Hardman and Secretary, Department of Social Services (Social services second review)

Hardman and Secretary, Department of Social Services (Social services second review) [2019] AATA 220 (22 February 2019)
Division:GENERAL DIVISION
File Number: 2018/2448
Re:Taya Hardman
APPLICANT

AndSecretary, Department of Social Services
RESPONDENT

DECISION
Tribunal:Member C Edwardes

Date:22 February 2019
Place:Perth

The decision under review is affirmed.
.......[Sgd]..........................................................
Member C Edwardes
CATCHWORDS
SOCIAL SECURITY – paid parenting payments – debt incurred – partner’s annual fortnightly income – recovery of debt – waiver of debt - sole administrative error – capacity to pay - decision affirmed.
LEGISLATION
Social Security Act 1991 (Cth) – ss 503, 1068B-A1, 1223(1), 1236(1A), 1236(1C), 1237
Social Security (Administration Act) 1999 (Cth) – ss 68(2), 100(1), 179
CASES
Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
Gerhardt and Secretary, Department of Employment and Training (1997) FCA 8150
L and Department of Social Security (1995) 38 ALD 176
Lumsden and Secretary, Department of Social security [1986] AATA 228
Secretary, Department of Social Security v Hales [1998] FCA 219
Sekhon and Secretary, Department of family and Community Services [2003] FCAFC 190
Stubbs and Secretary, Department of Families and Community Services [2003] AATA 729
SECONDARY MATERIALS
Department of Social Security, Guide to Social Policy Law: Family Assistance Guide (Department of Social Security, Version 1.209, 4 February 2019)
REASONS FOR DECISION
Member C Edwardes
22 February 2019
THE APPLICATION

