Foord and Secretary, Department of Social Services (Social services second review)
[2015] AATA 511
•15 July 2015
Foord and Secretary, Department of Social Services (Social services second review) [2015] AATA 511 (15 July 2015)
Division General Division File Number
2014/6505
Re
Irene Foord
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Mr S Webb, Member
Date 15 July 2015 Place Sydney The decision under review is set aside and remitted to the Secretary with the direction that the Pension Bonus Scheme claim Ms Foord lodged on 13 February 2014 was not made out of time and is to be assessed in accordance with these reasons.
.........................[sgd]...............................................
Mr S Webb, Member
CATCHWORDS
SOCIAL SECURITY – Age Pension – Pension Bonus Scheme – qualification for pension bonus payment – accrual of bonus periods – work test – period in which claim for pension bonus payment is to be made – discretion to extend period – special circumstances - decision set aside and remitted
LEGISLATION
Social Security Act 1991 ss 23, 43, 92C, 92J, 92L, 92N, 92P, 92Q, 92T, 92U, 92V, 93D, 93H
Social Security (Administration) Act 1999 s 17, 21, 22, 23, 25
Social Security and Other Legislation Amendment (Pension Reform and Other 2009 Budget Measures) Act 2009
CASES
Secretary, Department of Families, Community Services and Indigenous Affairs v Jones [2012] FCA 639
SECONDARY MATERIALS
Social Security (Pension Bonus Scheme—Non-accruing Members) Declaration (No. 1) 1998
Social Security (Pension Bonus Scheme — Non-accruing Members) Declaration 2007
Guide to Social Security Law
REASONS FOR DECISION
Mr S Webb, Member
15 July 2015
After reaching pension age, Irene Foord, continued in paid employment. Before retiring, she registered for the Pension Bonus Scheme. On retirement she claimed Age Pension, but her claim was rejected on account of her partner’s income. Subsequently, on the retirement of her partner, Ms Foord claimed Age Pension and a Pension Bonus. Her Pension Bonus claim was rejected. She is not content with this decision and has pressed her right to review.
ISSUE
The issue for determination is whether Ms Foord can be paid a Pension Bonus in the particular circumstances.
In the Secretary’s submission, Ms Foord’s claim for Pension Bonus is out of time by more than nine years. The Secretary argues that Ms Foord was required to lodge a claim for Pension Bonus within 13 weeks of the last ‘bonus period’ she accrued in employment. As Ms Foord is not covered by exclusions to the 13 week general rule for lodging a claim, so the argument goes, her claim cannot succeed.
Furthermore, the Secretary says that there are no special circumstances in Ms Foord’s case that render it appropriate to exercise discretion to extend the lodgement period for a claim by more than nine years.
There are some troubling aspects to this case.
Qualification for and payment of a Pension Bonus must be determined under the Social Security Act 1991 (Cth) (the Act) with reference to relevant provisions of the Social Security (Administration) Act 1999 (Cth) (the Administration Act). Section 92C of the Act sets out the qualification rules for Pension Bonus. It is not necessary to dwell on these rules. For present purposes it is sufficient to note that the first rule requires that “the person starts to receive an age pension at or after the time when the person makes a claim for the pension bonus”. A person who fails to meet this test cannot qualify for a Pension Bonus. As will appear, Ms Foord does not fail this test.
A claim for a Pension Bonus must be made within the terms of Subdivision E, Division 1, Part 3 of the Administration Act. The general rule is that a claim must be made within 13 weeks of the final ‘bonus period’ accrued. A ‘bonus period’ is a full-year or a part-year period of gainful employment after pension age under the terms of s 92T of the Act.
The 13 week rule is not absolute: ss 21(2) and 23(1)(b) of the Administration Act confer discretion on the Secretary to extend the period in which a claim must be lodged in certain circumstances. Whether either of the discretions is enlivened and, if so, whether it should be exercised in Ms Foord’s case is a live question.
FACTS
The following facts are established.
Throughout the period I must consider, Ms Foord has been a member of a couple with Ronald Carter.
Ms Foord reached ‘pension age’ on 19 January 2001.[1] Mr Carter reached ‘pension age’ on 14 April 2012.
[1] Pension age is relevantly determined under s 23(5) of the Act.
