Carroll and Secretary, Department of Family and Community Services
[2005] AATA 346
•19 April 2005
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2005] AATA 346
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2004/1266
GENERAL ADMINISTRATIVE DIVISION ) Re NOELLE CARROLL Applicant
And
SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal Ms Robin Hunt, Senior Member Date19 April 2005
PlaceSydney
Decision The Tribunal has affirmed the decision made by the Social Security Appeals Tribunal, dated the 28 June 2004, to reject Ms Carroll’s claim for a pension bonus.
...................{sgd}..............................
Ms R Hunt
Senior Member
CATCHWORDS
SOCIAL SECURITY – Registration while working overseas – Gainful employment overseas – No hours worked in Australia - Applicant not entitled to pension bonus.
LEGISLATION
Social Security Act 1991 ss92C, 92H, 92T, 92W
Acts Interpretation Act 1901 s15AB
CASES
Secretary, Department of Social Security v Smith (1991) 23 ALD 277
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Krzywak and Secretary, Department of Social Security (1988) 15 ALD 690
Re Ivovic and Director-General of Social Services (1981) 3 ALN N95
Colaiacolo and Secretary, Department of Social Security (AAT 2109, 24 April 1985)
Beadle v Director-General of Social Security (1985) 7 ALD 670
Re Secretary, Department of Social Security and Bolton (1989) 18 ALD 464
Secretary, Department of Social Security v Hales (1998) 51 ALD 695
Comcare v A'Hearn (1993) 45 FCR 441
Secretary, Department of Social Security v Hulls (1991) 22 ALD 570
Commonwealth v Daniels (1994) 33 ALD 111
Secretary, Department of Social Security v Banks (1990) 20 ALD 19
Secretary, Department of Social Security v Ellis (1997) 46 ALD 1
Klein v Domus Pty Ltd (1963) 109 CLR 467REASONS FOR DECISION
19 April 2005 Ms Robin Hunt, Senior Member
summary
1. Ms Noelle Carroll, the applicant for review, registered for the Pension Bonus Scheme (PBS) on 26 November 2000. When she later applied for the age pension and associated pension bonus payment, she was refused the bonus. The decision to refuse her the bonus was affirmed by the Social Security Appeals Tribunal (the SSAT) on 28 June 2004. The bonus payment was refused at all stages of decision and review because Ms Carroll had not been working in Australia since her registration and was therefore not accepted as an accruing member of the scheme. The Tribunal has reluctantly affirmed the decision for the reasons below.
issue
2. The issue before the Tribunal is whether Ms Carroll qualifies to receive the pension bonus in accordance with the legislative scheme. The Secretary argued that as Ms Carroll had not worked the requisite hours in Australia, she did not qualify. Secondly, the Secretary put to the Tribunal that there were insufficient grounds on which to exercise the discretion to treat gainful work outside Australia as gainful work in Australia.
legislation
3. Sections 92, 92D and 92E of the Social Security Act 1991 (the Act) regulate registration requirements for the PBS. Section 92 requires registration to be in written form in a manner approved by the Secretary.
4. Section 92C sets out eligibility criteria for the PBS, in part reading:
“A person is qualified for a pension bonus if:
(a) both:
(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
(ii) … and
(b) the person has not received an age pension at any time before making 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; and …”
5. Section 92C(d) requires a person to accrue a minimum, one full-year bonus period while registered. This leads to section 92T concerning the accrual of bonus periods. It states:
“(1) The first bonus period that accrues to a person is the full-year period of the person's accruing membership of the pension bonus scheme:
(a) that began on whichever of the following dates is applicable:
(i) if the person was an accruing member of the pension bonus scheme on the date the person's registration as a member took effect—the date the registration took effect;
(ii) in any other case—the date on which the person first became an accruing member of the pension bonus scheme; and
(b) for which the person passes the work test. “
6. Section 92U contains provisions requiring an applicant for the pension bonus to pass the work test for a full-year period of the accruing membership of the scheme. A person passes the test if the Secretary is satisfied that the total number of hours worked during the period “was at least 960 and that at least 640 of that total number of hours were worked in Australia; …”
7. The Secretary, or Tribunal upon review, has discretion under section 92W to treat gainful work outside Australia as gainful work in Australia because of “special circumstances”. Section 92W reads:
“92W(1) If a person satisfies the Secretary that:
(a) the person, or the person's partner, has carried on gainful work outside Australia; and
(b) because of special circumstances, the gainful work should be treated as gainful work carried on in Australia;
the Secretary may determine that this Part has effect as if the gainful work were carried on in Australia.