This is an application for review of a decision of the Social Services & Child Support Division of the Tribunal (AAT1), dated 28 March 2018 (T2, 7-12). The AAT1 affirmed a decision to recover the debt incurred by the Applicant in full as a result of the overpayment of her parenting entitlements to the amount of $18,649.00.
Overpaid Parenting Payments were incurred for the 2014/15, 2015/16 and 2016/17 financial years. The debt was incurred because the Applicant’s partner’s ordinary income was not taken into account (T2, 9).
The Administrative Appeals Tribunal (the Tribunal) has jurisdiction to hear this application pursuant to s 179 of the Social Security (Administration) Act 1999 (Cth) (the Administration Act).
BACKGROUND
The Applicant has been in receipt of Paid Parenting Payments (PPP) since 20 July 2012 (T46, 209).
The Applicant has been in a relationship with her partner Shaun S since 4 June 2010 (T46, 209).
The Department of Social Services (the Department) issued notices to the Applicant on 9 January 2014 (T5, 89) and 16 January 2015 (T9, 100) informing her of information concerning her partner’s earned annual other income and fortnightly earned income, being $45.76 and $0 respectively, which had been used for the purposes of calculating her PPP (R2).
The Department issued a further notice on 11 June 2015 (T12, 108) to the Applicant advising that her rate of PPP had been assessed on the basis of her partner’s annual other income and fortnightly earned income being $0 respectively.
The Department was contacted by the Applicant on 11 June 2015 (T59, 266) to be advised that her partner had been employed in 2012, and that payslips would be requested to document this income.
The Applicant’s partner was self-employed between 1 July 2014 and 30 June 2017 in his business, Denmark Ceilings (R2).
The Department issued a notice on 16 June 2015 (T13, 111) to the Applicant that her PPP was reduced as a result of her partner’s other income totalling $31,316.48 and fortnightly earned income being $0.
The Department after having taken into account the income for the 2012/2013 and 2013/2014 financial years of the Applicant’s partner, determined on 3 September 2015 to raise a PPP debt of $8,815.38 against the Applicant for the period 1 July 2013 to 29 May 2015 (T16, 121).
Tax returns for the business Denmark Ceilings were requested on 22 June 2017 for the 2015/2016 and 2016/2017 financial years (T44, 204). The Department received the Applicant’s tax return for the 2014/2015 period, together with the Applicant’s partner’s tax returns for the 2015/2016 and 2016/2017 periods on 31 October 2017.
These tax returns had been filed with the Australian Tax office (ATO) on 4 April 2016, 6 April 2017 and 14 September 2017 respectively (T48, 221-225) (T49, 226-233) (T50, 234-241). Against each of the financial years the following income for the Applicant’s partner was shown:
·2015 - $34,763.00
·2016 - $49,872.00
·2017 - $44,228.00
The Department having this information raised a PPP debt of $18,649 against the Applicant for the period 1 July 2014 to 30 June 2017, and issued notice to the Applicant on 30 January 2018 (T45, 206).
The Applicant sought a review of this decision which an Authorised Review Officer (ARO) of the Department undertook. The review affirmed the decision of the Department on 1 February 2018 (T46, 208-211). The ARO made the following findings:
·You have been paid Parenting Payment from 20 July 2012.
·Your department records show you have been partnered with Shaun S from 4 June 2010.
·In October 2017 you provided the department details your partner’s [sic] income for the financial years ending 2015 to 2017.
·During the period 1 July 2014 to 30 June 2017 your partner was self-employed in the business – Denmark Ceilings.
·You did not give the department full details of your partner’s income from his self-employment during the period 1 July 2014 to 30 June 2017.
·From 1 July 2014 to 30 June 2017 your Parenting Payment rate was based on income that was less than the income you received for this period.
·During the period 1 July 2014 to 30 June 2017 you received Parenting Payment totalling $24,897.20.
·You were entitled to receive $6,247.25.
·On January 2018 the department raised a Parenting Payment debt of $18,649.95 for the period 1 July 2014 to 30 June 2017.
The Applicant filed an application for review of the ARO’s decision on 13 February 2018 (T2, 8).
The AAT1 affirmed the decision of the department and the ARO on 28 March 2018 (T2, 7-12). It found:
12.The tribunal finds that Miss Hardman’s partner’s ordinary income from his business, as stated in the relevant income tax returns, is as follows:
2014/15          $34,691
2015/16          $49,828
2016/17          $44,228
13.The tribunal had regard to Miss Hardman’s parenting payment records and the Department’s debt calculations. The tribunal is satisfied that Miss Hardman’s rate of parenting payment did not correctly take into account her partner’s ordinary income and as a result she has been overpaid $18,649 for the period 1 July 2014 to 30 June 2017.
14.It was evident from the hearing that Miss Hardman did not understand that parenting payment is based upon actual fortnightly income. That method of rate calculation and is very different to family tax benefit which is based upon estimates of adjusted taxable income, and is subsequently reconciled.
15.Section 1223 of the Act provides that if a social security payment is made and the 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.
16.The tribunal is satisfied that Miss Hardman has a debt to the Commonwealth in the amount of $18,649.
…….
