Butler and Secretary, Department of Family and Community Services

[2005] AATA 764

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 764

ADMINISTRATIVE APPEALS TRIBUNAL        Nº V2005/246

GENERAL ADMINISTRATIVE  DIVISION

Re:         GEORGE ANTHONY BUTLER

Applicant

And:       SECRETARY,
  DEPARTMENT OF FAMILY AND

COMMUNITY SERVICES

Respondent

DECISION

Tribunal:       Regina Perton, Member

Date:             10 August 2005

Place:            Melbourne

Decision:      The Tribunal affirms the decision under review.

(sgd) Regina Perton
  Member

SOCIAL SECURITY – Newstart Allowance – payment of advance – subsequent cancellation of Newstart allowance – debt to Commonwealth - write‑off of debt - waiver of debt

Social Security Act 1991 ss 1061, 1061EL, 1224E(1), 1236, 1237, 1237A, 1237AAA, 1237AAD

Re Beadle and Director-General of Social Security (1984) 6 ALD 1

REASONS FOR DECISION

10 August 2005  Regina Perton, Member

1.      George Anthony Butler (the applicant) has applied for review of a decision of the Social Security Appeals Tribunal (SSAT) dated 25 January 2005.  A delegate of the Secretary to the Department of Family and Community Services (the respondent) made a decision dated 7 January 2004 to recover a debt of $461.50 from the applicant.  The debt arose as the result of an advance payment of Newstart Allowance (NSA) on 5 November 2003 and the subsequent cancellation of that allowance on 16 December 2003 with effect from 4 November 2003.  On 16 July 2004, an authorised review officer (ARO) decided that the debt should be written off and recovery deferred until the applicant has the capacity to repay the amount.  The SSAT affirmed the decision of the ARO to write‑off the debt of $461.50.  

2.      At the hearing on 20 June 2005, the applicant was represented by Ms Shayne Monaghan.  Ms Kayren Paul, a Centrelink advocate, represented the respondent.   The applicant gave evidence by telephone.  The Tribunal concurrently took evidence in relation to another application for review lodged by the applicant (V2005/358).  At the applicant’s request, the consideration of another related application for review (V2005/288) has been deferred.

3. The Tribunal received into evidence the documents lodged under s 37 of the Administrative Appeals Tribunal Act 1975 (T1‑T15) and additional documents provided by the applicant prior to the hearing.   

BACKGROUND

4.      The applicant, who was born on 22 July 1963, has been receiving NSA for several years.  The applicant’s NSA has been suspended or cancelled from time to time and then reinstated.  At present, he is not receiving NSA due to an ongoing dispute with the respondent, primarily over the method of lodgement of forms.

5.      On 5 November 2003, the applicant was receiving NSA, and on that day he received an advance payment of $500.00.  The applicant’s NSA was subsequently cancelled on 16 December 2003, with effect from 4 November 2003.  A delegate of the respondent made a decision dated 7 January 2004 to raise and recover a debt of $461.50, an amount of $38.50 having already been deducted from the applicant’s fortnightly payment as part of the recovery of the $500.  On 4 February 2004, 11 February 2004 and 20 April 2004, the respondent sent letters to the applicant demanding he repay an outstanding debt to the Commonwealth of $461.50.  On 10 May 2004, the respondent decided to write‑off the debt for 3 months until 10 August 2004.

6.      On 14 May 2004, the applicant applied for NSA again.  A decision was made on 3 August 2004 to grant NSA and the applicant was paid arrears for the period from 14 May 2004 to 22 July 2004.  On 5 August 2004, the applicant’s correspondence nominee attempted to lodge his application for payment form on his behalf, but the respondent did not accept this.  The rejection of this and other forms by the respondent are the subject of separate decisions by the SSAT. 

7.      On 16 July 2004, an ARO affirmed the decision that the applicant had a debt to the Commonwealth of $461.50 and also determined that as the applicant had no income at that time, the debt should be written off “until the situation changes”.  

8.      On 19 December 2004, the applicant sought review in the SSAT.  On 25 January 2005, the SSAT affirmed the decision that the debt should be written off until the applicant has the capacity to repay the debt. 

9.      On 17 March 2005, the applicant lodged an application with the Tribunal for review of the SSAT decision.  The application was outside the time limit for seeking review.  However, on 13 April 2005, the Tribunal differently constituted, with the consent of the respondent, granted the applicant an extension of time for its lodgement. 

10.     The issue before the Tribunal is whether the applicant owes a debt to the Commonwealth, and if so, whether the debt should be waived or written off. 

EVIDENCE

11.     Prior to the hearing, the applicant provided the Tribunal with a considerable number of documents in which he described in detail his dispute with the respondent in relation to his claims for, and its cancellation of, his NSA, and the impasse in relation to the method of lodgement of claims for its payment.  He also provided copies of original documents he held, which he deemed relevant to this and other applications for review under consideration. 

