Gina Massafra and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
[2012] AATA 573
•20 August 2012 30 August 2012
[2012] AATA 573
Division GENERAL ADMINISTRATIVE DIVISION File Number
2012/0716
Re
Gina Massafra
APPLICANT
And
Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
RESPONDENT
DECISION
Tribunal Deputy President R P Handley
Date
Date of Written Reasons
20 August 2012
30 August 2012
Place Sydney DECISION SUMMARY The decision under review to cancel payment of carer payment to Ms Massafra is affirmed.
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Deputy President R P Handley
CATCHWORDS
SOCIAL SECURITY – Carer allowance – Carer payment – Periodic compensation payment – Compensation affected payment – Income of Applicant above allowable limit – Whether special circumstances to disregard compensation payment – Decision under review affirmed
LEGISLATION
Social Security Act 1991 (Cth)
Workers Compensation Act 1987 (NSW)
CASES
Beadle v Director-General of Social Security(1985) 60 ALR 225
Groth and Secretary, Department of Social Security (1995) 40 ALD 541
Re Angelakos and Secretary, Department of Employment and Workplace Relations [2007] FCA 25
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Ivovic and Director-General of Social Services [1981] AATA 57
The following comprise the written reasons for the decision given orally at the conclusion of the hearing in Wollongong on 20 August 2012.
REASONS FOR DECISION
Deputy President R P Handley
Ms Massafra has applied for a review of a decision of the Social Security Appeals Tribunal (SSAT), affirming a decision made by a delegate of the Secretary of the Department of Families, Housing, Community Services and Indigenous Affairs (the Department) cancelling her carer payment.
BACKGROUND
From 8 March 2010, Ms Massafra received carer allowance in respect of her mother, Gladys Massafra, for which she originally applied to Centrelink on 9 April 2010.
On 30 September 2008 and 26 May 2010, while employed by Vision Australia, Ms Massafra suffered workplace injuries to her back and shoulders. On 4 May 2011, she received a gross lump sum compensation payment of $10,106.25, as a result of which a compensation preclusion period was applied. By letter dated 17 August 2011, Vision Australia notified Ms Massafra that she would be made redundant with effect from 13 September 2011. On 19 August 2011, Ms Massafra made a claim for carer payment in respect of her mother, which was granted from 21 August 2011.
As a result of a Workers Compensation Commission determination dated 8 November 2011, Ms Massafra commenced receiving periodic workers compensation payments of $300 per week, backdated to 4 October 2011.
On 14 November 2011, Ms Massafra commenced employment with Barnardos. Her declared fortnightly income at that time was $1,040 gross. Ms Massafra states she has since ceased working for Barnados because of the requirements of caring for her mother.
By letter dated 21 November 2011, Centrelink notified Ms Massafra that her carer payment had been cancelled from 4 October 2011 because her income was above the allowable limit. Ms Massafra sought a review of this decision which was affirmed by a Centrelink Authorised Review Officer (ARO) on 19 December 2011. Ms Massafra sought a further review by the Social Security Appeals Tribunal (SSAT). On 25 January 2012, the SSAT set aside the decision and sent it back to Centrelink for the purposes of recalculation and determination of the correct date of cancellation. On 22 February 2012, Ms Massafra lodged an application for a review by the Administrative Appeals Tribunal (AAT).
The Secretary has now conceded that the rate at which Ms Massafra’s carer payment was payable did not become nil until 3 November 2012, when her other income from financial investments and earnings were also taken into account. As explained by the Secretary in additional submissions to the Tribunal, the correct date of cancellation of her fortnightly carer payment was 14 November 2012.
THE ISSUES
There are two issues for the Tribunal to determine in this matter:
(a)Whether income received by Ms Massafra as periodic compensation payments are to be treated as ‘ordinary income’ when determining the rate of payment for carer payment; and
(b)Whether Ms Massafra’s circumstances are sufficiently special to warrant the exercise of discretion to disregard the whole or part of her periodic compensation payments, and treat them as having not been received.
DISCUSSION
The relevant legislation in this matter is the Social Security Act 1991 (the Act).
With regard to the first issue, Centrelink accepts that Ms Massafra satisfies the qualifications for carer payment in s 198 of the Act. Section 1064 provides that the rate of carer payment is worked out in accordance with the prescribed rate calculator. This includes an income test in Module A. However, there are other provisions of the Act that may affect a person’s rate of payment including in Part 3.14, which deals with compensation payments. Section 17(1) defines a ‘compensation affected payment’ as including carer payment. ‘Compensation’ is broadly defined in s 17(2) as including compensation payments including, specifically, compensation paid to a person under a State law.
