Dyson and Secretary to the Department of Family and Community Services

[2005] AATA 105

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 105

ADMINISTRATIVE APPEALS TRIBUNAL        Nº V2004/926

GENERAL ADMINISTRATIVE DIVISION

Re:           NOEL CHARLES DYSON

Applicant

And:           SECRETARY TO THE
  DEPARTMENT OF FAMILY AND

COMMUNITY SERVICES

Respondent

DECISION

Tribunal:       G.D. Friedman, Member

Date:             4 February 2005

Place:            Melbourne

Decision:The Tribunal affirms the decision under review.

(sgd) G. D. Friedman 

Member

SOCIAL SECURITY - overpayment of disability support pension - recovery of debt - write off of debt - waiver - whether special circumstances exist 

Social Security Act 1991 ss 1064(4), 1072, 1223(1), 1223(5), 1224, 1236(1), 1236(1A), 1237A(1), 1237AAD

Social Security (Administration) Act 1991 s 68

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

REASONS FOR DECISION

4 February 2005  G.D. Friedman, Member

1.      This is an application by Noel Charles Dyson (the applicant) for review of decisions of the Social Security Appeals Tribunal (SSAT) dated 12 July 2004.  The SSAT affirmed a decision of an authorised review officer of Centrelink dated 22 December 2003 that the applicant is a member of a couple The SSAT also affirmed a decision of an authorised review officer of Centrelink dated 9 June 2004 to raise and recover a debt of $6187.75, being overpayment of disability support pension (DSP) between 31 August 2000 and 30 June 2003 (the relevant period) in.

2.      At the hearing on 17 January 2005 the applicant represented himself and Ms K. Navarro, an advocate with Centrelink, represented the Secretary to the Department of Family and Community Services (the respondent).

3. The Tribunal received into evidence the documents lodged under s 37 of the Administrative Appeals Tribunal Act 1975 (T1-T81), together with one exhibit (Exhibit A1) tendered by the applicant and one exhibit (Exhibit R1) tendered on behalf of the respondent. 

BACKGROUND

4.      On 23 December 1999 the applicant was granted DSP at the married rate.  On 10 April 2003 Centrelink decided to raise and recover a debt of $1416.52 due to overpayment between 1 August 2002 and 1 January 2003.  On 28 April 2003 the applicant requested that he be treated as a single person rather than as a member of a couple.  On 14 October 2003, the respondent refused the request.  On 22 December 2003 an authorised review officer affirmed the decision.

5.      On 1 March 2004 Centrelink advised the applicant of a decision to raise and recover a debt of $7124.74 for overpayment between 21 June 2001 and 30 June 2003.  On 31 May 2004 Centrelink advised the applicant that the amount of the debt was varied to $6245.39.  On 9 June 2004 the authorised review officer varied the debt to $6187.75.

6.      On 3 February 2004 the applicant sought review by the SSAT of the decision to treat him as a member of a couple, and on 18 June 2004 he sought review of the decision to raise and recover a debt of $6187.75.

7.        At the hearing the applicant stated that he was not pursuing the issue of whether he was a member of a couple.  Consequently, the issues before the Tribunal were whether a debt to the Commonwealth exists, and, if so, whether the debt should be recovered. 

EVIDENCE

8.        In oral evidence the applicant stated that he is married, with one dependant child aged 9 years.  He told the Tribunal that when he applied for DSP he was not made aware by Centrelink that the payments were subject to an income test and that his wife’s income would be taken into account in determining the level of his payments.  He said that during the relevant period his wife worked as a training consultant and conducted her own business called M.D.Training and Personal Development Consultants.  He said that his dealings with Centrelink officers had been unsatisfactory and that Centrelink had had difficulty in determining the appropriate level of his wife’s income for social security purposes because her earnings were largely the result of her business dealings rather than wages and salary.

9.        The applicant noted that the seasonal and irregular nature of his wife’s work caused difficulties in reporting the exact amount of her income that should be taken into account when fixing the level of his DSP payments.  He produced remittance advices from Victoria University (Exhibit A1) showing varying amounts received by her between 2000 and 2002.  He was highly critical of Centrelink’s handling of the matter, which he said had caused tension within the marriage.  He also expressed the view that privacy concerns relating to his wife’s business income had been disregarded by Centrelink.

10.      In relation to the requirement to notify Centrelink of changes in circumstances, the applicant acknowledged receiving notices from Centrelink, but stated that he did not read the notices thoroughly.  He said that the notices were misleading and did not comply with the relevant legislation.  He said that consequently neither he nor his wife understood at the time that they should report past and future earnings to Centrelink.  He emphasised that Centrelink did not update its database when changes were notified, and that the debt arising from overpayment of DSP should be considerably less than the amount calculated by Centrelink.

