Heuer and Secretary, Department of Family and Community Services

[2002] AATA 797

DECISION AND REASONS FOR DECISION [2002] AATA 797

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2002/481

GENERAL ADMINISTRATIVE DIVISION          )          
           Re      NEIL HEUER          
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES        
  Respondent

DECISION

Tribunal       Dr E K Christie, Member   

Date4 September 2002 

PlaceBrisbane

Decision      The decision under review is affirmed.  This means Mr Heuer's application for review is unsuccessful.     

(Sgd) Dr E K Christie
  Member
CATCHWORDS
SOCIAL SECURITY – disability support pension – commencement date for payment of entitlement – legislative change – superannuation and assets test

Social Security (Administration) Act 1999 ss 11,13, 16
Act of Grace Payments
Scheme for Compensation for Detriment Caused by Defective Administration

Freeman v Secretary, Department of Social Security (1988) 87 ALR 506

WRITTEN REASONS FOR ORAL DECISION

13 September 2002    Dr E K Christie, Member               

1. This is an application by Neil Heuer for a review of a decision made by the Social Security Appeals Tribunal ("the SSAT") on 8 May 2002 that the commencement date from which Mr Heuer could be paid disability support pension ("DSP") was 14 January 2002.  As a consequence, Mr Heuer was not entitled to the payment of arrears of DSP over the period 1 July 2001 to 13 January 2002.

2. The Tribunal had in evidence before it documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (the "T" Documents) (Exhibit 1) and the following exhibit:

• Exhibit 2: Letter from the Minister for Family and Community Services (Senator Vanstone) to Cameron Thompson MP (5 June 2002).

1. Mr Heuer represented himself at the hearing.  The Department was represented by Mr S Letch, a Departmental advocate.
   Issues to be Decided

2. The only issue for the Tribunal to decide was the commencement date for payment of Mr Heuer's DSP entitlement following legislative changes introduced on 1 July 2001.  In turn, whether Mr Heuer was entitled to payment of arrears in DSP allowed over the period 1 July 2001 to 13 January 2002.
   Facts

3. The general facts were not in dispute and may be stated briefly.  Mr Heuer was granted DSP in March 1996.

4. On 25 December 1997, his DSP was cancelled following a legislative change which resulted in superannuation being included in the assets test for DSP entitlements.

5. On 1 July 2001, a further legislative change was made that meant superannuation was no longer included as part of the assets test for DSP entitlements.  Mr Heuer would have then been entitled to DSP from this date.  However, he did not make an application for DSP until 14 January 2002.

6. Mr Heuer now seeks arrears of DSP payment for the period 1 July 2001 to 13 January 2002.
   Evidence of Neil Heuer

7. Mr Heuer said that from 25 December 1997 to 14 January 2002 he had to survive on his superannuation as he had no other source of income.  His superannuation had now been significantly reduced.

8. Mr Heuer said that his pension had been "stopped" (see T6 folio 26-28) not "cancelled".  He believed that this meant his payment had only ended temporarily in December 1997.

9. Mr Heuer said that he had maintained regular contact with his Centrelink office from 25 December 1997 to 14 January 2002.  He said that he had enquired about his eligibility for entitlements, generally, and the Health Card specifically, on two or probably three occasions, from December 1997 to January 2002.  However, at no time, until January 2002, was he ever advised by Centrelink staff, in response to his queries, that he was entitled to DSP following the changes to legislation in July 2001.  Up until January 2002, he was completely unaware of the changes in legislation and his entitlement to DSP. 

10. Mr Heuer said that he had hoped he would have been "tagged" by Centrelink following his DSP being cancelled and advised of any legislative change by Centrelink that might affect his eligibility.  However, this was not the case - notwithstanding that he had maintained regular contact with Centrelink from the time his DSP was cancelled.

11. Mr Heuer said that he had been advised by a Centrelink staffer, who he believed may have been an authorised officer, that he would not be entitled to arrears payments because there had been no negligence on the part of Centrelink.

12. Mr Heuer referred the Tribunal to the following statement by the Minister (Senator Vanstone) to his local MP (Exhibit 2);

    "In his letter to you, Mr Heuer refers to the 2001 Federal Budget initiative to exempt superannuation assets held by customers between 55 and Age Pension age from the social security means test from 1 July 2001.  It is unfortunate that Mr Heuer did not become aware of this initiative until January 2002.  However, in the period leading up to its introduction, a number of strategies were used to promote this initiative.  These strategies included extensive advertising on radio and in print.  The initiative was also extensively promoted in information supplied by Centrelink to customers."

