Hardship Applicant 13312 v Icon Water Limited (Energy and Water)
[2018] ACAT 83
•13 July 2018
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
HARDSHIP APPLICANT 13312 v ICON WATER LIMITED (Energy and Water) [2018] ACAT 83
EW 0396/2015
Catchwords: ENERGY AND WATER – hardship assistance – water and waste water service – application to set aside decision to terminate assistance – application refused
Legislation cited: Utilities Act 2001 s 179
Subordinate
legislation cited: Consumer Protection Code
Tribunal: Senior Member P Sutherland
Member E Newmarch
Date of Orders: 13 July 2018
Date of Reasons for Decision: 23 August 2018
AUSTRALIAN CAPITAL TERRITORY ) EW 0396/2015
CIVIL & ADMINISTRATIVE TRIBUNAL )
BETWEEN:
HARDSHIP APPLICANT 13312
Applicant
AND:
ICON WATER LIMITED
Respondent
TRIBUNAL:Senior Member P Sutherland
Member E Newmarch
DATE:13 July 2018
ORDER
The ACT Civil and Administrative Tribunal – Energy and Water (the “Tribunal”) is satisfied that:
(a)the Applicant has made an Application to the Tribunal to set aside a Tribunal Order issued on 23/02/2018;
(b)the Tribunal considered the application on 13/07/2018; and
(c)the Application to set aside is Refused.
……Signed…………………..
Senior Member P Sutherland
REASONS FOR DECISION
Proceedings
The applicant first made an application for hardship assistance under section 179 of the Utilities Act 2000 on 4 May 2015 in respect of her electricity service. An interim order to maintain supply was made on that day, however it was revoked on 27 May 2015 when the applicant failed to attend a hearing.
On 24 June 2015, hardship assistance orders were made in respect of her electricity and water and waste water service. The applicant was required to pay $50 per fortnight towards her water and waste water service. Her water debt was approximately $3,500.
Icon Water Limited, the respondent, is a water and waste water public utility owned by the ACT Government. The applicant owns and manages the water and waste water business and assets in the Australian Capital Territory.
The applicant continued to experience difficulties in her payments for electricity and water between 2015 and 2018, and has a history of failure to meet payment conditions set by the tribunal and failure to attend tribunal hearings, resulting in a number of dismissals of her hardship assistance by the tribunal and applications to set aside these dismissals.
On 23 February 2018, the tribunal revoked an order to maintain the applicant’s water and waste water service because she had failed to make required payments of $100 per fortnight. At this time, her water debt was approximately $8,500.
The applicant applied for an order to set aside this revocation. On 13 July 2018, the Tribunal, constituted by Senior Member Sutherland and Member Newmarch (the Tribunal), refused the application to set aside.
As a consequence, the applicant has no hardship protection in relation to her water and waste water service and the respondent may take action to enforce its debt. This action is likely to include debt recovery proceedings in the tribunal’s civil dispute jurisdiction and may include restrictions on the quantity of water supplied to the household. This power to restrict water supply is available to the respondent under the Consumer Protection Code (ACT), but has not yet been used by Icon as a debt enforcement option.
Background
The applicant lives in a large property in Tuggeranong with a mortgage, which is also in arrears. She currently has two adult sons with their partners, and one son’s two children living in the property. One adult son has been resident in the property since 2016. The other son’s partner does not have permanent residence and is unable to work, and the applicant said they would be moving out shortly. The applicant stated she is currently supporting her father and mother in a nursing home.
The applicant has an income of approximately $1,000 per fortnight from Commonwealth superannuation and workers compensation. She informed the Tribunal that the other household residents only contribute to the household expenses sporadically, as costs for their children come first and they have their own debts. She also stated that there was equity in the property, the house was too big for her alone, and she may down-size when the children have moved out.
Consideration
Factors which led the Tribunal to refuse the application were:
(i)a long history of non-compliance with ACAT decisions resulting in a considerable increase in the outstanding debt;
(ii)the failure of other adults in the house to contribute to the household expenses; and
(iii)public policy.
The applicant first attended the Tribunal on 24 June 2015. She had approached ACAT for a hearing regarding her electricity supply and her water debt was added at the hearing. The applicant was dismissed from ACAT protection for non-compliance on 30 November 2015, as she had only made one successful payment in that time.
This is her fifth application to set aside an ACAT dismissal since the first dismissal. She has been dismissed previously on two occasions for failing to attend hearings, and two for non-compliances with the payment order. Over this time, her water debt has increased to $8,950
The applicant could not give an assurance that she would be able to comply with a payment order, and the Tribunal noted that seven out of fifteen of her most recent direct debits had been rejected. It appears to the Tribunal that the applicant is unable to commit to meeting her water costs because of other commitments considered more pressing.
