Hoang and Department of Family and Community Services - [2001] AATA 597

DECISION AND REASONS FOR DECISION [2001] AATA 597

ADMINISTRATIVE APPEALS TRIBUNAL )

) No V2000/1070

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

DECISION

Tribunal Mr J. T. C. Brassil, AM, Member

Date28 June 2001
PlaceMelbourne

Decision The Tribunal decides to set aside the reviewable decision.

..........(Sgd) J. T. C. Brassil...........
Member
CATCHWORDS
SOCIAL SECURITY – newstart allowance – newstart activity agreement – unreasonably delaying – mental element – activity test breach rate reduction period – timeliness in decision-making – decision set aside
Social Security Act 1991 ss 605(1), (2) and (3), 607(1) and (2), 625(1) and (1A), 644AE(1), 644AA
Re Wan and Secretary, Department of Social Security 30 ALD 899
Re Bartlett and Secretary, Department of Social Security 33 ALD 661
Re Browne and Secretary, Department of Employment, Education, Training and Youth Affairs 45 ALD 329
Re Geeves and Secretary, Department of Social Security 41 ALD 467

REASONS FOR DECISION

28 June 2001 Mr J. T. C. Brassil, AM, Member

This is an application for review of a decision made by a Centrelink officer on 27 April 2000 to apply a 24% activity test breach rate reduction period to the applicant's newstart allowance from that date until 25 October 2000. The decision was affirmed by an authorised review officer on 9 May 2000 and by the Social Security Appeals Tribunal (SSAT) on 6 July 2000.
The applicant was present at the hearing on 18 January 2001. The respondent was represented by departmental advocate Mr Pat Carson.
Documents submitted pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 ("the T docs") were taken into evidence. Evidence was given by Ms Clare Bailey of employment provider WISE.
Facts
The applicant claimed newstart allowance (NSA) in December 1998 and was advised of the grant of NSA on 11 January 1999 (T5).
He failed to attend two seminars (T6, T11) and as a result his NSA was suspended in February 1999 and then cancelled in March 1999 (T7, T12).
In May 1999 he was warned (T19) about late lodgement of forms.
In September 1999 his NSA was suspended (T25) and a rate reduction of 18% was imposed following a breach (T22).
During this period he had been assigned to the job service provider WISE at its Camberwell branch.
On 8 December 1999 he was requested in writing (T35) to attend an interview scheduled for 5 January 2000 in order to negotiate a Newstart Activity Agreement (NAA).
The applicant failed to lodge an application form on time in December 1999 and consequently his NSA was cancelled (T37).
The applicant failed to attend the 5 January interview to negotiate a new NAA (T39, T43) but attended the next day in the morning ready to be interviewed. He was re-scheduled for 20 January but later, on the request of the applicant, it was set down for 12 January 2000.
On 12 January 2000 he attended and signed the NAA.
The applicant subsequently failed to attend an appointment scheduled for 14 February 2000 and he failed to respond to attempts to contact him during March 2000 (T43).
A decision was taken to apply an activity test breach and the applicant was advised of the possibility of this on 5 April 2000 (T45) and formally of the decision on 27 April 2000 (T47).
During 1999 the applicant was enrolled in a Bachelor of Commerce course attendance at which was a requirement of his NAA. He had enrolled full-time in the first semester but failed all his subjects.
He did not attend classes in the second semester and was required to attend the University progress committee to discuss his future enrolment.
Legislation
The legislative provisions of the Social Security Act 1991 ("the Act") which require a recipient of an NSA to enter into an NAA are as follows:
"605(1)     Subject to this section, if a person has made a claim for, or who is in receipt of, a newstart allowance is not a party to a Newstart Activity Agreement, the Secretary may require the person to enter into such an agreement.
605(2)     Subject to this section, the Secretary may require a person who has entered into a Newstart Activity Agreement to enter into another such agreement instead of the existing one.
605(3)     The Secretary is to give a person who is required to enter into a Newstart Activity Agreement notice of:
(a)       the requirement; and
(b)       the places and times the agreement is to be negotiated."
Provisions of the Act which regulate the negotiation of an NAA are as follows:
"607(1)     If:
(a)a person has been given notice under subsection 605 (3) of a requirement to enter into a Newstart Activity Agreement; and
(b)because the person did not:
(i)        attend the negotiation of the agreement; or
(ii)       respond to correspondence about the agreement; or
(iii)       agree to terms of the agreement proposed by the Secretary;
or for any other reason, the Secretary is satisfied that the person is unreasonably delaying entering into the agreement;
then:
(c)the Secretary may give the person notice that the person is being taken to have failed to enter the agreement; and
(d)if the notice is given – the person is taken to have so failed.
607(2)     A notice under paragraph (1)(c) must:
(a)be in writing; and
(b)set out the reasons to give notice; and