Ms Foord continued in paid employment until retiring on 27 January 2005.[2] Mr Carter continued in paid employment until 28 November 2013.[3]
[2] T12 folio 71.
[3] T9 folio 51.
Under s 92T of the Act, Ms Foord accrued four full-year ‘bonus periods’ from 19 January 2001 to 18 January 2005 (satisfying the ‘work test’ under s 92U) and a part-year ‘bonus period’ from 19 to 27 January 2005 (satisfying the ‘work test’ under s 92V).
It appears that she contacted Centrelink on 23 November 2004 and attended an interview on 16 December 2004. In respect of this interview, a Centrelink officer noted “cus to lodge PDB [Pension Deferred Bonus] registration form and to discuss PDB”.[4] It appears that her registration for Pension Bonus was accepted and it was deemed to be effective from 19 January 2001. On the basis of the available Centrelink records, it appears that Ms Foord lodged a claim for Age Pension and a “New Claim” for Pension Bonus on 15 February 2005.[5] I understand that she was denied Age Pension on income grounds, as Mr Carter was then in employment and his income exceeded the upper threshold for payment of Age Pension. Unfortunately, Ms Foord’s 2005 claims and related documents are not in evidence.
[4] T18 folio 112.
[5] T18 folio 111.
If Ms Foord made a Pension Bonus claim in February 2005, as may be inferred on the available records, the claim was within the 13 week general rule; but it appears that no determination of her qualification for payment of a Pension Bonus was made, albeit that her claim for Age Pension was rejected. Without qualification for Age Pension, it is probable that her Pension Bonus claim fell away. What information she was given by Centrelink about the requirements of the Pension Bonus Scheme, and her rights and obligations under the Scheme at that time, in respect of the partner provisions and her ability to make a subsequent claim for payment of a Pension Bonus for example, is not clear on the present evidence.
Nonetheless, it is quite clear that Ms Foord wanted to claim a Pension Bonus, or at the least, wanted to preserve her right to do so, pending Mr Carter’s retirement from employment.
The legislation in force at the time allowed for this to occur in respect of ‘non-accruing’ members of the Pension Bonus Scheme.
In these circumstances and for the purposes of s 92Q of the Act, the Social Security (Pension Bonus Scheme—Non-accruing Members) Declaration (No. 1) 1998 (the 1998 Declaration) applied, relevantly –
4. Kinds of non-accruing members
A member of the pension bonus scheme who is a member of any of the following kinds is a non-accruing member:
…
(d) a member who is not a participant in the workforce, but whose partner:
(i) is a participant in the workforce; and
(ii) is not a registered member of the pension bonus scheme or of the corresponding scheme under Part IIIAB of the Veteran’s Entitlements Act; and
(iii) intends to become a registered member of the pension bonus scheme or of the corresponding scheme under Part IIIAB of the Veteran’s Entitlements Act;
…
5. Period for which member is non-accruing member
(1) A member of the pension bonus scheme to whom paragraph 4 (a), (b), (c) or (d) applies is a non-accruing member throughout the period during which the member is a member of that kind.
…
The Secretary says that Ms Foord was not a non-accruing member of the Pension Bonus Scheme. I do not agree.
In view of the 1998 Declaration, I am satisfied that Ms Foord was a non-accruing member of the Pension Bonus Scheme from 27 January 2005 until such time as she ceased to be a member ‘of that kind’. Her membership ‘of that kind’ was dependent, relevantly, on five conjunctive elements –
(a)she is not a participant in the workforce;
(b)she has a partner;
(c)her partner is a participant in the workforce;
(d)her partner is not a registered member of the Pension Bonus Scheme; and
(e)her partner intends to become a registered member of the Scheme.
The 1998 Declaration was repealed by the Social Security (Pension Bonus Scheme — Non-accruing Members) Declaration 2007 (the 2007 Declaration), but this did not affect Ms Foord’s continuing status as a non-accruing member. She is within the terms of clause 5(d) -
5 Kinds of non-accruing members
A member of the pension bonus scheme who is a member of any of the following kinds is a non-accruing member:
…
(d) a member who is not a participant in the workforce, but whose partner:
(i) is a participant in the workforce; and
(ii) is not a registered member of the pension bonus scheme or the corresponding scheme under Part IIIAB of the Veterans’ Entitlements Act; and
(iii) intends to become a registered member of the pension bonus scheme or the corresponding scheme under Part IIIAB of the Veterans’ Entitlements Act;
…
6 Period for which member is non-accruing member
(1) A member of the pension bonus scheme to whom a paragraph of section 5 applies is a non-accruing member throughout the period during which the member is a member of the kind mentioned in the paragraph.