27.The tribunal finds that Miss Hardman contributed to the debt arising by failing to provide the necessary information required to calculate the rate of parenting payment. That failure in part was due to her own misunderstanding of the basis on which her parenting payment was paid. In the tribunal’s view it is up to the recipient to understand the basis on which they are receiving payment they have claimed. The tribunal acknowledges that it is difficult for a recipient to accurately calculate net business income and avoidance of a debt may not always be possible. However that difficulty does not constitute administrative error on the part of the Department. The tribunal also acknowledges that after the first debt was raised the Department could have been more proactive in ensuring Miss Hardman provided her partner’s income tax returns to the Department in a more timely manner; however the Department’s failure to do so does not constitute sole administrative error. The tribunal is not satisfied that this debt is attributable solely to error by the Department, and therefore recovery is not waived under section 1237A of the Act.
28.Recovery of a debt may be waived where there are special circumstances. For this to occur the tribunal must satisfy itself that the debt did not result wholly or partly from Miss Hardman or another person, knowingly making a false statement or false representation, or failing or omitting to comply with the provisions of the social security law and further that there are special circumstances (other than financial hardship alone) that make it desirable to waive the debt. In addition the tribunal must be satisfied that it is more appropriate to waive than to write off all or part of the debt (section 1237AAD of the Act).
29.Miss Hardman stated that she does not have any special circumstances that should be taken into consideration.
30.Recovery of a debt may be written off for a period if, and only if:
•the debt is irrecoverable at law; or
•the debtor has no capacity to repay the debt; or
•the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
•it is not cost effective for the Commonwealth to take action to recover the debt (section 1236 of the Act).
31.If a debt is recoverable by means of deductions from the person’s social security or family assistance payments the person is taken to have a capacity to repay the debt unless recovery by those means would result in their being in severe financial hardship (subsection 1236(1C) of the Act).
32.Miss Hardman is currently in receipt of family tax benefit. Due to her partner’s income she is no longer entitled to receive parenting payment. The tribunal is satisfied that Miss Hardman has the capacity to repay the debt via withholdings from her family tax benefit. Write off is therefore not appropriate in this case.
33.This means that the debt is to be recovered from Miss Hardman.
On 7 May 2018, the General Division of the Administrative Appeals Tribunal (AAT) received from the Applicant an application for a second review of the decision on the basis that she felt not all information was taken into account by the AAT1 and during that hearing more incorrect information came to light (T1, 2).
RELEVANT LEGISLATION AND ISSUES
The legislation governing the review is contained in the Social Security Act 1991 (Cth) (the Act); and the Administration Act.
The Tribunal is assisted by the policy document The Family Assistance Guide (the Guide). The Guide provides assistance to those who administer the Act. Whilst not bound to apply policy guidelines, the Tribunal will usually do so unless there are cogent reasons in a particular case not to do so (see Drake and Minister for Immigration and Ethnic affairs (No 2) (1979) 2 ALD 634).
Section 503 of the Act states:
A person’s parenting payment rate is worked out using:
(a)if the person is not a member of a couple—the Pension PP (Single) Rate Calculator at the end of section 1068A (see Part 3.6A); or
(b)if the person is a member of a couple—the Benefit PP (Partnered) Rate Calculator at the end of section 1068B (see Part 3.6A).
Section 1068B-A1 of the Act states:
The rate of benefit PP (partnered) is a daily rate. That rate is worked out by dividing the fortnightly rate calculated according to this Rate Calculator by 14. There are 2 ways of working out the fortnightly rate:
(a)one for a person who is not a partner of a non-independent YA recipient (see point 1068B-A2); and
(b)one for a person who is a partner of a non-independent YA recipient (see point 1068B-A3).
Section 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.
Section 1236(1A) of the Act states:
(1A)The Secretary may decide to write off a debt under subsection (1) 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 1236(1C) of the Act states:
For the purposes of paragraph (1A)(b), if a debt is recoverable by means of:
(a)deductions from the debtor’s social security payment; or
(b)deductions under section 84 of the A New Tax System (Family Assistance) (Administration) Act 1999; or
(c)setting off under section 84A of that Act;
the debtor is taken to have a capacity to repay the debt unless recovery by those means would result in the debtor being in severe financial hardship.
Section 1237A of the Act states:
(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.
Section 68(2) of the Administration Act states:
The Secretary may give a person to whom this subsection applies a notice that requires the person to do any or all of the following:
(a)inform the Department if:
(i) a specified event or change of circumstances occurs; or
(ii) the person becomes aware that a specified event or change of circumstances is likely to occur;
(b)give the Department a statement about a matter that might affect the payment to the person of the social security payment;
(c)give the Department a statement about a matter that might affect the operation, or prospective operation, of Part 3B in relation to the person.
Section 100 of the Administration Act states:
(1)Subject to subsection (2), if:
(a)a person who is receiving a social security payment is given a notice under subsection 68(2); and
(b)the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period); and
(c)the event or change of circumstances occurs; and
(d)the person does not inform the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and
