Davey and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2008] AATA 888

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 888

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/4071

GENERAL ADMINISTRATIVE DIVISION		)                 2007/4072
Re		GORDON DAVEY AND JUNE DAVEY

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Mr R G Kenny, Member

Date6 October 2008

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

...............[Sgd]...............................

Member

CATCHWORDS

SOCIAL SECURITY – Pensions, Benefits and Allowances – disability support pension - engagement in business – findings of non- compliance with notification requirements and failure to advise Centrelink of relevant income information – overpayment raised – finding of debt due to the Commonwealth with no basis to waive debt – debt confirmed by Social Security Appeals Tribunal (SSAT) - decision set aside by SSAT and remitted to respondent for recalculation of debt in accordance with directions –  decision under review affirmed.

SOCIAL SECURITY – Pensions, Benefits and Allowances – wife pension - engagement in business – findings of non- compliance with notification requirements and failure to advise Centrelink of relevant income information – overpayment raised – finding of debt due to the Commonwealth with no basis to waive debt – debt confirmed by Social Security Appeals Tribunal (SSAT) - decision set aside by SSAT and remitted to respondent for recalculation of debt in accordance with directions – decision under review affirmed.

PRACTICE AND PROCEDURE – application for review – jurisdiction – limitation on Tribunal’s jurisdiction – Tribunal limited to reviewing the SSAT directions.

Social Security Act 1991 (Cth) ss 8, 117, 159, 1064, 1064A, 1072, 1075
Social Security (Administration) Act 1999 (Cth) s 179

Re Owen and  Secretary, Department of Family and Community Services [2002] AATA 1202

REASONS FOR DECISION

6 October 2008  Mr R G Kenny, Member    

APPLICATION

1.      In accordance with the terms of the Social Security Act 1991 (the Act),         Mr Gordon Davey received the disability support pension and his wife, Mrs June Davey, received the wife pension from 13 August 1992.   On 8 March 2007, a Centrelink delegate determined that Mr and Mrs Davey had each been overpaid in the amount of $43,080.06 in the period from 31 August 2000 until 17 October 2006.  Debts in those amounts with an additional 10% recovery penalty were raised against them.  On 1 May 2007, an authorized review officer with Centrelink affirmed the decisions.  On 27 July 2007, the Social Security Appeals Tribunal (“the SSAT”), whilst confirming that debts arose and that there was no basis for their being waived, set aside the decisions and remitted the matters to Centrelink for recalculation.  On 24 May 2007, an authorized review officer recalculated the debts in accordance with directions given by the SSAT and determined that the debts were $49,548.24 each for Mr and Mrs Davey.  Those amounts included a 10% debt recovery penalty.

2.      In giving its directions, the SSAT determined that Centrelink had relied upon incorrect income figures for Mr and Mrs Davey in the financial year 2005/6 and in the period from 1 July 2006 to 17 October 2006.  The SSAT found that, in each period, Centrelink had incorrectly relied upon the income for the 2004/5 financial year.  Additionally, the SSAT found that, for the 2003/4 financial year, donations of $488.50 should have been disallowed.   It directed the respondent to recalculate the debts on the basis of those findings.  This was done in the redetermination on 24 May 2007.

DECISION UNDER REVIEW

3.      The applications to the Administrative Appeals Tribunal (AAT) for review by Mr and Mrs Davey were in relation to the SSAT decision.  The ambit of the Tribunal’s capacity to review SSAT decisions is provided for in the Social Security (Administration) Act 1999 (“the Administration Act”). In so far as relevant, s 179 of the Administration Act reads:

“s179 Review of decisions by AAT

(1)  If:

(a)  a decision has been reviewed by the SSAT; and

(b)  the decision has been affirmed, varied or set aside by the SSAT;

application may be made to the AAT for review of the decision of the SSAT.

(2)  For the purposes of subsection (1), the decision made by the SSAT is taken to be:

(a)  where the SSAT affirms a decision—that decision as affirmed; and

(b)  where the SSAT varies a decision—that decision as varied; and

(c)  where the SSAT sets a decision aside and substitutes a new decision—the new decision; and

(d) where the SSAT sets a decision aside and sends the matter back to the Secretary for reconsideration in accordance with any directions or recommendations of the SSAT—the directions or recommendations of the SSAT”.

4. The present matters fall within s 179(2)(d) of that provision. This means that the only aspect of the SSAT’s decision that may be reviewed are the SSAT’s directions to the respondent[1].  The Tribunal, on the present application by Mr and Mrs Davey, is not able to review the merits of the decisions relating to whether or not overpayments were made to Mr and/or Mrs Davey, whether any debts were properly raised against them and, if so, whether any such debts may be waived. 

[1] See, further, Re Owen and  Secretary, Department of Family and Community Services [2002] AATA 1202.

