Burke and Secretary, Department of Social Services (Social services second review)
[2020] AATA 1995
•26 June 2020
Burke and Secretary, Department of Social Services (Social services second review) [2020] AATA 1995 (26 June 2020)
Division:General Division
File Number(s): 2019/4276
Re:Geoffrey Burke
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
AndKristy Jeffries
OTHER PARTY
DECISION
Tribunal:Member D Mitchell
Date:26 June 2020
Place:Brisbane
The Tribunal affirms the decision under review.
...............................[SGD].........................................
Member D Mitchell
CATCHWORDS
SOCIAL SECURITY – parenting payment single – separated parents with equal shared care – principal carer – parenting payment children – financial considerations – comparison of assets – comparison of earning potential – similar positions – decision under review affirmed.
LEGISLATION
Social Security Act 1991 (Cth)
CASES
Clarke and Secretary, Department of Education, Employment and Workplace Relations and Anor [2013] AATA 699
Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409
Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634
Herbst and Secretary, Department of Education, Employment and Workforce Relations and Anor [2010] AATA 416
Irving and Secretary, Department of Social Services [2016] AATA 949
Petrie and Secretary, Department of Social Services [2018] AATA 1641
Secretary, Department of Family and Community Services v Holmes (2000) 98 FCR 461
Smedley and Secretary, Department of Education, Employment & Workplace Relations and Beveridge [2010] AATA 292
Vickers and Secretary, Department of Education, Employment and Workplace Relations and Anor [2009] AATA 534SECONDARY MATERIALS
Guide to Social Security Law
REASONS FOR DECISION
Member D Mitchell
26 June 2020
INTRODUCTION
Mr Geoffrey Burke (the Applicant), and Ms Kristy Jeffries (the Other Party) (collectively the Parents), are the separated parents of three children born in 2011, 2014 and 2016 (the Children).
There is no Court Order in place in relation to the Children however the Parents confirmed that since separation they have shared care of the Children equally.[1]
[1] Exhibit 1, T Documents, T2, page 6, paragraph 8, Decision of the SSCSD; T6, pages 24-25, Claim for PP, T10, pages 37-39, Centrelink Mainframe Screen Printouts and Exhibit 3 – Other Party’s Statement of Facts, Issues and Contentions with attachments, received by the Tribunal on 16 December 2019, response to paragraph 8.
On 26 June 2018, the Applicant lodged a claim for parenting payment (PP)[2] at which time he and the Other Party shared 50% care of the Children[3] and the Other Party was considered the principal carer of the Children and was in receipt of PP.[4]
[2] Exhibit 1, T Documents, T6, pages 22-28, Claim for PP; T11, page 42, Document List and Customer Contact Notes for the period 26 June 2018 and 5 April 2019.
[3] Exhibit 1, T Documents, T6, pages 22-28, Claim for PP; T10, pages 37-40, Centrelink Mainframe Screen Printouts.
[4] Exhibit 1, T Documents, T11, pages 43-44, Document List and Customer Contact Notes for the period 26 June 2018 and 5 April 2019.
On 26 February 2019, a decision was made to reject the Applicant’s claim for PP.[5] The notification of this decision provided the reason or the decision as being:[6]
“We cannot pay you Parenting Payment because you do not have a dependent child under 8 in your care.”
[5] Exhibit 1, T Documents, T7, pages 29-30, Centrelink Notice: Rejection of your claim for PP; T11, pages 43-44, Document List and Customer Contact Notes for the period 26 June 2018 and 5 April 2019.
[6] Exhibit 1, T Documents, T7, pages 29-30, Centrelink Notice: Rejection of your claim for PP.
The Applicant sought a review of the decision,[7] which was affirmed by an authorised review officer (ARO) on 5 April 2019 on the basis that the Applicant was not considered to be the principal carer of at least one eligible PP child.[8]
[7] Exhibit 1, T Documents, T8, page 31, Centrelink Notice: Information about a recent decision.
[8] Exhibit 1, T Documents, T9, pages 32-36, Decision and Notes of ARO.
The Applicant applied to the Social Services and Child Support Division (SSCSD) of this Tribunal for further review.[9] On 1 July 2019, the SSCSD affirmed the decision of the ARO.[10]
[9] Exhibit 1, T Documents, T5, pages 20-21, Request for Statement and Application for First Review.
[10] Exhibit 1, T Documents, T2, pages 5-9, Decision of the SSCSD.
