Imielski and Secretary, Department of Social Services (Social services second review)
[2021] AATA 208
•12 February 2021
Imielski and Secretary, Department of Social Services (Social services second review) [2021] AATA 208 (12 February 2021)
Division:GENERAL DIVISION
File Number(s): 2020/0997
Re:Andrzej Imielski
APPLICANT
AndSecretary, Department of Social Services
RESPONDENT
DECISION
Tribunal:Chris Puplick AM, Senior Member
Date:12 February 2021
Place:Sydney
The decision under review is affirmed.
.
................................[sgd]................................
Chris Puplick AM, Senior Member
CATCHWORDS
SOCIAL SECURITY – Disability Support Pension – Age Pension – international social security agreements – social security agreement between Australia and the Republic of Poland – Applicant’s receipt of the Polish disability and age pensions – appointment of the correspondence nominee – allegation of breach of the European General Data Protection Regulation – allegation of breach of the Racial Discrimination Act 1975 (Cth) – whether debt should be recovered – writing off debt – waiver of debt arising from sole administrative error – whether there was sole administrative error – waiver of debt in special circumstances – whether special circumstances exist – reviewable decision is affirmed
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) s 33
Administrative Arrangement for the Application of the Agreement between Australia and the Republic of Poland on Social Security, 7 October 2009, ss 2, 3
Agreement between Australia and the Republic of Poland on Social Security, 7 October 2009, arts 1, 2, 4, 10, 11, 12, 15, 16, 17
Disability Discrimination Act 1992 (Cth) s 51
Evidence Act 1995 (Cth) s 138
International Convention on the Elimination of All Forms of Racial Discrimination, opened for signature 21 December 1965, 660 UNTS 195 (entered into force 4 January 1969) art 5
Racial Discrimination Act 1975 (Cth) ss 5, 10
Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) [2016] OJ L 119/1, arts 44, 45, 46
Social Security Act 1991 (Cth) ss 8, 1064, 1223, 1236, 1237A, 1237AAD
Social Security (Administration) Act 1999 (Cth) ss 66A, 68, 123C, 123D, 123I, 123J, 123M, 123O, 179
Social Security (International Agreements) Act 1999 (Cth) s 6, sch 25
CASES
Aslanidis and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2010] AATA 429
Davey and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2008] AATA 888
Dranichnikov v Centrelink [2003] FCAFC 133
Love and Secretary, Department of Social Services (Social services second review) [2016] AATA 8
Mirza and Secretary, Department of Families, Community Services and Indigenous Affairs [2007] AATA 1309
Rose v Secretary, Department of Social Security (1990) 92 ALR 521
Secretary, Department of Families, Housing, Community Services and Indigenous Affairs v Mahrous (No 2) [2012] FCA 1275
Secretary, Department of Family and Community Services and Owen [2002] AATA 1202
Secretary, Department of Social Services and Cannon (Social services second review) [2015] AATA 1028
Skinner and Secretary, Department of Social Services (Social services second review) [2015] AATA 569
SECONDARY MATERIALS
Department of Social Services, Social Security Agreement between Australia and Poland - Frequently Asked Questions (29 July 2019) < Commission, Adequacy decisions: How the EU determines if a non-EU country has an adequate level of data protection <ec.europa.eu/info/law/law-topic/data-protection/international-dimension-data-protection/adequacy-decisions_en>
Guides to Social Policy Law: Social Security Guide, pt 4
Office of the Australian Information Commissioner, Australian entities and the EU General Data Protection Regulation (GDPR) (8 June 2018) < FOR DECISION
Chris Puplick AM, Senior Member
12 February 2021
The matter before the Tribunal turns upon the question of how to treat the payments made to Mr Andrzej Imielski (Applicant) by the Zakład Ubezpieczeń Społecznych (ZUS) which is the social welfare agency of the Republic of Poland. Those payments are a disability pension due to an incapacity to work and an old age pension.[1] They have been paid pursuant to the provisions of the reciprocal Agreement between Australia and the Republic of Poland on Social Security (Polish Agreement), which allows for the benefit recipient to receive certain social security benefits while not residing in the country from which the benefit is paid.