(c)include a statement describing the rights of the person to apply for the review of the decision."
The penalty for a person who has failed to enter into an NAA after being required to do so is set out in section 625 as follows:
"625(1) Subject to subsection (2), if:
(a)a person is required to enter into a Newstart Activity Agreement in order to qualify, or to continue to qualify, for a newstart allowance; and
(b)the person fails to enter into a Newstart Activity Agreement (the failure);
a newstart allowance is not payable to the person because of the failure.
625(1A) If a newstart allowance becomes payable to the person after the time if ceases to be payable under subsection (1), then:
(a)if the failure is the person's first or second activity test breach in the 2 years immediately before the day after the failure – an activity test breach rate reduction period applies to the person; or
(b)if the failure is the person's third or subsequent activity test breach in the 2 years immediately before the day after the breach – an activity test non-payment period applies to the person."
The period of rate reduction is found in section 644AA as 26 weeks and the reduction rate is found in subsection 644AE(2) as 18% for a first breach and 24% for a second breach.
Issues before the Tribunal
The Tribunal must decide whether in the circumstances of the case a decision that the applicant had unreasonably delayed to enter into a new NAA is warranted. If this is so determined then the consequences of penalty will follow.
Evidence
Evidence was given by Ms Clare Bailey of the Camberwell branch of WISE (the applicant's job service provider) that in the period she had been in contact with the applicant he appeared to be uncertain about his direction.
Her first contact with the applicant was on 8 October 1999 after some previous failures to attend. It had been a long interview and she had concluded that he was being unrealistic about finding work and, in particular, he was not facing the reality of finding work of the kind he wanted. She stated that an NAA is always discussed but not necessarily entered into at the first interview.
She had recorded (T43, page 120) his lateness for subsequent scheduled interviews. He had arrived at 2.50 p.m. for his 10.30 a.m. appointment on 11 November 2000. He explained that he has slept in and she had noted he was on medication and found it difficult to wake early.
She stated that the decision to "breach" the applicant was not made until the end of March after repeated failures to attend or to respond. It was decided to "breach" in respect of the failure to attend on 5 January 2000 because there was clear evidence in the "mailhouse" letter that the applicant had been notified of the requirement to attend (T43, page 122).
The applicant stated he had been very concerned that he had not been passed in the subjects attempted in semester one at Monash University in 1999 and this resulted in much stress. His first priority was to resolve the problems he had with the University and get its agreement that he could continue his enrolment.
He stated that if he could not sort out his problems with his enrolment he could not graduate and WISE would not be able to assist him. He said his mind was focussed on the re-enrolment at the University. These academic matters were at the forefront of his mind and he tended to forget less important matters.
He claimed that he had to meet with the progress committee at the University on 5 January 2000 and because this was such a priority he attended there. On return from the University he realised he had missed the interview at WISE so he presented himself at their office the next morning to apologise. He asked for an interview that day but they were too busy to see him then.
The next scheduled interview was set down for 12 January 2000 although a later one was at first proposed.
At this interview he had signed the NAA (T43, page 123). The terms of the NAA were as follows:
"J01ON REQUEST attend and fully participate in job search interview with provider
T02By 24 November 2000 accept an offer, participate fully and complete BACHELOR OF COMMERCE with MONASH UNIVERSITY"
He stated that in all the correspondence he had received there seemed to be flexibility about interview times. He had never been warned that failure to attend would result in cancellation of his NSA or other penalty.
Submissions
Mr Carson submitted on behalf of the respondent that it was appropriate for the Secretary to require the applicant to enter into an NSA and he was given the proper notice including the place and time scheduled (T35). This was done after lapses by the applicant over a four-month period, from August 2000.
It was the respondent's submission that having received the notice under subsection 605(3) the applicant did not attend on 5 January 2000 nor did he respond to correspondence about the agreement. In the circumstances the respondent was satisfied that the applicant had "unreasonably delayed" entering into the NSA and he had proceeded to give him notice (T46) that he was taken to have failed to enter into the NSA.
