours calculated using the formula provided in section 92V(2) of the SS Act. 

    Did Ms Colley lodge her claim for pension bonus within the prescribed period?

20. The evidence before the Tribunal with respect to Ms Colley’s work record is somewhat confused.

21. Centrelink submit, and I accept, that Ms Colley’s registration for pension bonus was effective from 14 January 2008.  At the hearing it was agreed, Ms Colley had accrued two full-year bonus periods: 14 January 2008 to 13 January 2009 and 14 January 2009 to 13 January 2010.

22. Centrelink contends Ms Colley stopped full time work and thus failed the work test as of 30 April 2010, and she should have applied for age pension and pension bonus within 13 weeks of that date.

23. Centrelink relies on a letter from Ms Colley’s accountant dated 6 October 2010 in which he states on 30 April 2010 Ms Colley’s lease over the service station expired after which she continued to operate her company as an investment vehicle and her activities were “limited to only 10 hours per week”.

24. At the hearing Ms Colley told the Tribunal that she continued to work at home until November 2010 when she stopped because she had finished all the work with the service station; she said “my husband was keeping me”.

25. In response to a question from the Tribunal, Ms Colley agreed that after November 2010 she did no further work that could be considered relevant to the work test.

26. Centrelink contends Ms Colley ceased work on 30 April 2010 and lodged her claim on 20 March 2014, more than three years after the prescribed period, and therefore was not entitled to receive pension bonus.

27. The general rule in section 21(1) of the SSA Act is that “a claim for pension bonus must be made within the lodgement period fixed by this Subdivision”, that is 13 weeks after the last bonus period, being 13 weeks from the date Ms Colley ceased work or failed to satisfy the work test.

28. It is not clear from the evidence before the Tribunal the date of the end of Ms Colley’s last bonus period. I accept Ms Colley’s evidence she did not work after November 2010. She lodged her claim for pension bonus on 20 March 2014. On this evidence, it is clear Ms Colley did not lodge a claim for pension bonus within 13 weeks of ceasing all paid work. It follows that pursuant to section 21(1) of the SSA Act Ms Colley did not meet the requirements for lodging a claim for pension bonus.

29. However, section 21(2) SSA Act provides that “the Secretary, may in special circumstances allow a person a longer period to make a claim than the period fixed by this Subdivision”.

30. Ms Colley told the Tribunal that she was repeatedly told by the “girls at Centrelink” that she could not claim pension bonus because she did not qualify for the age pension but not to worry because she was still registered and the bonus will still be there when she gets the age pension. She said that she was very unhappy because she “deserves the bonus” and had relied on Centrelink.

31. Ms Colley claims that she was misled and that this was unfair and that this qualifies as “special circumstances”.

32. The respondent contends that there are no special circumstances in this case.

33. Therefore, the definitive issue in the proceeding is whether there are ”special circumstances” such that the Tribunal could allow Ms Colley a longer period to make a claim than the period fixed by the Subdivision.

    Special circumstances

34. Although not defined in the SSA Act the expression “special circumstances”’ has been the subject of judicial comment for many years. In Groth v Secretary Department of Social Security (1995) FCA 1708; (1995) 40 ALD 541 the Federal Court stated:

    The phrase “special circumstances”, it has been said , although imprecise is sufficiently understood not to require judicial gloss…for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth’s case from others, to take it out of the usual or ordinary case. That was, I consider, the only enquiry to be undertaken in this 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.

35. In Boscolo v Secretary Department of Social Security [1999] FCA 106; (1999) 53 ALD 277, French J said [at 18]:

    The word “special” conditioning “reasons” or “circumstances” guards the entrance to the exercise of many statutory discretions. It is generally futile to search for its meaning in terms of other words. It is in essence instrumental, a direction to the decision-maker that the discretion it constrains is not lightly to be enlivened…The core of the requirement for “special circumstances” or “special reasons” is that there be something unusual or different to take the matter the subject of the discretion out of the ordinary course…. [b]ut that does not require that the case be extremely unusual, uncommon or exceptional.

36. Part 3.4.7.80 of the Guide to Social Security Law (the Guide) provides guidelines on when it may be appropriate for the exercise of the discretion in section 21(2) of the SSA Act. Although the Tribunal is not bound to strictly apply the guidelines I accept that cogent reasons are required in a particular case for not doing so: see Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634.