…
On 31 August 2009, Centrelink notified Ms Foord of legislative changes to the Pension Bonus Scheme and enclosed a questionnaire.[6] In part, the letter states –
“As a current member of the Pension Bonus Scheme, you will be able to accrue and claim the Pension Bonus when you claim Age Pension, as long as you continue to meet the scheme’s work requirements. If you are not working 960 hours per year, you should contact Centrelink to see if you are affected by these changes.”
[6] T6.
Even though Ms Foord was not working the requisite amount (or at all) and she was affected by the changes, she did not respond to this letter.
On 28 September 2009, Centrelink sent Ms Foord another letter in similar terms.[7]
[7] T7.
The Secretary says that Ms Foord did not respond; but that is not correct. It appears that Ms Foord returned the Centrelink questionnaire, as on 17 October 2009 a Centrelink officer recorded the following –
“Pension Bonus Scheme Questionnaire review completed.
Customer meeting the work requirements of the scheme. No
Customer wishes to remain registered in the scheme. Yes
Review Outcome: Maintain Registration
FIS [Financial Information Service] Referral recommended. Yes
Reason for referral:
Not meeting work test but wants to maintain registration. Partner is under Age Pension age.
FIS Referral made: Yes
Search of Document List (DL) screen was completed and no recent FIS contacts were evident.
…”[8]
“…
Processing this customer’s PBS [Pension Bonus Scheme] review indicates that FIS referral is required.
Please contact this customer to discuss their continuing eligibility for PBS registration.
…
_____ANNOTATE BY LZ7 ON 26 OCT 2009
Phoned n/a._Left message about FIS available for further info by husband ringing._a/n is recovering from op….”[9]
[8] T18 folio 111.
[9] T18 folio 110.
Ms Foord indicated that she suffered a number of health issues that required surgery and that she was not focussed on Centrelink issues in the latter part of 2009. Nonetheless, it appears that she contacted the Centrelink “VIRTUAL FIS TEAM” on 15 January 2010. The following notes are recorded in evidence –
“…
Re financial situation, cust does not work, was relying on ptrs hours to meet work test, advised from sept 20th last year unable to do this anymore and had 13 weeks from this date to either claim age/pdb or satisfy work test herself. Local fis had contacted in October to advised of this but due to having operation she was not fully aware of the implication of this call and did not follow up, has contacted today to claim age but husb eans prob over upper limit for income, irene unable to give any details of his earnings so this is just an assumption discussed the changes to pdb and advised no pdb now, cust has ill health and they have a lot of financial pressures so quite understandably upset at this.”[10]
[10] Ibid.
As can be seen, Centrelink officers noted that Ms Foord was not meeting the ‘work test’[11] but she wanted to retain registration under the Pension Bonus Scheme, relying on her partner’s employment and income for that purpose.
[11] Administration Act, ss 92U and 92V.
It appears that Ms Foord attempted to claim Age Pension and a Pension Bonus on 15 January 2010, when she contacted Centrelink. The record in T18 folio 110 confirms this, although I accept that no claim was formalised or determined. Why this was not taken further to crystallize a claim, or to determine her eligibility or continuing membership under the Pension Bonus Scheme is not clear. But it was not, and there the matter rested until January 2013.
Ms Foord’s registration in the Pension Bonus Scheme continued even though she did not satisfy the work test and her eligibility to make claim was outside the 13 week general rule.
On 7 January 2013, Centrelink wrote to Ms Foord about the Pension Bonus Scheme and said –
“This letter is just to let you know that you are still registered as a member of the Pension Bonus Scheme. Your registration commenced from 19 January 2001.
…
When you are ready to claim Age Pension you will need to claim the bonus at the same time. Please remember that you’ll need to lodge your bonus claim within 13 weeks of ceasing work, or within 13 weeks from the date you no longer meet the work test…
…”[12]
[original emphasis]
[12] T1 folio 3.
