GREEN and SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATION

[2010] AATA 811

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 811

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2010/1953

GENERAL ADMINISTRATIVE DIVISION		)
Re		ANDREW GREEN

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Dr P McDermott, RFD, Senior Member

Date22 October 2010

PlaceBrisbane

Decision The Tribunal affirms the decision under review.

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

Senior Member

CATCHWORDS

SOCIAL SECURITY – Newstart allowance – Debt raised to recover overpayment stemming from a change to the applicant’s relationship status and the applicant’s failure to notify the respondent within the required time of that change – Debt cannot be written off – No special circumstances apply – Decision under review affirmed.

Social Security Act 1991 (Cth) ss 1068, 1223, 1236, 1237AAD

Social Security (Administration) Act 1999 (Cth) ss 78, 108,

REASONS FOR DECISION

22 October 2010 Dr P McDermott, RFD, Senior Member  

INTRODUCTION

1.      I have to decide whether Centrelink was correct in raising and recovering a debt against Mr Andrew Green for the overpayment of newstart allowance.  For the reasons which follow, I have formed the view that Centrelink were correct in raising the debt.

HISTORY OF THE RELATIONSHIP

2.      The applicant gave evidence of his de facto relationship with Karen Chapman.  He stated that both he and Ms Chapman had been together for some years, but that their relationship effectively ended on 13 September 2009.

3.      The applicant stated that in September 2008 he opened a fashion retail business at Hastings Street, Noosa Heads.  However, by 2009 that business had failed and after contacting ASIC he had to place his company into voluntary receivership.  The applicant stated that because of the failure of the business he had lost some $650,000 including the equity in his home.

4.      The applicant stated that on the evening of 12 September 2009 he was celebrating his birthday with Ms Chapman and her brother.  At that celebration there was some discussion concerning his fashion retail business that had gone into receivership.  The tenor of the evidence of the applicant was that over the course of the evening the applicant became disappointed when Ms Chapman’s family had blamed him for making the decision to commence a fashion business in Noosa Heads.  He stated that after that evening he moved into the spare bedroom and that his relationship with Ms Chapman was then on a friendship basis.  Although they shared cooking responsibilities they had separate laundry arrangements.  The applicant essentially stated that they shared accommodation to save costs.

5.      The Secretary’s statement of facts and contentions records that on 25 January 2010, the applicant ceased residing with Ms Chapman[1].  However, in giving evidence the applicant stated that in January 2010 Ms Chapman, who had lived with her family, had returned to live with him when he rented the Edens Landing property.  The applicant stated that both he and Ms Chapman became tenants of that property for six months.  The applicant stated that he believed that having Ms Chapman on the lease was a requirement of Queensland tenancy law.  At the end of that tenancy both he and Ms Chapman lived in separate accommodation.  The applicant stated that he still cares for Ms Chapman’s dog.

[1] See para 13.

CENTRELINK RECORDS

6.      According to the respondent’s statement of facts and contentions, on 11 August 2009, the applicant contacted Centrelink to claim newstart allowance.  He was granted newstart allowance from 17 August 2009.

7.      On 11 September 2009, Centrelink sent a letter to the applicant to advise him of his obligation to notify them of a change in his circumstances; those circumstances included any earnings by his partner or if he had separated from his partner.

8.      On 21 October 2009, Centrelink commenced a review of the applicant’s entitlement as a result of a data match.  On that day, a letter was sent to the applicant advising him that Centrelink matches data with information that the Australian Taxation Office receives from employers.  Centrelink sought information as to any employers of the applicant and Ms Chapman.

9.      On 30 October 2009, the applicant advised Centrelink that he "was now SUOR" (separated under one roof).  On that date a letter was issued to the applicant requesting that he and Ms Chapman each complete a Relationship Details (Separated Under One Roof) Form and to return it by 14 November 2009. 

10.     These forms were each signed by the applicant and Ms Chapman on 17 November 2009 and received by Centrelink on 20 November 2009.  In each form, both the applicant and Ms Chapman assert that they separated on 13 September 2009.

DECISIONS

11.     On 30 November 2009, Centrelink made a decision that the applicant was not a member of a couple as at 30 October 2009 and that he should be regarded as single from that date.  On 8 January 2010, the applicant sought an explanation from Centrelink about the decision.

12.     On 5 February 2010, Centrelink decided to raise and recover a debt in the amount of $1,227.40 for the period 19 September 2009 to 30 October 2009.  On that date the applicant sought a review of that decision.

13.     On 23 February 2010, an authorised review officer affirmed the decision.  That officer remarked that Centrelink was advised on 30 October 2009 that the applicant was not a member of a couple and any earnings of Ms Chapman would affect his rate of newstart allowance until 29 October 2009.  The officer also stated that the decision to raise and recover a debt in the amount of $1,227.40 was correct.

14.     On 21 April 2010, the Social Security Appeals Tribunal (“SSAT”) reviewed and affirmed the decision[2].  The applicant sought review of the decision by this Tribunal.

[2] Exhibit A, T2/6-10. 

RELEVANT LEGISLATION

15.     The legislation which applies to the determination of this application is the Social Security Act 1991 (Cth) ("the Act") and the Social Security (Administration) Act 1999 (Cth) ("the Administration Act").

ISSUES

16.     I must determine whether at some time prior to 30 October 2009, the applicant advised Centrelink of the cessation of his de facto relationship with Ms Chapman.

