Boyes and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2007] AATA 2090

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 2090

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/3605

GENERAL ADMINISTRATIVE DIVISION			)
Re	SIDNEY BOYES

Applicant

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

Respondent

DECISION

Tribunal Mr RG Kenny, Member

Date21 December 2007 

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

……[Sgd]………………………  

RG Kenny

Member

CATCHWORDS

SOCIAL SECURITY – age pension – failure to advise Centrelink of relevant income information - overpayment – debt due to the Commonwealth – debt not due solely to Commonwealth error – no special circumstances – decision affirmed

Social Security Act 1991 (Cth) ss 1064, 1223, 1237A, 1237AAD
Social Security (Administration) Act 1999 (Cth) ss 68, 180

Director‑General of Social Services v Hangan (1982) 70 FLR 212

Beadle v Director-General of Social Security (1985) 7 ALD 670
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25

Groth v Secretary, Department of Social Security (1995) 40 ALD 541

REASONS FOR DECISION

21 December 2007     Mr RG Kenny, Member

Application

1. Sidney Boyes has been in receipt of the age pension since 1995. He lives with his wife and, in the calculation of his pension entitlements, Centrelink took into account both of their incomes. On 23 February 2007, a Centrelink delegate determined that Mr Boyes had been overpaid in the amount of $12,033.96. On 8 May 2007, an authorized review officer with Centrelink confirmed the overpayment but varied the amount to $12,120.96. That decision was affirmed by the Social Security Appeals Tribunal on 24 July 2007. Since Mr Boyes sought further review by the Administrative Appeals Tribunal, Centrelink again reduced the amount of the overpayment which now stands at $11,792.77. In accordance with s 180 of the Social Security (Administration) Act 1999 (the Administration Act), the review by the Tribunal relates to the overpayment in that reduced amount. The relevant period (the overpayment period) is from 30 July 2003 until 6 December 2006.

Debt due to the Commonwealth

2. Mr Boyes accepted that he had received overpayments of his age pension. He was reluctant to agree with the level of the debt alleged by Centrelink but conceded that he was in no position to challenge the calculations. Evidence was given by Mr S Anderson who is a senior legal officer with Centrelink. He has been involved as a technical support officer in debt calculation for some 7 or 8 years. Mr Anderson provided a detailed explanation of the operation of the formula pursuant to which age pension entitlements are calculated including the application of Module A of the Pension Rate Calculator in s 1064 of the Social Security Act 1991 (the Act).  He also provided a report which comprised a detailed update of Mr Boyes’ pension calculations.  He checked these on Centrelink’s computer system and also completed a manual calculation.  These procedures revealed the overpayment in the amount of $11,792.77. 

3.      Having looked at Mr Anderson’s calculations, I am satisfied that they are in accordance with the scheme of the Act and that Mr Boyes received the amount $11,792.77 in excess of his age pension entitlement.  In accordance with s 1223(1) of the Act, this is a debt due by him to the Commonwealth. 

Waiver of Debt

Contentions

4.      Mr Boyes’ concern with the decision was that the debt had not been waived by Centrelink.  He submitted that it arose solely because of error and incompetence by Centrelink and that there was no fault on his part which contributed to the overpayment.  He also considered that Centrelink’s conduct in this matter constituted special circumstances which justified waiver.  For the respondent, Mr Avery conceded that Centrelink had been in error in some aspects of its dealings with Mr Boyes but submitted that Mr Boyes had contributed to the overpayment by failing to respond to requests by Centrelink to advise of changes in his wife’s income within the time-frame nominated in letters sent to him.

Legislation

5.      The matters relating to waiver of a debt due to sole administrative error by the Commonwealth and to special circumstances arise under s 1237A(1) and s 1237AAD, respectively, of the Act.  In so far as relevant in this matter, they read:

1237A(1)       Administrative error

1237A(1)  …. 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.

1237AAD      Waiver in special circumstances

1237AAD  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 a false representation; or

(ii) failing or omitting to comply with a provision of this 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.

Background

6.      Mrs Boyes was employed as a nurse throughout the overpayment period.  Initially, she worked for Blue Care Queensland from the start of the overpayment period until May 2004 and then she worked for Anglican Care of the Aged until 10 May 2005 before returning to work for Blue Care Queensland for the rest of the overpayment period.  Mr Boyes said that, until he was advised of the overpayment in late 2006, he was not aware that his age pension entitlements were calculated on the combined income of himself and Mrs Boyes.  Mr Boyes went to a Centrelink office on 5 May 2004 and advised that his wife was no longer working for Blue Care Queensland.  It is unclear whether he also advised that she had changed jobs and was then working for Anglican Care of the Aged.  However, from then until July 2005, Centrelink did not take account of Mrs Boyes’ income in the calculation of Mr Boyes’ age pension.  This resulted in an increase in his pension payments from $268.15 to $390.50 per fortnight during that time.

7. In evidence were copies of numerous letters sent by Centrelink to Mr Boyes throughout the overpayment period. These advised him of the amount of age pension he was being paid and also the level of income upon which this was calculated. The letters required him to advise Centrelink, within 14 days, of various matters including any increase in income on which age pension calculations were made. I am satisfied that these letters constituted notices under s 68(2) of the Administration Act and that they created an obligation on Mr Boyes to provide the requested information in the stated time-frame. Mr Boyes conceded that he received, from time to time, many letters from Centrelink but said that he did not believe in contacting that agency with any frequency.

8.      Evidence from Queensland Health show that, in both periods when Mrs Boyes was working for Blue Care Queensland, her earnings were irregular.  The letters sent to Mr Boyes in those periods did not correctly declare the level of Mrs Boyes’ earnings and Mr Boyes did not advise Centrelink of the actual earnings in those periods.  