Following this, the Applicant sought a second-tier review of this matter by the General Division of this Tribunal, by way of an application dated 17 July 2019.[11]
[11] Exhibit 1, T Documents, T1, pages 1-4, Application for Review.
On 20 April 2020, a Hearing was held for this application. At the Hearing, the Applicant and Other Party were self-represented, appeared by telephone and gave evidence under affirmation.
The Respondent submitted that it takes a neutral position in relation to this application and considers her role to be to record the evidence and set out the relevant law and policy to assist the Tribunal to make the correct or preferable decision about which party is the ‘principal carer’ of the Children in this matter.[12]
[12] Exhibit 2, Secretary’s Statement of Facts, Issues and Contentions, page 2, paragraph 17.
THE LAW
The relevant legislation in relation to this matter is the Social Security Act 1991 (Cth) (the Act).
Section 500 of the Act outlines the qualification requirements for PP, which among other things requires a person to have at least one PP child.
Section 500D(2) of the Act defines that where a person is not a member of a couple, a child is a PP child of a person if the child is a child of the person, has not turned 8 and the person is the principal carer of the child.
Section 5 of the Act outlines family relationship definitions as they relate to children. Relevantly sections 5(15) to 5(24) of the Act define who is the principal carer of a child.
Section 5(15) of the Act provides that a person is the principal carer of a child who has not turned 16 years of age and is a dependent child of the person.
Section 5(18) of the Act provides that a child can only have one principal carer at a time. Where otherwise 2 or more persons would be principal carers of the same child, the Secretary must pursuant to section 5(19) of the Act make a written determination specifying one of the adults as the principal carer of the child and give a copy of the determination to each adult.
The Act does not prescribe how a principal carer of a child should be determined in situations where two parties share equally in the care of the child. The Respondent referred the Tribunal to the Guide to Social Security Law (the Guide) which is a policy document used by officers who administer the Act to assist them in interpreting and applying the Act. While the Tribunal is not bound by policy, to aid consistency, it will usually be taken into account and followed unless there are cogent reasons not to.[13]
[13] Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409; Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634 at 639-645.
It is noted that with respect to whether the Tribunal should apply policy, in Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, Brennan J stated at page 645:
In my view, the Tribunal, being entitled to determine its own practice in respect of the part which ministerial policy plays in the making of Tribunal decisions, should adopt the following practice.
When the Tribunal is reviewing the exercise of a discretionary power reposed in a Minister, and the Minister has adopted a general policy to guide him in the exercise of the power, the Tribunal will ordinarily apply that policy in reviewing the decision, unless the policy is unlawful or unless its application tends to product an unjust decision in the circumstances of the particular case. Where the policy would ordinarily be applied, an argument against the policy itself or against its application in the particular case will be considered, but cogent reasons will have to be shown against its application, especially if the policy is shown to have been exposed to parliamentary scrutiny.
In Secretary, Department of Family and Community Services v Holmes (2000) 98 FCR 461, Gyles J in considering earlier provisions of the Act regarding parenting payments and making a determination between carers, relevantly provided at page 467:
… the Secretary, and the Tribunals on appeal, have the invidious task of choosing between those persons in circumstances where the legislation does not provide a criterion or criteria.
This is a discretion constrained only by the purposes of the Act and the provisions of it relating to Sole Parent Pensions: O’Sullivan v Farrer (1989) 168 CLR 210 at 216. The section does not oblige the decision-maker to take any particular matter into account, and only prohibits taking into account those matters which are not relevant to the purposes of the Act. Within those very broad limits, it is a matter for the exercise of discretion by the decision-maker which cannot be controlled by a court dealing with errors of law: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-42 per Mason J. Thus, it is that one decision-maker might prefer the apparent objectivity of deciding on the basis of hours of custody, another night also take into account the qualitative factors and yet another right also take into account the financial circumstances of the parties. If there is any relevant government policy guidance, then appropriate regard should be paid to it. It is, in circumstances such as the present, a matter for decision by the Administrative Appeals Tribunal, as it has the ultimate say on the merits of the decision.
The Tribunal considers it appropriate to apply the Guide in determining the principal carer of a child where section 5(19) of the Act applies in circumstances where two parties share equally in the care of a child. Relevantly, the Guide at 1.1.P.416 provides:
Equal Care
If the difference in the level of care provided by the 2 carers is less than 10%, care is considered to be shared equally.
Example: Where care is shared 54/46% or 50/50%.