CONSIDERATION

17. The essential issue for review in determining this application is whether the applicant had notified Centrelink of the breakdown of his relationship with Ms Chapman before 30 October 2009. It was common ground that if he did notify Centrelink of the breakdown of the relationship before that date then the earnings of Ms Chapman would not be taken into account in assessing the rate of payment to the applicant. This is because s 78 of the Administration Act, provides that if the Secretary is satisfied that the rate at which a social security payment is being paid is less than the rate provided for by social security law, the Secretary is required to determine that the rate is to be increased to the rate provided for by the social security law and, specify the last-mentioned rate in the determination. Such a determination is known as a "favourable determination" under s 108 of the Administration Act. However, if a favourable determination is made then the determination takes effect (a) on the day on which the person so informed the Department; or (b) on the day on which the event or change occurred; whichever is the latter.

18.     The applicant has contended that he advised Centrelink of the change of his circumstances before 30 October 2009.  In fact, the applicant believes that he lodged the form on 13 September 2009 at the same time that he lodged his fortnightly form.  I have difficulty in accepting that this had occurred on 13 September 2009.  The Centrelink records, which are in evidence before me, do not contain any record of contact from the applicant at that time.  The only record from about that time is a record that the applicant’s company was deregistered on 16 September 2009.  The entry of that event was made in the records of Centrelink on 19 September 2009.

19.     Ms J Satchwell, who is a Centrelink team leader, gave evidence of the applicant’s Centrelink records.  Ms Satchwell explained that in August 2009, when the applicant first claimed newstart allowance, the applicant would have been required to lodge the fortnightly forms every two weeks.  However, she stated that on 5 September 2010 a decision was made by Centrelink which required the applicant to lodge the fortnightly forms every twelve weeks.  The next fortnightly form was lodged by the applicant on 30 October 2010.

20.     The applicant also contends that he was issued with the Relationship Details (Separated Under One Roof) forms on 13 September 2009.  The applicant appreciates that the Centrelink records would reveal whenever such a form has been issued to a customer.  The applicant believes that he was issued with those forms on three occasions but the internal Centrelink records do not verify that he was issued with three sets of these forms.  The only record of the applicant being issued with the Relationship Details (Separated Under One Roof) forms was on 30 October 2010.  That was after the applicant was sent a letter on 21 October 2010 informing him that Centrelink would undertake a data matching exercise with the Australian Taxation Office.

21.     There is a lack of contemporaneous evidence which supports the contentions of the applicant.  I consider that the applicant was mistaken about when he first notified Centrelink of the change of his status.  I should mention that I do not accept that the applicant is a reliable historian.  For example, a Centrelink record of 12 October 2009 records the applicant informing Centrelink that Ms Chapman returned to work on 28 September 2010.  On 20 November 2010, Centrelink was advised by Ms Chapman’s employer that she returned to work on 22 September 2010.  Perhaps, what is most significant is the Centrelink file note of 30 October 2009 which records that the applicant informed Centrelink that he "was now SUOR".  I regard this contemporaneous documentary evidence as cogent evidence of when Centrelink was actually informed of the change of status of the applicant. 

22. I am satisfied that the applicant informed Centrelink of the change of his status on 30 October 2009. Module G of s 1068 of the Act provides a Method Statement for working out the effect of a person's or their partner's income on the person's maximum payment rate. Accordingly, the earnings of Ms Chapman prior to that date had to be taken into account in assessing the appropriate rate of payment of newstart allowance to the applicant who received payments in excess of his correct entitlement. The applicant did not take issue with the calculation of the amount of $1,227.40 that was paid to him for the period 19 September 2009 to 30 October 2009. I consider that the sum of $1277.40 was correctly raised by Centrelink as a debt due to the Commonwealth under subsection 1223(1) of the Act.

DEBT WRITTEN OFF

23. I have taken the view that the debt should not be written off. The Secretary may, under s 1236(1) of the Act on behalf of the Commonwealth, write off a debt for a stated period or otherwise. The exercise by the Secretary of this power under s 1236(1) is subject to s 1236(1A) of the Act. There are various grounds in s 1236(1A) which enable the Secretary to write off a debt. I do not think that there is any basis for me to find that the debt is irrecoverable at law: s 1236(1A)(a), s 1236(1B). The Secretary may write off the debt if the debtor has no capacity to repay the debt: s 1236(1A)(b). As the applicant has paid off most of the debt by deductions from his present social security payment, the debtor is taken to have capacity to repay the debt unless recovery by those means would result in the debtor being in severe financial hardship: s 1236(1C). There is no evidence before me that indicates that the applicant is in severe financial hardship.

SPECIAL CIRCUMSTANCES

24. Section 1237AAD of the Act provides that the Secretary may waive the right to recover all or part of a debt on the grounds of special circumstances. I am not satisfied that the evidence discloses special circumstances within the meaning of s 1237AAD of the Act.

DECISION

25.     I affirm the decision under review.

I certify that the 25 preceding paragraphs are a true copy of the reasons for the decision herein of Dr P McDermott, RFD, Senior Member

Signed: .......................[Sgd]......................................................
  Kate Slack, Research Associate

Date/s of Hearing  12 October 2010
Date of Decision  22 October 2010
The Applicant was self represented
For the Respondent                  Ms J Forsyth, departmental advocate