[1] Section 37 documents (T documents) at 68.
Throughout these proceedings the Applicant has been assisted by his daughter Ms Agnieszka Imielska (Applicant’s representative).
THE MATTER BEFORE THE TRIBUNAL
On 19 December 2018[2] the Respondent (via Centrelink) reviewed the Applicant’s social security payments and determined that from 1 October 2010 to 16 April 2018[3] (although the debt calculations themselves only commence from 1 March 2013 to 16 April 2018)[4] he had been overpaid (variously the Disability Support Pension (DSP) and the Age Pension (AP)). The basis of determining whether the Applicant was overpaid involved assessing money he received by way of pension payments from the Republic of Poland as part of his assessable income for social security purposes. The quantum of overpayment was calculated to be $12,004.46 (original debt decision).
[2] The Respondent’s Statement of Facts, Issues and Contentions dated 15 June 2020 (Respondent’s SFIC) at [1.4] gives 18 December 2018. The Social Services and Child Support Division of the Tribunal (AAT1) in its decision dated 21 January 2020 at [4] gives 19 December 2018: T documents at 9. The Respondent’s letter to the Applicant informing him of his debt is also dated 19 December 2018: T documents at 72.
[3] T documents at 72.
[4] Ibid 11 [17].
The Applicant sought a review of the original debt decision which was affirmed by an Authorised Review Officer (ARO) of the Department on 30 August 2019. The Applicant then sought a further review by the Social Services and Child Support Division of this Tribunal (AAT1) which, on 21 January 2020, set aside the decision of the ARO and found that the Applicant had been overpaid and had a recoverable debt for the entire period from 1 October 2010 to 16 April 2018 (debt period).
The AAT1 sent the matter back to Centrelink to recalculate the debt in question as from 1 October 2010 (and not 1 March 2013). This resulted in a further debt of $3,338.64 being established, bringing the total debt to $15,343.10.
On 24 February 2020 this division of the Tribunal (AAT2) received an application to review that AAT1 decision and the matter was heard on 16 December 2020. Due to the restrictions imposed as a result of the COVID-19 pandemic the hearing was conducted remotely by telephone and with the assistance of a Polish language interpreter where necessary.
Although the total debt recalculated by the Respondent is $15,343.10, this Tribunal has jurisdiction only to review that portion of the debt which was before the AAT1 ($12,004.46).
The limitation on this Tribunal’s jurisdiction is grounded in section 179 of the Social Security (Administration) Act 1999 (Cth) (Administration Act) which relevantly provides that:
(1) Application may be made to the AAT for review (AAT second review) of a decision of the AAT on AAT first review made under subsection 43(1) of the AAT Act.
(2) For the purposes of subsection (1), the decision of the AAT on AAT first review is taken to be:
…
(d) if an AAT first review sets a decision aside and sends the matter back to the Secretary for reconsideration in accordance with any directions or recommendations of the AAT – the directions or recommendations of the AAT.[5]
[5] Emphasis in original.
This does not mean that the additional impost of $3,338.64 is unreviewable. It simply means that it is not reviewable by this Tribunal in these present proceedings.[6]
[6] See Secretary, Department of Family and Community Services and Owen [2002] AATA 1202, [8]; Davey and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2008] AATA 888, [4]; Aslanidis and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2010] AATA 429.
WHAT AUSTRALIAN SOCIAL SECURITY PAYMENTS DOES THE APPLICANT RECEIVE?
On 9 April 2002 the Applicant was granted the DSP and on 15 August 2015 he was transferred to the AP as he had reached the age of 65 years.[7] On two occasions (6 August 2013 to 8 August 2013 and 7 July 2015 to 15 July 2015) his DSP was suspended because he had been overseas for a period greater than 28 days.
[7] T documents at 137.
The Applicant was paid at the single rate for his pensions as he was not a member of a couple during the debt period.
WHAT POLISH SOCIAL SECURITY PAYMENTS DOES THE APPLICANT RECEIVE?