In situations of equal care where only 1 of the carers is claiming or receiving income support, that person should be determined as the principal carer. If both carers are claiming or receiving income support, the carer who is most in need of a favourable determination should be deemed principal carer.
A decision maker MUST take into account the following factors when deciding which carer is in most need of a favourable determination:
·whether 1 carer already qualifies as principal carer of another child (see below for further detail on determinations involving more than 1 child)
·whether only 1 carer would be eligible for PP
·which carer would receive the higher rate of payment
·any other sources of income the carers may have, whether actual or potential, including both employment and investment income
oNote: If either carer has income that fluctuates, the assessment officer may need to look at average income levels over an extended period of time, such as 12 weeks, and
·the asset levels of each carer.
The following factors MAY be taken into consideration by the decision maker, if further information is required to make the determination:
· the expenses of each carer
o Example: Rent, child care
· workforce experience, education levels and future employment prospects of each carer
· the duration that each carer has been on income support and their principal carer status during this time. If there are no substantial differences between the parties, then generally the determination should be favoured which maintains the 'status quo', and
· any other factors considered relevant by the decision maker.
Example: Mary and John are separated and equally share the care of their daughter Cathy. Mary has been receiving JSP with principal carer status since April 2020, and John lodges a claim for JSP in June 2020. The rate that would be payable to John is approximately the same as that being paid to Mary. Neither John nor Mary owns any substantial assets such as a house or car. John has recent workforce experience, which increases his employment prospects in the area. It is fair to argue that a decision that cancelled Mary's status as principal carer would have a more significant impact than a decision to reject John's claim to be deemed principal carer, especially as John has greater employment prospects than Mary. Therefore, Mary should continue to be specified as the principal carer of Cathy while John should have generic JSP requirements/concessions.
Equal care – same decision applies to each child
If the care arrangements for 2 or more children are identical, it is NOT appropriate to ‘allocate’ each parent as the principal carer of a child, thus enabling both parents to qualify for income support as a principal carer. Different determinations about which parent is the principal carer of each child should only be made if the circumstances relating to the care of the children are not the same and justify a different decision.
In order to make a determination about which parent is the principal carer of each child, each child must be assessed separately based on the care arrangements applying to them. If the care arrangements for each child are the same, then the determination as to which aren’t is the principal carer must also be the same. That is, if parent A is determined as the principal carer of child 1, and the care arrangements for child 2 are the same, then parent A must also be determined as the principal carer for child 2. This is because the same factors leading to the first decision also apply to the second.
ISSUES
The issue for the Tribunal to consider in this matter is whether the Applicant was qualified to receive PP at the date of his claim on 26 June 2018. To be qualified to receive PP the Tribunal is required to find that the Applicant was the principal carer of at least one of the Children on 26 June 2018.
EVIDENCE AND SUBMISSIONS
The documentary evidence before the Tribunal in this matter was set out in the follow exhibits:
· Exhibit 1 – Section 37 T Documents
· Exhibit 2 – Secretary’s Statement of Facts, Issues and Contentions, with attachments, received by the Tribunal on 27 March 2020
· Exhibit 3 – Other Party’s Statement of Facts, Issues and Contentions with attachments, received by the Tribunal on 16 December 2019
· Exhibit 4 – Applicant’s submissions with attachments received by the Tribunal on 4 December 2019
· Exhibit 5 – Applicant’s document providing income and asset details, received by the Tribunal on 28 February 2020
· Exhibit 6 – Applicant’s evidence – screenshots of Facebook posts, received by the Tribunal on 28 February 2020
· Exhibit 7 – Applicant’s response to the Secretary’s Statement of Facts, Issues and Contentions, received by the Tribunal on 5 April 2020
The Tribunal has considered the documentary material and as a whole the substantive information contained within was confirmed by the Applicant and Other Party in their evidence at the Hearing.
At Hearing the Applicant told the Tribunal:
· That the only reason he was refused PP was the fact that the Respondent said he did not have children. This is wrong and if the Tribunal is agreeing with him that he does have children then the matter should be finished and his application for PP should be granted. In referring to the initial decision letter of the Respondent refusing his claim for PP, it is in black and white that the Respondent said his application was refused because they said he did not have children under the age of eight at that time and he in fact had three children under the age of eight.