37. The Guide provides a non-exhaustive list of examples of acceptable reasons for not lodging a claim for pension bonus within the prescribed time, and states that each case should be judged on it merits.

38. The examples of acceptable reasons include cases where a member of the pension bonus scheme:

    ·     has poor numeracy or literacy skills;

    ·     was ill;

    ·     was located in a remote area;

    ·     performed irregular work that made it difficult for the member to determine the lodgement period;

    ·     was helping a close family member suffering from a serious illness;

    ·     has experienced the death of a close family member;

    ·     has experienced a major disruption to their living arrangements.

39. The Guide also states that before accepting a late claim “the delegate of the Secretary should consider how late the claim is and whether this is reasonable when considering the event/s that caused the member to claim late”.

    Ms Colley’s contact with Centrelink

    40.On 11 August 2010 Ms Colley contacted Centrelink about her entitlement to age pension and pension bonus, the record of that contact notes:

    [customer age pension] at 63.5, working full time in own business, knew about scheme, don’t think knew about registration??…got talking about relationship between rate of pension and pension bonus amount, customer was unaware of this, husband earns $52,000, she has super $220,00 so income world (sic) give minimum $23.10 and therefore no pension bonus amount,  if super not taken into account then rate higher and some bonus payable if late registration accepted for 2.5 years, customer to speak to financial planner re this

40. Following this telephone contact a letter dated 11 August 2010 was sent to Ms Colley confirming she had contacted Centrelink and indicated that a claim form should be lodged before 25 August 2010. A Pension Bonus Scheme booklet was included with the letter.

41. Ms Colley told the Tribunal that she did not recall receiving the letter or the booklet. However, she did agree that she had been told by Centrelink that she was not qualified for the age pension because her husband was working fulltime and supporting her.

42. On 20 August 2010 Ms Colley contacted Centrelink in respect of the pension bonus scheme.

43. On 15 November 2010 Centrelink sent a letter to Ms Colley confirming that she was an accruing member of the pension bonus scheme since 14 January 2008 and could claim a bonus whenever ready provided that she had “been an accruing member of the Scheme for at least the minimum 12 month period”.

44. The letter also stated that Ms Colley had signed an acknowledgement of her rights and obligations under the pension bonus scheme and had received an information booklet which sets out the details of the Scheme.

45. Centrelink records show that on 16 November 2010 a Centrelink officer contacted Ms Colley and provided her with information about the age pension and pension bonus that would have made it clear the time limits for claims under the pension bonus scheme. The following is an extract of the record of the Centrelink officer’s  notes:

    I rang customer 161110 to advise that I have registered her for the PBS from 140108.  I also advised that working on 40 hrs per week until 300410 she would have ceased passing the PBS work test on 070910. She now has 13 weeks from 070910 to claim the Age Pension and Pension Bonus. Cus thought so would get a Pension Bonus she didn’t realise you had to qualify for age pension as well. Discussed limits for age pension and CSHC. Suggested to customer that she claim both Age Pension and Pension Bonus and CSHC now before the 13 weeks expires to test if she is eligible. 

46. At the hearing Ms Colley said that she recalls this conversation and agreed that she understood that the age pension and pension bonus applications had to be lodged at the same time but she did not understand that she had to apply within 13 weeks of failing the work test and had relied on Centrelink staff who told her “don’t worry about anything until you go on the pension”.

47. In a letter dated 16 November 2010 Centrelink stated that if she wished to claim a payment she must return the claim form on or before 30 November 2010. An Age Pension New Claim Pack was included with the letter.

48. On 31 December 2010 Centrelink sent a letter to Ms Colley which stated:

    When you are ready to claim Age Pension you will need to claim the bonus at the same time. Please remember that you’ll need to lodge your bonus claim within 13 weeks of ceasing work, or within 13 weeks  from the date you no longer meet the work test.

49. Ms Colley told the Tribunal that she thought that she did remember receiving this letter and went to Centrelink to ask a few more questions. She said that she was told “Bev, don’t worry. You’re not ready to claim the pension.”

50. A similar letter was sent to Ms Colley on 3 January 2012, 31 December 2012 and 31 December 2013. Each of the letters confirmed that Ms Colley was still registered as a member of the pension bonus scheme and that when she was ready to claim the age pension she would she would need to claim the pension bonus at the same time. Each of the letters also clearly stated: “Please remember that you’ll need to lodge your bonus claim within 13 weeks of ceasing work, or within 13 weeks from the date you no longer meet the work test.”

