He and Secretary, Department of Social Services (Social services second review)
[2020] AATA 1848
•19 June 2020
He and Secretary, Department of Social Services (Social services second review) [2020] AATA 1848 (19 June 2020)
Division:GENERAL DIVISION
File Number(s): 2019/3236
Re:Jian He
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
AndMin Zhou
OTHER PARTY
DECISION
Tribunal:Member D Mitchell
Date:19 June 2020
Place:Brisbane
The Tribunal affirms the decision under review.
...............................[SGD].........................................
Member D Mitchell
CATCHWORDS
SOCIAL SECURITY – parenting payment single – separated parents with shared care – principal carer – parenting payment child – financial considerations – comparison of assets – comparison of earning potential – decision under review affirmed.
LEGISLATION
Social Security Act 1991 (Cth)
CASES
Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409
Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634
Secretary, Department of Family and Community Services v Holmes (2000) 98 FCR 461
Smedley and Secretary, Department of Education, Employment & Workplace Relations and Beveridge [2010] AATA 292
SECONDARY MATERIALS
Guide to Social Security Law
REASONS FOR DECISION
Member D Mitchell
19 June 2020
INTRODUCTION
Mr Jian He (the Applicant), and Ms Min Zhou (the Other Party) (collectively the Parents), are the separated parents of a child born in June 2013 (the Child).
On 6 August 2018, the Applicant lodged a claim for parenting payment (PP)[1] at which time he had 50% care of the Child[2] and the Other Party was considered the principal carer of the Child and was in receipt of PP.[3]
[1] Exhibit 1, T Documents, T6, The Applicant’s claim for parenting payment, pages 32-37.
[2] Exhibit 1, T Documents, T8, Letter to the Applicant from the Child Support Agency regarding the percentage of care of the Child from 23 April 2018, page 39.
[3] Exhibit 1, T Documents, T20, Centrelink file notes from the Other Party’s customer record, page 115.
On 30 August 2018, a decision was made to reject the Applicant’s claim for PP.[4] The Applicant sought a review of the decision, which was affirmed by an authorised review officer (ARO) on 29 November 2018.[5]
[4] Exhibit 1, T Documents, T15, Centrelink file notes from the Applicant’s customer record, page 72.
[5] Exhibit 1, T Documents, T10, Decision and Notes of ARO, pages 44-48.
The Applicant applied to the Social Services and Child Support Division (SSCSD) of this Tribunal for further review. On 14 May 2019, the SSCSD affirmed the decision of the ARO.[6]
[6] Exhibit 1, T Documents, T2, Decision of the SSCSD, pages 6-11.
Following this, the Applicant sought a second-tier review of this matter by the General Division of this Tribunal, by way of an application dated 7 June 2019.[7]
[7] Exhibit 1, T Documents, T1, Application for Review, pages 1-5.
On 12 March 2020, a Hearing was held for this application. At the Hearing, the Applicant and Other Party were self-represented, appeared in person and gave evidence under affirmation. The Other Party was assisted throughout the Hearing by an interpreter.
THE LAW
The relevant legislation in relation to this matter is the Social Security Act 1991 (Cth) (the Act).
Section 500 of the Act outlines the qualification requirements for PP, which among other things requires a person to have at least one PP child.
Section 500D(2) of the Act defines that where a person is not a member of a couple, a child is a PP child of a person if the child is a child of the person, has not turned 8 and the person is the principal carer of the child.
Section 5 of the Act outlines family relationship definitions as they relate to children. Relevantly sections 5(15) to 5(24) of the Act define who is the principal carer of a child.
Section 5(15) of the Act provides that a person is the principal carer of a child who has not turned 16 years of age and is a dependent child of the person.
Section 5(18) of the Act provides that a child can only have one principal carer at a time. Where otherwise 2 or more persons would be principal carers of the same child, the Secretary must pursuant to section 5(19) of the Act make a written determination specifying one of the adults as the principal carer of the child and give a copy of the determination to each adult.
The Act does not prescribe how a principal carer of a child should be determined in situations where two parties share equally in the care of the child. The Respondent referred the Tribunal to the Guide to Social Security Law (the Guide) which is a policy document used by officers who administer the Act to assist them in interpreting and applying the Act. While the Tribunal is not bound by policy, to aid consistency, policy will usually be taken into account and followed unless there are cogent reasons not to.[8]
[8] Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409; Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 634 at 639-645.
It is noted that with respect to whether the Tribunal should apply policy, in Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, Brennan J stated at page 645:
In my view, the Tribunal, being entitled to determine its own practice in respect of the part which ministerial policy plays in the making of Tribunal decisions, should adopt the following practice.