There is no dispute that Ms Massafra received carer payment, which is a compensation affected payment. She also receives compensation in respect of a work-related injury under NSW State law. She has received periodic compensation payments from the CGU (her former employer’s workers compensation insurer) since 4 October 2011. While Ms Massafra drew to the Tribunal’s attention that the Workers Compensation Commission Certificate of Determination dated 8 November 2011 states that the payment of $300 per week by the Respondent is “Without admission” and “on a voluntary basis”, the payment is also stated to be “pursuant to section 40 of the 1987 Act”.
Section 40 of the Workers Compensation Act 1987 (NSW) provides for the making of “weekly payment of compensation to an injured worker in respect of any period of partial incapacity for work”. Thus, while Ms Massafra claimed that the payments are not directly related to her injury but “appeared to be made to appease me and to contribute to a wages ‘top up’” due to the fact that Vision Australia had made her redundant, I am satisfied that the periodic payments of $300 per week are in respect of the injuries Ms Massafra suffered while in the employment of Vision Australia, payments that are made under State compensation law. I note that Ms Massafra has now received two lump sum compensation payments in respect of whole person impairments attributable to her work-related injuries: one in May 2011 referred to in paragraph 4 above, and a second payment in about February 2012 following a finding that she had suffered a 9% whole person impairment for the injury to her “right upper extremity” (Medical Assessment Certificate dated 6 January 2012).
Section 1160(1) provides that Part 3.14 of the Act may operate to reduce a person’s compensation affected payment. In particular, s 1173 states:
(1) If:
(a) a person receives periodic compensation payments; and
(b) the person was not, at the time of the event that gave rise to the entitlement of the person to the compensation, qualified for, and receiving, a compensation affected payment; and
(c) the person receives or claims a compensation affected payment in relation to a day or days in the periodic payments period;
the rate of the person’s compensation affected payment in relation to that day or those days is reduced in accordance with subsection (2).
(2) The person’s daily rate of compensation affected payment is reduced by the amount of the person’s daily rate of periodic compensation.
(3) The reference in subsection (2) to a daily rate of periodic compensation is a reference to the amount worked out by dividing the total amount of the periodic compensation payments referred to in paragraph (1)(a) by the number of days in the periodic payments period.
(4) If:
(a) a person receives periodic compensation payments; and
(b) at the time of the event that gave rise to the entitlement of the person to compensation, the person was qualified for, and was receiving, a compensation affected payment; and
(c) the person receives or claims a compensation affected payment in relation to a day or days in the periodic payments period;
the periodic compensation payments are to be treated as ordinary income of the person for the purposes of this Act.
In relation to s 1173(4), the events that gave rise to Ms Massafra’s entitlement to workers compensation took place on 30 September 2008 and 26 May 2010 before her claim for carer payment. Thus, pursuant to s 1173(2), the daily rate of Ms Massafra’s carer payment, being a compensation affected payment, is reduced by the amount of the daily rate of her periodic compensation payment. The Secretary’s determination in respect of the first issue, which was made pursuant to s 1173(2), is therefore correct.
With regard to the second issue, s 1184K provides the Secretary with a discretion to disregard the whole or part of a compensation payment where there are special circumstances. The section states:
(1) For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:
(a) not having been made; or
(b) not liable to be made;
if the Secretary thinks it is appropriate to do so in the special circumstances of the case.
(2) If:
(a) a person or a person's partner receives or claims a compensation affected payment; and
(b) the person receives compensation; and
(c) the set of circumstances that gave rise to the claim for compensation is not related to the set of circumstances that gave rise to the person's or the person's partner's receipt of, or claim for, the compensation affected payment;
the fact that those 2 sets of circumstances are unrelated does not alone constitute special circumstances for the purposes of subsection (1).
The issue is whether there are special circumstances that warrant exercising the Secretary’s discretion to disregard the whole or part of her periodic compensation payments. It should be noted that what constitutes ‘special circumstances’ has been the subject of much discussion in the Federal Court and the Tribunal. ‘Special circumstances’ have been held to be circumstances that are unusual, uncommon or exceptional: Re Beadle and Director-General of Social Security (1984) 6 ALD 1, at 3; see also Groth and Secretary, Department of Social Security; (1995) 40 ALD 541; Re Ivovic and Director-General of Social Services [1981] AATA 57;; Re Angelakos and Secretary, Department of Employment and Workplace Relations [2007] FCA 25. Such circumstances do not have to be unique but do need to have “a particular quality of unusualness that permits them to be described as special”: Re Beadle and Director-General of Social Security (1984) 6 ALD 1, at 3, a finding that was upheld generally on appeal by the Federal Court in Beadle v Director-General of Social Security(1985) 60 ALR 225. Financial hardship and ill health are factors commonly relied on to establish this.
