Holbrook and Secretary, Department of Social Services (Social security)

[2024] ARTA 244

Holbrook and Secretary, Department of Social Services (Social security) [2024] ARTA 244 (20 November 2024)

Applicant:  Mr Holbrook

Respondent:  Secretary, Department of Social Services

Chief Executive Centrelink    

Tribunal Number:   2024/B190415 

Tribunal:  Member N Foster

Place:Brisbane

Date:20 November 2024

Decision:The Tribunal affirms the decisions under review.

CATCHWORDS

SOCIAL SECURITY – pensions, benefits and allowances – cancellation – Disability Support Pension – portability period – pension payable outside Australia for 13 weeks – abandonment by wife – parental responsibilities overseas – severity of health issues – return to Australia not possible – no terminal illness – financial hardship – recovery of large debts – decision under review affirmed

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information pursuant to subsection 201(1A) of the Social Security (Administration) Act 1999.

Statement of Reasons

BACKGROUND

1. This review is about whether Mr Holbrook’s disability support pension should be cancelled for being outside Australia and whether he has recoverable debts.

2. Mr Holbrook, who is [age] years old, was granted disability support pension from 5 October 2010.  After Mr Holbrook departed Australia for [Country 1] [in] March 2011, he continued to receive disability support pension, as well as related one-off payments.

3. On 25 March 2024, following an investigation into Mr Holbrook’s residence status, Services Australia (Centrelink) cancelled his disability support pension on the basis that he had not been in Australia since 2011.  On 9 and 15 April 2024, Centrelink also raised the following debts against Mr Holbrook on the basis that he was not entitled to receive payments while outside Australia:

   ·   a disability support pension debt of $301,169.80 for the period 4 June 2011 to 20 March 2024;

   ·   an economic support payment debt of $2,000 for the period 2 April 2020 to 1 March 2021;

   ·   a cost of living payment debt of $250 in respect of a payment made on 28 April 2022; and

   ·   an advance payment debt of $595.60 in respect of an advance of disability support pension that was granted to Mr Holbrook on 1 December 2023.

4. Mr Holbrook requested a review and on 30 May 2024 an authorised review officer affirmed Centrelink’s decisions.  In doing so, the authorised review officer found that, at the time Mr Holbrook departed Australia, disability support pension was only payable overseas for up to 13 weeks.  The authorised review officer also found that Mr Holbrook had recoverable debts due to his failure to advise Centrelink of his overseas absence.

5. Mr Holbrook applied to the Administrative Appeals Tribunal[1] (the AAT) on 15 August 2024.  The application was heard by the Tribunal on 20 November 2024, with Mr Holbrook appearing by telephone from [Country 1].

   [1] From 14 October 2024 the AAT became the Administrative Review Tribunal (the Tribunal). Under the transitional provisions in the Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Act 2024 (the Transitional Act), applications for review to the AAT that were not finalised before 14 October 2024 are taken to be an application for review to the Tribunal. The Transitional Act gives the Tribunal the authority to continue and finalise any aspect of the review not already completed by the AAT.

CONSIDERATION

Should disability support pension have been cancelled?

1. Mr Holbrook told the Tribunal that he travelled to [Country 1] in March 2011 because his [young] son was ill.  He said that he had had no intention of staying long-term in [Country 1]; however, his wife disappeared and left him to look after their son on his own.  He also learnt that the possessions that he left behind in Australia were stolen.  He has remained in [Country 1] ever since to care for his son and he has continued to suffer poor health.  Mr Holbrook contended that, given the severity of his health issues, he should be able to receive disability support pension while overseas and that it was not reasonable for Centrelink to cancel his payments and leave him with nothing to live on.

2. Mr Holbrook emphasised to the Tribunal that he had no idea that he was supposed to notify Centrelink that he was living overseas and that he was unaware that disability support pension was only payable outside Australia for 13 weeks.  He denied concealing his situation from Centrelink and queried why Centrelink, with all its special powers, did not realise earlier that he was overseas and should not be getting paid.  Mr Holbrook noted that there was the capacity under the law for a severely disabled pensioner to be paid overseas indefinitely, which he said should happen in his case.  He also lamented the unfairness that disability support pension is payable overseas under various international social security agreements but not where a person travels to [Country 1].

3. Mr Holbrook urged the Tribunal to take a compassionate approach in his case and to reinstate his disability support pension.  He said that it would be a death sentence if his pension was cancelled and that he was not well enough to return to Australia.  He noted that Centrelink had previously reinstated his pension for a period of time after he requested a review and said that he was seeking for a similar payment arrangement going forward so that he could continue to look after his son in [Country 1]. 