· That at the time he made his claim for PP:
o He met the requirements more than the Other Party did because at the time he was unemployed, but she had working hours.
o He and the Other Party had 50-50 care of the Children.
o Everything comes down to income and his was zero.
o Both he and the Other Party had 50-50 percent ownership of the assets.
o He had a car and the Other Party had a car.
o He and the Other Party owned a house which was later sold. The sale settled in October 2018 and the proceeds were used to settle the mortgage and other personal debts held by the Parents.
o They had 50-50 percent ownership of the furniture.
o The only difference was that the Other Party at the time had an income which he did not.
o He had $2,746 in the bank which was left over once paying bills and other expenses after finishing with his employer and receiving a termination payment.
o He estimated his motor vehicle to have a value of $9,500.
o He estimated his household and personal effects to have a value of about $1,500.
o He was living in the family home and the mortgage payments were on hold based on advice he had received.
o He was paying child support, so he did not have to contribute to school costs for his eldest child who was at school.
o His expenses included roughly $150 a week for food, $300 a quarter for electricity, $300-$400 a quarter for rates and water, $50 a month for internet, he was not sure how much insurance was costing, $150 a month for credit card repayments, $78 a week for a personal loan repayment and $50 a month for his telephone.
· In relation to the Other Party having already been in receipt of PP at the time he made his claim:[14]
[14] Transcript, page 34.
So, is the Department’s stance on it that it’s okay for somebody to relinquish work and keep their working hours down just so they can get a payment, or is it their understanding that they need to be able to support a parent who needs some support at the time and not one that just refuses to get off their backsides to go to work?
· Prior to making his claim for PP the Applicant said he was working however his contract ended and there was no potential for him to do a casual position around the Children.
· He finished year 12 at high school, holds a Certificate III in Patisserie, a white card for construction and demolition and a licence for bar and gaming work, however the licence for bar and gaming work was obtained after he made his claim for PP.
· He confirmed that at the time of:
o His claim for PP he was unemployed, and his income was zero.
o The ARO decision he was earning approximately $1,100 a fortnight.
o The SSCSD hearing he was employed casually and in 2018/2019 his income was around $45,000 for the year.
o He was not receiving any form of support from Newstart during this period.
· In relation to the work he undertook after making his claim for PP:[15]
[15] Transcript, page 35 to 36.
But what would you expect me to do in that situation? Just sit back and do nothing and have no roof over the heads for the kids while I’m waiting for this parenting payment to get paid, or do you expect me to go and try and find something so I can keep a roof over the kids’ heads and keep food on the table for them?
….
So why is it okay that she [the Other Party] gets the payment and can only work the minimal set of hours but yet, I have to work my hours, to make sure that I can keep putting a roof over their heads?
· His intention was that if he was granted the PP, he would work every now and then and, on the weekends, to top up the payment that he would get so that he could be there to focus on the Children. “Same as what [the Other Party] is doing.”[16]
[16] Transcript, page 36.
· He had been in receipt of the Family Tax Benefit based on his 50 percent care of the Children since around the time he separated from the Other Party in June 2017. He said it was around this time he put in his first claim for PP.
· His rent has been roughly around $400 a week.
· Prior to this claim for PP he had received youth allowance when he was younger and an apprentice, sickness allowance in 2014 when he broke his arm, and he had made previous claims for PP which seem to have gotten lost.
· He applied for Newstart Allowance around May 2018, however due to a delay in its processing he was not in receipt of income support payments until December 2018 when he was back paid for the period prior to him returning to work. He had returned to work in the meantime.
· He pays for day care on the days the Children go to day care when they are in his care.
· He has expenses relating to electricity, internet especially now the Children are studying at home, car and home insurance.
· When asked to provide more information in relation to a written statement he had provided stating that he thought the Respondent could move the Other Party onto income support payments (Newstart Allowance) then both parents could be supported equally:[17]
[17] Transcript, page 39.
… the person who submitted the file and sent all the documents to me, said there’s a possibility, if I was on a higher income bracket, the test eligibility for the Parenting Payment is actually a lot higher than the test eligibility for the Newstart Allowance and [the Other Party] would completely satisfy being on a Newstart Allowance, being the fact that she only works minimal hours a week.
So, she would get supported at the top amount, even though she’s got that minimal income, she would get the full rebate on the Newstart.
And at my current income, I would be eligible for the claim there at Parenting Payment, because I’ve had to go out and look for work to keep a roof over the kids’ heads.