9.      In letters to Mr Boyes dated 5 May 2004, 26 May 2004 and 16 June 2004, Centrelink advised that the only income relied on in calculating his age pension was $1.50 per year.  This was while Mrs Boyes was working for Anglican Care of the Aged.  The information was incorrect.  Mr Boyes contacted Centrelink on 23 August 2004.  In his evidence, he said that this was to query whether he was being overpaid.  Computer records in evidence confirm this contact and describe his inquiry as a general one about age pension.  They also show that he was advised of the level of age pension payment at that time.  The records make no reference to information about Mrs Boyes’ employment for Anglican Care for the Aged.  After that contact, no change in the pension amount was made and Mr Boyes said that he believed that the payment must have been correct.  As noted above, the payment did not take account of any of Mrs Boyes’ earnings.

10. In June 2004, Centrelink became aware that Mrs Boyes had signed a tax file number declaration with Anglican Care of the Aged. Centrelink sent letters to Mr Boyes in June 2004 and July 2005 advising him of this and requesting that he contact Centrelink so it could obtain full information of Mrs Boyes’ employment arrangements. There is no record of any response by Mr Boyes to the first of these requests. However, he contacted Centrelink on 28 July 2005 and advised Centrelink of his wife’s employment. From then on, his age pension was reduced on the basis of her income. A letter to Mr Boyes, dated 29 July 2005 and which also constitutes a notice under s 68(2) of the Administration Act, advised that her income level was $1034.22 per fortnight. Employer information shows that her income continued to vary for the remainder of the overpayment period and was often greater than this amount. Again, Mr Boyes did not advise Centrelink of this.

Waiver under s 1237A

11.     The first element to be satisfied under s 1237A(1) of the Act is that the debt must be attributable solely to administrative error made by the Commonwealth.  In the periods from 30 July 2003 until 4 May 2004 and from 29 July 2005 until 6 December 2006, Mr Boyes did not provide Centrelink with correct income information relating to his wife’s income as he was required to do in the various notices sent to him in those periods.  In the period from 5 May 2004 until 28 July 2005, notices to Mr Boyes did not refer to any income from Mrs Boyes.  In that period, Mr Boyes did not advise Centrelink that this was incorrect.

12.     I do not accept Mr Boyes’ assertion that, until he was advised of the overpayment in late 2006, he was not aware that his age pension entitlements were calculated on the combined income of himself and his wife.  The letters sent to him while Mrs Boyes was with Blue Care Queensland included a fortnightly income figure.  At all relevant times, Mr Boyes was not working and that fortnightly figure could only relate to Mrs Boyes’ employment.  He also advised Centrelink in May 2004 that she was no longer working for Blue Care Queensland.  This indicates an understanding on his part that her employment was material to his age pension payments.  Mr Boyes’ failure to advise Centrelink of the correct levels of his wife’s income during her employment with Blue Care Queensland contributed to the overpayment.  Similarly, he failed to advise that notices sent while his wife was working for Anglican Care of the Aged were incorrect in relation to her income.  This inaction by Mr Boyes contributed to the overpayments during that period.

13.     A debt will not arise solely through error by the Commonwealth if there has been some contribution to the causing of the debt by the recipient of the relevant pension: see Director‑General of Social Services v Hangan (1982) 70 FLR 212 at 215, 225 and 235. In Mr Boyes’ case, his contribution means that the debt can not be waived under s 1237A of the Act.

Waiver under s 1237AAD

14.     For waiver of a debt under s 1237AAD of the Act, it must be the case, amongst the other requirements of the provision, that there are special circumstances other than financial hardship alone that make it desirable to waive the debt.  The Act provides no guidance as to the meaning of the term “special circumstances” in that provision.  In Beadle v Director-General of Social Security (1985) 7 ALD 670, the Full Federal Court stated that it was not possible to lay down precise limits or precise rules for the meaning of the term. The Court indicated that this would depend upon the circumstances of each particular case but commented that, even though the term lacks precision, it was sufficiently understood “not to require judicial gloss" (at 674). There, the Court affirmed the decision of the Tribunal (Re Beadle and Director-General of Social Security (1984) 6 ALD 1) where (at 3) the Tribunal had acknowledged that the term was "incapable of precise or exhaustive definition" and that, to be special, the circumstances "must have a particular quality of unusualness that permits them to be described as special". See also Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25 per Besanko J at [33].

15.     In Groth v Secretary, Department of Social Security (1995) 40 ALD 541, Kiefel J, after referring to the Federal Court's decision in Beadle’s case, observed (at 545) 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.

16.     Mr Boyes said that, during the overpayment period, he had been engaged as an owner-builder of a new house.  This had kept him extremely busy and may have distracted him from dealing more fully with Centrelink matters.  He and his wife are now endeavouring to sell that house but are experiencing difficulty in that regard because of its remote location.  Mrs Boyes is no longer in employment and they are making ends meet in a financial sense by utilising her superannuation monies.  They are managing to make repayments of the debt through deductions from Mr Boyes’ age pension.  On the material before me, I am satisfied there are no factors, either individually or taken together, in this case that enable it to be characterised as unusual or unfair and I am satisfied that there are no special circumstances in Mr Boyes’ case that would justify waiver of the debt under s 1237AAD of the Act.

Decision

17.     The decision under review is affirmed.

I certify that the 17 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RG Kenny, Member

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

Date/s of Hearing  23 November 2007
Date of DecisioN  21 December 2007
The Applicant was unrepresented
For the Respondent                  Mr B Avery, Departmental Advocate.