4. In written submissions provided to the Tribunal prior to the hearing, Mr Holbrook outlined a range of matters similar to those raised at the hearing.  In particular, he stated that he had originally intended to return to Australia but had had no choice but to remain in [Country 1] after, firstly, all of his possessions in Australia had been confiscated by his landlord and, secondly, his [Country 1] wife disappeared and left him to look after their young son on his own.  Mr Holbrook also stated that he would die if his disability support pension was cancelled and contended that his pension should be indefinitely portable due to his serious medical impairment and his inability to work. 

10.In making its decision, the Tribunal must apply the relevant law, which is contained in the Social Security (Administration) Act 1999 (the Administration Act) and the Social Security Act 1991 (the SS Act). Under section 80 of the Administration Act, Centrelink may cancel a person’s social security payment if satisfied that the payment is not payable. Chapter 4 of the SS Act sets out the circumstances in which a social security payment is payable to a person who is outside Australia. In particular, under section 1217 of the SS Act, disability support pension is generally only portable – i.e. payable overseas – for a limited period of time. When Mr Holbrook departed Australia in March 2011, section 1217 provided that disability support pension was portable for a temporary absence of up to 13 weeks. Under section 1218 of the SS Act, disability support pension could also be portable indefinitely where a person was terminally ill.

1. In Mr Holbrook’s case, he departed Australia [in] March 2011 and he has remained in [Country 1] ever since. In accordance with section 1217 of the SS Act, Centrelink has determined that disability support pension remained payable to Mr Holbrook outside Australia for 13 weeks and that it then ceased to be payable with effect from 4 June 2011. After belatedly becoming aware of Mr Holbrook’s absence from Australia, Centrelink retrospectively cancelled his pension in 2024 with effect from 4 June 2011.

2. In contesting this decision, Mr Holbrook has urged the Tribunal to take a compassionate approach in light of his health issues, his reasons for being outside Australia and his inability to support himself without any disability support pension. While recognising why Mr Holbrook would like his pension reinstated, the Tribunal must apply the law and cannot determine that disability support pension remains payable to him if the law states that it is not. Given that Mr Holbrook has been outside of Australia for more than 13 weeks, the Tribunal finds that his disability support pension ceased to be portable under section 1217 of the SS Act, and therefore was no longer payable, from 4 June 2011.

13.As Mr Holbrook was not terminally ill when he departed Australia in March 2011, his pension was not indefinitely portable under section 1218 of the SS Act. The Tribunal observes that Mr Holbrook’s contention that his disability support pension should be indefinitely portable on medical grounds is a reference to the current section 1218AAA of the SS Act. Under subsection 1218AAA(1), a written determination may be made that disability support pension is portable for an indefinite period if the decision-maker is satisfied that the pension recipient will have a severe impairment for at least the next five years and the impairment will prevent the person from performing any work independently of a program of support within that period. Under subsection 1218AAA(2) of the SS Act, a determination about unlimited portability cannot be made in relation to a person who is outside Australia, unless the person is unable to return because of a serious accident or hospitalisation that occurred before the end of their portability period.

14.As discussed with Mr Holbrook at the hearing, there are two obvious bars to a determination being made under section 1218AAA of the SS Act in his case. Firstly, section 1218AAA – which was introduced into the SS Act with effect from 1 July 2012 – did not exist when he departed Australia in March 2011. As such, his disability support pension was not indefinitely portable on medical grounds under the law at the time that he left Australia or when his 13-week portability period expired in June 2011. Secondly, even now, a determination under section 1218AAA of the SS Act cannot be made in relation to a person who is outside Australia, except in circumstances that are not relevant in Mr Holbrook’s case. Accordingly, the Tribunal finds that Mr Holbrook’s disability support pension is not indefinitely portable under section 1218AAA.

15.More generally, the Tribunal notes that there is no scope under either the SS Act or the Administration Act to continue to pay disability support pension to a person overseas in special or extenuating circumstances. While Centrelink recently reinstated Mr Holbrook’s disability support pension under the payment pending review provisions in Part 4A of the Administration Act, the Tribunal’s role is to review the correctness of the underlying cancellation decision. As the Tribunal is satisfied that disability support pension was no longer payable to Mr Holbrook from 4 June 2011, the Tribunal concludes that Centrelink’s decision to cancel his pension from that date is correct and that his pension payments must therefore cease.