· In relation to earning capacity around June 2018:
o As a qualified pâtissier the annual rate of pay is $38,000.
o The Other Party was studying a Diploma in Early Education and Childcare at the time and had been in the industry since high school. So, her qualifications and knowledge could earn her anywhere up to $85,000 a year as a part owner or as a director over $120,000.
o At his previous employment through his experience his base salary was $65,000 a year, however are you meant to look at full time, part time or causal working around the kids?
o If you work, it on the days the Other Party has the Children she could be earning anywhere up to $35,000 to $40,000 a year if she worked the days, she did not have the Children. If he worked the days, he did not have the Children then he could have earned $35,000 to $40,000 a year as well.
o With the present COVID-19 situation however his employer had, had to close.
· In relation to his work history that after completing his apprenticeship he was casually employed with catering companies and then he was bus driving for 10-12 years and then progressed towards working in the office.
· When asked what the document provided at Exhibit 5 relates to, that it relates to the Other Party and that it was a letter he received in relation to Child Support. He said that this document showed large assets that were not disclosed to the Department of Human Services or the Taxation Office.
· That the screenshots from Facebook provided at Exhibit 6 show that the Other Party was running a business outside of the Taxation Office.
· He was single at the time of making his claim for PP.
· He has care of the Children on Wednesday, Thursday, Friday and every second Saturday night and that the Other Party has care of the Children on the other Saturday night and Sunday, Monday, Tuesday nights.
· The care arrangements were the same for all of the Children.
· That:[18]
What I want to wrap up with is at the time of the application I was not employed. I was in 50 per cent care of the kids, as was [the Other Party]. At the time we both owned all the assets in the house. [The Other Party] was coming to and from the house on regular occasions, taking items that she quite willingly was able to do. There was items that she asked to be left behind, which I left behind for her, which she later destroyed. So, all of that information that was given before is not correct. In contrary, what I’m here to fight today is that piece of documentation that we argued about this morning, that documentation that says the only reason I was disallowed was because I did not have kids.
[18] Transcript, page 84.
At Hearing the Other Party told the Tribunal:
· She wrote her Statement of Facts, Issues and Contentions and confirms the information outlined in the document. She acknowledged she had made mistakes with the dates in relation to when she first claimed PP and when she ceased her makeup business.
· She had to start over after separating from the Applicant and she has technically been the principal carer of the Children as she has been paying for everything.
· She had not finished the Diploma of Early Education and Childcare because of stress. She had completed year 12 at high school and her highest qualification is a Certificate III in Child Services.
· That in relation to the Facebook screenshots that she had stopped her makeup business in 2017 and she made the 2018 posts to try and help a friend generate business, she herself has not been engaged in the business at all.
· That:[19]
[19] Transcript, page 62.
Okay, so pretty much I did have that – that Facebook page for my own personal business, I ended that in 2017 when I separated from [the Applicant] because I – at that time I couldn’t – I couldn’t focus on anything. I just had to deal with what I had to deal with and that was separating from [the Applicant], getting everything in order. In 2018, my friend asked me to post up some stuff to try and get her some business, and I did it, I posted it all up as if it was me that was doing it, but it was actually for a friend and I can get an affidavit to say – like, to say that.
· She has paid for all school costs including uniforms and school books.
· When asked if she could explain the details contained in the document described as Exhibit 5 that:
o The income amounts described in the document did not sound familiar.
o The $188 listed as cash, investments, savings would have been what she had in the bank.
o She did not know anything about why it would say she had $45,000 in household effects at 30 November 2017 as she did not have anything, and she had to start over.
o She did not know why the real estate value of $243,624 at 8 January 2019 was provided as the only real estate she had was with the Applicant which has now been sold.
· She had accessed some of her superannuation and purchased a car when her car was written off.
· In June 2018, she was working minimal hours and was earning between $300 and $350 a fortnight. She worked with a company that provides little sports to toddlers up to the age of six.
· Her work history included:
o Working at before and after school care prior to separating from the Applicant. Her employment was terminated after their separation as she had to have time off. She worked in this role for approximately 2 years.
o She also worked full time in childcare.
o Since having the Children over the last 8-10 years she has worked in before and after school care at various times and in a kids club for about 5 years. The hours were suitable as the Applicant or family members would be with the Children when she worked.
o All of her employment experience lies in the childcare industry.
· She had a boyfriend from February to April 2018, however they did not live together, she was living with her parents. She has not lived with a partner since separating from the Applicant.
· In June 2018 she was single.
