Frank Wadsworth and Secretary, Dept. of Families, Housing, Community Services and Indigenous Affairs

[2012] AATA 916

[2012] AATA  916

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2012/0136
Re	Frank Wadsworth
APPLICANT
And	Secretary, Dept. of Families, Housing, Community Services and Indigenous Affairs
RESPONDENT

DECISION

Tribunal	Senior Member A K Britton
Date	21 December 2012
Place	Sydney

The decision not to exercise the power conferred by s 1237A of the Social Security Act 1991 (Cth) to waive the debt incurred by the Applicant for the period, 5 August 2009 to 13 April 2010, is set aside and remitted to the Secretary for reconsideration in accordance with these reasons.

The balance of the decision made by the Social Security Appeals Tribunal on 4 November 2011 is affirmed.

...............[SGD].........................................................

Senior Member A K Britton  

CATCHWORDS

SOCIAL SECURITY—Debt—Overpayment of disability support pension and age pension—Meaning of ‘debt solely attributable to administrative error’— Whether all or part of the debt is attributable solely to an administrative error made by Centrelink —Whether debt should be waived due to special circumstances—Whether debt can be written off

LEGISLATION

Administrative Appeals Tribunal Act 1975 (Cth) s37
Freedom of Information Act 1982 (Cth)

Social Security Act 1991 (Cth) ss 1237A; 1237AAD; 1236(1)

CASES

Boscolo v Secretary, Department of Social Security (1999) 90 FCR 531
Fischer v Secretary, Department of Families, Housing, Community Services & Indigenous Affairs (2010) 185 FCR 52
Groth v Secretary, Department of Social Security (1995) 40 ALD 541
Secretary Department of Social Security v Hodgson (1992) 37 FCR 32
Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126

secondary

REASONS FOR DECISION

Senior Member A K Britton

1. Mr Frank Wadsworth seeks review of the decision, made by a Centrelink Authorised Review Officer and affirmed by the Social Security Appeals Tribunal, to raise and recover a debt of just under $50,000 and not to exercise the statutory power to waive or write-off that debt. 

2. The debt arose as a result of an overpayment made to Mr Wadsworth of Disability Support Pension (DSP) and, from December 2003, Age Pension throughout the period July 1998 to April 2010 (the debt period). Throughout that period Centrelink calculated Mr Wadsworth’s rate of pension on the basis of the mistaken assumption that his weekly employment income was $96 ($4992 pa). At all times his actual income was significantly higher and, by the end of the debt period, five times that amount.

3. Mr Wadsworth contends that he was unaware he was being overpaid and at all times kept Centrelink fully informed of any changes to his income. The Secretary disputes that claim and asserts that despite being repeatedly advised of the income figure used to calculate his rate of pension, Mr Wadsworth failed to draw to Centrelink’s attention the discrepancy between that figure and his actual income.

4. It is agreed that the debt raised by the Secretary has been correctly calculated. The sole issue to be decided in this review is whether the discretionary power conferred by the Social Security Act 1991 (Cth) (“the Act”) to waive or write off all or part of the debt can and should be exercised. The answer to that question turns principally on whether all or part of the debt is attributable solely to an administrative error made by Centrelink, and, if not, whether there are special circumstances (other than financial hardship alone) that make it desirable to waive the debt.

   BACKGROUND TO THE DEBT

5. Throughout the debt period Mr Wadsworth worked as a music therapist at Penrith Hospital. A file note made by a Centrelink officer on 10 July 1996 (the July 1996 letter) states:

   As per letter received on 1.7.96 client advises that he will be working for Penrith Hospital working part-time for 7 hours per week at an hourly rate of $13.75 … $96.25 per week

6. Throughout the debt period Centrelink calculated Mr Wadsworth’s rate of DSP, and from December 2003 Age Pension, on the assumption that his employment income remained at $96 per week. In addition to pension benefits, throughout that period Mr Wadsworth received a Mobility Allowance. Such allowance is only payable if, among other things, the recipient works at least eight hours per week.

   Incomplete documentation

7. Mr Wadsworth contends that the documents provided by the Secretary pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (Cth) (“the section 37 documents”) are incomplete. Section 37 of the Administrative Appeals Tribunal Act requires the decision-maker to lodge with the Tribunal a copy of every document in their possession relevant to the review of the decision by the Tribunal. The documents provided to the Tribunal under section 37 span the period 1991 to 2012.

