GEORGE RUDD and SECRETARY, DEPARTMENT OF FAMILIES, HOUSING COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
[2013] AATA 295
•13 May 2013
[2013] AATA 295
Division GENERAL ADMINISTRATIVE DIVISION File Number(s)
2012/3350
Re
GEORGE RUDD
APPLICANT
And
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
RESPONDENT
DECISION
Tribunal Ms K Hogan, Member
Date 13 May 2013 Place Perth The Tribunal affirms the decision under review.
…(Sgd) K. Hogan…….
Ms K Hogan, MemberCatchwords
Social Security – Disability Support Pension – Aged Pension – Whether Applicant was Overpaid Disability Support Pension and Aged Pension – Applicant Failed to Declare Partner’s Income – Applicant was Overpaid Disability Support Pension and Aged Pension - Overpayments were Debts Due to the Commonwealth – Debts Could not be Written-off Under Section 1236 of the Social Security Act - Debts Could not be Waived Under Section 1237A of the Social Security Act - Debts Could not be Waived Under Section 1237AAD of the Social Security Act
Legislation
SocialSecurity Act 1991
Social Security (Administration) Act 1999
REASONS FOR DECISION
Ms K Hogan, Member
13 May 2013
HISTORY
The applicant was in receipt of disability support pension and age pension during the period 5 March 1998 to 3 March 2009. Throughout this time the applicant’s partner, Ms Nannette Paul, was in receipt of income from employment.
On 28 July 2010, an employee of Centrelink decided the applicant had been overpaid disability support pension and age pension of $35,872.22 and $51,010.21 in the periods 5 March 1998 to 23 August 2003 and 24 August 2003 to 3 March 2009 respectively, as the applicant’s partner’s income had not been taken into account when calculating his rate of payment (the Original Decision).
On 10 October 2011, the applicant requested a review of the Original Decision and on 20 February 2012 a Centrelink Authorised Review Officer (ARO) reviewed and affirmed the Original Decision.
On 24 February 2012, the applicant requested a review of the ARO’s decision by the Social Security Appeals Tribunal (SSAT) and on 2 July 2012 the SSAT affirmed the decision of the ARO.
The applicant sought review of that decision to this Tribunal.
THE ISSUES
The issues to be considered by the Tribunal are:
(a)whether the applicant has been overpaid disability support pension and/or age pension in the period 5 March 1998 to 3 March 2009 (the Relevant Period)?
and, if so,
(b)are the overpayments debts due to the Commonwealth?
and, if so,
(c)should recovery of the applicant’s debts be waived or written off?
EVIDENCE
The Tribunal was provided with a number of documents including:
(a) the section 37 documents;
(b) written submissions from the applicant and the respondent.
The Tribunal heard oral submissions on behalf of the parties.
THE LEGISLATIVE FRAMEWORK
The legislation relevant to this decision is contained in the Social Security Act 1991 (the Act) and the Social Security (Administration) Act 1999 (the Administration Act).
A person’s rate of disability support pension and age pension is to be worked out using the Pension Rate Calculator A at the end of section 1064 of the Act (sections 117 and 55 of the Act respectively). In general terms, a person's and their partner’s, income(s) will reduce the rate of disability support pension and age pension payable to a person. Income is defined in section 8 of the Act and is taken to mean, among other things, gross income from employment (section 1072 of the Act).
Section 66A(1) of the Administration Act prescribes a general requirement that a claimant or recipient of a social security payment notify Centrelink within 14 days of any event or change in circumstances that may affect the payment.
Section 68 of the Administration Act provides that a person can be given a notice requiring them to provide information about an event or change in their circumstances that might affect the payment of a social security payment.
Subsection 1223(1) of the Act states:
(1)Subject to this section, if:
(a)a social security payment is made; and
(b)a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit;
the amount of the payment is a debt due to the Commonwealth by the person and the debt is taken to arise when the person obtains the benefit of the payment.
Subsection 1236(1A) of the Act provides that Centrelink may decide to write-off recovery of a debt for a stated period or otherwise, if and 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.
Section 1237A of the Act deals with waiver of debt arising from an error. Subsection 1237A(1) of the Act provides that subject to subsection 1237A(1A) Centrelink 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.
Section 1237AAD of the Act provides that Centrelink may waive the right to recover all or part of a debt if satisfied that:
(a)the debt did not result wholly or partly from the debtor or another person knowingly:
(i)making a false statement or a false representation; or
(ii)failing or omitting to comply with a provision of this Act or the Administration 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.
APPLICANT
The applicant contended that he and Ms Paul always maintained separate finances so he never thought her income would need to be included by Centrelink in his pension calculations.
The applicant advised the Tribunal that because he had a position as a caretaker he had no rent or electricity bills to pay and he had no reason to take any money from Ms Paul.