It appears that similar letters were sent to Ms Foord on 5 January 2009, 5 January 2010, 5 January 2011 and 5 January 2012.[13] The Secretary says that these letters were simply formulaic responses to Ms Foord’s continuing registration under the Pension Bonus Scheme. Ms Foord says that the 7 January 2013 letter confirmed her membership and entitlement to claim payment under the Pension Bonus Scheme when Mr Carter retired. And that is what she did.
[13] Secretary’s Submissions, 12 June 2015, Attachment 1.
In January 2013, Mr Carter was continuing to earn in employment. His employment ceased on 28 November 2013.[14] He told me that his final payments from employment were not received until early in 2014.
[14] T9 folio 51.
On 13 February 2014, Ms Foord and Mr Carter lodged claims for Age Pension and Pension Bonus.[15] Ms Foord’s Pension Bonus claim was rejected.
[15] T13, T10, T11 and T18 folios 113-114 refer.
13 WEEK LODGEMENT PERIOD
As I have said, the general rule is that a claim for Pension Bonus must be lodged within the specified time: 13 weeks from the end of the last ‘bonus period’.
Subject to exceptions and discretions, the 13 week general rule has a number of iterations under ss 22 to 26 of the Administration Act, relevantly for present purposes -
(a)13 weeks immediately following the last full-year ‘bonus period’: s 22(1);
(b)13 weeks immediately following the last part-year ‘bonus period’: s 23(1);
(c)13 weeks after the time when the person’s membership of the Scheme ceases to be ‘non-accruing’: s 25(1).
I am satisfied that Ms Foord’s final ‘bonus period’ was a part-year period. This means that s 22(1) does not apply.
I am also satisfied that Ms Foord was a ‘non-accruing’ member of the Pension Bonus Scheme immediately after she ceased work on 27 January 2005 and that this kind of membership continued at least until 20 September 2009. It follows that s 23(1) does not apply.
The legislative changes that came into effect on 20 September 2009 precluded people who reach pension age after that date from registering under the Pension Bonus Scheme (see then new s 92J(1A) of the Act). Mr Carter is one of those people.
It is quite clear from the Centrelink records that Centrelink officers considered that the legislative changes directly affected her – she was informed of this in writing, twice, and the reasoning was explained to her in January 2010.
That notwithstanding, there is a question whether the legislative changes acted upon Ms Foord’s status as a ‘non-accruing’ member of the Pension Bonus Scheme. Her ‘non-accruing’ status was essentially preconditioned by five conjunctive elements (see above at [20]). The legislative changes precluded Mr Carter from registering under the Scheme. Does this mean that he should be taken to have no further intent to do so from 20 September 2009? On the one hand, his intention is curtailed by law – he cannot sensibly be taken to intend to register for something that is not open to him and from which he is precluded. On the other hand, his intention may persist in order to enable his partner to claim a Pension Bonus, even though in every other regard his intent is futile.
The Secretary relies on the Guide to Social Security Law at 3.4.7.50 -
Prior to 20 September 2009, a scheme member could be considered non-accruing if the member's partner was working but not a member of the scheme, and intended to become a member. From 20 September 2009, this provision is no longer applicable. In those circumstances the scheme member should be encouraged to claim Age and their bonus or become accruing in their own right if they wish to remain in the scheme.
In the Secretary’s submission, in view of this and as a result of the legislative amendment, the definition of a non-accruing member in the Declaration would not apply to the Applicant. In effect, after 20 September 2009, Ms Foord could not rely on Mr Carter’s employment to meet the ‘work test’.
That may be correct, but if it is it would result in unfairness to Ms Foord in the particular circumstances, whereby she would lose her non-accruing status under the Scheme albeit that she was not in a position to successfully claim Age Pension and the Pension Bonus because of her partner’s continuing income in employment at the time. She was not in a position to lodge a claim for Age Pension and Pension Bonus within 13 weeks of the legislative amendments coming into effect and, if the Secretary’s submissions are accepted, she lost her accrued Pension Bonus because she was not able to claim it within the 13 week period, despite her express desire to do so. Contrary to the Secretary’s submissions, I have seen nothing to suggest that this was an intended consequence of the legislative amendments. This is a matter to which I will return.