8. The task of determining whether, as claimed, Mr Wadsworth provided Centrelink with accurate information about his income is difficult because, as acknowledged by the Secretary, the documents contained in the section 37 documents do not contain all of the documents provided to Centrelink by Mr Wadsworth throughout the debt period. Missing are a number of key documents which could be expected to shed light on the information Mr Wadsworth provided to Centrelink about his income. These include the income and assets review forms submitted in January 2000 and February 2001 and the Aged Pension claim form submitted in 2003. All are referred to in electronic file notes made by Centrelink officers. Mr Wadsworth’s request made under the Freedom of Information Act 1982 (Cth) for these and other documents was refused apparently on the grounds that those documents could not be located.

9. Contained in the section 37 documents are a number of secondary documents which purport to record information provided by Mr Wadsworth including that contained in the income and assets review forms referred to above. Mr Wadsworth disputes the accuracy of many of these documents and contends that they merely pick up and repeat the information set out in the July 1996 letter.

10. The section 37 documents contain electronic file notes made by Centrelink officers of conversations and interviews with Mr Wadsworth. He contends that they contain only a small proportion of the conversations he had with Centrelink officers throughout the debt period.

11. Mr Wadsworth did not keep copies of any of documents he sent or received from Centrelink throughout the debt period. Nor did he make any contemporary notes of his discussions with Centrelink officers. 

    Record of interaction between Centrelink and Mr Wadsworth throughout the debt period  

12. The following summarises the interaction between Mr Wadsworth and Centrelink throughout the debt period as recorded in the section 37 documents.

    Period 1: 9 July 1998 – 12 January 2004

13. Centrelink’s records indicate that during this period Mr Wadsworth notified Centrelink on a number of occasions that he was working more than seven hours per week. On 30 October 1997 he advised that he was working nine hours per week; on 12 January 2001 and again on 31 January 2002, he told Centrelink he was working ten hours per week.  

14. On 8 December 1999 Centrelink wrote to Mr Wadsworth and advised him of his rate of pension. The letter stated that his pension had been calculated on the assumption that his employment income was $4993 pa and that he must notify Centrelink if that, or any other information contained in the letter, was incorrect. Centrelink’s records reveal that Mr Wadsworth contacted Centrelink on 8 December 1999 presumably in response to that letter but not what was discussed. A month later he provided Centrelink an updated income and assets review form. As noted that form is not contained in the section 37 documents and has not been produced in these proceedings.

15. On 31 January 2000 Mr Wadsworth submitted a mobility allowance form, which has also not been produced. Centrelink records that Mr Wadsworth claimed in that form to be working nine hours per week.

16. On 22 December 2000 Mr Wadsworth’s Mobility Allowance was cancelled because he had been off work for “six pays”. (He was apparently hospitalised during this period). The allowance was reinstated on 12 January 2001. Centrelink recorded that Mr Wadsworth “is continuing working for health service 10 hours per week”. On 9 February 2001 Mr Wadsworth attended an interview with Centrelink in relation to his Mobility Allowance. A record of that interview states that he had returned to work and “nothing has changed”. 

17. On 26 February 2001 Centrelink received an updated income and assets review form submitted by Mr Wadsworth. As noted that form is not contained in the section 37 documents. An electronic file note made on the same day states: “received money from father’s estate $90,000 that was not previously assessed”.

18. On 9 March 2001 Centrelink wrote to Mr Wadsworth advising that he was to receive a bonus payment of $315 as part of the government’s tax reform changes. The letter recorded Mr Wadsworth’s “retirement income” as $5,182.00 and “savings and investment income” as $315. The letter explained that the term “retirement income” meant the annual income from any source including earnings from salaries and wages and that “savings and investment income” meant “any income received from investments”.

19. By a letter dated 16 March 2001 Centrelink informed Mr Wadsworth that his DSP would be paid at a rate of $300.37 per fortnight and in calculating that rate his annual income had been taken to be $9,361.97 [$183 per fortnight]. The letter contained the standard instruction to notify Centrelink within 14 days if his income were to increase. There are no documents to explain why Centrelink almost doubled its estimate of Mr Wadsworth’s income at this time.

20. On 31 January 2002 Mr Wadsworth submitted a Mobility Allowance Review form. Apparently on the basis of that form Centrelink recorded “working 10 hours p/week at Penrith hospital — paid employment”. On the same day Centrelink wrote to Mr Wadsworth’s employer to provide a “form advice”. That letter was not produced and there is nothing to indicate that the employer replied to that letter.