When the Tribunal is reviewing the exercise of a discretionary power reposed in a Minister, and the Minister has adopted a general policy to guide him in the exercise of the power, the Tribunal will ordinarily apply that policy in reviewing the decision, unless the policy is unlawful or unless its application tends to product an unjust decision in the circumstances of the particular case. Where the policy would ordinarily be applied, an argument against the policy itself or against its application in the particular case will be considered, but cogent reasons will have to be shown against its application, especially if the policy is shown to have been exposed to parliamentary scrutiny.
In Secretary, Department of Family and Community Services v Holmes (2000) 98 FCR 461, Gyles J in considering an earlier provision of the Act regarding parenting payments and determining between carers, relevantly provided at page 467:
… the Secretary, and the Tribunals on appeal, have the invidious task of choosing between those persons in circumstances where the legislation does not provide a criterion or criteria.
This is a discretion constrained only by the purposes of the Act and the provisions of it relating to Sole Parent Pensions: O’Sullivan v Farrer (1989) 168 CLR 210 at 216. The section does not oblige the decision-maker to take any particular matter into account, and only prohibits taking into account those matters which are not relevant to the purposes of the Act. Within those very broad limits, it is a matter for the exercise of discretion by the decision-maker which cannot be controlled by a court dealing with errors of law: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-42 per Mason J. Thus, it is that one decision-maker might prefer the apparent objectivity of deciding on the basis of hours of custody, another night also take into account the qualitative factors and yet another right also take into account the financial circumstances of the parties. If there is any relevant government policy guidance, then appropriate regard should be paid to it. It is, in circumstances such as the present, a matter for decision by the Administrative Appeals Tribunal, as it has the ultimate say on the merits of the decision.
The Tribunal considers it appropriate to apply the Guide in determining the principal carer of a child where section 5(19) of the Act applies to circumstances where two parties share equally in the care of a child. Relevantly, the Guide at 1.1.P.416 provides:
Equal Care
If the difference in the level of care provided by the 2 carers is less than 10%, care is considered to be shared equally.
Example: Where care is shared 54/46% or 50/50%.
In situations of equal care where only 1 of the carers is claiming or receiving income support, that person should be determined as the principal carer. If both carers are claiming or receiving income support, the carer who is most in need of a favourable determination should be deemed principal carer.
A decision maker MUST take into account the following factors when deciding which carer is in most need of a favourable determination:
·whether 1 carer already qualifies as principal carer of another child (see below for further detail on determinations involving more than 1 child)
·whether only 1 carer would be eligible for PP
·which carer would receive the higher rate of payment
·any other sources of income the carers may have, whether actual or potential, including both employment and investment income
oNote: If either carer has income that fluctuates, the assessment officer may need to look at average income levels over an extended period of time, such as 12 weeks, and
·the asset levels of each carer.
The following factors MAY be taken into consideration by the decision maker, if further information is required to make the determination:
· the expenses of each carer
o Example: Rent, child care
· workforce experience, education levels and future employment prospects of each carer
· the duration that each carer has been on income support and their principal carer status during this time. If there are no substantial differences between the parties, then generally the determination should be favoured which maintains the 'status quo', and
· any other factors considered relevant by the decision maker.
Example: Mary and John are separated and equally share the care of their daughter Cathy. Mary has been receiving JSP with principal carer status since April 2020, and John lodges a claim for JSP in June 2020. The rate that would be payable to John is approximately the same as that being paid to Mary. Neither John nor Mary owns any substantial assets such as a house or car. John has recent workforce experience, which increases his employment prospects in the area. It is fair to argue that a decision that cancelled Mary's status as principal carer would have a more significant impact than a decision to reject John's claim to be deemed principal carer, especially as John has greater employment prospects than Mary. Therefore, Mary should continue to be specified as the principal carer of Cathy while John should have generic JSP requirements/concessions.
ISSUES
The issue for the Tribunal to consider in this matter is, whether the Applicant was qualified to receive the PP at the date of his claim on 6 August 2018.
EVIDENCE
The evidence provided by the Parents during the application and review processes that occurred prior to the Applicant seeking further review by this Tribunal was limited. It contained mainly invoices in relation to activities or costs that were attributed to the care of the Child or the time spent by the Child in each parents care.
Applicant’s Evidence
The Applicant provided the following in an email dated 9 March 2019 for the purposes of the Hearing before the SSCSD: [9]
I think both party in similar conditions for “Principal Care”, I understood only 1 can be PC, what I want is father has PC one year and the mother has PC second year, any problems on the Law?!