Ms Massafra said CGU has to date refused to meet her rehabilitation expenses such as those for physiotherapy and injections into her shoulder which would alleviate her pain and assist her in obtaining employment. The Approved Medical Specialist, Dr T Rosenthal, referred to this in his Medical Assessment Certificate dated 11 January 2012, noting that since remedial massage was stopped in August 2011, there had been deterioration in Ms Massafra’s range of movement. Ms Massafra said she is still awaiting a response from the CGU for her claim for medical treatment expenses. She said that apart from those conditions associated with her work injuries, she also has other chronic health conditions: osteoporosis, clinical depression and dental problems. Ms Massafra referred to a report from a clinical psychologist, Dr Carole Carter, dated 22 July 2011, stating that she is suffering from clinical depression and anxiety. She also referred to significant costs associated with dental treatment. The totality of these costs is imposing a considerable strain on her.
Ms Massafra said that due to her mother’s health problems, she and her mother decided to sell her mother’s house, where she lived with her mother, and which had been the family home for 40 years, and purchase a new house better suited to her mother’s health needs and allowing for improved living conditions. They moved into a new house in December 2011, encountering various problems along the way, on the basis of real estate advice that they could safely do this before selling her mother’s house, which they were advised would sell without difficulty. This advice has not proved to be correct and they are now bearing the costs of both the old house, which is vacant, and the new house.
Ms Massafra obtained a housing loan to finance the move in respect of which she currently owes $306,000. They have had to reduce the price of the old house by $100,000 but it has still not sold. Ms Massafra says she has about $53,000 in savings, which she is holding in reserve to address financial problems associated with the sale of the old house. She hopes that the old house will sell and permit the repayment of the whole of the housing loan. Ms Massafra also referred to additional expenditure that proved necessary for the new house amounting to $43,511, including for the installation of a chairlift and security screens.
Ms Massafra said Centrelink made an incorrect decision relating to her mother’s pension that was only corrected on appeal to the SSAT, which found the old house to be an exempt asset, and restored her mother’s pension (SSAT decision dated 25 January 2012). Ms Massafra said the reduction in her mother’s pension caused both her and her mother significant anxiety, which has caused deterioration in her mother’s condition and has resulted in Ms Massafra having to pay for medical costs and extras for her mother including a wheelchair. A further mistake by Centrelink referring to a reduction in the rate of her mother’s pension, on the day after receiving notification of the successful SSAT outcome, has also undermined her mother’s confidence in her independence.
Ms Massafra also complained about misleading wording in her Centrelink correspondence saying that periodic payments of compensation would be treated as ordinary income when, in the case of her carer payment, this was not the case. The letter in question, dated 21 November 2011, refers to pensions, benefits or allowances being treated in this way. While a generic letter, I agree that it should be targeted more specifically to the particular payment the person is receiving.
Ms Massafra stated, “recently I had to give up employment as I could not cope with maintaining the care my mother needed and working the increasing hours of the Barnados job”. She said her mother, who is aged 82 and has significant health problems, needs constant care and assistance. The main reason Ms Massafra sought the carer payment in respect of her mother was “to provide the care she needs and to not feel forced to work unsuitable hours and locations”. Ms Massafra has recently paid for two urgent cataract operations for her mother costing $4,522 and used some of her compensation monies for this purpose.
CONCLUSION
I accept that Ms Massafra is currently experiencing significant financial strain as a result of her and her mother moving to a house better suited to their needs and as a result of the cost of medical treatment both for her and her mother. The difficulties Ms Massafra is facing are associated with two presently unresolved matters: first, with her unresolved claim for workers compensation in respect of medical treatment expenses associated with her work-related injuries; and second, with the sale of her mother’s house which is contributing to additional expenses and delaying Ms Massafra repaying the housing loan she undertook to finance her and her mother’s move. If and when these matters are resolved, this will remove both her present financial strain and alleviate the anxiety associated with it.
In my view, at this time, these circumstances should be considered temporary in the sense they will, hopefully, be resolved in the not too distant future. I note that Ms Massafra’s mother still owns, in her house, a valuable asset, and that Ms Massafra, while being indebted under her housing loan, also has savings of approximately $53,000. It is understandable that both she and her mother are anxious to conserve their savings, but compared to the circumstances of many who are in receipt of social security benefits, I am not satisfied that Ms Massafra’s circumstances are sufficiently unusual, uncommon or exceptional to warrant treating the whole or part of her periodic compensation payments as not having been made.
DECISION
The decision under review to cancel payment of carer payment to Ms Massafra is affirmed.
I certify that the preceding 25 (twenty five) paragraphs are a true copy of the reasons for the decision herein of Deputy President R P Handley.
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Associate
Dated 30 August 2012
Date of hearing 20 August 2012 Date final submissions received 20 August 2012 Applicant In person Advocate for the Respondent B Salaji
Key Legal Topics
Areas of Law
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Social Security Law
Legal Concepts
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Social Security – Carer allowance
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Ordinary Income
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Special Circumstances
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