· She lived with her parents from December 2017 until April 2018 when she moved into a townhouse. When she lived with her parents, she paid rent but not utilities.
· Her rent is $340 a week. Her other expenses include: $250 a quarter for electricity, $100 a quarter for water, $150 a month for phone and internet, $120 a quarter for gas, $57 a month for comprehensive car insurance, approximately $150 one week and maintenance items the following week for food.
· In 2018 her earning capacity was low. She was not earning much, but she plans to change that once her youngest child goes to school.
· When asked if back at June 2018 she had the ability to go and work more and earn more:[20]
[20] Transcript, page 66.
No, because of the stress that I was under with [the Applicant]. I wasn’t able to focus, I wasn’t able to - my anxiety was through the roof, my depression was bad – yeah, I wasn’t able to cope.
· When asked by the Applicant what was stopping her from getting more work hours to raise her income:[21]
[21] Transcript, page 77.
Because nobody will take me on for that amount of time, so I do what I can, as much as I can, and then when my youngest goes to school then I will pick up the hours as much as I can.
· She agreed with the care arrangements that were outlined by the Applicant.
· She paid day care fees on the days the Children went to day care while in her care.
· In June 2018, she was receiving Family Tax Benefit and PP.
· In June 2018, she was receiving Child Support from the Applicant.
· She confirmed that she had owned a home with the Applicant which had been sold with the proceeds paying off the mortgage and other debts.
· She had received PP in 2012-2013 and in June 2017 she claimed PP and had been receiving it from that time.
· It is her understanding that she has been determined to be the principle carer of the Children.
At Hearing the Respondent submitted:
· Each of the three children have the same care arrangement as such the principle carer should be the same.
· The Guide says that if there are no substantial differences between the parties then generally the determination should be favoured which maintains the status quo. In respect of that, the [Respondent] maintains a neutral position in this matter. But if it’s the Tribunal’s position that when considering all the factors that must be and may be taken into account there is little difference between the two parties, then our submission is that maintaining the status quo would retain [the Other Party] in receipt….[22]
[22] Transcript, page 88.
CONSIDERATION
The Tribunal acknowledges the Applicant’s frustrations in relation to the decision letter sent to him by an officer of the Respondent in initially refusing his application for PP. The letter was poorly written and left the Applicant with little scope to interpret the decision as saying anything other than the Respondent had formed the view that he did not have any dependent children under the age of 8. In the Tribunal accepting that the Applicant does in fact have three children under the age of 8 and did so at the time of his application for PP, the Applicant sought that the matter be concluded in his favour at that point. Despite the poorly communicated decision of the Respondent the law that establishes eligibility for PP requires further requirements to be met.
As outlined above, the Act requires not only that a child is a PP child, but also the determination that the carer is the principal carer of that child or children. As such establishing that the Applicant has PP Children for the purposes of the Act, does not automatically mean he qualifies for PP.
The evidence before the Tribunal makes it clear that the Applicant and Other Party have three children together, care of the Children is shared equally and is the same for each child. All three children are PP children for the purposes of the Act as at the date the Applicant made his claim for PP. As such, both Parents may be considered the principal carer of the Children. As only one parent can be considered the primary carer of a child for the purposes of eligibility to receive PP, the Tribunal must consider which of the parents is most in need of a favourable determination.
The Tribunal is guided by the observations of Deputy President Wright QC in Smedley andSecretary, Department of Education, Employment & Workplace Relations and Beveridge [2010] AATA 292 at [6]:
Within the statutory scheme and the present policy the relevant “need” relates to the financial capacity of the relevant parent to cope with the costs, both direct and indirect of providing food, clothing and shelter and mental, physical, social and cultural nourishment of the relevant child within the family environment in which that child finds itself during its period(s) of care by that parent. Accordingly, it is plain that a determination in this case must depend on factors and considerations over and above a simple assessment of which of the competing parties has the higher and more dependable source of income or assets of the greater value.
For the reasons outlined above the Tribunal considers it appropriate to have regard to the Equal Care factors set out in the Guide at 1.1.P.416 and take them into account in determining which of the Parents was, at June 2018, in most need of a favourable determination.[23]
[23] Noting that the principles as set out in the Guide to determine who is more in need of a favourable decision have been applied in a number of Tribunal decisions including: Vickers and Secretary, Department of Education, Employment and Workplace Relations and Anor [2009] AATA 534; Smedley and Secretary, Department of Education, Employment and Workplace Relations and Anor [2010] AATA 292; Herbst and Secretary, Department of Education, Employment and Workforce Relations and Anor [2010] AATA 416; Clarke and Secretary, Department of Education, Employment and Workplace Relations and Anor [2013] AATA 699; Irving and Secretary, Department of Social Services [2016] AATA 949; Petrie and Secretary, Department of Social Services [2018] AATA 1641.