Are there recoverable debts?

1. As well as the cancellation of his disability support pension, Mr Holbrook took issue with Centrelink’s decision to raise and recover various large debts.  In doing so, he denied ever misleading Centrelink about his circumstances or concealing the fact that he was in [Country 1].  He said that he did not notify Centrelink that he was living in [Country 1] because he was never asked and he never knew he had to advise it.  He contended that Centrelink should have realised there was a problem much earlier given that it is supposedly able to check everything and he was not using Medicare and was accessing his bank account from [Country 1].  He said that he has no money now that his pension has been cancelled and has no way of ever repaying the large sums that Centrelink is seeking.  He lives with his son, who is now [age] years old and is attending high school.  Mr Holbrook said that his health remains poor and that he is just trying to stay alive.  He said that he is “lost” now that his pension has stopped and that he does not understand why someone will not take a compassionate look at his situation.

17.In his written submissions, Mr Holbrook similarly contended that he had acted in good faith and that he did not know or understand that he was supposed to advise Centrelink that he was overseas.  He also queried why Centrelink did not detect that he was overseas at a point earlier than 2024.  In addition, he outlined his various health issues and provided photographs and medical documents as supporting evidence.  He also emphasised that he had no money or income or assets and no way of repaying the large sums sought by the Commonwealth.  In an accompanying Statement of Financial Circumstances dated 5 November 2024, Mr Holbrook likewise indicated that he had little in the way of available funds and described his current financial situation as dire.

1. The relevant debt recovery provisions are contained in Chapter 5 of the SS Act. Where a person has been paid social security payments that they were not entitled to receive, the overpayment is a debt due to the Commonwealth under section 1223. As set out in the hearing papers, Mr Holbrook continued to be paid disability support pension, as well as one-off amounts of economic support payment and cost of living payment, after his entitlement to receive social security payments outside Australia ceased in June 2011. The Tribunal is satisfied that Mr Holbrook was not entitled to those payments and that he has debts of disability support pension, economic support payment and cost of living payment under section 1223 of the SS Act in the amounts calculated by Centrelink.

2. Where a person has not repaid an advance payment of a social security entitlement when their entitlement ceases, the amount that has not been repaid is a debt due to the Commonwealth under section 1224E of the SS Act. When Centrelink cancelled Mr Holbrook’s disability support pension, there was an outstanding amount of $595.60 that he was yet to repay in relation to an advance payment granted in December 2023. The Tribunal finds that this amount is a debt to the Commonwealth under section 1224E.

3. In determining whether these debts should be recovered, the Tribunal notes that the SS Act allows for waiver – or permanent non-recovery – in certain, limited situations. In particular, section 1237AAD of the SS Act provides for waiver in special circumstances as follows:

   Waiver in special circumstances

   The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

    (a)  the debt did not result wholly or partly from the debtor or another person knowingly:

   (i)  making a false statement or a false representation; or

   (ii) failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and

   (b)  there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

   (c)  it is more appropriate to waive than to write off the debt or part of the debt.

4. As can be seen, the existence of special circumstances is not the sole requirement for waiver under this section. As is made clear by paragraph 1237AAD(a), the debt must not have resulted, either wholly or partly, from a person knowingly making a false statement or knowingly failing to comply with their statutory notification obligations. According to the case law, the term “knowingly” requires a person to have had actual knowledge that they were making a false statement or were failing to comply with their notification requirements; it is not necessary, however, for the person to have been acting fraudulently – see Re Callaghan and Secretary, DSS (1996) 45 ALD 435.

5. In Mr Holbrook’s case, his debts arose because he has been outside Australia since March 2011 and Centrelink did not become aware of this state of affairs until recently.  As set out in the hearing papers, Centrelink sent Mr Holbrook numerous letters over the last 13 years that set out his notification obligations as a recipient of disability support pension.  In particular, the initial grant letter sent to Mr Holbrook on 19 October 2022 – and multiple, subsequent pension letters – included the following information:

   If you are planning to travel outside Australia

   If you or dependent children decide to leave Australia even for a holiday or short visit, you must tell us within 14 days of making the decision so we can check to make sure you are still eligible to receive your payment while you are away. If you do not tell us your payment may stop ...