In the circumstances he submitted that subsection 625(1A) of the Act applied and a rate reduction calculated in accordance with section 644AA and section 644AE applied. Further on 27 April 2000 pursuant to subsection 644AB(1) of the Act, the applicant was given written notice of the commencement of the activity test breach rate reduction period.
He submitted that there were precedents in ReWan and Secretary, Department of Social Security, 30 ALD 899, ("Wan"), and ReBartlett and Secretary, Department of Social Security, 33 ALD 661, ("Bartlett"), for strict compliance to the notice requirements if a penalty was possible and this had been done in this matter.
Mr Carson submitted that the Tribunal should follow the decision in respect of "unreasonably delaying" found in Re Browne and Secretary, Department of Employment, Education, Training and Youth Affairs, 45 ALD 329. While this referred to the provisions of the old Act it related directly to the issue in this matter.
For these reasons he submitted that the SSAT decision made on 6 July 2000 was correct and the reviewable decision should be affirmed.
The applicant submitted that the primary issue for him in the latter part of 1999 was his enrolment after he had been failed in the first semester. This was of concern to WISE also as the NAA which he was requested to sign was about his course at the Monash University. Until he had sorted out his enrolment he could not sign the NAA.
Further, after the first breach although he asked for a review (T 26, page 85) and gave an explanation he did not appeal further because he could only deal with one problem at a time and he felt he had to give priority to his enrolment.
He submitted that the second breach was very harsh in view of the fact that the actual delay in signing the NAA was only 7 days.
On 5 January 2000 he had to attend the progress committee at the University to persuade them to allow his 2000 enrolment. He submitted that this was vital to him and a necessary action prior to signing the NAA. When he returned from the University meeting was when he realised he had missed the WISE appointment.
He requested the Tribunal to note that he had attended WISE the next day ready to sign the NAA but they said they could not fit him in until later in January. He had requested an earlier date and Clare Bailey said she would see him the next week, on 12 January 2000.
He submitted that he did attend on 12 January 2000 and signed the NAA presented to him on that day. He said he should not be penalised for any delay as he was present at WISE and prepared to sign the NAA within 24 hours of the scheduled time. Any delay beyond that was caused by WISE and not by him.
Consideration of the Issues
There is quite a deal of evidence that the applicant failed to cooperate with his job search provider, WISE, in the months prior to 5 January 2000 and in the months after that date. But the Tribunal does not have to come to a decision on that issue.
The applicant has been found in breach because he was unreasonably delaying the signing of an NAA in that he did not attend the scheduled interview on 5 January 2000. It is the circumstances of this alleged breach which must be considered.
In regard to that interview the Tribunal is satisfied that the applicant was properly notified in writing of the requirement to sign an NAA and was given appropriate notice of the time and place pursuant to ss 605 (3) of the Act.
The Tribunal is satisfied that, as required by subsection 607(1)(b)(i), he did not attend the negotiation of the agreement on 5 January 2000.
Further the Tribunal is satisfied that when the respondent came to the conclusion that a breach had occurred on 5 January 2000 then the procedural actions taken were in accordance with the provisions of the Act, sufficient to satisfy Wan and Bartlett. The issues of time lapse and lack of precision in such notification will be discussed below.
What the Tribunal must consider is whether that non-attendance is a "failure" to enter into an NAA which would attract certain penalties, such as the activity test breach rate reduction of 24% for 26 weeks, as has been applied by the respondent in this case.
If it can be properly characterised as such a "failure" the Tribunal will be satisfied from the evidence that the respondent has correctly applied the relevant provisions of the Act.
But before deciding this there is a timeliness consideration that should be considered. No action was taken immediately subsequent to the alleged "breach". For almost three months nothing was done. It appears from the evidence that the provider WISE did not decide to recommend breach of the applicant for this second time until late in March. The formal notice was given on 27 April 2000 (T52, page 139).
The notice of possible breach that was given on 5 April 2000 did not mention directly the alleged breach on 5 January 2000 but stated:
"Recent information indicates the you may have failed the Activity Test because (sic) failed to attend Intensive Assistance appointments with WISE Employment Camberwell and failed to contact provider."
The notice on 27 April 2000 stated:
"Your Newstart Allowance has been suspended because you did not attend an interview with a Job Network Member. This is an activity breach. As this is your second activity test breach in the last two years, your rate will be reduced by 24% until 25 October 2000."