11.      The applicant stated that his health is poor and is deteriorating, and that his family’s financial circumstances are difficult, especially as deductions are being made from his DSP payments to repay the debt.  He said that Centrelink created the accounting irregularities by its inability to take into account his wife’s multi-stream business income.  He stated that these matters constitute special circumstances to waive the debt.

CONSIDERATION OF THE ISSUES

12. Payment of DSP is subject to an income test and is affected when a partner’s income exceeds a threshold (s 1064(4) and s 1072 of the Social Security Act 1991) (the Act). Section 68 of the Social Security (Administration) Act 1999 (the Administration Act) provides that a person receiving DSP must notify Centrelink of the correct level of their gross earnings and the gross earnings of the person’s partner.

13.      Ms Navarro submitted that the applicant was overpaid DSP for the relevant period because the information provided by him regarding his wife’s actual income was incomplete and inaccurate.  Therefore, the debt to the Commonwealth could not be attributable solely to administrative error by Centrelink.  Ms Navarro also submitted that the applicant did not receive the payments in good faith because Centrelink had sent him notices during the relevant period advising him that Centrelink must be notified of changes in circumstances.  She submitted that there was no basis upon which the debt should be waived.

14.      In reaching its decision the Tribunal takes into account the oral and written evidence and the submissions made at the hearing.

15. The Tribunal finds that the applicant received notices from Centrelink under s 68 of the Administration Act informing him of the amounts of his wife’s earnings, and that the notices stated that he was required to inform Centrelink of any changes in circumstances. On the applicant’s own evidence he did not read the notices carefully. The Tribunal accepts that notification of earnings received from a business of a seasonal nature may be difficult because of the irregular nature of the employment and because of differing practices among employers. The Tribunal also takes into account the applicant’s evidence about the complexity of the accounting processes involved in calculating his DSP payments, and his concerns about the degree of compliance by Centrelink with the requirements of s 68 of the Administration Act. However, on balance the Tribunal is satisfied that the information provided to Centrelink by the applicant about his wife’s earnings in the relevant period was incomplete and inaccurate.

16. The Tribunal notes the documentary evidence of earnings by the applicant’s wife from Victoria University and her other business income during the relevant period. The Tribunal accepts the re-calculations made by Centrelink, reducing the debt from $7124.74 to $6245.39, following the receipt of information from tax returns and from Victoria University. The Tribunal accepts the further re-calculations made by Centrelink , reducing the debt to $6187.75 taking into account the change in the start date from 1 July 2000 to 31 August 2000, as a result of legislative changes. The Tribunal finds that, under s 1223(1)(b), s 1223(5) and s 1224(1) of the Act before 1 July 2002, and s 1223(1) of the Act after 1 July 2001, the DSP payment made to the applicant during the relevant period constitutes an overpayment, resulting in a debt to the Commonwealth of $6187.75.

17. Section 1236 of the Act provides for a write-off of a debt owed to the Commonwealth under certain circumstances. The Tribunal finds that the applicant has the capacity to repay the debt by deduction from ongoing social security payments, and that the debt is not irrecoverable at law. Therefore, those circumstances are not present.

18. Section 1237A of the Act provides for waiver of a debt arising from administrative error:

1237A(1) Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt

1237A(1A)     Subsection (1) only applies if:

(a)the debt is not raised within a period of 6 weeks from the first payment that caused the debt; or

(b)if the debt arose because a person has complied with a notification obligation, the debt is not raised within a period of 6 weeks from the end of the notification period;

whichever is the later.

In view of its findings that the debt arose because the applicant provided incomplete and inaccurate information to Centrelink, the Tribunal finds that the applicant’s debt to the Commonwealth was not attributable solely to administrative error by Centrelink. Therefore, the debt cannot be waived under s 1237A of the Act.

19. 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.

20.      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), must be unusual, uncommon or exceptional. The Tribunal accepts that the applicant has a number of serious medical conditions which have an impact on his ability to engage in everyday activities, including the care of his son. The Tribunal also takes into account the applicant’s financial situation and that during the relevant period his wife worked irregularly and that the difficulties involved in his dealings with Centrelink have caused stress and frustration for the applicant and his wife. The Tribunal accepts that the applicant is highly critical of Centrelink’s procedures and its handling of his matter.

21.      On balance the Tribunal is satisfied that, although the applicant’s overall situation may have been difficult, the circumstances in this case are not unusual, uncommon or exceptional, and do not constitute special circumstances (other than financial hardship alone). Therefore, the waiver provisions of s 1237AAD of the Act do not apply.

22.      Therefore, the applicant owes a debt to the Commonwealth in the amount of $6187.75, which cannot be written off or waived.

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:

G.D. Friedman, Member

(sgd)       Catherine Lake

Clerk

Date of hearing:  17 January 2005

Date of decision:  4 February 2005
Advocate for applicant:                Self-represented
Advocate for respondent:            Ms K. Navarro, Centrelink