Goodwin and Secretary, Department of Family and Community Services

[2004] AATA 716

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 716

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2004/228

GENERAL ADMINISTRATIVE DIVISION		)
Re		POLEVIA GOODWIN

Applicant

And SECRETARY, DEPARTMENT
OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Ms MJ Carstairs, Member

Date18 June 2004

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

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

MJ Carstairs
  Member

CATCHWORDS

SOCIAL SECURITY – benefits and entitlements – disability support pension – applicant was injured at work in New Zealand – workers’ compensation benefits ceased - successful challenge to have compensation paid – back-payment of weekly benefits – required to repay social security benefits paid during the period – applicant not entitled to disability support pension due to rate of workers’ compensation benefits she is receiving – decision affirmed

Social Security Act 1991 ss 17(2), 17(2A)

Acts Interpretation Act 1901 ss 17

WRITTEN REASONS FOR ORAL DECISION

6 July 2004 Ms MJ Carstairs, Member

1.      This is the hearing of an application by Polevia Goodwin (the applicant) for review of a decision made by the Social Security Appeals Tribunal (SSAT) on 29 April 2003.  The SSAT affirmed a decision of a Centrelink delegate to cancel the applicant’s disability support pension and recover a compensation debt of $20,512.65.  This figure was later revised as stated below. 

2.      The applicant was represented at the hearing by her husband, Mr K Goodwin.  Mr J Howard, a Centrelink advocate, represented the respondent. Oral reasons for decision were given on the day of hearing on 18 June 2004.  The respondent subsequently requested written reasons.

3. The Tribunal had before it the documents lodged under s37 of the Administrative Appeals Tribunal Act 1975, as well as exhibits marked A1-A3 for the applicant and R1–R3 for the respondent.

BACKGROUND

4.      The applicant was injured in her workplace in New Zealand in the 1980s and received payments of workers’ compensation at that time.  She ceased work in about 1987 and her workers’ compensation payments also ceased (about May 1998). The compensation payments were being paid by the New Zealand Accident Compensation Corporation (“the NZACC”).

5.      In March 1998, the applicant and her husband came to Australia from New Zealand, and commenced receiving social security payments - the applicant receiving a disability support pension and her husband, age pension.

6.      In March 2002, the applicant successfully challenged the decision of the NZACC to cancel the workers’ compensation payments.  As a result her case was reviewed and she received an arrears payment of some $54,817.46.  Since then ongoing payments of compensation have been restored.  The favourable outcome in regard to the New Zealand compensation had an effect on the payments of disability support pension she had already received in Australia, it being a provision of the Social Security Act 1991 (the Act) that the receipt of compensation may have an effect retrospectively on social security payments.  Often this is referred to as the “avoidance of double-dipping”.

7.      Centrelink has calculated that, from 14 May 1998 to 19 November 2002, the applicant was paid $20,997.69 in disability support pension in excess of what she should have been paid if it had been known that she was entitled to the compensation payments for the same period.

8.      This amount that was said to be owed and a debt was raised against the applicant for $20,512.65.  In any event, Mr and Mrs Goodwin repaid $21,978.90 on 18 December 2002.  The figures were later disputed and the respondent has now produced additional evidence (exhibit R1) about the calculations used in raising the debt and the amount now calculated is $20,997.69

9.      The applicant sought review of the decision to recover the disability support pension paid in the period. The decision has been reviewed and affirmed by an Authorised Review Officer and by the SSAT.  The decision under review is now the decision, as varied in regard to the amount of the debt (the figure of $20,997.69), a decision made on or about 20 May 2004. As stated, however, more than this amount has been recovered from the applicant.  Mr Goodwin did not dispute the calculations made about his wife’s payments, and the Tribunal finds, as a result of the carefully explained recalculations at exhibit R1, that the recoverable amount is $20,997.69.

CONSIDERATION OF THE ISSUES

10.     It was not disputed that disability support pension is a compensation-affected payment, nor that the compensation that the applicant received from New Zealand after she requested the review, were periodical payments paid in arrears. The Tribunal agrees with the correctness of this characterisation and was satisfied, and so finds, that the compensation payments had to be deducted on a dollar-for-dollar basis under the Act: s1173.  The consequence of the dollar for dollar deduction was that the applicant had no entitlement to disability support pension.  It is necessary, under the Act, that disability support pension be cancelled in these circumstances: s98.  It is also necessary to consider whether amounts of disability support pension paid previously should be recovered.