    Period 2: 13 January 2004 – 23 July 2009

21. Mr Wadsworth lodged a claim for Age Pension on 13 January 2004. The claim was granted and payment backdated to 30 December 2003. An electronic file note made on 13 January 2004 stated: “Earnings … Penrith hospital … $5,044”. Centrelink wrote to Mr Wadsworth on the same day and under the heading “information for calculating your regular payment” stated:

    Annual income   $2,748

    Regular fortnightly earnings       $194

22. The letter contained the standard instruction that Mr Wadsworth was required to notify Centrelink within 14 days if his income were to increase.

23. The next record of Centrelink writing to Mr Wadsworth about his rate of pension is a letter dated 14 May 2007. It contained much the same information as the letter of 13 January 2004, recording Mr Wadsworth’s employment income as $194 per fortnight and the standard instruction to notify Centrelink if this was to change. 

24. Throughout 2004 and 2007 Centrelink wrote to Mr Wadsworth periodically advising of his rate of Mobility Allowance. That correspondence contained no mention of his rate of income or number of hours worked.

25. According to its records, between May 2007 and July 2009 Centrelink wrote to Mr Wadsworth on eight occasions noting that his income was $194 per fortnight and reminding him of his obligation to notify it in the event of change.

    Period 3: 24 July 2009 to April 2010

26. On 31 July 2009 Centrelink wrote to Penrith Hospital apparently as part of a regular review requesting details about Mr Wadsworth’s employment. Information provided by the Hospital revealed that Mr Wadsworth’s gross income for 2007/2008 was $19,340. This information triggered an investigation and ultimately the decision to raise and recover a debt from Mr Wadsworth.

27. At Centrelink’s request Mr Wadsworth contacted Centrelink officer, “Adrian” on 31 July 2009. A file note of that conversation recorded:

    Customer states they correctly declared income to [Centrelink]? — Yes. [A]dvised [client] that employer not updated in[come] earn[ings] since 2001. [Client] advised that now earns more than $97 per [week], but unsure of [amount]. [Client] advised that he rec[eived] lump sum pay[ment] for backpay of work during 2007/08, states that it was about $5000, this still leaves about $9 [000] variance to actual earnings already declared. [A]dvised [client] to also update his [savings] & [managed investment schemes] as no updates since 2001 & [client] states these bal[ances] reduced.

28. Over the ensuing nine months Centrelink gathered material from Mr Wadsworth and his employer about the employment income he received throughout the debt period. The records reveal that on 4 August 2009 Mr Wadsworth attended Centrelink’s St Mary’s office and provided a copy of his bank statements. Centrelink’s records reveal that there were numerous discussions between Mr Wadsworth and Centrelink officers throughout this period. 

29. Centrelink issued a debt notice to Mr Wadsworth on 19 April 2010.

    Mr Wadsworth’s evidence

30. Throughout the debt period Mr Wadsworth suffered a number of serious health problems including a psychiatric disorder. Mr Wadsworth testified that during that period he was hospitalised on number of occasions and from time to time lived with his father. He claims that as a result of multiple health problems his memory is now poor.

31. Mr Wadsworth does not dispute he was aware of his obligation to contact Centrelink if his income varied and testified that on numerous occasions he notified Centrelink of errors in its records. He claims that on at least two occasions, probably 2005 and 2007, he visited the Centrelink office in St Marys, Sydney in response to letters which stated that his income was $196 per fortnight. He stated on both occasions he advised that the information in the letters was wrong and provided bank statements and demanded they be faxed to “Sydney”. There are no records of Mr Wadsworth submitting bank records before 2009.

32. According to Mr Wadsworth, on a number of occasions throughout the debt period members of his employer’s payroll office mentioned that Centrelink had contacted them enquiring about his income. He stated that this was one of the reasons he was led to believe that Centrelink had the correct information about his income.

33. The section 37 documents contain the following record made by a Centrelink officer on 9 October 2009 of a conversation held with Mr Wadsworth:

    [Customer] called to advise he receives the same of money each week and does not understand why he has to report income on a regular basis advised he spoke to OAS who told him he would not have to report again unless his income changed.

