Breen and Secretary, Department of Social Services (Social services second review)

[2024] AATA 104

Breen and Secretary, Department of Social Services (Social services second review) [2024] AATA 104 (31 January 2024)

Division:GENERAL DIVISION

File Number(s):      2023/6658

Re:Andrew Breen

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Senior Member O'Donovan

Date:31 January 2024

Place:Canberra

The decision under review is affirmed.

……………[SGD]……………..

Senior Member O’Donovan

Catchwords:

SOCIAL SECURITY – Age Pension – calculation of partnered rate – member of a couple – spouse qualified but failed to apply – claim of defective administration – section 24 discretion – decision affirmed

Legislation:

Social Security Act 1991, ss 11, 55
Social Security (Administration) Act 1999, s 24

REASONS FOR DECISION

Senior Member O'Donovan

31 January 2024

1. This is a review of a decision of the Administrative Appeals Tribunal (Social Services & Child Support Division) (AAT1) which was made on 21 August 2023. The AAT1 affirmed the decision made by an Authorised Review Officer (ARO) within Services Australia (the Agency) on 14 April 2023 to pay the applicant the partnered rate of Age Pension from 26 May 2015 being the date he lodged his application for the age pension.

2. Mr Breen’s complaint is that from 26 May 2015 both he and his wife qualified for the Age Pension, but only he was paid the pension. That state of affairs persisted until 2022 when the applicant realised that his wife was entitled to a pension. A claim was made and his wife was paid a pension forthwith. Between 2015 and 2022, Mr Breen’s pension was paid on the basis that he was a member of a couple and his wife’s assets and income were taken into account in the calculation of his pension. This reduced his pension significantly.  As a consequence, the applicant feels, ‘either I was underpaid or definitely as a couple we were underpaid!’. Mr Breen also feels that the correspondence he received from Centrelink and the forms that he had to fill out obscured the fact that he was getting a pension which was half what each member of a couple was entitled to. He is also disappointed that Centrelink attentively monitored his wife’s income and assets and reduced his pension whenever his wife’s income went up, but it never thought to advise him or his wife that she was entitled to a pension.  For 7 years the Breens were receiving only half of the government support which they qualified for.

3. Mr Breen’s frustration with this situation is understandable. Regrettably, the structure of the Social Security Act 1991 is such that both he and his wife were paid correctly as a matter of law. I do not have legal capacity to change the financial outcome for the Breens but I can explain how it has come about.

4. The critical facts are these. On 26 May 2015 Mr Breen lodged an application for the Age Pension. The form states that ‘we require your partner’s details to assess your claim’. The next question asked is ‘Is your partner also claiming Age Pension?’ The answer to this question is the source of the Breens’ problem. Mr Breen answered ‘No’. The reason he answered ‘no’ was because he and his wife assumed that she was not entitled to the Age Pension because she was already in receipt of a Commonwealth superannuation pension.

5. Despite the fact that Mr Breen’s wife was not claiming the Age Pension, Mr Breen was still required to provide details about her income and assets and Mrs Breen signed the form. The information provided was used to calculate Mr Breen’s pension and as noted previously, his wife’s income reduced his entitlement.  Mr Breen was duly granted a pension which was paid from 26 May 2015.

6. When, in 2022, the Breens discovered that Mrs Breen was entitled to the pension, the Breens had foregone something in the order of $90,000 in government benefits.

   Contentions

7. Mr Breen’s view is that Centrelink had all of the information which they needed and so he should be paid the full ‘couple’s pension’ from the date he applied.

8. He notes that when he was notified of the pension decision in response to his application ‘nowhere does the Centrelink letter state that I was receiving 50% of a couple’s pension. Nor did Centrelink advise my wife that she needed to apply for her legal entitlement.’

9. Dealing with the second issue first. It is regrettable that the Centrelink staff who dealt with Mr Breen were not more perceptive in identifying that a claim could and should be made by his wife. This is particularly so in light of the fact that the Social Security (Administration) Act 1999 (Administration Act) provides that:

   In administering the social security law, the Secretary is to have regard to:

   (a) the desirability of achieving the following results:

   (i)     the ready availability to members of the public of advice and information services relating to income support generally and to the social security payments that are available…    

10. Such a provision, however, does not create entitlements. It is primarily aspirational and of no direct assistance to the applicant in the context of a review in the Administrative Appeals Tribunal.

11. Turning then to the second issue - that Mr Breen was not advised that he was only receiving 50% of a couple’s pension. The first thing to understand is that Mr Breen was not receiving ‘a couple’s pension’. A couple’s pension is not a benefit provided for under the Social Security Act 1991 (Social Security Act).