In relation to which of the Parent’s would receive the higher rate of payment the Tribunal notes that it does not have any direct evidence in relation to expected rates of PP payment for the Applicant should he have been granted PP at June 2018. As at that time the Applicant was unemployed and, had he been granted the PP, he told the Tribunal his intention was to work every now and then and on the weekends to top up the payment so he could be there to focus on the Children, it is not unlikely that at that point in time the rate of PP payment may not have been materially different between the Parents.
The Tribunal, however, notes that the Applicant did engaged in employment after June 2018 and earnt approximately $45,000 for the 2018-2019 income tax year and was therefore not entitled to income support payments. As such, it is likely that now in retrospect the Applicant’s rate of PP from June 2018 would be less than that of the Other Party. The Tribunal accepts the Applicant’s submissions that as he was not receiving the PP or any other form of income support, he needed to find work in order to provide accommodation and food for the Children and that is why his income for that period was what it was. However, that does not change the application of the relevant income tests in relation to the Applicant’s potential social security benefit payments.
In relation to the other sources of income the Parent’s may have, whether actual or potential, including both employment and investment income, based on the evidence before it, the Tribunal considers the Parents’ circumstances to be materially similar. At June 2018 the Applicant was not employed but receiving Family Tax Benefits in relation to the Children and the Other Party was receiving PP, Family Tax Benefits and wages of approximately $300 a fortnight. There is no evidence before the Tribunal to suggest that either the Applicant or Other Party had actual or potential investment income at that date.
In relation to potential employment income the evidence before the Tribunal shows that both Parents have work history, industry experience and qualifications that provide them with potential employment income. In relation to the potential amount of any such employment income the evidence before the Tribunal lies around the submissions of the Parents. There is no independent evidence in relation to potential earning capacity. The Applicant has provided submissions indicating that he believes the Other Party’s earning capacity to have exceeded his at the time. The Other Party’s evidence was that she believed she did not have the ability to work more at June 2018 due to health issues. The Tribunal notes that in considering recent employment history and level of engagement in the workforce (in the 5 to 10 years prior to 2018) on balance this factor weighs towards the Other Party being the parent more in need at June 2018.
The Tribunal notes that the Applicant raised concerns in relation to how potential income is assessed – be that with reference to full time, part time, casual work or to work related qualifications or any employment. The Tribunal considers that the paramount concern should be the Parents overall potential or capacity to generate income required to fulfil their parenting duties. The Tribunal agrees that the correct approach is that as set out by Senior Member Sosso (as he then was) in Irving and Secretary, Department of Social Services [2016] AATA 949 at [61]:
The parenting payment, as its name suggests, is payment to a parent to ensure that a young child or children are given the care required and expected by society. The parent most in need of a favourable determination is the parent whose parenting needs most required that cash payment. The term “need” is broad and the discretion vested in the decision-maker in such circumstances allows for a consideration of a range of circumstances and factors. Nonetheless when engaging in this evaluative process the focus of the decision-maker is not the relative needs of each parent vis-à-vis each other, but the relative needs of the parents in fulfilling their parenting duties.
To that extent it is evident that the Applicant gained new skills and secured further employment, demonstrating that his potential of gaining employment income was high. The Tribunal notes that there is neither evidence to suggest that such potential does or does not also exist for the Other Party.
Based on the evidence before it, the Tribunal finds that on balance the Parents circumstances in relation to potential income were similar at June 2018. However, this factor overall favours the Other Party being the one who is most in need.
In relation to the asset level of the Parents’ the Tribunal accepts that at June 2018 the Parents’ held a 50% share of the assets of their relationship, being a house and contents and motor vehicles. The proceeds from the resulting sale of the family home were used to pay the mortgage and other debts attributable to the Parents.