34. A further record made on 9 October 2009 by a Centrelink officer states:

    [Client] still believed he was earning only $97 per [week]. [Client] does receive [pay]slips from his employer regularly, but [doesn’t] check them. [A]dvised [client] that last several recent [pay]slips have been around $872 [per fortnight]. [Client] checked his pocket for most recent [pay]slip & confirmed his GROSS inc[ome] was $872.54 for [fortnight].

35. In cross-examination Mr Wadsworth said he could not recall that conversation.

36. The following note was made by a Centrelink officer four days later:

    Customer called to complain that Centrelink letters are too confusing and difficult to read. Customer was not referring to any letter in particular but alleges that it is through no fault of his own that … his income and savings details may have been incorrect for several years as the letters are too long and complex.

37. According to Mr Wadsworth while he held the opinion that the letters were too long and complex, that record was a sanitised version of his comments and the purpose of his call had not been to complain about Centrelink’s letters.

    CAN THE DEBT BE WAIVED ON ACCOUNT OF ADMINISTRATIVE ERROR?

38. Section 1237A of the Act provides that the Secretary, or Tribunal acting as substitute decision-maker, must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth:

    Waiver of debt arising from error

    Administrative error

    (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.

    Note:     Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).

39. In Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126, Selway J discussed (at 135) the meaning of the phrase “attributable solely” in the context of s 1237A(1) of the Act:

    The ordinary or usual interpretation of the phrase ‘attributable solely to’ is that it refers to the single or sole cause of the relevant act or event. The word ‘attributable’ means ‘capable of being attributed’. It involves an objective assessment of causation. The words ‘a debt attributable solely to an administrative error' can be paraphrased as meaning that the only cause that objectively can be ascribed to the relevant debt is an administrative error.

40. Adopting that approach, the issue to be determined is whether “an administrative error made by the Commonwealth is the only cause that objectively can be ascribed to some or all of Mr Wadsworth’s debt?”. If the answer to that question is yes, and the relevant overpayment was received in good faith, that part of the debt attributable to that error must be waived.

41. Throughout the debt period Centrelink calculated Mr Wadsworth’s rate of pension on the basis of the information contained in the letter of July 1996, that is, that he was working seven hours per week and receiving a weekly income of $96. Centrelink failed to reconcile that information with conflicting and more recent information Mr Wadsworth had supplied about his hours of work. Paradoxically, had Mr Wadsworth been working seven hours per week he would have been ineligible to receive the Mobility Allowance. It is troubling that this discrepancy, or the fact that Mr Wadsworth’s assumed hourly rate remained unchanged, was not picked up for some 14 years. 

42. There can be no argument that this failure was partly responsible for the overpayment of pension throughout the debt period. The more difficult issue is whether the overpayment and consequent debt was solely attributable to Centrelink error. Critical to that issue is what, if any, information Mr Wadsworth supplied to Centrelink about his income after the letter of July 1996.

43. There is nothing in the section 37 documents to support Mr Wadsworth’s claim that prior to the commencement of the investigation into the overpayment of his pension he had supplied Centrelink with correct information about his employment income. That is not determinative because, as Mr Wadsworth points out, the section 37 documents are incomplete. It is unfortunate that the income and assets review forms submitted Mr Wadsworth in 2000 and 2001 have not to be located because they could be expected to shed light on the veracity of his claims. Mr Wadsworth requested these documents on a number of occasions throughout the investigation into the overpayment.

44. Having carefully reviewed the evidence I conclude that it is more likely than not that Mr Wadsworth did not as claimed repeatedly report to Centrelink that the information it held about his employment income was incorrect. There can be no argument that Centrelink’s records are incomplete. However in my opinion it is improbable that, had Mr Wadsworth, as claimed, repeatedly contacted Centrelink throughout the debt period, not one of the many officers he dealt with made a record of that contact, or that none of those records would have survived and found their way into the section 37 documents.

1. Nor am I satisfied that in or around 2004 and 2007 Mr Wadsworth provided copies of bank statements to Centrelink’s St Marys office. There are no records of either the visits or the bank statements in the section 37 documents. Nor is there any record of Mr Wadsworth mentioning that he had provided bank statements at those times in the file notes of the many conversations he had with Centrelink officers after the commencement of the investigation. I think it likley that Mr Wadsworth has confused those alleged visits with that made to Centrelink’s St Marys office in August 2009.