APPLICANT'S SUBMISSION

5.      Mr Davey appeared on his own behalf and that of his wife.  He did not dispute the findings of the SSAT on which it based its directions to the respondent.  Neither did he dispute that they were overpaid or the amount of the two debts.  His only concern was that the overpayments were made because of fault on the part of Centrelink and, therefore, he submitted that the debts should be waived.

EVIDENCE

6.      Mr Davey received the disability support pension because he contracted Ross River fever and chronic fatigue syndrome which continue to affect him.   He and his wife received letters in 1992 when they were first paid the disability support and wife’s pension.  These required them to notify Centrelink if their income exceeded $88 per week or if they commenced a business.  At that time, he had no intention of commencing a business.  However, in 1994, he did so and advised Centrelink of this, indicating that he had incurred a loss in excess of $4,000 for the financial year.  He has been in business ever since and, in 2000, this became a partnership with his wife and daughter.  The business has grown substantially and this has necessitated periodic relocations to ever larger premises to accommodate his wide range of retail stock which includes collectible items and costumes.

7.       Mr Davey had no contact with Centrelink until 2003 when he was considering the purchase of a commercial property and he sought information concerning the effects this might have on his and his wife’s pension entitlements.  Interviews were arranged with Centrelink officers at that time but these did not eventuate because the prospective property purchase fell through. 

8.      Mr Davey was sent a questionnaire by Centrelink in August 2006.  This was a routine procedure in which Centrelink sought information from Mr Davey about his financial circumstances.  In his response, Mr Davey revealed to Centrelink the details of his business and this led to Centrelink’s decision to raise the debts.

9.        Mr Davey described his business as having been very successful and said that this was due to the commitment and long hours that he and his family had put into it over the years.  He agreed that copies of his and his wife’s income tax returns were in evidence and that these revealed taxable income for 2000/1 of $32,242 and $14,880; for 2001/2 of $35,926 and $16,582; for 2002/3 of $21,089 and $9,734; for 2003/4 of $32,615 and $15,504; and for 2005/6 of $32,621 and $15,056.  However, he said that he believed that he did not earn an income during those years because he constantly turned all monies back into the business to ensure that he had sufficient stock for his customers.

10.     Mr Davey agreed that the material before the Tribunal included Centrelink letters, dated 10 March 2003, to him and to his wife advising them that their pensions were calculated on the basis that their annual income was $18.34 and requiring them to advise Centrelink of a range of matters including if their combined income exceeded that level.  He also agreed that the material included three other letters, dated 10 December 1996, 18 December 1996 and 4 July 1997, respectively, which were addressed to Mrs Davey.  These required her to advise Centrelink of a range of matters including whether she was engaged in employment.   Mr Davey agreed that these letters were properly addressed to the post office boxes they were using at those times.  However, he said that he could not recall receiving them and was not aware of any responses being made to them.

11.     Mr Davey said that his advice to Centrelink in 1994 about his business and his enquiry in 2003 concerning the prospective purchase of a commercial property should have put Centrelink on notice that he was engaged in business activity.  He submitted that Centrelink was at fault for not logging his details into their systems on those occasions and that, as a result, there was fault on its part which contributed to the continuing payment of disability support and wife’s pension.  In that sense, he submitted, Centrelink was responsible for the debts having been incurred and he and his wife should not have to repay them.  He was also critical of the long periods of time that passed between occasions when Centrelink contacted him or his wife requesting information from them.

12.     Mr Davey said that the debt is being recovered by Centrelink out of pension entitlements and that he and his wife are making ends meet, in a financial sense, because of their business earnings.  He could not nominate any special circumstances on which he wished to rely for the debts to be waived except that they arose through Centrelink error.

CONSIDERATION

13.     The disability support and wife’s pension are paid and calculated in accordance with the terms of ss 117, 159, 1064 and 1064A of the Act.  Also relevant are the definitions of “income” and “ordinary income” and those relating to the manner in which business outgoings are taken into account[2].  In evidence were Centrelink documents which revealed the calculations of Mr and Mrs Davey’s pension entitlements based on those provisions.  As noted above, the issue of the debt and its waiver are not before me for determination.  The debt calculation documents confirm that the respondent relied upon income for the 2004/5 financial year for Mr and Mrs Davey in the financial year 2005/6 and in the period from 1 July 2006 to 17 October 2006.  They also confirm that, for the 2003/4 financial year, donations of $488.50 should have been disallowed.  Those errors provided the basis on which the SSAT made directions to the respondent.  I am satisfied that those directions were correctly made.

[2] See Social Security Act (Cth) 1999 ss 8, 1072 and 1075.

14.     The decisions under review are affirmed.

I certify that the 14 preceding paragraphs are a true copy of the reasons for the decision herein of Mr RG Kenny, Member

Signed:…………[Sgd]……………………………………….
  Elizabeth Young, Research Associate

Date/s of Hearing:   17 September 2008
Date of Decision:    6 October 2008
Mr Davey represented himself and Mrs Davey
For the Respondent:                 Mr R Hamilton, Departmental Advocate.