[9] Exhibit 1, T Documents, T17, Email to SSCSD from the Applicant regarding upcoming hearing with attachments, page 94.
The Applicant made similar assertions before, at and after the Hearing of this matter before this Tribunal.
In the lead up to the Hearing before this Tribunal, the Applicant in support of his application provided a Statement of Facts Issues and Contentions[10] as well as a number of written submissions and attachments.[11] The attachments relate to care provided for the Child, Family Court proceedings, parenting arrangements, Centrelink notices and Magistrate Court judgements.
[10] Exhibit 2, Applicant’s updated Statement of Facts, Issues & Contentions, received by the Tribunal on 20 January 2020.
[11] Exhibits 3, 4, 5 and 6, being submissions and attachments provided by the Applicant.
In his Statement of Facts Issues and Contentions the Applicant in addressing some of the evidence before the Tribunal and in providing his contentions relevantly provided:[12]
[12] Exhibit 2, Applicant’s updated Statement of Facts, Issues and Contentions, received by the Tribunal on 20 January 2020, pages 8-9 and 14-21.
65. On 01 April 2019, the applicant email to the AAT as he was very concerned as:
"1, looks like a lot of conditions on both parties are similar, so the final decision
may be relying who has worse income or income prospect,
2, both parties claimed lower ATO personal income, both in low income range by
Centrelink standards.
3, There are 2 nationalities in this case, [the Applicant] is Australian and [the Other Party] is Chinese with PR recently.
3, the both party were self-employed in their own Pty companies and working
alone in same tourist industry and target Chinese market too, that make the
true financial condition more harder to be confirmed as the cash income
happened too normal in that kind of business.
4, but there are many question points on [the Other Party’s] true income as:
A, she set up the company at Dec 2016, and claim $6,000 income at 2016-
2017 financial year, that means $6,000 in 6 months. But $5,000 income
at 2017-2018 financial year, that means $5,000 in 12 months, that is
unnormal, and her tax return was so late on 2017-2018, that is unusual
on such simple and lower income case too.
B, she has refinanced the property at [Calamvale] at Dec 2017, the refinance amount was $450,000 around by ANZ, that means both she and the ANZ bank believe [the Other Party’s] income can afford that size of loan, that means her annual income is above $100k as ANZ Bank proved. And she has no problem to pay the mortgage more than 12 month.
C, [The Other Party] has Private health insurance,
D, [The Other Party] lived in a big house with higher value and big mortgage.
E, [The Other Party] took oversee cruiser holidays at June 2018."
……..
88. Regarding "whether only one carer would be eligible for PP",
Both parents were looks eligible for PP for all times.
89. Regarding "which carer would receive the higher rate of payment",
Both parents were applied Single Parent Payment (PPS), it was a single
rate of payment.
90. Regarding "any other sources of income the carers may have, whether actual or
potential, including both employment and investment income",
The other party's actual or potential income is strong in doubt as her cost of
living was extremely unpaired to her claimed ATO income, and the applicant's actual or potential income is crystal clear.
The other party:
A. has ATO income that all did by accredit accountant as:
2014, $55,002
2015, $40,000
2016, $16,317 ($xxx as PP)
2017, $26,180 ($19,958 as PP)
2018, $24,649 ($19,598 as PP)
B. Operates her own business, Flaggy Travel Pty Ltd, registered since 22
December 2016, reported salary from this company was $5,000 at
2018. That means $104 per week. No company itself income
information been supply. That may have potential income/loss can by
used as "Actual or potential" income for the third party.
C. The other party has the higher possibility to have cash income as her
business is to sale the attraction tickets or tours to Chinese individuals
both in China and Australia (private clients) and it is normally cash
based deals like the Chinese restaurants.
D. Has the 4 bedrooms, 2 lounges/halls brick, more than 200 square
meters Calamvale property with big garage on two land titles, 800
square meters land lot, the mortgage cost was $564.11/w at 2018 that
means $29,333/y at 2018. The total living expenditure was $1075.84/w
at 2018, that means $55,944/y at 2018(T23, 128). It was much more
than her ATO income, it was much more than the minimum salary of
Australian, it was much more than average ordinary Australian home
expenditures, did this kind of expenditures were qualified the social
security payment more than 4 years?
E. the other party's living standard is much higher than ordinary Australian
as like driving brad new luxury SUV and over sea cruse tours. Where
was the income corning from?