The Tribunal accepts the material submitted by the Applicant outlined in Exhibits 5 and 6 relating to income and assets of the Other Party and Facebook posts relating to a business page belonging to the Other Party. There is no reason for the Tribunal to question the validity of this material, however when put to the Other Party although she was not able to explain all aspects of the details found in Exhibit 5, she was clear about her income and asset position. The evidence she provided was consistent with her written submissions and also the evidence of the Applicant in relation to the Parents sharing equally the assets at the time of their separation and up until their family home was sold. Further as outlined above the Other Party provided an explanation of the Facebook posts, she provided that she had not operated her makeup business since separating from the Applicant. There is no independent evidence before the Tribunal that establishes that the evidence provided by the Other Party in relation to this information should not be accepted. The Applicant has not submitted evidence to support his contention that the information shows that the Other Party had greater income or assets available to her than what was disclosed.
Based on the evidence before it, the Tribunal finds that on balance the Parents circumstances in relation to their level of assets were similar or the same at June 2018.
The Parents’ outlined their expenses which in the Tribunal’s view are in totality not materially different.
In relation to workforce experience, education levels and future employment prospects of each of the Parents the Tribunal heard evidence from both Parents in relation to their qualifications and work experience. Both the Applicant and Other Party completed year 12 at high school, had engaged in further study and had a fair length of experience within particular industries. The Tribunal considers that the education level and workforce experience of the Parents are very similar. In relation to future employment prospects the Applicant demonstrated he has strong prospects in this regard as he successfully gained further qualifications and engaged in employment after June 2018. The Tribunal also considers that the Other Party’s future employment prospects are strong as she has varied experience in the child care industry.
In relation to the duration that each Parent has been on income support and their principal carer status during that time the evidence before the Tribunal shows that the Other Party has been in receipt of PP from September 2017. During this period, she was considered to be the principal carer of the Children. The Applicant, while having applied for the Newstart Allowance (NSA) around May 2018, was not in receipt of income support payments until December 2018 due to a delay in the processing of his claim. At that time, he was back paid NSA for the period between when he was found to have qualified for NSA and when he returned to work. The Applicant’s level of employment income meant he did not qualify for income support payments. The Applicant had also received income support payments for a short period of time in 2014.
Overall in considering both the mandatory and discretionary considerations outlined in the Guide to determine which parent is most in need of a favourable determination in June 2018, the Tribunal finds that there is immaterial difference in most of the circumstances of the Applicant and Other Party at that particular point of time. In considering however the Applicant’s ability to quickly engage in employment to a level that meant he was not reliant on income support payments after June 2018, and the subsequent differing rate to PP each of the Parties would be entitled to, the Tribunal considers that on balance the Other Party was most in need of a favourable determination at the time the Applicant lodged his claim for PP.
Even if looking at the small window of time around the date of claim for PP, the financial positions of the Parents was similar and as such the Guide provides that if there are no substantial differences between the parties then generally the determination should be favoured which maintains the status quo.
As the Parents both confirmed that the care arrangements are the same for the Children, the Tribunal’s decision applies consistently to all three children.
The Applicant made a number of comments in his evidence in relation to why one parent should be given the opportunity to work less and receive PP but not the other. While the Tribunal acknowledges the Applicant’s frustrations and point of view, the policy behind the operation of the PP is a matter for the Government, it is not a matter for the Tribunal. The Tribunal’s role is to apply the law as in place.
The balancing of which parent is most in need of a favourable determination regarding primary carer of the Children is not an easy task. As eloquently provided by Senior Member Sosso (as he then was) in Irving and Secretary, Department of Social Services [2016] AATA 949 at [65]:
Determinations in these circumstances required the decision-maker to exercise the Wisdom of Solomon. Unfortunately, the manner in which the legislation operations has the unintended by-product of pitting impecunious and estranged parents against each other, thereby further damaging the family unit and potentially undermining the overall best interests of the child. Nonetheless, the Tribunal must apply the law as it stands and make a fine decision about which party has the greater need.
In conclusion, based on the evidence before it, the Tribunal determines that the Other Party was in greater need of a favourable determination and as such was the principal carer of the Children for the purposes of the Act in June 2018. Consequently, the Applicant was not at that time qualified to receive PP. The Tribunal notes that it is open to the Applicant to reapply for PP.
DECISION
The Tribunal affirms the decision under review.
I certify that the preceding 50 (fifty) paragraphs are a true copy of the reasons for the decision herein of Member D Mitchell
...............................[SGD].........................................
Associate
Dated: 26 June 2020
Date(s) of hearing: 20 April 2020 Applicant: By phone Advocate for the Respondent: Ms Lisa Palmer Solicitors for the Respondent: Services Australia Other Party: By phone
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