11.     Mr Goodwin tendered material in exhibits A1 to A3 in support of his key submissions that:

(a)the Policy Manual (exhibit A3) refers to excluded payments if these are received periodically for permanent impairment.  The Manual states:

“Assessors should take care when assessing the effect of compensation received from overseas… If for example the foreign compensation payment is received periodically for a permanent impairment, the compensation would be treated as ordinary income as opposed to applying the dd rules…”

(The “dd rules” refers to the direct deduction of the compensation on a dollar for dollar basis, as discussed above. Treating the amount of compensation as “income” would have a lesser effect in working out the amount of disability support pension payable).

(b)NZACC is not a statutory authority but is a private company, funded by taxes on workers, therefore the nature of the scheme is akin to personal contributions by each worker. On this basis, Mr Goodwin submitted that it is like private insurance, which is referred to in s17(2A) of the Act and that section effectively exempts payments under such schemes from the coverage of s17(2) of the Act.

12. Mr Goodwin referred to the preamble to the Bill prior to enactment and said that the Act is not being correctly applied by Centrelink. He also said that provisions for waiver on the basis of administrative error should be applied to his wife’s receipts of compensation. These arose because of the error in cancelling her compensation (that is error occurring in New Zealand), and although the Act refers to error on the part of the Commonwealth, it was inconsistent for the Act on the one hand to attempt to cover foreign payments in s17(2) but then exempt them in s1237A by limiting the “errors” to those occurring within Australia.

13.     This last submission I will deal with quickly.  The term “Commonwealth” is covered by the definition in s17 of the Acts Interpretation Act 1901.  There is no bar to an Act making a provision of wide coverage in one part and limiting operations and effect of coverage in another part of the same Act.  The error that Mr Goodwin points to falls outside of the coverage of s1237A as it is not error on the part of the Commonwealth as defined.

14.     Turning to the substantive argument about the coverage of the Act as it relates to the payment the applicant receives.  It was not disputed that the payments were periodic, and the Tribunal was satisfied from the materials, particularly T37 p163 and exhibit R2 (where reference is made to the applicant’s payment of earning related compensation), as well as Mr Goodwin’s evidence that his wife’s payments are connected to her hours of employment at the time she last worked, that the payments are related to her continuing inability to work and have the necessary connection with “lost earnings or lost capacity to earn” – the phrase used in s17(2) of the Act.

15.     The Tribunal was satisfied that the payments made were “compensation” within s17(2)(d) and that, as section 17(2) refers to payments made within or outside Australia, the payment of this money from a source outside Australia, that is, New Zealand, is captured whilever Mrs Goodwin sought to receive social security payments within Australia. The Tribunal rejects Mr Goodwin’s submission that the section is only meant to cover Australians who may be sourcing income outside Australia and are injured in so doing. The plain words refer to the payment being from within or outside Australia, not to the person who receives it.

16. As to Mr Goodwin’s submissions in regard to s17(2A), I respectfully agree with and adopt the reasoning of the SSAT (T2) at paragraph 21.

“In his written submission, Mr Goodwin contends that the ACC scheme is ‘fully contributory’, being funded by way of a payroll tax in respect of individual workers.  The Tribunal considered subsection 17(2A):

‘17(2A) Paragraph (2)(d) does not apply to a compensation payment if:

(a)the recipient has made contributions (for example, by way of insurance premiums) towards the payment; and

(b)either:

(i)the agreement under which the contributions are made does not provide for the amounts that would otherwise be payable under the agreement being reduced or not payable because the recipient is eligible for or receives payments under this Act that are compensation affected payments; or

(ii)the agreement does so provide but the compensation payment has been calculated without reference to the provision.’

Mr Goodwin contends, in effect, that his wife indirectly contributed to the ACC payments.  The Tribunal considers it clear enough that for subsection 17(2A) to apply, any contribution must be made under an agreement which provides for payments which do not take account of the level of any compensation affected payment under the Act.  The provision is intended to deal with situations where a person pays premiums under an insurance policy and has no bearing on the circumstances of this case.”

17.     Where disability support pension has been paid to a person, and subsequently periodic compensation payments are paid for the same period, s1180 authorises recovery. Here Centrelink recovered all moneys and cancelled the applicant’s disability support pension, because the dollar for dollar application of ongoing compensation meant that no disability support pension could be paid.

18.     This was the correct decision, and for the reasons I have given, I affirm the decision as varied in the decision made on or about 20 May 2004 altering the recoverable amount to the sum of $20,997.69.

DECISION

19.     The decision under review is affirmed.

I certify that the 19 preceding paragraphs are a true copy of the reasons for the decision herein of Ms MJ Carstairs, Member

Signed:         Sarah Oliver
  Associate

Date of Hearing  18 June 2004
Date of Decision  18 June 2004
Date of Written Reasons          6 July 2004

The Applicant was represented by her husband,            Mr K Goodwin
For the Respondent                  Mr J Howard, Departmental Advocate