92W(2) The determination has effect accordingly. “
evidence
8. It is common ground that Ms Carroll was working in Singapore at the time she registered for the scheme and that she continued to work in Singapore for the subsequent period that she wants taken into account in order to qualify for the bonus.
9. The Secretary’s advocate suggested, in a letter to the Tribunal dated 25 October 2004, that there was no evidence Ms Carroll was registered in the PBS. The advocate further suggested that the finding of the SSAT that Ms Carroll was registered from 26 November 2000 was wrong in this respect. Nevertheless, the argument before the Tribunal concerned the Secretary’s refusal to accept the overseas work carried out by Ms Carroll.
10. After the Tribunal hearing, Ms Carroll produced a letter, dated 26 September 2003, from a Centrelink customer service officer addressed to Ms Carroll and sent care of her daughter in Australia. This letter advised Ms Carroll that she was registered as an accruing member from 26 November 2000. Had Ms Carroll not produced this letter and had there been no other convincing evidence that she was indeed registered, it might not have been necessary to consider whether Ms Carroll’s work overseas should be recognised. Non-registration would have prevented her action from succeeding.
11. As Ms Carroll was registered, she made a claim for the bonus when she retired. Ms Carroll’s completed claim form for the pension bonus, a copy of which is before the Tribunal, has been stamped by Centrelink at Tweed Heads ‘2003’, with no further date. Her claim for an age pension claim has been stamped on 29 October 2003. The period of the claim set out in Part C of the bonus claim is from 26 June 1999 to 30 November 2003. In response to the application made, Centrelink granted Ms Carroll the pension on 9 December 2003, but not the pension bonus payment. At T7, a Centrelink file note indicates that an officer considered Ms Carroll had worked the required hours for the bonus but had not met the requirement that a certain number of hours were worked in Australia.
12. Ms Carroll was self represented and gave oral evidence to the Tribunal. She said that, when living in Singapore, she had contacted Centrelink by telephone on more than one occasion to enquire about her entitlements. She also stated that she had made an appointment from Singapore in 2003 to see an officer before lodging her claim. She told the Tribunal that the officers to whom she spoke were always courteous and helpful. No one told her she was not eligible for the bonus although they knew she was working in Singapore. She said the staff with whom she dealt encouraged her to apply. She filled out the pension and bonus claim forms and kept an appointment with Centrelink in November 2003. Ms Carroll did not recall being given any brochures about the PBS at Centrelink. She told the Tribunal she had learned about the PBS from a seniors’ newsletter. She said that the newsletter came to her from her local member of parliament. Ms Carroll produced a copy of the newsletter to the Tribunal and pointed out that it contained no reference to the need for an applicant to be working in Australia to qualify.
13. Mrs Carroll submitted that she had deferred her access to the age pension by working from age 61 to 64, although she would by then have been eligible to receive the pension. This meant she met the main object of the pension scheme, that is, to benefit the taxpayer by continuing to remain in paid employment past retirement age. Ms Carroll applied for many positions in Australia and as a result of being unsuccessful in obtaining a job, she had sought employment in Singapore. She had previously worked as an instructor with a sporting body in Australia.