2. Had Mr Wadsworth, as claimed, reported to Centrelink on numerous occasions throughout the debt period that it held incorrect information about his income, it would be reasonable to expect that he would have submitted some documentation to prevent the error being repeated. By his own admission, apart from the bank statements allegedly provided in or around 2004 and 2007, prior to August 2009 he had not provided any such documentation to Centrelink.  

3. In my opinion the most likely explanation for Mr Wadsworth’s failure to alert Centrelink to its error is because he failed to carefully read the information he received from Centrelink about his assumed annual income. That is consistent with file note made by a Centrelink officer of a conversation with Mr Wadsworth in October 2009 which recorded him as saying “the letters are too confusing and difficult to read … and too long and complex”. It is also consistent with Mr Wadsworth’s claim, which I accept, that he assumed that Centrelink was obtaining details about his income from his employer and the Australian Tax Office (see Mr Wadsworth’s written submission to the SSAT, section 37 documents, T 109, p 523).

4. While in the absence of the income and assets review forms submitted by Mr Wadsworth it is not possible to be certain, I think it more likely than not that the information supplied by Mr Wadsworth in those forms was correct. There is no evidence that he supplied incorrect information about any other matter relevant to the calculation of his rate of pension. Indeed Centrelink’s records suggest that the reason he submitted the the 2001 review form was because Mr Wadsworth wanted to alert Centrelink to the fact that he had inherited some money which had not previously been assessed.

5. The letter of July 1996 was the genesis for the error which caused Mr Wadsworth to be overpaid pension benefits for over a decade. One of the reasons that error continued for the period it did was Centrelink’s failure to pick up the discrepancy in the information it used to calculate Mr Wadsworth’s rate of pension and that used to determine his eligibility for Mobility Allowance. It was also contributed to by Centrelink’s failure to update its records following the receipt of Mr Wadsworth’s 2000 and 2001 income and assets review forms.

6. Nonetheless it cannot be said that the debt was solely attributable to Centrelink’s error. Mr Wadsworth notified Centrelink on only two occasions throughout the debt period that the information it held about his income of which he had been advised was incorrect. He was on notice that the error continued after he submitted the income and assets review forms. In my opinion Mr Wadsworth’s failure to notify Centrelink of the continuing error also contributed to the creation of the debt. 

7. There is some strength in Mr Wadsworth’s argument that Centrelink was better placed than he, an elderly person with a psychiatric disorder and multiple health problems, to pick up the discrepancy in the information he had provided. Section 1237A is not concerned with apportionment of blame for the creation of the debt. Once established that the debt is even partly caused by a factor other than Centrelink administrative error the power to waive the debt cannot be exercised.

8. While I am satisfied that the debt was not attributable solely to Centrelink error for most of the debt period, I am less confident in respect of the period following the commencement of the investigation into the debt. By late July 2009 Centrelink was on notice that the information it had used to calculate Mr Wadsworth’s pension was wrong. On 30 September 2009 Centrelink reduced Mr Wadsworth’s rate of pension apparently on the basis of information he and his employer had supplied to Centrelink. While Mr Wadsworth was extremely critical of Centrelink’s conduct of the investigation there is no evidence to suggest that he failed to fully cooperate with the investigation or provide correct information when requested. Nonetheless over the ensuing six months he continued to receive pension overpayments, on occasion, albeit of relatively small amounts (See “Debt explanation”, section 37 documents, T 84, pp 446 - 448).

9. In these proceedings the Secretary suggested that the reason the overpayment continued was because of the delay in obtaining accurate information about Mr Wadsworth’s gross income. While this might explain why it took until 30 September 2009 to adjust Mr Wadsworth’s rate of pension (six weeks after he had supplied his bank statements) it does not explain the reason for the overpayment for the remainder of the debt period. On what is before me I am unable to form a concluded view on the cause of the overpayments for the period from 4 August 2009.  

   Conclusion:

10. Not being satisfied that the debt incurred by Mr Wadsworth for the period to 3 August 2009 was attributable solely to an administrative error made by Centrelink, the power to waive that part of the debt conferred by s 1237A cannot be exercised. The decision in respect of the balance of the debt period is remitted to the Secretary for reconsideration in accordance with these reasons.

    CAN THE DEBT BE WAIVED BECAUSE OF SPECIAL CIRCUMSTANCES?

11. Section 1237AAD of the Act gives the decision-maker the power to waive all or part of a debt if satisfied, among other things, that “there are special circumstances (other than financial hardship alone) that make it desirable to waive [the debt]”.