(e)because of the occurrence of the event or change of circumstances, the rate of the social security payment is to be reduced;
the social security payment becomes payable to the person at the reduced rate on the day on which the event or change of circumstances occurs.
(2) If:
(a)a person who is receiving a social security payment is given a notice under subsection 68(2); and
(b)the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period); and
(c)the event or change of circumstances occurs; and
(d)the person does not inform the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and
(e)because of the event or change of circumstances, the person’s working credit balance or student income bank balance is reduced to nil in an instalment period of the person that is the same as, or later than, the instalment period in which the event or change of circumstances occurs; and
(f)either because of the reduction of the balance to nil or because of the balance having already been reduced to nil – the rate of the person’s social security payment is to be reduced;
the social security payment becomes payable to the person at the reduced rate on :
(g)if the rate reduction is attributable to the reduction of the balance to nil – the day on which the balance was so reduced; and
(h)if the rate reduction is attributable to the balance having already been reduced to nil – the first day on which the opening balance was nil.
ISSUES FOR DETERMINATION
This Tribunal must determine whether the Applicant has a debt and if so; whether there is a reason not to recover it in line with the legislative and policy framework that governs parenting payments.
EVIDENCE
The Tribunal received the following evidence:
·T documents (T1-T60 pp1-319) (Exhibit R1)
·Statement of Facts Issues and Contentions (SOFIC) dated 3 August 2018 (Exhibit R2)
·Letter from Centrelink dated 17 October 2017 (Exhibit R3)
·Request for information from Centrelink dated 18 October 2017 (Exhibit R4)
The Tribunal has reviewed all of the material before it. The Tribunal is satisfied that all relevant evidence was before it, and that both parties were provided an opportunity to address the evidence and the matters in issue, either orally or in writing. Relevant aspects of the evidence and material before the Tribunal will be analysed and referred to below.
The Respondent makes the following contentions (R2):
Debt creation and recoverability
…
24.The Secretary submits that, as the applicant failed to comply with the information notices issued to her under subsection 68(2) of the Administration Act, her payments of PPP can be retrospectively reduced under subsection 100(1) of the Administration Act.
25.The Secretary also submits that, as the applicant received payments in excess of her correct entitlement due to Mr S' self-employed income not being taken into consideration, the Department has correctly calculated a PPP debt in the amount of $18,649.95 for the period 1 June 2014 to 30 June 2017.
…
27.The Secretary contends that the amount overpaid constitutes a legally recoverable debt under subsection 1223(1) of the Act.
Debt write off
28.Pursuant to subsection 1236(1A), the Secretary may write off a debt for a stated period if it is irrecoverable at law, if the debtor has no capacity to repay it, or if it is otherwise not cost effective for the Commonwealth to take action to recover it.
29.Subsection 1236(1C) provides that where a debt is recoverable by way of social security payment deductions, a 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'.
30.The term 'severe financial hardship' is not defined in the Act, however the Administrative Appeals Tribunal in:
(a)Re Lumsden and Secretary, Department of Social Security [1986] AATA 228 required that, for this term to be satisfied, a person's entire financial position would need to be materially less than the current rate of pension;
(b)Stubbs and Secretary, Department of Families and Community Services [2003] AATA 729 stated that:
'...Severe financial hardship, while not implying destitution, goes beyond straitened financial circumstances and imports a need for the particular case of a person to include financial suffering of a severe or extreme nature...'
(c)L and Department of Social Security [1995] AATA 159; (1995) 38 ALD 176, stated in part as follows:
66. In summary, I consider that matters relating to the personal financial hardship of the individual are always relevant in any decision as to write off under subsection 1236(1). Retrospective considerations may occasionally be relevant. The essential inquiry will always be whether recovery is a feasible proposition, bearing in mind the financial means and obligations of the individual concerned. Will recovery cause such personal hardship as to run contrary to the beneficial nature of the legislation?
31.The Secretary submits that section 1236 has no application in this matter. The debt is recoverable at law and there is no question of cost efficacy to the Commonwealth in taking recovery action. The applicant has capacity to repay the debt by way of modest fortnightly instalments, noting she currently receives around $885.00 net a fortnight in family assistance payments from the Department.
Debt waiver
Sole administrative error
32.Where a debt (or part thereof) has arisen solely as a result of administrative error by the Commonwealth, and the debtor received the payment in good faith, the Secretary must waive recovery of that debt (section 1237A of the Act).
33.The existence of an administrative error is not sufficient to meet the requirement, and the debt must arise from administrative error to the exclusion of all else (see Re Gerhardt and Secretary, Department of Employment & Training (1997) FCA 815).
34.In Ward and Secretary, Department of Families and Community Services (2000) AATA 212, Deputy President Forgie held:
