Creek and Secretary, Department of Employment and Workplace Relations

[2005] AATA 760

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 760

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2005/205

GENERAL ADMINISTRATIVE DIVISION		)
Re		JAMES CREEK

Applicant

And SECRETARY, DEPARTMENT
OF EMPLOYMENT AND
WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Mr RG Kenny, Member

Date10 August 2005

PlaceBrisbane

Decision The Tribunal affirms the decisions under review.

..............................................

RG Kenny
  Member

CATCHWORDS

SOCIAL SECURITY – benefits and entitlements – newstart allowance – failure on two occasions to enter into a newstart activity agreement – applicant’s conduct not reasonable – imposition of activity test breach rate reduction periods  – use of the Guide to the Social Security Law – decision affirmed.

Social Security Act 1991 ss 593, 601, 603AA, 605, 607, 625

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
Re Dainty and Minister for Immigration and Ethnic Affairs (1987) 6 AAR 259
Minister for Immigration, Local Government and Ethnic Affairs v Roberts (1993) 41 FCR 82

REASONS FOR DECISION

10 August 2005 Mr RG Kenny, Member      

Background

1.      In 2004, James Creek (the applicant) was in receipt of newstart allowance which is a form of income support payable in accordance with the terms of the Social Security Act 1991 (the Act).  He had been in receipt of this allowance for more than 3 years.  On 21 October 2004, an officer with Centrelink, a statutory authority within the portfolio of the Department of Employment and Workplace Relations (the respondent), determined that Mr Creek had not satisfied the activity test and that, as a consequence, a rate reduction period should be imposed on him for a period of 26 weeks at the rate of 18%.  On 17 November 2004, a Centrelink officer determined that Mr Creek had again failed to satisfy the activity test and imposed on him a further rate reduction period of 26 weeks at the rate of 24%.  Those decisions were affirmed by an authorised review officer in Centrelink on 14 January 2005 and, in turn, by the Social Security Appeals Tribunal (SSAT) on 18 March 2005.  Mr Creek sought review of the decisions by the Administrative Appeals Tribunal (the Tribunal) on 5 April 2005.

Hearing

2.      Mr Creek attended the hearing but was not represented.  Ms C Heffner, from Centrelink’s Legal Services Team, appeared on behalf of the respondent.

3.      In evidence were the following documents:

exhibit 1the “T” Documents (T1 – T43) prepared in accordance with section 37 of the Administrative Appeals Tribunal Act 1975;

exhibit 2a statement with annexures, dated 22 June 2005, by Ron Brisby;  

exhibit 3a Positions Available List demonstrating job vacancies as at 12 July 2005 with Volunteering Tweed;

exhibit 4a Participation Record published by Centrelink;

exhibit 5a statement, dated 31 May 2005, by the applicant; and

exhibit 6an extract from the Guide to the Social Security Law (being paragraph 3.2.13.50 Participation Support – Hours of participation & Exemptions (NSA 50+)

Issues and Legislation

4.      In accordance with subsection 593(1) of the Act, a person is qualified for newstart allowance if he/she satisfies the activity test.  Subsection 601(4) of the Act provides that one means of doing this is to comply with the terms of a newstart activity agreement.  In accordance with subsection 605(1) of the Act, a person in receipt of newstart allowance may be required to enter into a newstart activity agreement.  Section 607 of the Act is applicable where there is a failure to negotiate such an agreement.  It reads:

“607.(1)  If:

(a)a person has been given notice under subsection 605(3) of a requirement to enter into a Newstart Activity Agreement; and

(b)       because the person did not:

(i)        attend the negotiation of the agreement; or

(ii)       respond to correspondence about the agreement; or

(iii)agree to the reasonable terms of the agreement proposed by the Secretary;

or for any other reason, the Secretary is satisfied that the person is unreasonably delaying entering into the agreement;

then:

(c)the Secretary may give the person notice that the person is being taken to have failed to enter the agreement; and

(d)       if the notice is given—the person is taken to have so failed.

607.(2)  A notice under paragraph (1)(c) must:

(a)       be in writing; and

(b)       set out the reasons for the decision to give the notice; and

(c)include a statement describing the rights of the person to apply for the review of the decision.”

5.      Where those requirements are met, a penalty may be imposed under section 625 of the Act.  In this matter, the respondent has imposed two such penalties in the form of activity test breach rate reduction periods on the basis that, on two occasions, Mr Creek failed to enter into a newstart activity agreement in circumstances which amount to unreasonably delaying in doing so.  The matter for determination is whether the activity test breach rate reduction periods were properly imposed.

Evidence

6.      Evidence was given in this matter by Mr Creek and by Ron Brisby, a guidance officer with Tweed Recruitment which is a job network member engaged by Centrelink to implement policies and procedures relating to newstart allowance.