12.     In his oral evidence, the applicant described the financial and health crisis he is facing due to the cancellation of NSA.  He stated that he has no source of income.  He described the severe consequences of his dispute with the respondent on his elderly mother, as well as on him.  The applicant described the impact of the automatic cancellation of his Health Care Card (HCC) along with NSA and his unwillingness to apply for a fresh HCC, as he believes that his NSA and the card should be reinstated together.  He also described his inability to obtain medical certificates due to his being unable to see his preferred doctor; his unwillingness to access the local hospital network; and his reasons for this stance.  He stated that he should not owe a debt to the Commonwealth, as his NSA should not have been cancelled.  He described the difficulties he encountered in dealing with certain Centrelink officers and stated that some officers appeared to be deliberately making it difficult for him to be able to obtain the benefits to which he was entitled.  He stated that once his health improved he would like to return to work.  Ms Shayne Monaghan also gave oral evidence about the difficult circumstances that the applicant faced in relation to health and financial matters. 

CONSIDERATION OF THE ISSUES

13. Section 1061 of the Social Security Act 1991 (the Act) allows for an advance payment of NSA.  There is no dispute that the applicant received such an advance on 5 November 2003.

14. The requirement for, and method of, the repayment of such an advance is set out in s 1061EL.

1061EL(1)      If a person receives an advance payment or an instalment of an advance payment under this Part, the person must repay the advance payment or instalment to the Commonwealth by one or more of the following methods:

(a)deductions from the person's social security entitlement under Chapter 3 (General provisions relating to payability and rates);

…

15.     The $500 advance was paid to the applicant on 5 November 2003; along with a fortnightly NSA payment, from which $38.50 was deducted towards repayment of  the advance (T3).  The applicant’s NSA was subsequently cancelled on 16 December 2003 with effect from 4 November 2003 (T6).  There were no deductions from the NSA which the applicant was paid between 14 May 2004 and 22 July 2004.

16. Section 1224E(1) of the Act allows the respondent to raise a debt in circumstances where a person ceases to be entitled to a social security benefit:

1224E(1) If:

(a)a person has received an advance payment of a social security entitlement (the "first entitlement") or an instalment of such an advance payment; and

(b)the first entitlement ceases to be payable to the person; and

(c)when the first entitlement ceases to be payable, the person has not repaid the whole of the advance payment or instalment; and

(d)the person does not receive another social security entitlement or benefit PP (partnered) immediately after the first entitlement ceases to be payable;

the amount that has not been repaid is a debt due to the Commonwealth

17. The applicant’s circumstances are such that s 1224E(1) applies. The Tribunal, therefore, finds that the applicant owes a debt of $461.50 to the Commonwealth, being the remainder of the advance payment of $500.

18. Section 1236 of the Act provides for a write‑off of the debt in certain limited circumstances, namely if it is irrecoverable at law, the debtor has no capacity to repay the debt, the debtor’s whereabouts are unknown or it is not cost effective for the Commonwealth to take action to recover the debt. In this matter the Tribunal accepts that the applicant has no capacity to repay the debt. Therefore, the Tribunal is satisfied that it is appropriate to write‑off the debt, until the applicant is again in receipt of a social security entitlement or has some other source of income.

19. Section 1237 and the sections immediately following it set out the circumstances in which the respondent may waive a debt. Unless a debt arises solely out of an administrative error by the respondent resulting in an overpayment (1237A(1)), or a debt is less than $200 and is not recoverable from social security benefits and the cost of retrieval outweighs the debt (1237AAA), or in certain other limited circumstances (also not applicable to the applicant), there is no discretion to waive a debt, unless s 1237AAD applies

20. Section 1237AAD of the Act provides for waiver of the debt in certain other 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 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.

21.     The Tribunal accepts that the applicant is in financial hardship.  However, that is not a sufficient basis upon which to waive the debt, as financial circumstances alone do not meet this criterion.  In Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the Tribunal held that the special circumstances, referred to in s 1237AAD(b) of the Act, must be unusual, uncommon or exceptional.  Even if the Tribunal were to find that there are such special circumstances, the Tribunal would have to be satisfied that it is more appropriate to waive the debt rather than write it off.  The applicant obtained an advance of his NSA in the knowledge that the amount was to be repaid by deductions from his fortnightly entitlements.  The Tribunal is of the view that once the applicant again qualifies for a social security payment and/or returns to the workforce, it is appropriate that he repay the advance.  The Tribunal is not satisfied that a waiver is more appropriate than a write-off in this matter. 

22.     Therefore, the Tribunal is satisfied that it is appropriate to write‑off the debt of $461.50 to the Commonwealth, until the applicant has the capacity to repay the debt through deductions from a social security payment or income from other sources. 

DECISION

23.     The Tribunal affirms the decision under review. 

I certify that the twenty-three [23] preceding paragraphs are a true copy of the reasons for the decision of:

Regina Perton, Member

(sgd)       Catherine Thomas

Clerk

Date of hearing:  20 June 2005

Date of decision:  10 August 2005
Applicant’s representative:          Ms S Monaghan
Advocate for respondent:            Ms K Paul, Centrelink