F. did claimed $70k loans from her mother and sister in China at 2018
(T23, 133), and I believe it is more than $100k now if her ATO income
is true. If the that "big money" came from China for 4 year without any
pause and it will continue in the foreseeable future, it is a loan or her
income? I have been "married" to the other party, I knew her families,
they do not have this money indeed. The other party is Chinese Citizen
with permanent residence in Australia. She has properties, bank
accounts and social security account in China that can be used to
generate "foreign income", but it is impossible to check it out the real
numbers as there are in China. If this big cash loan can be last for 4
years and beyond and looks like the loan may never have chance to be
returned, it should be treated as "actual income" if not potential.
G. Has claimed "no family supports as they live in China" when she applied
the emergency assistances payment from Centrelink at 14 May 2016.
(5008, T22, 211), It is conflict information that can be used to have
strong doubt for her actual income. If the loan is true, if the support was
so real, how she entitled to stay women refugee and emergency
payment from Centrelink at May 2016?
H. Even if in the worse scenario the other party do not entitle PP, the other
party may still qualify the other social security payment like "Austudy". If
it is not best choice then, why not now as she only have half care
duties? The other party claimed very limited ATO income from her
travel business, $5,000 per year or $104 per week income is equal to 6
hours minimum hourly pay rate, it is not a job even to pay the basic
living cost! Go to Uni or TAFE to learn the skills with "Austudy" will at
least keep her current income lever and benefit for her future income,
why not? Which one was best choice? What is her actual income?
The applicant:
A. has ATO income as:
2014, $88,520 ($27,979 redundancy payment)
2015, $32,270
2016, $48,665
2017, $28,485
2018, $29,325
B. Operates his own business, Sunny Travel Agency Pty Ltd, his reported
salary from this company was $24,000 at 2017 and 2018. It hardly has
cash income as the clients are local companies (corporate clients). The
company itself was lose money at 2017 and 2018.
C. Has a management right business purchased at 2009, his parents paid
the deposit, and did all caretaker job since 2009, his parents have
permanent residency since 2008. The income from this business was
very limited as the applicant did limited job. It was $4,353 at 2017 and
$4,743 at 2018. It was included in his annual ATO income.
D. Has a Woodridge property in rental, the rental income is $18,510 at
2018, it was mortgaged, the interest and cost are $18,500 a 2018, net
contribution for the applicant ATO income is $10 at 2018. If the
applicant chose living along at Woodridge property, his income can be
used to support his son and himself will not enough at all.
E. The applicant is Australian citizen only. He didn't have any interest in
China and any other third country. All his income is ATO income. and
his living standard was paired his ATO income for last 4 years.
91. Regarding "the asset levels of each carer”;
The financial and property order been made as consent order at FCC on
26 November 2017 (H102). It was negotiated with helps and witnessed by both parent's friends, [Mr GQ] and [Mr MN]. It was signed by the each's lawyer and stamped by FCC. It is an equal share property order.
The other party:
1) has a Calamvale property, the market value is $650k, the home loan
is $454k at 2018, the net is $196k; (T22, 130,133)
2) has a loan from her mother and sister in China $70k at 2018. The net
is -$70K.
3) has the total asset is $196k in Australia without family loan in China Or the total asset is 126K with family loan in China.
The applicant:
1) the Sunnybank Hills property has market value at $430k, home loan is
$227k at 2018, the net is 203k at 2018;
2) the Woodridge property has market value at $270k, home loan is
$237k at 2018, the liability for the capital gain tax is -$11k, the net is
$22k.
3) the study loan is -$22k at 2018,
4) the liability to "the child fund" of the property order on 2017 is -$20k.
5) has a loan from his parents in Australia $150k at 2018. The net is -
$150K. (the parents has ATO income for more than 10 years as the
caretaker of Sunnyrose management rights at Sunnybank Hills
Queensland)
6) has the total asset is $183k in Australia without family loan in
Australia or the total asset is 33K with family loan in Australia.
92. Regarding "the expenses of each carer'';
The applicant:
a. Sunnybank Hills Home loan mortgage is $340/w;
b. Sunnybank Hills Home rate and water and townhouse fee are $140/w;
c. Car rego $15/w;
d. All other living cost $500/w. (food, cloth, fuel, child care)
e. Sub Total living cost is $995/w.
Plus?
f. Woodridge home loan is $240/w.
g. Woodridge home rate and water are $93/w.
h. the child's school education cost $1,044 at 2018.
The [Other Party]:
a Calamvale Home loan mortgage is $564/w.
b. Rate is $92/w.
c. Life insurance is $21/w.
d. Medibank private insurance is $49/w
a Car rego is $50/w ($2600/y? too much)
f. All other living cost is $300/w.
g. Total living cost is $1,075/w
h. pays approximately $78 per month for the child's swimming lessons.