This notice did not specify the date of the interview not attended.

In the review undertaken after a request by the applicant there is reference to non-attendance on 5 January and 14 February (T54, page 143). In a file note made by a Centrelink officer (author E7Z) it is recorded that the ARO rang the applicant to respond to his request for appeal information to the SSAT. The note states:
"I explained the 24% breach is because he failed to attend WISE on 5 Jan and did not contact until 6 Jan to reschedule."
This Tribunal notes that the letter to the applicant from the ARO dated 9 May 2000 (T56, pages 147-9) specifies that he does not accept the applicant's explanation about his non-attendance on 5 January 2000 and sets out the basis on his findings which specify the notice given on 8 December 1999 and a copy of the mailhouse register that confirms the letter was posted on that date.
The apparent time lapse between the date of the breach notification, 27 April, and the date of the nominated breach incident, 5 January, was explained to the Tribunal that the 5 January 2000 date was selected as there was clear proof from the mailhouse register of posting of notice of that interview so as to satisfy the provisions of subsection 605(3) of the Act.
It is not necessary for the Tribunal to make a decision about the time delay but the circumstances are open to a conclusion that there was a primary decision to breach and then, to ensure that it would best conform with the requirements of the Act, the interview of 5 January 2000 was selected as the vehicle. If that is a fair assumption, and there was no evidence which would lead to any different conclusion, then it can also be concluded that the action would be contrary to the aims and objects of the Act which are to provide benefits not to impose penalties.
But in this matter the Tribunal is only concerned with the alleged breach on 5 January 2000 and whether this can be properly characterised as a "failure". Did the applicant unreasonably delay?
The applicant did not attend the scheduled interview on 5 January but presented himself the following day giving as his excuse that he had to attend the progress committee concerning his 2000 enrolment at Monash University on the previous day. His understanding was that convincing the progress committee was a necessary step before he could enter into the NAA being presented for him to sign.
In the circumstances it is the view of this Tribunal that, while it would have been more courteous to have contacted WISE prior, he did have a sufficient explanation for his non-attendance. That he presented himself the next day prepared to enter into the NAA does not match the action of an unwilling participant in the process and the Tribunal is not of the mind to conclude he was, at that particular stage at least, unwilling to enter into the agreement.
Deputy President Blow in Re Geeves and Secretary, Department of SocialSecurity, 41 ALD 467, in discussing the issue of unreasonably delaying held that there was a "mental element" involved. This Tribunal adopts this requirement for a finding of "unreasonably delaying" and does not form the view from the evidence that the applicant in respect to his actions relating to the 5 January 2000 interview was unreasonably delaying to enter into the proposed NAA.
Conclusion
The Tribunal finds that in respect to the interview scheduled for 5 January 2000 the applicant could not be found to have been unreasonably delaying to enter into the proposed NAA hence he cannot be held to have failed to enter into an NAA, pursuant to subsection 625(1) of the Act. It follows that the penalties applied should not have been applied.
The Tribunal will set aside the reviewable decision.
I certify that the sixty-three (63) preceding paragraphs are a true copy of the reasons for the decision herein of
Mr J. T. C. Brassil, AM, Member
Signed:         .....................................................................................
  Personal Assistant
Date/s of Hearing  18 January 2001
Date of Decision  28 June 2001
The Applicant  Self-represented
Solicitor for the Respondent    Mr P. Carson, Centrelink