7.      Mr Creek conceded that he had been sent notices on 10 September 2004 and 5 October 2004 which required him to attend Tweed Recruitment on 23 September 2004 and 18 October 2004, respectively, to negotiate a job search plan, the name given by Tweed Recruitment to the newstart activity agreement.  He said that he attended the appointments but did not enter the job search plan.  Mr Creek said that the person with whom he was in contact at Tweed Recruitment was Ron Brisby and that a term of the plan proposed by Mr Brisby was that he was to engage in voluntary work for sixteen hours per week.  He objected to this.  One basis of the objection was that he believed that it was immoral for the government to impose, on recipients of income support payments, a requirement to engage in voluntary work.  He believed that this had the effect of taking employment away from younger people who could do that work for remuneration. 

8.      Mr Creek described Mr Brisby’s sixteen hour requirement as not being consistent with documentation that had been published by Centrelink.  He referred to extracts from the Guide to the Social Security Law (exhibit 6) and a Centrelink document entitled Participation Record (exhibit 4).  He said that these made provision for special arrangements in the case of recipients of newstart allowance who were more than fifty years of age.  He said that he was in that category and that, in that situation, it was only necessary for a total of 150 hours to be completed in each 6 months which equated to six hours per week.  Mr Creek said he was not willing to enter into any agreement which exceeded that requirement.  Further, Mr Creek said that his elderly parents were in ill health and that he customarily spent about three hours per day at their house providing assistance to them.  He described this as voluntary work and said that it should be included as part of any job search plan that he signed.

9.      Mr Creek agreed that he had been in receipt of newstart allowance for approximately three years and that he had entered into newstart activity agreements in the past.  He said that he had complied with the requirements of any such agreement such as logging on to his personal page on Centrelink’s website and completing diary records of attempts to find work particularly in the area of his trade which was as a fitter and turner.  However, he also said that he had reached the stage in his life where he really did not want to work.  Nevertheless, he said that he would be prepared to undertake voluntary work providing it was no more than six hours per week and included his role in looking after his parents.

10.     Mr Creek said that he had been advised by Centrelink officers that the six hour voluntary work option was only available to persons who claimed newstart allowance after a certain date in 2003 or who were already in receipt of newstart allowance by that date but then subsequently had their fiftieth birthday.  Nevertheless, he submitted that he should be given the benefit of that participation rate.

11.     Mr Creek said that his health was good except he experienced post traumatic arthritis as a legacy of ankle fractures.  Nevertheless, he said that his treating doctor had described him as being able to work for 30 hours per week.   However, Mr Creek doubted that he could undertake work on a full-time basis.

12.     Mr Brisby, in his evidence, said that he had commenced working with Tweed Recruitment in February 2004 and was dealing with Mr Creek.  He said that persons who had been unemployed for more than twelve months went through a process involving intensive support customised assistance (ISCA). He said that this was the basis of the appointments that had been made by Centrelink with Tweed Recruitment and Mr Creek.  He described the ISCA procedure as one involving various kinds of activities which would increase a person’s prospects of gaining employment.  He said that these included intensive job seeking activities as well as volunteer work.  He said that, in assessing appropriate activity, each person’s capacity to engage in activities is separately considered and that, typically, a person might be required to undertake voluntary work for three days a week for six hours a day which included travel time.

13.     Mr Brisby referred to Mr Creek’s request that the time he spent caring for his parents should be taken into account as part of his voluntary work programme.  Mr Brisby said that he checked with his supervisors and was advised that this was not appropriate because it did not have any prospects of leading to any future employment.  He said that, where a person is willing to engage in voluntary work, the management of the work programme is conducted by a body called Volunteering Tweed and he referred to documentation provided by that organisation which lists many dozens of available voluntary positions (exhibit 3).  He said that engagement in voluntary work has the benefits of increasing a person’s skills, of meeting a new network of people who may assist in furthering employment prospects and also taking a person out of the home environment and into the workplace.  He said that, in his experience, many people who engage in voluntary work ultimately find full-time remunerative employment.

Submissions

14.     Ms Heffner submitted that it was appropriate for voluntary work to be offered to Mr Creek and that the sixteen hours referred to by Mr Brisby was in accordance with the terms of the Act.  She noted the modified participation record in relation to persons over fifty and submitted that this was not applicable for persons who had been on newstart allowance and were more than fifty years of age when that option commenced.  She also submitted that it was reasonable for Mr Brisby to refuse to take into account the caring duties that Mr Creek engaged in with his parents on the basis that it was not likely to lead to any future employment.  She submitted that Mr Creek had been appropriately notified under the Act of the need to attend interviews and enter into agreements, that he had not done so and that his refusal was unreasonable in the circumstances.  She submitted that this meant that the activity test breach rate reduction periods were correctly imposed.

15.     Mr Creek submitted that, as he was over fifty years of age, he should be given the benefit of the reduced voluntary work component required in any plan and that this should include his caring duties towards his parents.

Consideration

16.     The factual aspects of this case are not in dispute.  I am satisfied that, in accordance with subsection 605(1) of the Act, Mr Creek was required by the respondent to enter into a newstart activity agreement and was so notified by letters dated 10 September 2004 and 5 October 2004.  They required Mr Creek to attend interviews with Tweed Recruitment on 23 September 2004 and 18 October 2004, respectively.  He attended those interviews where he spoke with Mr Brisby.  At those interviews, there was discussion about the terms of the agreement and Mr Brisby indicated that Mr Creek would need to undertake sixteen hours of voluntary work per week.  Mr Creek refused to sign the agreement.