14. In addition, Ms Carroll said she had invested her earnings in an Australian fund and had paid tax on income in both Singapore and Australia. Her house in Australia was earning rental income while she was living and working in Singapore. She paid Australian tax on this income as well. Ms Carroll subsequently produced to the Tribunal a copy of her income tax assessment from the Australian Taxation Office for the tax year ending 30 June 2000 and her accountant’s bill for preparation of her income tax returns for the years ending 2000 and 2001.
15. Ms Carroll further claimed that she was misled by Centrelink. She had not seen any evidence in Centrelink publications or elsewhere of the overseas working rule. She had been led to believe that she was entitled to the bonus payments and had arranged her affairs accordingly and in reliance on this advice. She ceased to work, at age 64, in the belief that she would be receiving the extra bonus monies along with the pension. She felt she had been treated harshly and unfairly in being refused the bonus.
16. The Tribunal requested that the Secretary furnish to the Tribunal any brochures available to the public at the date of Ms Carroll’s application. The Secretary’s advocate subsequently produced a copy of a booklet entitled “Pension Bonus Scheme” and with the subtitle “Bonus For Working Seniors”. The booklet was dated March 2004. The letter to the Tribunal accompanying the brochure did not point to any information about the rule that applicants, in order to be eligible, should not be working overseas. The advocate wrote that Centrelink had not archived previous brochures. He further wrote that it should be borne in mind that information contained in brochures was intended as a guide only and was not intended to contain everything customers need to know.
analysis and findings
17. In view of the letter, dated 26 September 2003, which was signed by a Centrelink officer and addressed to Ms Carroll informing her that she was registered as an accruing member of the scheme from 26 November 2000, the Tribunal therefore finds that Ms Carroll was appropriately registered before she made her claim for the bonus in 2003. Registration is mandatory and an important part of the Scheme.
18. As to the general rule under section 92C(d) of the Act that a person must accrue a minimum, one full-year bonus period while registered, it is clear that Ms Carroll has worked more than one full year after her registration as an accruing member of the scheme. She therefore meets this part of the tests for the bonus. However, she has not passed the work test in respect to the total number of hours worked during the period, being that “at least 640 of that total number of hours were worked in Australia”. This means that the discretion to treat Ms Carroll’s hours worked overseas as hours worked in Australia becomes relevant. I have dealt with this below.
19. The Secretary has not disputed that Ms Carroll was, from 17 July 1997 to 30 November 2003, employed in Singapore as a teacher at the Morris Allen Study Centre. The Secretary further has not disputed that Ms Carroll worked a sufficient number of hours, apart from the component required under section 92U of the Act that a certain number of these hours were to be performed in Australia. As well, there is no dispute that Ms Carroll has met the work test under section 92T as to work hours performed. Again, there is no suggestion by the Secretary that Mrs Carroll has not carried on gainful work outside Australia as expected under subsection 92W(1)(a).
20. What remains to be decided is whether the preferable decision for the Tribunal would be to exercise the discretion given under section 92W(1)(b) of the Act. This provision gives the Tribunal discretion, when there are special circumstances, to treat gainful work performed outside Australia as qualifying work carried on in Australia. I find that I am unable to make a decision in favour of Ms Carroll in this respect and have explained why below.
21. Ms Carroll has given persuasive evidence to the Tribunal that she made enquiries of Centrelink on several occasions while she was employed overseas. She says she made it clear that she was working overseas and planned to return to Australia when she retired. She made an appointment from Singapore to discuss her position with an officer when she planned to come to Australia. She met with the officer in November 2003 and still was not alerted during their discussion that there might be a problem with her claiming the pension bonus. Prior to the meeting in November 2003, Ms Carroll asked that mail for her, concerning her pension entitlements and registration for the pension bonus scheme, be forwarded to her daughter in Australia as she was working overseas. Centrelink duly forwarded mail to the address provided, addressing it to Ms Carroll “c o Samantha Carroll” in Victoria. Ms Carroll carried out her plans to return to Australia in the expectation that she would receive not only the usual pension but the bonus as well. This was a reasonable expectation in view of the enquiries and response that Ms Carroll had received from Centrelink. In addition, I note that the legislation governing Ms Carroll’s position is beneficial legislation designed to encourage older Australians to continue to work and to reduce the burden on the taxpayer by postponing the pension entitlement.