(it was after 2018, but it would refund by the "child fund" set up on
property order at 27 November 2017)
93. Regarding "the workforce experience, education levels and the future employment prospects of each care"
The applicant:
a. has tertiary education in China,
b. Commenced but not completed a Master of Business Administration at
Griffith University at 2010.
c has been employed as coal exploring engineer between 2006 and 2013 in
Australia, working as Uber driver and Bus driver now.
d is suffering sleep disorder as "Sleep Apnoea" since 2008. He needs go
to bed with CPAP machine and mask every night.
e. is suffering mental illness as "anxiety and depression" after May 2016.
f. is took medicine daily for his hormone disorder "Hypothyroidisum" since
2017.
The other party:
a. was tertiary educated in China. The major is "Chinese languages";
b. can speak fluently on Mandarin and Cantonese and Hakka and
functioned English;
c. was Studied Certificate III in small business in TAFE and completed the
course in 2013;
d. worked as property sale agent more than 10 years in China.
e. very good on selling anything to Chinese that include but not limited the
attraction tickets and tours and "DAIGOU" after 2013.
f. Very good on social media to help sales since 2013.
g. has approved professional sale skills as:
was No 1 property sale agent of her company in China before 2013,
was No 1 independent local sale agent on "Tangalooma Resort"
since 2016.
94. Regarding “the duration that each carer has been on income support and their principal carer status during this time. If there are no substantial differences between the parties then generally the determination should be favoured which maintains the ‘status quo’,
The other party applied PP at 27 May 2016, As no written determination been made and copy to both parties on 27 May 2016 available, it is reasonable to take the view that the decision at 27 May 2016 will have no influence on the application on 6 August 2018. That means it should take consider together 2 applications of 2 parents at the same time without any preferential.
95. The "any other factors considered relevant by the decision maker":
The applicant:
a. has been proved innocent on Domestic Violence (DV) claimed by the
other party since 2016. All DV related orders has been revoked.
It may be the major contributor of decision made at 26 May 2016.
b. was principal carer for [his daughter] since 1999, she is the first child of the applicant, and has OP1 when she graduated at Brisbane State High at 2014.
It means the applicant may take more education responsibility more in the future.
c. has to live with his parents at a townhouse at Sunnybank Hills, as he
must rent out the Woodridge property as his income is not enough to
support essential living as single parent.
Potential become an lower incomes of age carer for his parents as they are more than 80 years old.
d The applicant did ask the assessment by Child Support Agency at early
2018
The applicant need helps from Centerlink indeed, and followed the rules of Centerlink indeed, and have tried all other ways before went to Centrelink.
The other party:
a. sponsored her mother migrant as contribution parent to Australia at 19
November 2015, it would cost 50k cash to Australian Government, and
liable cost of living for 10 years.
The other party have great income expectations by herself.
b. was driving a brand-new Mercedes SUV since 2017. The plate number is
[redacted]. She has oversea cruiser tours at 2017 and recently.
The other party's daily cost or her living standard was extremely
unpaired to her claimed income.
c. never asked Child Support Assessment even if she claim so little income,
and may have more money from the Applicant.
d. Was applied PP at 27 May 2016, she knew the rules, she created a lot of
dramas to let the Centrelink believed she was "principle carer", and tried
successfully to avoid the Child Support Assessment at that time;
e. It is the third party's responsibility to report any child care changes to avoid
the "debt" been created, but she didn't report any changes initiative at all.
96. On balance above, the Applicant is the carer in most need of a favorable
determination by 1.1.P.416 of the guide. therefore, the applicant is the principal
carer of the child pursuant to subsection 5(18) of the Act.
In addition to the evidence set out in his written material, at Hearing the Applicant told the Tribunal:
· When he made his application for PP he was in financial difficulty as he was paying childcare for the Child the year before and had a lot of legal fees.
· The Other Party has a new company, new house, new home loan, taken overseas trips since they separated, and he has nothing new.
· He can explain his income and expenses and they match.
· Both parties have claimed loans from family. His family has been in Australia for over 10 years so all the money is “very clean and clear – can be checked if the Member want … But on the other side – the Other Party [come from] China.”[13]
[13] Transcript, page 13.
· The Other Party had said in 2016 to the social worker when she applied for parenting payment single that she had no help from her family. But over the last two or three years $100,000 is being transferred from China, so she conflicts in what she is saying.