12. The way the system works is that individuals claim entitlements. A claim is an essential pre-requisite for the payment of most benefits under the Social Security Act including the Age Pension. Section 11(1) of the Administration Act provides:

    Subject to subsections (2) and (3) and Subdivision B, a person who wants to be granted:

    (a)       a social security payment; or

    (b)      …;

    must make a claim for the payment … in accordance with this Division.

13. Consequently, ticking the ‘no’ box in response to the question ‘Is your partner also claiming Age Pension’ meant that an essential pre-requisite for the granting of a pension to Mrs Breen had not taken place – no claim had been made by Mrs Breen.

14. The result was that only Mr Breen was claiming the Age Pension. When his claim was assessed, it was not a ‘couple’s pension’ that he was entitled to, but an individual pension which was assessed on the basis that he was a member of a couple. The fact that he was a member of a couple was relevant and affected what he was entitled to, but the pension was payable to him as an individual and calculated by reference to his circumstances. So much is clear from section 55 of the Social Security Act. It provides that:

    A person’s age pension is worked out:

    (a)if the person is not permanently blind – using Pension Rate Calculator A at the end of section 1064…

15. The Pension Rate Calculator A was applied in Mr Breen’s case, and I am satisfied it was applied correctly. Consequently, he was paid the right amount of pension in response to the claim which he made.

16. Until Mrs Breen made a claim seeking the pension, she was not entitled to be paid the pension. Mr Breen has been paid correctly according to law, as has Mrs Breen.

    Section 24 Discretion

17. In the alternative to a finding that he was entitled to a higher pension, the applicant has asked that the discretion in section 24 of the Administration Act be exercised so as to treat him as not being a member of a couple. This would have the effect of lifting his pension entitlements from the coupled rate to the higher single rate.

18. Section 24 provides as follows:

    Where:

    (a)A person is legally married to another person; and

    (b)The person is not living separately and apart from the other person on a permanent or indefinite basis; and

    (c)The Secretary is satisfied that the person should, for a special reason in the particular case, not be treated as a member of a couple;

    the Secretary may determine, in writing, that the person is not to be treated as a member of a couple for the purposes of this Act.

19. Mr Breen meets the first two requirements. In order to exercise the power I have to be satisfied that Mr Breen should, for a special reason in the particular case, not be treated as a member of a couple.

20. The respondent understood Mr Breen to be pressing this discretion on the basis that he and his wife slept in separate beds and drafted his amended SOFIC accordingly. However, it became clear at the hearing that that was not the basis on which Mr Breen pressed his argument. His essential point is that for 7 years he and his wife received only one of the pensions that they were entitled to. Centrelink had the information necessary to identify that but never explained to him what their entitlements were. Centrelink only used the information provided about Mr Breen’s wife’s assets and income to reduce his entitlement. Consequently, he received a pension which was inadequate to the income support needs of a couple because it was designed to be paired with an equivalent pension payable to his wife. The result was significant financial difficulty for the Breens between 2015 and 2022, including the need to borrow money to meet medical expenses.

21. Mr Breen considers that he was treated unfairly by Centrelink when they paid him the low rate of pension that he was entitled to without alerting him and his wife to the fact that she could also claim.

22. I have a great deal of sympathy for the position advanced by Mr Breen. However, I do not consider the power in section 24 is appropriate to use in these circumstances. Mr Breen’s complaint fundamentally is that he was not alerted to the need for his wife to claim the Age Pension in order for them to be able to access all of the support which they needed and qualified for. He accepts that he is part of a couple and that it is appropriate to treat them as a couple. In my assessment, section 24 is not a general provision for addressing unfairness of every kind. It is available if there is a special reason not to treat a person as a member of a couple. The fact that a partner was not told by Centrelink that a claim could be made and as a consequence failed to access a benefit might give rise to a claim for defective administration,[1] but does not provide a reason why each should not be treated consistently with the reality of their relationship – as a member of a couple.  

    [1] Scheme for Compensation for Detriment caused by Defective Administration (CDDA Scheme) | Department of Finance.

23. Paying Mr Breen a single rate pension would ameliorate some of the disadvantage experienced by the Breens, but in my view section 24 is not designed to be used to reduce the consequences of a person’s failure to claim. Its purpose is more narrow.

24. In these circumstances I am not satisfied that Mr Breen should for a special reason in his particular case, not be treated as a member of a couple.

25. In light of these findings the decision under review should be affirmed.

26.     I certify that the preceding 25 (twenty-five) paragraphs are a true copy of the reasons for the decision herein of Senior Member O'Donovan

………………[SGD]…………………

Dated: 31 January 2024

Date of hearing:	31 January 2024
Date final submissions received:	31 January 2024
Applicant’s representative:	Self-represented
Counsel for the Respondent:	Mr Matt Gauci
Solicitors for the Respondent:	Hunt & Hunt