As I have said, there is an open question whether Ms Foord’s ‘non-accruing’ membership of the Scheme continued after 20 September 2009. The changes to the Pension Bonus Scheme introduced by the Social Security and Other Legislation Amendment (Pension Reform and Other 2009 Budget Measures) Act 2009 (the Amendment Act) simply bars the Secretary from registering a person as a member of the pension bonus scheme if the person’s date of qualification for the age pension occurs on or after 20 September 2009. The Explanatory Memorandum states that “Existing members of the pension bonus scheme will continue to accrue entitlements under existing rules”.
If the intention, as stated, was to preserve the rules for existing members of the Scheme to accrue entitlements, it may be reasonable to expect that the previously existing rules under which the accrued entitlements of existing ‘non-accruing’ members would also continue. These rules were not expressly altered by the Amendment Act.
While ambiguity in beneficial legislation should be construed in the most favourable manner that is consistent with the language and purposes of the enactment, this is not a licence for an administrative decision-maker to adopt a fanciful or absurd interpretation.
The 2007 Declaration preceded the Amendment Act, but it remains in force. It is this Declaration that must be construed, for present purposes, under the Act as amended. The Declaration is a species of delegated legislation and it cannot be construed in a manner that is inconsistent with the primary legislation. The point of interpretation is narrow, concerning the five essential preconditioning factors for ‘non-accruing’ membership of the Scheme, in particular cl 5(d)(iii) – “a person who is not a participant in the workforce, but whose partner: … intends to become a registered member of the pension bonus scheme”.
To my mind, once the Amendment Act came into force and Mr Carter was precluded from registration under the Scheme, his previous intention to become a registered member could not continue. I think that the legislative bar on registration should be taken as a bar to his intent for the purposes of clause 5(d) of the 2007 Declaration. If that is correct, one of the essential pre-conditioning elements on which Ms Foord’s ‘non-accruing’ membership of the Scheme rested fell away on 20 September 2009, and from that date she ceased to be a ‘non-accruing’ member of the Scheme. It follows, under s 25 of the Administration Act, that she had 13 weeks thereafter in which to lodge a claim for Pension Bonus.
Ms Foord most recently lodged a Pension Bonus claim on 13 February 2014. This is within 13 weeks of Mr Carter’s retirement from employment. But it is more than nine years after the end of Ms Foord’s final ‘bonus period’ and more than four years after she ceased to be a non-accruing member of the Scheme. It is also four years after she was informed by Centrelink that she could not rely on Mr Carter’s employment or income to meet the ‘work test’. It is more than one year after Centrelink informed her that her membership of the Pension Bonus Scheme was current and continuing, and that she could make a claim when she was ready, but this should be done within 13 weeks of failing to meet the ‘work test’.
Under the construction I have adopted, it follows that Ms Foord’s Pension Bonus claim is out of time, and it may only succeed if one of the discretions conferred by s 21(2) and 23(1)(b) of the Administration Act is enlivened and exercised in her favour in the particular circumstances.
If I am wrong about this construction, such that Ms Foord’s ‘non-accruing’ membership of the Scheme continued after 20 September 2009, until Mr Carter retired from participation in the workforce on 28 November, her claim would not be out of time – it was lodged within 13 weeks of that event.
Before moving on, it is desirable to say something about the inference that Ms Foord previously lodged a claim for Pension Bonus on 15 February 2005, within 13 weeks of ceasing paid employment and within 13 weeks of her final part-year bonus period. If the inference is correct, what is to be made of her earlier claim?
Section 17(2) of the Administration Act makes provision for this eventuality –
17 Special requirements regarding claims for pension bonus
(1) A claim for pension bonus must be:
(a) attached to a proper claim made by the person for age pension and lodged together with that claim for age pension; or
(b) made in accordance with an invitation under subsection (3); or
(c) the subject of a determination under subsection (5).
(2) A claim for pension bonus may be made even though it is not certain whether the person will start to receive an age pension at or after the time when the person makes the claim. The claim has effect as a claim that is contingent on the person receiving an age pension.
(3) …
[emphasis added]
The provision made in s 17(2) is permissive – it allows a claim to be made for Pension Bonus with a claim for Age Pension even though the claimant is not yet receiving an Age Pension. The words ”receive an age pension at or after the time when the person makes the claim” for Pension Bonus are not expressly confined to determination of the concurrent Age Pension claim. It may be expected, even intended, in the usual course, that both claims would be determined in a reasonably proximate manner, with the Pension Bonus claim being contingent on the payment of Age Pension (quantification of the amount or rate of Pension Bonus is affected by the rate of Age Pension). But Ms Foord’s circumstances amply demonstrate that concurrent claims for Age Pension and Pension Bonus may not always be finally determined in a proximate manner – the present evidence does not establish that a determination was made in respect of Ms Foord’s claim for Pension Bonus in February 2005. Whether or not this was deliberate, or an error is not clear on the present evidence.