· The management rights are in his name but not his property. They were paid for by his parents and his parents do the job. They put the management rights in his name as they needed a loan and “he can loan”.
· There is no loan agreement or evidence in relation to the management rights and his arrangements with his parents.
· That the Court Orders that set out his property settlement with the Other Party represents his position.
· His property in Sunnybank Hills is a townhouse with a market value of $430,000 and home loan balance of $227,000 in 2018.
· His property in Woodridge is a house with a market value of $270,000 and a loan balance of $237,000 in 2018. In working out any value a capital gain tax will arise of roughly $11,000.
· His management rights if he must include them would have been worth $75,000 in 2018, because he bought them in 2009 for $150,000 and there is half left.
· His parents earn $38,000 income from the management rights and his father reports this in his tax return.
· He has a study loan of $22,000.
· He is liable for $30,000 for the Child as a result of the Consent Parenting Orders.
· He had a loan from his parents of $150,000 in 2018. His parents have been with him since 2005, they helped him look after his older child since then. He is a single parent, so he needs his parents help.
· His mining business has not operated since 2015 when he stopped working in the mining industry.
· The assets of his travel business are negative. The vehicles owned by the company were purchased using finance and the net value is negative. He is the sole director and shareholder of this company and he is a tour guide using the company bus. He paid himself $2,000 a month from the business.
· When asked about his references to cash income and his business: “I do not have any cash business. I do not have any cash income.”[14] He said the cash business was operated by the Other Party before they separated. He said he did not have the ability to deal with the cash business. He said: “I’m not that kind of person.”[15]
[14] Transcript, page 22.
[15] Transcript, page 22.
· When asked how his travel business went from a total estimated income of $600,000 in 2015 to a loss in 2018:[16]
[16] Transcript, page 23.
The business in 2013, 2014 and 2015 is very nice. The income is more than half million each year. But this income is different, it was the income (indistinct) income. And that actually is turnover. That’s all the income I – for example, I sold the international flight ticket at that time. That’s almost 200 – more than $200,000 income. But eventually most money – most of the money go to the – the airlines and in – when I have – when I have half million turnover at that time, the annual income is less than the $100,000. Because I earn the money by sell the international flight tickets and I rental cars to the companies, the Chinese companies. They all based 30 days. It is just turnover. Rental – car rental is loan. I don’t have any money. When I marry to the other party, I clearly told her, ‘I don’t have that kind of money.’ So, once the mining boom was collapse in 2015, all income is gone. The international flight tickets gone. The car nearly ten and I needed to sold, is no value. So that’s why the company incurred the net value or net asset. Because all the money at that time, how (indistinct). Looks good income. Looks good income. But based on (indistinct words) with low (indistinct), and at that time the other party take the cash income and he also claim income to support her parents, her mother, coming to here.
· He owns a Ford Falcon made in 2004 with no value or maybe $1,000.
· He has no net income from the Woodridge property.
· When asked to explain how his estimated expenses total $1,000 a week, being $50,000 per annum which is $20,000 above his disclosed income, that is why he borrowed money from his brother and parents and why he wants the parenting payment.
· When asked about his future work prospects:
oHe can tell you all about lots of businesses but has not found the right one for him.
oWorking for someone else he would not be free to look after the Child in the same way as when he works for himself.
· His education background is not too bad, he gained tertiary education in China and he tried a Master of Business Administration in Australia however he chose the wrong career at the time as he is not good at administration.
· His language skills are better than two years ago and get better all the time.
· He has illnesses that affect his ability to work.
· His income from Uber was between $5,000 and $8,000 in 2018.
· That Centrelink advised him that due to his income of approximately $30,000 he could not get Newstart Allowance or Austudy.
· He believes that there is no income limitations of the parenting payment so his income would still allow him to get the parenting payment.
Other Party’s evidence
Prior to the Hearing of this matter the Other Party provided two emails sent by Legal Aid Queensland on her behalf on 3 and 5 February 2020, outlining that an appraisal of her home provided in around late December 2019 was that it would likely sell for $600,000 and that the current balance of her mortgage was $433,200. On that basis, the Other Party considers she held equity of $166,800 in her home. The Other Party also provided screen shots of her mortgage account. The Other Party submitted that the Applicant purchased body corporate management rights for an amount of $500,000 and it is her view that this business is a relevant asset that should be considered.[17]
[17] Exhibit 9, Emails and attachments provided by the Other Party.
At Hearing the Other Party told the Tribunal:
· She has put work as a second priority to helping at the Child’s school.