17.     Under section 603AA of the Act, a person undertaking voluntary work is relieved from the activity test if the person is engaged in approved full-time unpaid voluntary work for an approved organisation for at least thirty two hours in a fortnight.  This was the rate of work which Mr Creek refused to engage in. 

18.     In evidence were extracts from the Guide to the Social Security Law (the Guide).  This provides assistance to those who administer the Act.  The Tribunal, whilst not bound to apply policy guidelines of the kind referred to above in the Guide (see Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409) may do so and, indeed, will usually apply the guidelines unless there are cogent reasons in a particular case for not doing so: see Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634 at 639-645; Re Dainty and Minister for Immigration and Ethnic Affairs (1987) 6 AAR 259 at 267; and Minister for Immigration, Local Government and Ethnic Affairs v Roberts (1993) 41 FCR 82 at 86. In this case, there is no material before the Tribunal to indicate that the Guide should not be applied.

19.     Paragraph 3.2.8.70 of the Guide deals with voluntary work and lists the kinds of such work which are not considered to be suitable.  These include voluntary work which is undertaken with the person’s own family.  I accept as correct the evidence of Mr Brisby as to the relevance of voluntary work to the improvement of future prospects of gaining employment.  I am satisfied that, while the task undertaken by Mr Creek in looking after his parents is important, it does not meet that requirement and does not constitute suitable voluntary work for the purposes of the Guide.  Its unsuitability was explained to him and, yet, he refused to sign the agreement.  On that basis, I am satisfied that Mr Creek’s refusal was unreasonable. 

20.     I have also noted Mr Creek’s contention that his circumstances were embraced by the Centrelink document entitled “Participation Record”.  This is dealt with in the Guide in paragraphs 3.2.13.10 and 3.2.13.50.  In the first of those paragraphs, the target group for that reduced period of work is nominated as including new claimants for new start allowance who are over the age of fifty when the claim is lodged or existing recipients who turn fifty after the introduction of the scheme which occurred on 20 September 2003.  Because he was in receipt of new start allowance prior to that date and had already attained fifty years of age before that date, he was not within the group targeted for the application of that reduced voluntary work arrangement.

21.     Mr Creek’s submission was that he was only willing to do a maximum of six  hours per week and that this had to comprise caring for his parents.  That does not meet the requirements for being relieved from the activity test under section 603AA, in that it is less than the sixteen hours per week required by that provision and because the nature of the voluntary work is not such as would be approved, in accordance with that provision, and paragraph 3.2.8.70 of the Guide.

22.     Section 625 of the Act deals with activity test penalties for failure to enter a newstart activity agreement.  It reads:

“625.(1)  Subject to subsection (2), if:

(a)a person is required to enter into a Newstart Activity Agreement in order to qualify, or to continue to qualify, for a newstart allowance; and

(b)       the person fails to enter into a Newstart Activity Agreement (the failure);

a newstart allowance is not payable to the person because of the failure.

625.(1A)  If a newstart allowance becomes payable to the person after the time it ceases to be payable under subsection (1), then:

(a)if the failure is the person’s first or second activity test breach in the 2 years immediately before the day after the failure—an activity test breach rate reduction period applies to the person; or

(b)if the failure is the person’s third or subsequent activity test breach in the 2 years immediately before the day after the failure—an activity test non-payment period applies to the person.

625.(2)  A person is not subject to the activity test penalty period under subsection (1) at any time during which the person:

(a)       is undertaking:

(i)formal vocational training in a labour market program approved by the Employment Secretary; or

(ia)      participation in the CSP; or

(ii)       a rehabilitation program approved by the Employment Secretary; and

(b)       has been exempted from the application of that subsection by the Secretary.

625.(3)  If:

(a)an activity test penalty period applies to a person under subsection (1) (or would apply to the person apart from this subsection); and

(b)       the person starts to participate in the PSP;

the activity test penalty period stops applying to the person from and including the day on which the person starts to participate in the PSP (whether or not the person completes the program).”

23.     It is not disputed that there had been no previous breach for the two years prior to Mr Creek’s refusal to enter into the agreement on 23 September 2004 and, therefore, I am satisfied that this was the first activity test breach by him in that period.  I am also satisfied that his refusal to enter into an agreement on 18 October 2004 constituted a second activity test breach.  In accordance with section 625 of the Act, I am satisfied that activity test breach rate reduction periods of 26 weeks at 18% and 24%, respectively, should be imposed on Mr Creek.

Decision

24.     The Tribunal affirms the decisions under review.

I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RG Kenny, Member

Signed:         J Mills

Legal Research Officer

Date/s of Hearing  19 July 2005 [at Coolangatta]
Date of Decision  10 August 2005 [at Brisbane]  
The Applicant appeared in person
For the Respondent                    Ms C Heffner, Departmental Advocate