FRANK HARPHAM and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

[2009] AATA 275

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 275

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2008/3827

GENERAL ADMINISTRATIVE DIVISION		)
Re		FRANK HARPHAM

Applicant

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

Respondent

DECISION

Tribunal  Senior Member M J Carstairs

Date 23 April 2009

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

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

CATCHWORDS

SOCIAL SECURITY – foreign war service pension – debt raised – whether payments were “income” – recalculation of debt

Social Security (Administration) Act 1999 (Cth) s 180(2).

Social Security Act 1991 (Cth) ss 8, 23.

REASONS FOR DECISION

23 April 2009 M J Carstairs, Senior Member

1.      This is an application for review of a decision made in 1992, but not reviewed until 2008.  Mr Harpham let matters lie from the time the decision had been made because he had suffered from debilitating illness in the 1990’s and is quite elderly. 

2.      Mr Harpham incurred an Australian age pension debt in 1991/1992 when he started to receive payments of New Zealand war pension.  The payments involved a sum of arrears, and this effectively crossed over a period of age pension payments that had been paid to him and to his wife, without account being taken of the New Zealand payments. 

3.      The substance of the decision under review is that Centrelink took into account payments made to him as the New Zealand war pension once they were known.  The question is whether these New Zealand payments are “income” for the purposes of the Social Security Act 1991 (the Act).

4.      The definition of “income” is found at s 8 of the Act.  There is no need to set out its terms in full.  It has been recognised as a wide definition; one that captures all sorts of payments, whether of a capital nature or not.  What was specifically in issue here was whether Mr Harpham’s New Zealand payments might have fallen within certain exclusions from that wide definition of income.  These exclusions are also set out in s 8, as expanded upon at s 23 of the Act.

5.      It is helpful to understand, by way of background, something about the kind of payment that Mr Harpham receives from New Zealand.  The documents before me revealed that his payments were in the nature of a disability pension.  I formed this conclusion because the New Zealand War Pension’s Services Office refers to the payment as a “disablement” pension.  The New Zealand authorities, in a letter to Mr Harpham in 1992[1], specified that the payment was a 30% disablement pension, for his war-caused hearing loss and tinnitus.

[1]   T21.

6.      One of the exclusions to the definition of income in the Act is for a payment by way of “service pension”.  However, “service pension” is confined in s 23 of the Act to payments of an aged service pension, invalidity service pension, partner service pension or carer service pension.  All of these service pensions are paid under the Veterans’ Entitlements Act 1986, which is Australian legislation.

7.      In other words, the exclusion does not extend to payments made under New Zealand legislation, however similar or dissimilar these might be to payments made under Australian legislation.  It may well be that New Zealand legislation makes the distinction made by Australian legislation between veterans’ “disability pensions,” (paid with respect to injury), and veterans’ “service pensions”, (paid as a form of income support to ex-soldiers).  However, that is not a point that I need to examine.  It is simply the case that the exclusion provided for in the social security legislation extends only to Australian service pensions, and not to a New Zealand pension, whether service or disability related.  In that regard, the listed exemptions in s 8 of the Act provide a code.  If the payment does not fall within the listed exemptions then it has to be taken into account as “income”.

8.      As a result, Mr Harpham's New Zealand pension payments had to be counted.  Once the New Zealand payments were taken into account, over a certain threshold, they would reduce the amount of age pension that the Australian Government would pay to him.  The correct decision was to take the New Zealand payments into account.  Accordingly, I would affirm the decision to count the payment as “income”.

9.       However, Mr Harpham raised as an additional matter whether his rate of pension was correctly calculated in 1992, when striking the amount of the debt then raised against him.  He questioned whether Centrelink had applied the “income free area” in the process of raising the debt. 

10.     I would observe that this aspect of the matter had not been raised earlier in the review processes.  The matter warranted consideration, although it was now raised so many years after the debt was calculated.  I asked Mr R McQuinlan to have this aspect examined by a Centrelink expert. 

11.     The results of that investigation were filed, and included a recalculation of the debt by Mr Steven Smith, a Centrelink Complex Assessment Officer[2].  There is no need to set out the details of that calculation process.  Suffice to say that there had been an error in the calculation process; a failure to distinguish between the age pension paid to Mr Harpham and that paid to Mrs Harpham in 1992.  The result of this error was that the total debt of $1,114.80 had been raised against Mr Harpham, when in fact only 50% of that amount ought to have been raised against him. 

[2]        Letter and attachments dated 16 March 2009.

12. Accordingly, Centrelink reduced the debt to $557.40, making a new decision under s 180(2) of the Social Security Administration Act 1999 (the Administration Act). That decision recorded that, as Mr Harpham had already repaid the debt, the sum of $557.40 would be remitted to him forthwith.

13. I would simply observe that in accordance with the Administration Act, this new decision becomes the decision under review before the Tribunal. I am satisfied that the calculations have been correctly made by Mr Smith and the reviewable decision, being now the decision dated 16 March 2009, ought to be affirmed.

DECISION

The Tribunal affirms the decision under review.

I certify that the 13 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member M J Carstairs.

Signed:............................[Sgd]..............................................
           Mátyás Kochárdy, Research Associate

Date of Hearing   19 February 2009
Date of Last Submissions        17 March 2009    
Date of Decision  23 April 2009     
The Applicant was self-represented          
Advocate for the Respondent   Mr R McQuinlan