51. In response to an enquiry by Ms Colley as to why her claim for pension bonus was rejected, Centrelink records of 24 April 2014 note  Ms Colley claimed “she was never advised of the requirement to claim age pension within 13 weeks of ceasing work.”  The note goes on to record Ms Colley did not claim the pension earlier as her husband was working full time and supporting her and they both intended to claim the age pension when he ceased working; now that her husband was deceased she “lodged her claim for age pension & pension bonus within 13 weeks”.    

52. The respondent submits that Ms Colley was aware of the requirements for lodging her claim for pension bonus and that she was not qualified for the age pension, and therefore pension bonus, at the relevant time.

53. Even accepting Ms Colley may have misunderstood some of the information she was provided, for the reasons provided below I am not satisfied that special circumstances exist to enliven the discretion in section 21(1) of the SSA Act.

    Consideration

54. In her evidence before the Tribunal Ms Colley asserts that she was misled into believing that she would be paid pension bonus whenever she qualified for the age pension. This belief appears to have arisen as a result intermittent casual conversations with the staff at her local Centrelink office over several years and letters from Centrelink confirming that she was still registered as a member of the pension bonus scheme.

55. Ms Colley also claims that she was not advised of the requirement to lodge a claim for pension bonus within 13 weeks of ceasing work.

56. The difficulty for Ms Colley is that her assertions are not consistent with the documentary evidence before the Tribunal.

57. The evidence demonstrates that in 2010, after she had ceased work, she was advised in writing and telephone conversations that in order to receive pension bonus she must claim the age pension and pension bonus at the same time and that there was a requirement to lodge the application within 13 weeks of ceasing work or failing to meet the work test.

58. She was also provided with relevant documents and claim forms which explained the requirements for claiming pension bonus and there is no evidence to suggest that Ms Colley was not able to read and understand these documents.

59. I accept that the recurrent letters from Centrelink confirming she was still registered as a member of the pension bonus scheme long after the end of the relevant 13 week period may have given Ms Colley the wrong impression that she still entitled to claim pension bonus.  These letters appear to be generic, containing general information for registered members and no specific reference to the circumstances of the member to whom the letter is addressed.

60. Nevertheless each of the letters clearly states that the claim for pension bonus must be lodged within 13 weeks of ceasing work or within 13 weeks from the date of failing to meet the work test.

1. After due consideration of all the evidence before the Tribunal I accept that Ms Colley may have misunderstood some of the information she received but I am not persuaded that Ms Colley was misled by Centrelink.

2. Ms Colley agrees she did not apply for the age pension and the pension bonus until 2014 as it was her understanding she did not qualify for the age pension because of her husband’s income; she told the Tribunal that her qualification for age pension was temporary and was stopped after she was able to access her husband’s superannuation of about $900,000. These circumstances are not “special” for the purposes of section 21(2) of the SSA Act.

3. Ms Colley provided no other compelling reasons which could be considered as special circumstances.

   Decision

4. I am satisfied that the evidence before the Tribunal does not support a conclusion that the circumstances in Ms Colley’s case were such that the discretion provided by section 21(2) of the SSA Act should be applied.

5. For completeness I note the respondent also submits that even if Ms Colley had, on 30 April 2010 or within the subsequent 13 weeks applied for the age pension and pension bonus, it was likely that, because of her husband’s income and her own assets, she would have not have qualified for either the age pension or pension bonus. I note there is evidence before the Tribunal that Ms Colley’s husband’s income and her own assets may have precluded Ms Colley from qualifying for the age pension until after her husband’s death in 2014 and therefore would not have been entitled to receive the pension bonus. It is not necessary to finally decide this issue as for the reasons already given Ms Colley did not make her claim for pension bonus as required by the SSA Act and her claim was therefore correctly rejected.

6. The decision under review is affirmed.

I certify that the preceding 67 (sixty-seven) paragraphs are a true copy of the reasons for the decision herein of Dr Ion Alexander, Member.

.........................................

Associate

Dated 24 June 2015

Date of hearing	19 March 2015 and 18 May 2015
Representative for the Applicant	Self
Representative for the Respondent	Ms G Heggan, Department of Human Services