‘47. This means that the Secretary's duty to waive does not extend to those debts which are attributable to errors or other factors which are independent of the Commonwealth's administrative error. It makes no difference that those other errors or factors are minor.'
35.The Secretary notes the Federal Court decision in Sekhon and Secretary, Department of Family and Community Services [2003] FCAFC 190, which states:
‘35. 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 sole 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.'
36.During the debt periods, the applicant was sent numerous notices notifying her of the obligation to advise the Department of changes to her and her partner's circumstances; particularly, if her partner started any form of business or selfemployment, or if his income increased. The notices also confirmed that the applicant's entitlement to PPP was calculated on the basis of both her and her partner's income, and specified the respective amounts as recorded by the Department.
37.The Secretary contends that the applicant's failure to read and comply with written notices and report changes in her partner's income for the purposes of ensuring she was paid the correct amount of PPP materially contributed to her being overpaid. The main purpose of the written notices is to advise recipients of their notification obligations, and a failure to closely read and respond to them precludes a finding that the resulting debt is attributable solely to administrative error.
38.Further, the Department raised a separate PPP debt against the applicant on 3 September 2015 on the same basis as the debt subject of these Tribunal proceedings. The raising of this earlier debt demonstrated the consequences of failing to advise the Department of her partner's self-employed income for PPP purposes, and the effect his income had in terms of calculating her correct entitlement.
39.The applicant failed to provide the Department with a copy of her partner's income tax returns for the 2014/2015, 2015/2016 and 2016/2017 financial years until 31 October 2017, despite them being lodged with the ATO by Mr S on 4 April 2016, 6 April 2017 and 14 September 2017 respectively, and despite the raising of an earlier debt in circumstances akin to the present. Providing an income estimate for Family Tax Benefit purposes is not sufficient to satisfy the requirement of advising of income changes for PPP purposes, particularly in circumstances where the estimate significantly exceeded Mr S' actual income.
40.As such, the Secretary contends that it cannot be said the debt arose solely as a result of administrative error on the part of the Commonwealth, or that the payments were received by the applicant in good faith. The applicant was fully informed of her notification obligations, and was aware of an overpayment likely resulting in the event her partner's income was incorrectly recorded. There is no evidence of the applicant informing the Department of a change in her partner's earnings within 14 days of her becoming aware.
Special circumstances
41.Section 1237AAD of the Act provides that the Secretary may waive the right to recover all or part of a debt where there are special circumstances present such that waiver of the debt is desirable, and where the debt did not result from a person knowingly making a false statement or representation, or failing or omitting to comply with a relevant legislative provision.
42.The term 'special circumstances' is not defined in the Act however it has been extensively considered in case law.
43.The Federal Court has indicated that a finding of special circumstances requires something unfair or unjust that, in the circumstances, makes the case unusual or uncommon (Groth and Secretary, Department of Social Services (1995) 40 ALD 541, 545 per Kiefel J; Angelakos and Secretary, Department of Employment and Workplace Relations [2007] FCA 25, [33] per Besanko J). In making that assessment, it is relevant to consider how the overpayment came about (Dranichnikov and Centrelink (2003) 75 ALO 134, [66]).
44.Beadle and Director-General of Social Security (1984) 6 ALD 1 states:
'An expression such as "special circumstances" is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend upon the context in which they occur. For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.'
45.Timothy Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114, at [80] provides in part:
'... special circumstances" are not merely directed to the person's own circumstances. Rather, they are directed to those that are "special circumstances... that make it desirable to waive". That necessarily requires a consideration of the person's individual circumstances but also a consideration of the general administration of the social security system. Waiver of the debt would mean that Mr Davy would have had the benefit of part of his DSP in circumstances in which he was not entitled to it... He has had the benefit of the money and there is no injustice in requiring him to repay the money of which he has had the benefit but not the entitlement...The system of administration of the Social Security Act does not visit any injustice for many if not all social security recipients but it did not lead to any injustice or unfairness on Mr Davy that is not visited, or potentially visited, upon all other recipients of social security payments under the Act. Therefore, I am not satisfied that there are special circumstances that make it desirable to waive the debt under s 1237AAD of the Act...’
46.The Secretary contends that the applicant's circumstances are not sufficiently special to warrant an exercise of the discretion to waive all or part of the debt under section 1237AAD of the Act, noting the applicant's evidence to the AAT1 that 'she does not have any special circumstances that should be taken into consideration'.
…
47.As the write off and relevant waiver provisions do not apply to the matter, the Secretary contends the debt must be recovered in full.