The applicant contended that they never shared their finances and would each pay their own half of the food bill from their own funds. The applicant added their only joint purchase was a washing machine.
The applicant admitted to the Tribunal that he had made "a stupid mistake" in not declaring Ms Paul's income.
The applicant did not dispute the calculations made by Centrelink in respect of the overpayments.
RESPONDENT
The respondent contended that the applicant had a general requirement, and by reason of numerous notices [for example see:T4: p12;T5; p15] an explicit requirement, to provide Centrelink with information that might affect the payment to him of a social security benefit and that he had failed to so do.
The respondent contended that the applicant’s income was not taken into account when assessing his rate of age pension in the period prior to 24 February 2011.
The respondent contended that the debt was not caused by the administrative error of the Commonwealth and recovery could not be waived under the terms of section 1237A of the Act.
The respondent submitted that the applicant had actual knowledge of the requirement to notify Centrelink of changes to his circumstances and knowingly failed to do so. The respondent further contended that the applicant had no circumstance that might be considered unusual or uncommon so as to be considered special in the context of other social security recipients.
CONSIDERATION OF THE ISSUES
The following facts were not in dispute and the Tribunal finds:
i.The applicant and Ms Nannette Paul were partnered during the period 5 March 1998 to 3 March 2009.
ii.The applicant was in receipt of disability support pension during the period 5 March 1998 to 23 August 2003.
iii.The applicant was in receipt of age pension during the period 24 August 2003 to 3 March 2009.
iv.The applicant did not advise Centrelink of Ms Paul’s earnings from “Coles” during the relevant period.
v.Centrelink did not take into account Ms Paul’s income when calculating the applicant’s rate of disability support pension or age pension during the relevant period.
There is no discretion in section 1064 of the Act to permit a person’s partner’s income to be disregarded when calculating their rate of payment, regardless of whether the person and their partner “pool” their financial resources or not.
The Tribunal finds that, as Ms Paul’s income from employment was not taken into account when calculating the applicant’s rate of disability support pension and age pension in the relevant period, the applicant has been overpaid disability support pension and age pension.
With regard to Ms Paul’s employment income from Coles, Centrelink determined that the applicant had been overpaid disability support pension of $35,872.22 in the period 5 March 1998 to 23 August 2003 and age pension of $51,010.21 in the period 24 August 2004 to 3 March 2009. The applicant did not dispute and the Tribunal is satisfied that the applicant therefore has debts due to the Commonwealth totalling $86,882.43 for the combined amount of the overpayments (section 1223(5) of the Act applies for the period prior to 1 July 2001 and subsection 1223(1) of the Act for the period from 1 July 2001).
The applicant told the Tribunal that he is currently in receipt of age pension and a small income from the Police Force of approximately $200 per week. The applicant said that he is managing his current debt repayments. The applicant does not have any expenses for rent, electricity or water.
Based on the applicant’s evidence the Tribunal found that the applicant has the capacity to repay his debt and therefore it was not appropriate to write off the recovery of the applicant’s debt under section 1236 of the Act.
The applicant's evidence was that he did not inform Centrelink of his partner’s income because he believed that her earnings were not relevant to his payments as they kept very separate finances. The Tribunal is satisfied that the applicant’s debts arose because he failed to advise Centrelink of Ms Paul’s income as required, and not as a result of "sole administrative error". The Tribunal has decided that the recovery of the applicant’s debt could not be waived in accordance with section 1237A of the Act.
The Tribunal appreciates the applicant’s assertion that he believed his pension should not be affected by Ms Paul’s income as they never shared their finances and would each pay their own half of the food bill (their only expense given they shared the caretaker property) from their own funds. The applicant added their only joint purchase was a washing machine.
The Tribunal considered the applicant's evidence thathe knew that he had made a mistake in not telling Centrelink about Ms Paul’s earnings, and that he knew at the time that he probably needed to tell Centrelink. The Tribunal is unable to find that the applicant did not knowingly fail to comply with a provision of the Act and therefore does not need to consider further whether the applicant satisfies the other provisions of section 1237AAD.
The Tribunal finds that the recovery of the applicant’s debts could not be waived under section 1237AAD of the Act.
DECISION
The Tribunal affirms the decision under review.
I certify that the preceding 36 (thirty-six) paragraphs are a true copy of the reasons for the decision herein of Ms K Hogan, Member.
..(Sgd) D. Chapman..............................................
Dated 13 May 2013
Date of hearing 25 March 2013 Applicant Self
Advocate for the respondent Ms Nguyen
Australian Government Solicitor
Key Legal Topics
Areas of Law
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Social Security Law
Legal Concepts
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Social Security Act 1991
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Overpayment
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Administrative Error
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Debts Due to the Commonwealth
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Waiver of Debt
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Capacity to Repay
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