6. Centrelink has no record of Mr Holbrook notifying it in 2011, or over the next decade, that he had left Australia and was in [Country 1].  To the contrary, the Centrelink records indicate that Mr Holbrook provided it with updated Australian addresses in March 2012, September 2012, October 2016 and November 2019, with no mention that he was living overseas.  With the last of these updates, a Centrelink computer document dated 4 November 2019 also records Mr Holbrook as advising that he was living at an address at [Town 1] and sharing accommodation with another person, [Mr A]. 

7. Similarly, there is no reference to Mr Holbrook being in [Country 1] when he advised Centrelink in March 2017 that he did not want to transfer from disability support pension to age pension.  In March 2017 Mr Holbrook also returned a review form to Centrelink about his relationship status, in which he again did not mention that he was in [Country 1].  Along with this review form, Mr Holbrook provided Centrelink with statements for a [Bank 1] account, which bore an Australian address and which contained transactions indicating that the account was being accessed in Australia.  As noted by the authorised review officer, copies of the statements for this account that were later obtained from [Bank 1] as part of Centrelink’s residence investigation were completely different and indicated that the account was actually being used in [Country 1].

8. According to a Centrelink computer document dated 25 March 2024, Mr Holbrook was still purporting to be in Australia even when contacted by an investigations officer on that date.  In particular, Mr Holbrook is recorded as initially advising the investigations officer that he was last in Australia one month ago, having flown with [Airline 1].  Mr Holbrook also specifically denied the accusation that he was living in [Country 1].  When the officer then disclosed the existence of evidence indicating that Mr Holbrook had indeed been living in [Country 1] since March 2011, Mr Holbrook responded that he did not know that he had to tell Centrelink he was moving.  When asked about the different addresses he had provided, Mr Holbrook said that he did not know what to say or do and, after further questioning, acknowledged that he had been living in [Country 1] in March 2011.

9. When asked at the hearing about the information he had provided to Centrelink while overseas, Mr Holbrook insisted that he had never intended to conceal the fact that he was in [Country 1].  He said that the Australian addresses that he provided to Centrelink were for mailing purposes and that he had had to change the addresses whenever the people who were receiving and forwarding his mail moved.  One of these people was [Mr A] but Mr Holbrook denied that he ever told Centrelink that the two of them were sharing accommodation.  With regard to the conversation in 2017 about transferring to age pension, Mr Holbrook said that he did not advise the officer that he was in [Country 1] because the subject was not brought up.  He said that the officer should have realised he was calling from overseas and should also have told him to transfer to age pension, rather than stay on disability support pension.  When asked about the [Bank 1] statements, Mr Holbrook could not explain why the copies he provided to Centrelink in 2017 showed Australian transactions.  As for the initial statements he made to the investigations officer in 2024, Mr Holbrook denied that he lied about his whereabouts.  Rather, he said that his mind gets jumbled due to a previous brain injury and that he was confused when he said he had recently been to Australia and was not living in [Country 1].   

1. In assessing the credibility of Mr Holbrook’s explanations, the Tribunal observes that he has sought, in both his oral evidence and in his written submissions, to portray his case as being one of innocent miscommunication involving a person who was oblivious of the requirement to notify Centrelink that they had left Australia. However, such a portrayal is incompatible with the objective evidence that Mr Holbrook repeatedly provided information to Centrelink that indicated that he was in Australia, and even that he was sharing accommodation with a particular person, when he was not. Mr Holbrook also provided Centrelink with what appear to be falsified bank statements in 2017 when his marital situation was being reviewed. Furthermore, contrary to his claims of honesty, he initially attempted to deny that he was living in [Country 1], and falsely stated that he had recently been in Australia, when contacted by the Centrelink investigations officer in 2024. In the view of the Tribunal, this objective evidence gives compelling weight to the obvious inference to be drawn from Mr Holbrook’s failure to disclose his actual whereabouts – and from his provision of information to the contrary – that he was seeking to conceal his true situation from Centrelink. Accordingly, the Tribunal concludes that Mr Holbrook knew that he was required to inform Centrelink that he was overseas, that he knowingly failed to do so and that he knowingly provided false information that misleadingly suggested that he was still living in Australia. In such circumstances, the Tribunal finds that paragraph 1237AAD(a) of the SS Act is not satisfied and that recovery of Mr Holbrook’s debts cannot be waived.

2. The Tribunal is satisfied that none of the other non-recovery provisions in the SS Act apply to Mr Holbrook. It follows that his debts must be recovered in full.

DECISION

The Tribunal affirms the decisions under review.

Date of hearing: Wednesday, 20 November 2024