The Applicant made no written submissions.
HEARING
The application for review was heard in Perth on 11 February 2019. The Applicant appeared in person and had her uncle Mr Maller for support. The Respondent was represented by Ms Jones–Bolla of Sparke Helmore.
The Tribunal would like to thank both the Applicant and the Respondent for their assistance during the hearing.
The Respondent opened by relying on its SOFIC (R2). The Respondent addressed how the debt was created, whether the debt could be written off, whether the debt was created solely as a result of administrative error and whether special circumstances existed.
The Respondent submitted that there was no evidence to suggest the debt arose solely as a result of administrative error by Centrelink.
The Respondent opened by substantially relying on arguments contained in the SOFIC (R2). Essentially the Respondent submits that the Applicant has incurred a Parenting Payment Partnered debt as a result of excessive payments from 2014 to 2017 and that the debt incurred cannot be solely attributed to administrative error.
Under cross examination the Applicant stated:
·She had received a number of notices referred to by the Respondent. These notices were included in the T documents (commencing at T5, 89).
·She agreed she had received these notices, however was possibly not as vigilant as she should have been in reading them.
·There was confusion on her part regarding some of the language used in the letters received, such as “annual other income and fortnightly earned income”.
·She admitted in respect to fortnightly income: “It was my mistake, I should have raised this. I did not look.”
·“My belief was I thought I had provided all the necessary information asked of me.”
The Respondent concluded by noting that there is a difference in calculation between Family Tax Benefit and PPP. The Applicant had an obligation to advise Centrelink and had failed to do so. As a result the Applicant was in receipt of excess payments.
The Applicant summed up by stating that as a customer she had no idea about the different calculations. She was convinced she had provided all information required, however accepted there was a debt and that she contributed to the debt by not reading the fine print of Centrelink correspondence she had received.
CONSIDERATION
Was the debt against the Applicant appropriately raised?
The Tribunal finds the Applicant to be a truthful witness who admits that she should have been more vigilant in reading and interpreting Centrelink correspondence.
The Applicant accepts a debt has been incurred. She claims as she did to the AATI that her partner’s income was known to the Department and that information should have been used for the purpose of assessing her PPP.
The Tribunal after having examined the tax returns in evidence, confirms the ARO finding that for the following three financial years the Applicant’s partner’s ordinary income from his business was (T46, 210):
·2015 - $34,763.00
·2016 - $49,872.00
·2017 - $44,228.00
The Tribunal having regard to the evidence before it accepts that the Applicant’s PPP was not initially assessed incorporating the ordinary income of her partner and consequently she has been overpaid to the amount of $18,649 from 2014 to 2017.
It is clear to the Tribunal that s 1223(1) of the Act provides that where a person receives the benefit of a payment they are not entitled to receive, a debt to that person is incurred.
On this basis the Tribunal finds the Applicant has incurred a debt to the Commonwealth of $18,649.95 (T46, 209).
Is there any basis to waive the debt?
The Tribunal finds that, generally, all debts incurred must be recovered (see French J in Secretary, Department of Social Security v Hales [1998] FCA 219 at [1]).
The Tribunal notes that the Applicant received a number of notices from the Department detailing how her PPP was being assessed. Each of those notices contained the following:
Your Parenting Payment
……
If you disagree with a decision, contact us as soon as possible. It is important to ask for a review within 13 weeks of being notified about the decision. ….
The Tribunal accepts there is provision within the Act to waive recovery where it is not in dispute that a debt arose solely as a result of administrative error by the Department. For this to occur the Tribunal would have to find that the Applicant in no way contributed to the administrative error.
The Applicant told this Tribunal she accepts that she was responsible for the debt being incurred, and the Tribunal accepts the circumstances outlined by her that may have contributed to some confusion between the differing PPP and FTB payments.