On the one hand, if, as appears likely, Ms Foord made a claim for Pension Bonus with her Age Pension claim on 15 February 2005, and her Age pension claim was rejected but no determination of her Pension Bonus claim was made, it is conceivable that her Pension Bonus claim is effectively preserved, albeit contingent upon her receiving an Age Pension at a later time. On the other hand, the legislation may sensibly be construed to permit and preserve a Pension Bonus claim lodged concurrently with a claim for Age Pension pending determination of the Age pension claim.
The legislation is not clear on this point. To my mind, the latter construction is correct. The contingent relationship of a Pension Bonus claim lodged concurrently, as it should be, with a claim for Age Pension is specific and subject to determination of the Age Pension claim.
On the present evidence, I can go no further on this point. But this impediment does not prevent me from deciding Ms Foord’s application without further delay. Even if I am wrong about the manner in which s 17(2) should be construed, as will appear, the matter is resolved in Ms Foord’s favour on other grounds.
DISCRETIONS TO EXTEND LODGEMENT PERIOD
Part-year period
The discretion to extend the lodgement period where the final ‘bonus period’ is a part-year is set out in s 23(1)(b) of the Administration Act–
23 Last bonus period a part-year period
(1) If a person’s last bonus period is a part-year period, the lodgment period for a claim by the person for pension bonus is:
(a) the period of 13 weeks beginning at the end of that bonus period; or
(b) if the Secretary allows a longer period—that longer period.
However, this subsection does not apply if:
(c) the person is an exempt partnered person (see subsection 24(2)) at the end of the person’s last bonus period; or
(d) the person’s membership of the pension bonus scheme becomes non-accruing immediately after the end of the person’s last bonus period; or
(e) the person is a post-75 member of the pension bonus scheme and has a post-75 work period (see subsection 26(2)).
(2) If:
(a) subsection (1) applies to a person’s claim for pension bonus; and
(b) the claim is lodged within a period allowed under paragraph (1)(b);
Division 6 of Part 2.2A of the 1991 Act has effect, in relation to the calculation of the amount of that pension bonus, as if the person had not accrued the part-year bonus period.
In the Secretary’s submission during the hearing, the discretion is not enlivened in Ms Foord’s circumstances. This is correct, but not for the reasons submitted.
The section does not apply because Ms Foord became a ‘non-accruing’ member of the Scheme immediately after the end of her last ‘bonus period’. She is within the exclusionary terms of s 23(1)(d).
Special circumstances
The discretion to extend the lodgement period for a Pension Bonus claim if ‘special circumstances’ exist is set out in s 21(2) –
21 General rule
(1) A claim for pension bonus must be made within the lodgement period fixed by this Subdivision.
(2) However, the Secretary may in special circumstances allow a person a longer period to make a claim than the period fixed by this Subdivision. If the Secretary does so, the lodgment period for the person’s claim is the period allowed by the Secretary.
(3) Subsection (2) does not apply in relation to a claim for which the lodgment period is fixed by subsection 23(1).
In the Secretary’s submission, it is not appropriate to exercise this general discretion in Ms Foord’s favour as the nine year period from the end of her last ‘bonus period’ to the date on which she claimed Age Pension and Pension Bonus is too long.
I do not agree.
The present evidence clearly establishes that Ms Foord made a number of attempts to comply with the legislative requirements when trying to claim a Pension Bonus in February 2005, January 2010 and February 2014.
When the legislative changes to the Pension Bonus Scheme came into effect, Mr Carter was excluded from registering under the Scheme on reaching ‘pension age’, thereby bringing to an end Ms Foord’s ‘non-accruing’ membership of the Scheme. It is not clear to me that the changes introduced by the Amendment Act were intended to end the latitude given to members of the Scheme, such as Ms Foord, with partners whose income prevented payment of Age Pension. The Amendment Act does not make express provision for a change of this kind. On the contrary, the Explanatory Memorandum suggests that the intention was to prevent registration of new entrants to the Scheme who reach ‘pension age’ after 20 September 2009 and that for existing members the rules for accrual of entitlements would continue to apply.