· She used her PP on Chinese, LEGO, swimming and piano classes for the Child. She has paid all of the fees for these classes.
· She believes the management rights held by the Applicant would not have decreased in value.
· It was difficult for her to get a job because of her language barriers and she has very limited English literacy skills.
· Her only income for the 2018 income year was $24,649 being the parenting payment and $5,000 income from her business.
· She had between $140,000 to $160,000 equity in her home in 2018.
· Her mortgage repayments in 2018 were around $2,200 per month.
· When asked how she afforded her mortgage and other expenses based on her disclosed income, that her mother and younger sister provided her with assistance from China. They send her money whenever she needs it, and this was all shown in her bank statements. She confirmed that she had not provided evidence of this to the Tribunal.
· She runs her own company and she is the only employee.
· She disagreed with the Applicant’s evidence in relation to his travel business. She said her level of work with the business was limited. She said she was paid a salary each month from that business, but this was for tax purposes.
· That she did not deal with any cash as part of the Applicant’s travel business. She described the arrangements in place regarding the cash component of that business which she said included large clients paying 10% commission to the travel business which the Applicant would pick up in cash. She said her family never benefited from the money collected.
· When asked about her listed expenses of $1,075 a week which is more than $50,000 a year, being double what she discloses her available income to be, that she had previously provided all documents as part of the Family Court proceedings and did not think she had to provide them to the Tribunal.
· When taken to an affidavit she had written in 2016 that had been tendered as evidence by the Applicant and the inconsistencies with what she had written in her statement about her work with the Applicant’s travel business and what she had told the Tribunal, that the Applicant was only teaching her the business.
· She is the sole director of her travel company, which in 2018 made a small profit. She did receive cash amounts in her travel company, and she used it not to pay the mortgage but for buying groceries. She said in 2018 the cash she received and used for personal expenses was around $4,000. She said she works from home and puts a percentage of her mortgage repayments, electricity, water, petrol and care expenses through the business.
· Her Mother expects her to repay the money she has given her.
· She will need to pay her sister back the money she has given to her and may do this by giving her a share of the house.
Respondent’s contentions
The Respondent sought to rely on their Statement of Facts, Issues and Contentions[18] and in summary contended that the Applicant was not qualified to receive PP when he lodged his claim on 6 August 2018 primarily on the basis that he was not considered the principal carer of the Child at that time.
[18] Exhibit 7, Secretary’s Statement of Facts, Issues & Contentions received by the Tribunal on 19 December 2019.
The Respondent contended that what was clear after hearing the evidence of the Applicant and Other Party was that the evidence is not clear in terms of their earning capacity and what cash transactions were taking place around the relevant time. Further both parties have properties with equity attached however there is limited evidence as to how the mortgages of those properties are paid. The education and work experience of the parties are comparable. It is unclear whether the Applicant would be entitled to PP single given his earning capacity as at 2018.
The Respondent contended that the Tribunal may be persuaded to affirm the decision under review as if it was set aside then the Other Party would incur a substantial overpayment.
CONSIDERATION
As the Parents shared equal care of the Child at the time when the Applicant made his claim for PP and only one parent can be considered the primary carer of a child for the purposes of eligibility to receive PP, the Tribunal must consider which of the parents is most in need of a favourable determination.
The Tribunal is guided by the observations of Deputy President Wright QC in Smedley and Secretary, Department of Education, Employment & Workplace Relations and Beveridge [2010] AATA 292 at [6]:
Within the statutory scheme and the present policy the relevant “need” relates to the financial capacity of the relevant parent to cope with the costs, both direct and indirect of providing food, clothing and shelter and mental, physical, social and cultural nourishment of the relevant child within the family environment in which that child finds itself during its period(s) of care by that parent. Accordingly, it is plain that a determination in this case must depend on factors and considerations over and above a simple assessment of which of the competing parties has the higher and more dependable source of income or assets of the greater value.
At the outset of the Hearing the Tribunal outlined its concerns in relation to the evidence that was before it with particular reference to the Parents financial situation in the period around August 2018. The evidence showed expenses that far exceeded disclosed income and provided references to both the Parents having engaged in businesses both during and after their marriage that operated on at least a semi cash basis – this being income that did not appear to be disclosed for income tax reporting or for social security benefit claim purposes.
The Tribunal considers that both the Applicant and Other Party gave evidence at Hearing that directly conflicted with the documentary evidence before the Tribunal, at times with evidence they had given earlier to the Tribunal and with the evidence provided by each other. While the Applicant was more fore coming with providing details addressing the factors set out in the Guide to determine which parent should be considered the primary carer of the Child and in providing details of his financial situation, overall the picture that was painted did not provide what the Tribunal considers to be a clear view of his true financial situation.