12. The term “special circumstances” is contained in a number of provisions of the Act and has been the subject of exhaustive consideration by the Administrative Appeals Tribunal and the Federal Court. The Federal Court has consistently declined to adopt a prescriptive formula. (See for example French J in Boscolo v Secretary, Department of Social Security (1999) 90 FCR 531 at 535). Nonetheless, the Court has emphasised that the term denotes a requirement that there be “something to distinguish [the claimant’s] case from others, to take it out of the usual or ordinary case”: per Kiefel J in Groth v Secretary, Department of Social Security (1995) 40 ALD 541 at 545. This however is not to be interpreted as a requirement that the claimant’s circumstances be “extremely unusual, uncommon or exceptional”: per Hill J in Secretary Department of Social Security v Hodgson (1992) 37 FCR 32 at 42. Nor is there a requirement that the circumstances be unique to the individual: per Katzmann J in Fischer v Secretary, Department of Families, Housing, Community Services & Indigenous Affairs (2010) 185 FCR 52 at 65.

13. It was submitted for Mr Wadsworth that the following establish special circumstances: the quantum of the debt; the long period over which it has been accrued; Centrelink’s part in its creation; his poor health, in particular his psychiatric condition and future significant health costs.

14. There can be no argument that Mr Wadsworth is in poor health. That is confirmed by recent reports prepared by his GP and geriatrician, Dr Meng Chew. Each holds the opinion that since undergoing cardiac surgery earlier this year the deterioration in his health and consequent problems with mobility have accelerated. Mr Wadsworth also suffers from kidney disease and understands that he will require dialysis treatment in the near future.

15. Mr Wadsworth has been advised that he will soon require a wheel chair. He understands that he will need to purchase a modified vehicle to transport the chair. He estimates that the combined cost of the chair and the modified vehicle to be about $55,000.

16. Mr Wadsworth owns his home and a four wheel drive, which he estimates to be worth $300,000 and $7,000 respectively. Apart from investment income his sole source of income is the Age Pension. He has entered into an agreement with Centrelink to repay the subject debt at the rate of $20 per fortnight. After deduction for utilities this leaves him with $675 per fortnight.

17. I accept that Mr Wadsworth is in a difficult position because of a combination of health and social problems. He feels deeply aggrieved with what he considers to be Centrelink’s mismanagement of his pension. His future quality of life will to a large degree be determined by his ability to maintain mobility. This will be costly. While his financial circumstances are modest, he is not, and nor has he suggested, that he is in straitened financial circumstances: he has no dependents, owns his own home and some assets. Given his modest income a deduction of $10 per week is not insignificant but nor could it be characterised as especially punishing.

    Conclusion

18. Having regard to all of Mr Wadsworth’s circumstances I am unable to conclude that special circumstances are established. I note that it would be open to Mr Wadsworth to apply for review in the event the Secretary decides to recover the debt at a faster rate than currently agreed.

    CAN THE DEBT BE WRITTEN OFF?

19. Section 1236(1) of the Act provides that the Secretary may write off a debt only if:

    (a)the debt is irrecoverable at law; or

    (b)the debtor has no capacity to repay the debt; or

    (c)the debtor's whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or

    (d)it is not cost effective for the Commonwealth to take action to recover the debt.

20. There is no evidence and nor is it suggested that any of the pre-conditions to the exercise of the power conferred by s 1236(1) are satisfied. Accordingly the debt cannot be written off under this provision.

    CONCLUSION  

21. For the reasons given, the power to waive or write off the debt under ss 1237AAD and 1236(1) of the Act, respectively, cannot be exercised. Nor can the power to waive the debt conferred by s 1237A of the Act for the period 9 July 1998 to 4 August 2009 be exercised. The decision not to exercise the power to waive the debt conferred by s 1237A for the period 5 August 2009 to 13 April 2010 is set aside and remitted to the Secretary for reconsideration in accordance with these reasons.

I certify that the preceding 65 (sixty five) paragraphs are a true copy of the reasons for the decision herein of Senior Member A K Britton.

..............[SGD]..........................................................

Associate to Senior Member Britton

Dated 21 December 2012

Date(s) of hearing	13 November 2012
Solicitors for the Applicant	Stephen Hodges
Solicitors for the Respondent	Program Litigation and Review Branch, Department of Human Services