Erceg; Secretary, Department of Social Services and (Social services second review)

This matter concerned an appeal by Mrs Erceg against a decision by the Secretary of the Department of Social Services regarding a debt raised for Newstart Allowance. The dispute centred on whether the debt was recoverable, considering allegations of administrative error by the Department, severe financial hardship, and the presence of special circumstances. The case was heard by Mr D. J. Morris, Member, of the Administrative Appeals Tribunal.

The primary legal issues before the Tribunal were whether the debt raised against Mrs Erceg was recoverable, and if so, whether there were special circumstances that warranted the Secretary exercising discretion to vary or waive the debt. This involved determining the extent of any administrative error by the Department, the impact of Mrs Erceg's failure to fully notify the Department of her financial circumstances, and whether her personal situation constituted "special circumstances" for the purposes of debt relief.

The Tribunal found that while there was some administrative error on the part of the Department in failing to update Mrs Erceg's record regarding the proceeds from the sale of her property, this was not the sole cause of the debt. Mrs Erceg also had an obligation to report changes in her financial circumstances, including the receipt of substantial interest income. However, the Tribunal considered that the circumstances surrounding Mrs Erceg's notification to Centrelink about the sale of her home, including the loss of a written statement and the notation of the cheque amount by officers, suggested she may have reasonably believed some or all of the proceeds would not be considered liquid assets. Coupled with medical evidence of her mental distress at the time, the Tribunal concluded that special circumstances existed that justified varying the debt.

Consequently, the Tribunal set aside the reviewable decision. It directed that the debt period commence on 31 December 2010, rather than an earlier date, and end on 29 October 2014. The Tribunal further found that interest income received by Mrs Erceg prior to 31 December 2010 should not be included in the calculation of her liquid assets for the Newstart Allowance, and the debt was to be recalculated accordingly.