1. Mr Heuer contended that this was not the case in his situation when he raised queries with Centrelink on a regular basis.  He said that he felt he was "let down" by Centrelink staff as he had never received any information from them on the legislative change and his eligibility for DSP.  He felt let down because he had maintained contact with Centrelink over time.  Moreover, he submitted that he should be entitled to payment of arrears given the circumstances that he was not paid and the beneficial effect of the legislation.  Finally, Mr Heuer stated that his residential address had remained the same from the time his DSP was cancelled.
   The Department's Submissions

2. Mr Letch contends that Mr Heuer's DSP was correctly cancelled in 1997 and that his payments with respect to his claim lodged on 25 January 2002 could not be backdated prior to 14 January 2002.

3. Mr Letch submitted that Mr Heuer's entitlements to DSP ceased in 1997 as his assets exceeded the allowable limits.  Mr Heuer was notified of the cessation of his payments on 16 December 1997.

4. To re-commence his entitlement to DSP following a loss of entitlement, Mr Heuer was required to lodge a new claim.  Mr Letch stated that a social security payment, unless provided otherwise, became payable on the person's "start day".  As Mr Heuer had lodged his claim on 25 January 2002, his "start date" was this day.

5. Mr Letch stated that section 42 of the Social Security (Administration) Act 1999 provides that a person's "start day" was to be worked out by reference to Schedule 2. In the ordinary course, clause 3 in Schedule 2 provides that a person's start day was the day on which a claim was made. However, this general rule was subject to some exceptions. The only exception relevant to Mr Heuer's case was section 13 which provided for a "deemed claim" where a person telephoned Centrelink intending to claim and then lodged a claim within 14 days.  Mr Heuer had contacted Centrelink by telephone on 14 January 2002, and given his claim was lodged within the allowable 14 day period, his "start day" was held to be 14 January 2002.

6. Mr Letch stated that he was unaware whether a database had been kept of people whose DSP had been cancelled following legislative change in 1997.

7. Mr Letch concluded with the submission that Mr Heuer's position was unfortunate.  The relevant legislation and case law could not be applied in any other way than to establish the commencement date of his DSP as 14 January 2002 and so deny him payment of DSP arrears from 1 July 2001 to 13 January 2002.
   Consideration of the Issues

8. The objective of the Tribunal is to review administrative decisions, not only on their merits, but in accordance with the law at all times.  The relevant legislation is the Social Security (Administration) Act 1999 ("the Act").

9. The first matter for the Tribunal to decide is the credibility of Mr Heuer as a witness.  The Tribunal finds Mr Heuer to be an honest witness who had dealt consistently with Centrelink over time in seeking advice on social security entitlement issues.

10. The Tribunal next considers the relevant provisions of the Act to Mr Heuer's factual circumstances.

11. Section 11 requires a person who wants to be granted a DSP payment to make a claim for payment. Section 16 requires the claim to be lodged in writing and then delivered to an approved person or place. Mr Heuer's written claim was lodged with the Centrelink office at Ipswich on 25 January 2002 (T7).

12. Section 41(1) of the Act provides that a payment becomes payable on a person's start day.

13. Section 42 provides that a person's "start day" is worked out by reference to the rules set out in Schedule 2 of the Act. Clause 3 of this Schedule is relevant in Mr Heuer's circumstances:

    "Start day – general rule
    3(1) If:

    (a)a person makes a claim for a social security payment; and

    (b)the person is qualified for the payment on the day on which the claim is made;

    the person's start day in relation to the payment is the day on which the claim is made."

In this case, Heuer actually lodged his claim on 25 January 2002.  If the ordinary rules were to apply, Mr Heuer's "start day" would be the 25 January 2002.

1. However, section 13(1) of the Act operates to provide an exception to enable this date to be varied, provided all the provisions of this section are satisfied. In Mr Heuer's case, by telephoning Centrelink on 14 January 2002, and meeting all the other requirements of this section, section 13(1) could be applied to vary the commencement date to be the day on which Centrelink was contacted (14 January 2002).