Despite this, the interaction of the Amendment Act and the 2007 Declaration negatively affects ‘non-accruing’ members of the Scheme with partners in the workforce who reach ‘pension age’ after 20 September 2009. And it does so without express provision or passing comment.
Nonetheless, the Amendment Act and the 2007 Declaration cannot sensibly be construed in a manner that allows a person to intend to register for membership of the Scheme when that is expressly precluded. To do so would be to torture the language of the legislation and to strain its meaning unacceptably.
The bar on Mr Carter registering as a member of the scheme has a direct effect on Ms Foord’s ‘non-accruing’ membership, and his income at that time precluded her from qualifying for Age pension. The combined effect of these circumstances is that she stands to lose all of her accrued entitlements under the Pension Bonus Scheme. That, to my mind, is an unintended consequence of the Amendment Act and the 2007 Declaration that results in significant unfairness to Ms Foord.
Even though Ms Foord does not recall receiving letters from Centrelink about the legislative changes in 2009, I am satisfied that she did. At the time she was unwell. I accept her evidence that she was hospitalised and underwent surgery, and that she did not have her mind on Centrelink matters, at that time.
I also accept that Ms Foord and Mr Carter found the information they were provided by Centrelink confusing, ambiguous, in certain regards contradictory and difficult to understand. I have examined the various letters and notes of communications between Ms Foord and Centrelink on related matters. And I have considered the actions that Centrelink officers took and the information Centrelink provided to Ms Foord and Mr Carter from time to time. On these materials, I can well understand Ms Foord’s difficulty.
In sum, when all of these circumstances and developments are considered together, they may properly be considered to be ‘special circumstances’ for the purposes of the discretion conferred by s 21(2) of the Act. This conclusion is reinforced by my conclusion that removing the latitude previously given to a ‘non-accruing’ member of the Scheme was an unintended consequence of the Amendment Act that is productive of unfairness to Ms Foord, who was unwell at the time the amendments were made. The confusing and ambiguous nature of the information Ms Foord was given at the time and subsequently in respect of the 13 week rule does not alter the factors that remove her case from the ordinary course.
The principles attaching to consideration of ‘special circumstances’ in the Act are well understood. Addressing this point in Secretary, Department of Families, Community Services and Indigenous Affairs v Jones,[16] Jacobson J said -
51. The effect of the authorities is that the phrase “special circumstances”, although lacking in precision, is sufficiently understood as including events or things that render the operation of the statue in a particular case as unfair, unintended or unjust. What is required is something that takes the case out of the ordinary, and unfairness or unintended consequences may show that this exists. Moreover, the circumstances of the case are not confined to matters that are external to the operation of the statutory scheme: see Smith per von Doussa J at 60, 61–62; Groth per Kiefel J at 545, Kertland v Secretary, Department of Family and Community Services [1999] FCA 1596; (1999) 95 FCR 64 per Merkel J at 71, 73; Kirkbright v Secretary, Department of Family and Community Services [2000] FCA 1876; (2000) 106 FCR 281 per Mansfield J at [22], [26]-[27] and [31]-[32]; see also Secretary to the Department of Family and Community Services v Allan [2001] FCA 1160; (2001) 116 FCR 1 per Heerey J at [17].
[16] [2012] FCA 639.
That being so, it is appropriate to exercise the discretion conferred by s 21(2) of the Act to extend the period in which Ms Foord must lodge a claim for Pension Bonus to 13 February 2014.
This means that the claim she lodged on that day is not out of time, and it must be assessed on its merits. For this purpose it will be remitted to the Secretary.
DECISION
The decision under review is set aside and remitted to the Secretary with the direction that the Pension Bonus claim Ms Foord lodged on 13 February 2014 was not made out of time and is to be assessed in accordance with these reasons.
I certify that the preceding 75 (seventy -five) paragraphs are a true copy of the reasons for the decision herein of Mr S Webb, Member ...............................[sgd].........................................
Associate
Dated 15 July 2015
Date of hearing 1 June 2015 Date final submissions received 30 June 201530 June 2015 Applicant In person Solicitors for the Respondent Department of Human Services
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