22. On the other side of the argument, is my concern that the discretion should not be exercised lightly and irresponsibly. I am also mindful of any guidelines. The Secretary did not present any guidelines to the Tribunal for the exercise of the discretion. The Secretary’s advocate has urged me to follow the example given in the Explanatory Memorandum accompanying the Amendment Bill when it was introduced into the Parliament in 1998. The Secretary forwarded a copy of the Explanatory Memorandum to the Tribunal on 25 October 2004. The Explanatory Memorandum is not, of course, a guideline or policy document as such but may be called upon if there is any difficulty in ascertaining the meaning of a particular provision by virtue of section 15AB(1) of the Acts Interpretation Act 1901. The provision setting out the present discretion is not at all ambiguous or obscure in my view and the Explanatory Memorandum is therefore of no assistance to the Tribunal.
23. I am aware, however, that a Guide to Social Security Law does exist although it was not brought to my attention by the parties in connection with these proceedings. Ms Carroll gave oral evidence that she had never been advised of any policy in relation to working overseas until she received the refusal decision. The SSAT referred to the Guide in making its decision and I have obtained a copy to assist my decision.
24. The Guide has adopted the example given in the Explanatory Memorandum as the only circumstance in which the discretion may be exercised and has added a further restriction, thereby making policy more rigid than the Parliament intended. Paragraph 3.4.7.70, ‘Gainful Work for PBS’, of the Guide sets out policy as “… This discretion should only be exercised where the customer’s employment overseas is a normal part of their employment in Australia and is short in duration. … Example: Up to 6 weeks per year.”
25. By contrast, the Explanatory Memorandum to the Social Security and Veterans' Affairs Legislation (Pension Bonus Scheme) Bill 1998 gave as an example of the intention of the Parliament for section 92W of the Act, in part, as :
“It is intended that the secretary should favourably exercise this discretion only in unusual situations where the exercise of the discretion in this manner would be consistent with the objects of the pension bonus scheme. For example, it is possible that a person who normally works in Australia has a secondment overseas; the person expects to resume their normal position (or a similar position) upon their return to Australia. In this situation, it may be reasonable for work carried out by the person outside Australia to be treated as having been carried on in Australia.”
26. I am conscious of the need to observe Government policy unless there are cogent reasons why it should not be followed. I am tempted to find that this is such a case because of the poor handling by Centrelink of Ms Carroll’s enquires and her subsequent claim for the bonus. Some of the failings and incompetence suffered by Ms Carroll include the inconsistent acknowledgement and denial of her registration for the bonus scheme, the lack of correct advice and guidance given in response to her enquiries and Ms Carroll’s resultant confusion and false expectations that she was entitled to receive the bonus. In view of the continuing failure to bring to my attention at any stage of the review the terms of the Guide to Social Security and, in particular, the policy guideline as to the overseas work rule, I have no difficulty in accepting that Ms Carroll was given misleading advice by Centrelink officers. She has been left out of pocket as a result and been put to considerable inconvenience in seeking redress from Centrelink and from the Tribunal.
27. However, as Ms Carroll does not fall within the policy guidelines concerning overseas work I reluctantly find that the decision under review must be affirmed. I am aware that Ms Carroll may be able to be compensated under an administrative scheme for aggrieved persons not protected by the social security provisions. This is a matter for Ms Carroll to pursue with Centrelink if she wishes and for Centrelink to decide.
decision
28.The Tribunal has affirmed the decision of the Social Security Appeals Tribunal, dated the 28 June 2004, to reject Ms Carroll’s claim for a pension bonus.
I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of
Signed: .....................................................................................
Associate: Zoe McDonaldDate/s of Hearing 3 May 2005
Date of Decision 19 April 2005
Solicitor for the Applicant SelfSolicitor for the Respondent Mr Luke Carter
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