2. Finally, the Tribunal considers the common law relevant to the facts of this application for review.  In Freeman v Secretary, Department of Social Security (1988) 87 ALR 506, Davies J stated (at p 509):

   "…However, if the Tribunal comes to the view that the decision to cancel was the correct or preferable decision, then no further matter remains for the Tribunal's consideration.  Any entitlement of the applicant to a pension or benefit at a subsequent time must be the subject of a further claim which, having been made, would only become the subject of review within the Tribunal's jurisdiction once a decision with respect to it had been made by an officer of the Department of Social Security and that decision had been the subject of appeal and reconsideration in accordance with s 19."

1. The Tribunal concludes that the decision to cancel Mr Heuer's DSP in 1997 was correct.  As a result Mr Heuer would be required to make a further application for entitlements at a subsequent time.  This was not done until the deemed date of 14 January 2002.

2. The Tribunal has carefully considered the application of the legislation and case law to all of the facts before the Tribunal and concludes that the effect of section 13(1) and Freeman's case is that, as Mr Heuer first contacted Centrelink on the 14 January 2002, his "start day" will be taken to be the 14 January 2002 because he actually lodged his claim within 14 days of first making contact.  Accordingly, Mr Heuer is entitled to be paid disability support pension on and from 14 January 2002 only.  His previous payments had been effectively cancelled and in order to be paid again, he needed to lodge a new claim.  Mr Heuer is not entitled to arrears payments under the legislation.

3. The Tribunal next considers the possible application of Departmental Policies to Mr Heuer's factual situation with respect to the payment of DSP arrears over the period 1 July 2001 to 13 January 2002.  Specifically:  Act of Grace Payments and The Scheme for Compensation for Detriment Caused by Defective Administration ("Defective Administration Policy").

4. The Tribunal concludes that in Mr Heuer's factual situation (see paras 9-15) a number of facts have contributed to his being unaware of the changes in legislation introduced in 1 July 2001 and his entitlement to lodge a new claim for DSP:

   (a)the failure of Centrelink staff to advise him, or to provide him with information on legislative changes – given that he had raised queries with them on a continuing basis from December 1997 to January 2002.  This failure by Centrelink is inconsistent with the statement of Senator Vanstone for Centrelink to promote information on the initiative to customers (see para 14); and

   (b)Mr Letch's submissions indicating that he was unaware whether Centrelink had made or maintained a database of cancelled SDP recipients after the 1997 legislative change (para 20). 

1. Mr Heuer's circumstances were unusual in that over the period 1997 to 2001 his DSP entitlement was cancelled, then enlivened, through legislative changes to the way superannuation was treated as an asset for social security entitlements.

2. The Tribunal considers that in Mr Heuer's factual circumstances, the factors in paras 33, 34 were out of his control.  Because of his reliance on information from advice and information in response to queries that he made with Centrelink, the eventual situation was that he only became aware of his rights to a DSP entitlement in January 2002 – some six months after the legislative change.  Whilst, the legislation [the Social Security (Administration) Act] does not give the Tribunal any discretion to apply these findings in the Tribunal's decision-making powers, they may have application under Departmental Policies.  Application of the Departmental Policies is solely a matter for Mr Heuer and the Department.

3. The Tribunal considers that applying the conclusions in paras 33 and 34, in the context of the criteria provided for in the Act of Grace Policy, the decision under the Social Security (Administration) Act is one that could be seen as "unintended' or "unjust".

4. Accordingly, the Act of Grace Policy may well provide an avenue for Mr Heuer to now pursue with the Department, with respect to recovery of the DSP arrears accrued over the period 1 July 2001 to 13 January 2002.

5. Furthermore, Mr Heuer may wish to pursue an initial claim with the Department under the Defective Administration Policy.  The Tribunal considers that the Tribunal's conclusions (in paras 33 and 34) may be applicable to the following criteria:

   "an unreasonable failure to give to (or for) a claimant, the proper advice that was within the official's power and knowledge to give (or was reasonably capable of being obtained by the official to give)."

1. For all of the above reasons, the Tribunal affirms the decision under review.

   I certify that the 39 preceding paragraphs are a true copy of the reasons for the decision herein of Dr E K Christie, Member

   Signed:         .....................................................................................
     S Oliver
     Associate

   Date of Hearing  4 September 2002
   Date of Decision  4 September 2002
   Date of Written Reasons         13 September 2002

   The Applicant Appeared in Person
   For the Respondent                 Mr S Letch, Departmental Advocate