The Applicant told the AAT1:
20.Miss Hardman contends that she gave the Department all the information requested of her whenever she attended the Department’s offices. In her view it is up to the Department to decide which payments that information should be applied to. She drew the tribunal’s attention to several letters, sent by the Department to her in relation to family tax benefit. Those letters advised her that her income had been reconciled for the particular year and that she was entitled to an arrears payment. She said that those letters proved that the Department had all the relevant information. Miss Hardman said that she did not realise she was getting two separate payments as the family tax benefit and parenting payment go into her account on the same day. She generally checks her account balance but does not check her bank statements.
The Tribunal agrees with the AAT1 that the Applicant is the person responsible for advising the Department of any changes to her circumstances in the context of receiving a Commonwealth benefit.
The evidence before the Tribunal shows that the Applicant received a number of notices from the Department concerning her PPP and had been advised consistently that the assessment of the payment she was receiving included calculations by the Department of her partner’s annual and fortnightly income.
The Tribunal notes the Applicant advised the Department of her partner’s employment situation from 2013 and produced his tax returns for 2016 and 2017 (T50, 226-241).
The Department sent a notice to the Applicant on 16 June 2015 stating (T13, 111):
Our records show, there is a change to you and your partner’s combined income, and as a result a decision has been made to reduce the amount of Parenting Payment Partnered you receive from 13 July 2015. Information about what to do if you think this decision is wrong is on the back of this letter.
The notice showed her partner’s annual other income was $31,316.48 and his fortnightly earned income was $0.00.
A similar notice was sent to the Applicant on 5 October 2015 (T17, 123).
The Tribunal has no evidence to suggest that the Applicant made any attempt to contact the Department until 29 March 2017 when she submitted an Income and Assets update.
The Department on 22 June 2017 requested her partner’s 2015/16 and 2016/17 income tax returns and they were received by the Department on 31 October 2017 (R2).
The Tribunal after having considered all the evidence before it is satisfied that the debt incurred did not arise solely as a result of administrative error by the Department. The Tribunal finds that the Applicant should have provided the Department with all the information necessary in order for it to make the correct assessment of her PPP.
The Applicant had received several notices which gave her the opportunity to consider the accuracy of the information she was required to produce. The Tribunal finds the Applicant’s mistake in not providing information to the Department contained in her partner’s tax returns at an earlier point has substantially contributed to the creation of the debt.
As the Applicant has stated to the Tribunal that there are no special circumstances to be considered, the Tribunal did not undertake an assessment of this factor as part of its deliberations. However on the evidence before it, the Tribunal concludes the circumstances outlined by the Applicant are not so overtly unusual or uncommon to be deemed special.
The Tribunal finds on the evidence before it that the debt incurred by the Applicant is recoverable by law, and that the Applicant has the capacity to pay it. The Tribunal has been advised that recovery payments have commenced through deduction from her Commonwealth benefits.
DECISION
For the reasons outlined above, the Tribunal affirms the decision under review.

I certify that the preceding 65 (sixty five) paragraphs are a true copy of the reasons for the decision herein of Member C Edwardes

.........[Sgd]......................................................
Associate
Dated: 22 February 2019

Date of hearing: 11 February 2019

Applicant: In person

Counsel for the Respondent: Ms D Jones-Bolla

Solicitors for the Respondent: Sparke Helmore

[2019] AATA 220

22 February 2019

Key Legal Topics

Areas of Law

Administrative Law

Statutory Interpretation

Legal Concepts

Judicial Review

Procedural Fairness

Statutory Construction

Appeal

Jurisdiction

Natural Justice

Date of hearing:	11 February 2019
Applicant:	In person
Counsel for the Respondent:	Ms D Jones-Bolla
Solicitors for the Respondent:	Sparke Helmore