The Tribunal considers that the Other Party evaded answering the questions it put to her at Hearing especially in relation to her financial situation and work capacity. She at times was unwilling to engage in discussion of her circumstances, sought to rely on having provided evidence in relation to her Family Court matters and was unable to explain or provide evidence in support of the assertions she was making about either her or the Applicant’s situation.
The Tribunal notes that the Other Party provided further material after the Hearing which as a whole was either irrelevant or deepened the concerns of the Tribunal in relation to the uncertainty regarding the Other Party’s real income and access to financial support. The Applicant also provided further submissions which overall were consistent with those he made prior to and at Hearing.
For the reasons outlined above the Tribunal considers it appropriate to have regard to the Equal Care factors set out in the Guide at 1.1.P.416 and take them into account in determining which parent was, at August 2018, in most need of a favourable determination.
As such the Tribunal considers that based on the evidence before it, both the Applicant and Other Party shared equal care of the Child, who was a PP Child for the purposes of the Act and as such both could be considered the principal carer of the Child.
While there is no evidence before the Tribunal in relation to whether the Applicant or Other Party would have received a higher rate of PP, based on the Applicant’s income at the time, it may be possible that his rate of PP would have been zero or it is at least likely that it would have been lower than that of the Other Party when considering her reported income.
In considering the sources of income, being actual or potential of the Applicant and Other Party the evidence placed before the Tribunal does not provide a clear picture of the actual or potential sources of income of either the Applicant or the Other Party. Both the Applicant and Other Party source income from their own businesses, including cash income which does not appear to be disclosed in their reported income as well as access to financial support from their families.
The expenses outlined by both the Applicant and Other Party far exceed what they say their income was. There is no evidence before the Tribunal in relation to any arrangements in place between the Applicant and his parents and brother or the Other Party and her mother and sister in relation to financial support they say is being provided by way of loans. It is difficult to see how the level of financial support that the Applicant and Other Party say they have been and continue to be provided are loans. Both the Applicant and Other Party outline difficulties in future employment hence making future repayment of this assistance seem fanciful.
Despite the reported financial situations, there is no evidence before the Tribunal that either the Applicant or Other Party were not able to meet their financial commitments in relation to their mortgages, utilities, company running costs or provision of support and care for the Child at any time.
Both the Applicant and Other Party have assets in the way of property which had equity available to them in August 2018.
After hearing the evidence at Hearing of both the Applicant and Other Party and considering the documentary evidence before it, it is not clear to the Tribunal what the true financial situation is of either of the Parents.
Based on the evidence before the Tribunal it considers that the workforce experience and education level of the Applicant and Other Party are similar as are their future employment prospects.
The Other Party has been in receipt of the PP since 2016 with minimal other reported income, allegedly relying upon the PP as her primary source of income. In the period leading up to making his claim for PP and for the immediate period thereafter the Applicant was not in receipt of an income support payment.
The Tribunal considers that based on the information before it the circumstances of the Applicant and Other Party at the relevant time being August 2018 were not all that different. This finding is not inconsistent with the evidence of the Applicant.
Section 5(18) of the Act clearly provides that a child can only have one principal carer at a time. In situations where there are no substantial differences between the parties, the Guide provides that generally the determination which should be favoured is that which maintains the ‘status quo’.
For the reasons set out above, given the paucity of the evidence before the Tribunal there is no clear picture or clear evidence that leads the Tribunal to being able to clearly distinguish between which parent is more in need of a favourable determination. Both Parents despite the disclosed discrepancies in the shortfall between their income and expenses always appear to have been able to meet their financial commitments while also providing for the needs of the Child when in their care. Consequently, the Tribunal considers there is no basis to make a determination that does not maintain the status quo.
The Tribunal acknowledges the Applicant’s submission that where the Parents circumstances are similar that the PP should be paid on an alternative year basis to each of the parents. This proposition however is not a matter for this Tribunal to consider, noting that the Applicant is able to test his eligibility for the PP at any stage.
DECISION
The Tribunal affirms the decision under review.
I certify that the preceding 49 (forty-nine) paragraphs are a true copy of the reasons for the decision herein of Member Mitchell
.................................[SGD].......................................
Associate
Dated: 19 June 2020
Date(s) of hearing: 12 March 2020 Applicant: In person Advocate for the Respondent: Jasmine Forsyth Solicitors for the Respondent: Mills Oakley Lawyers Other Party: In person
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