There are other adults in the house who receive income but fail to contribute to household expenses. The water usage in the property is quite high at $116 per fortnight, suggesting that those adults and the two children are substantial users of water.
The Tribunal noted that the applicant’s position is that she cannot afford to make regular payments for water at the level required. The Tribunal considers that she is in this position because of her choice to house her extended family without asking for regular financial contributions from the adult children, whether from their wages, their Centrelink benefits or their family tax benefits. The applicant could also address her position in the medium term by downsizing and releasing some of the equity in her home.
As a matter of public policy, the Tribunal considered that it is not the role of ACAT to maintain, in their own house, home owners who are not able to meet their ongoing utility and mortgage costs. This would be give rise to substantial inequity between home owners and private renters, who almost inevitably face eviction if they fail to pay their rent.
In some special cases, the tribunal does support customers who are unable to pay for their reasonable cost of energy and water consumption; this is managed through the tribunal’s “Under-Consumption Discharge” policy (Attachment A). This form of support is usually associated with unusually high medical expenses (for example, families with a child who receives treatment in a Sydney hospital), high pharmaceutical expenses (outside the safety net), or lack of any income (victims of domestic violence, residents without permanent residence), etc. The Tribunal considers that there are no special factors in the present case.
………………………………..
Senior Member P Sutherland
ATTACHMENT A
UNDER-CONSUMPTION DEBT DISCHARGE
What is Under-Consumption Debt Discharge?
ACAT E&W recognises that some utility customers in the ACT genuinely cannot afford to pay for the amount of utilities consumed in the household. In most cases, this inability to pay for usage is short-term, however in some cases the inability may be long-term because of highly individual circumstances in the affected household.
In such cases, ACAT E&W may authorise “Under-Consumption Debt Discharge”, that is discharge will be authorised for the amount which the client spends on utility services which is in excess of the amount ordered by ACAT E&W to be paid by the client for the relevant period. In special cases, under-consumption discharge may be for the total amount of the account because, at an ACAT E&W hearing, an assessment is made that the client has no current capacity to pay for utilities.
Who can it help?
Under-consumption discharge will be considered for all ACAT E&W clients who are in situations of extreme hardship. Under-consumption discharge can be for either a short period (generally 6 – 13 weeks) or for longer periods, depending on individual circumstances..
Short-term Under-consumption Debt Discharge
There are a range of household circumstances where short-term under-consumption discharge will be considered, including where:
there is extremely high usage in a low income household which requires investigation and/or modification of household behaviour;
there is a short-term issues with income and ACAT E&W has agreed that no payment is required during this period;
ACAT E&W has made a referral for financial counselling and, again, has agreed that no payment is required during this period.
Long-term Under-consumption Debt Discharge
Under-consumption discharge on a long-term basis will be ordered only in very special circumstances and will be reviewed at least every six months to ensure that eligibility circumstances have not changed. ACAT E&W will require the client to provide appropriate evidence substantiating long-term assistance, for example a medical certificate, a pharmacy report or an aged care assessment report. Circumstances for long-term/on-going under-consumption debt discharge may include where:
there is extremely high usage in a household and that usage is genuinely required because of special circumstances in the household such as disability, medical conditions including brain tumours and mental health problems, and life support equipment;
there are unusually high and genuinely unavoidable household costs, for example children receiving medical treatment in Sydney, unusually high pharmaceutical costs, etc, and this makes utilities unaffordable for the household.
Under-consumption Debt Discharge Not Appropriate
There are a number of circumstances where under-consumption discharge is not appropriate, including where:
the client requests a staged introduction of increased payments in circumstances where ACAT E&W considers that an amount of payment above consumption is currently manageable;
payments below consumption are approved because the client has a realistic expectation of future income or a capital receipt which will allow payment of the accrued debt (eg. a forthcoming personal injury compensation payment or an employment or business-related lump-sum payment).
Water and sewerage debts
Under-consumption discharge can be applied to water and sewerage debts in appropriate circumstances. However, consideration should always be given to ordering an amount which is less than consumption, but not discharging the under-consumption portion of the debt. Water debt is attached to the land and Icon Water can ultimately recover a water/sewerage debt when the property is sold. In some cases (eg. medium-high income earners), under-consumption discharge of water and sewerage debts may result in an unfair accretion to the client's asset base.
HEARING DETAILS
FILE NUMBER: | EW 0396/2015 |
PARTIES, APPLICANT: | In person |
PARTIES, RESPONDENT: | Did not appear |
COUNSEL APPEARING, APPLICANT | N/A |
COUNSEL APPEARING, RESPONDENT | N/A |
SOLICITORS FOR APPLICANT | N/A |
SOLICITORS FOR RESPONDENT | N/A |
TRIBUNAL MEMBERS: | Senior Member P Sutherland Member E Newmarch |
DATES OF HEARING: | 13 July 2018 |
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