On 1 October 2010 the Polish Agreement came into effect. The Agreement was negotiated under the provisions of the Social Security (International Agreements) Act 1999 (Cth) (International Agreements Act) and is incorporated as schedule 25 to that Act.
Relevantly it provides in article 2 that:
1. This Agreement shall apply to the following laws:
(1) in relation to Australia,
(a) the Acts forming the social security law in so far as the law provides for, applies to or affects age pension,
(b) the law concerning the superannuation guarantee, which at the time of signature of this Agreement is contained in the Superannuation Guarantee (Administration) Act 1992, the Superannuation Guarantee Charge Act 1992 and the Superannuation Guarantee (Administration) Regulations;
(2) in relation to the Republic of Poland, legislation on the compulsory coverage and the following benefits within social insurance and social insurance for farmers:
(a) Age pensions, disability pensions, survivors pensions,
(b) Work accidents and occupational diseases compensation and pensions,
(c) Funeral benefits.
As a result of the Polish Agreement being in place, on 18 May 2015, the Respondent wrote to the Applicant about his potential eligibility for a foreign pension, in the following terms:
Australia and Poland have a Social Security Agreement. The information you have given us about the time you spent in Poland indicates that you may be entitled to receive Old Age/Seniority Pension from that country. Please let us know if our information is not correct.
…
Australian social security law requires you to take reasonable action to claim any foreign pension entitlements you may have, otherwise your Australian payment may be stopped. If you think you have no entitlement to this payment please contact us.
Centrelink can assist you in completing your claim …[8]
[8] T documents at 293.
Information supplied to the Respondent by ZUS indicates that the Applicant received the following payments from the Polish government:
·a disability pension due to an incapacity to work from 1 October 2010 (the effective date of the Polish Agreement) to 14 July 2016, and
·an old age pension from 15 July 2016 (when the Applicant reached the statutory age for receipt of that pension under Polish legislation), which is still current.[9]
[9] Correspondence from ZUS to Services Australia dated 21 September 2020: Supplementary section 37 documents (Supplementary T documents).
The information from ZUS included further advice about the gross amounts of social security payments (before deduction of tax and contributions for medical insurance purposes). These amounts are given in Polish złoty and ZUS also confirmed that such payments were made into the Applicant’s nominated bank account in Poland.
A NOTE ON INTERNATIONAL RECIPROCAL SOCIAL SECURITY AGREEMENTS
It is not surprising that, as a country with a long and distinguished history of becoming home to migrants from around the globe, Australia has long sought to provide some degree of reciprocity in terms of shared responsibilities for social security entitlements and payments involving people who have lived in, or contributed to the social welfare systems of, more than just Australia.
As social welfare systems vary enormously around the world (for example, many countries have systems of compulsory social insurance contributions, age pensions are payable at different ages, and qualifying residency requirements differ), each international agreement negotiated with a foreign country is different and makes different provisions.
In 1999 Parliament enacted the International Agreements Act which superseded previous arrangements providing for the recognition of reciprocal social security agreements.
The International Agreements Act itself is relatively brief in establishing certain principles of general application and then each of the 30 international agreements (each with a different country) are included as schedules to that Act. The first such agreement was with Italy in 1986 and the latest with the Republic of Estonia in 2015. The Polish Agreement (schedule 25) was negotiated and signed in 2009 and became operative on 1 October 2010.
Two important points should be noted. In the first instance, section 6 of the International Agreements Act provides:
6 Overriding of social security law by scheduled international social security agreements
(1) The provisions of a scheduled international social security agreement have effect despite anything in the social security law.
(2) Subsection (1) applies to a provision of an agreement only in so far as the provision is in force and affects the operation of the social security law.
(3) If:
(a) immediately before he or she reaches pension age, a person is receiving a social security payment (other than age pension) solely because of the operation of a scheduled international social security agreement; and
(b) on reaching pension age, the person becomes qualified for age pension because of the operation of paragraph 43(1)(c) of the Social Security Act 1991;
the age pension is taken to be payable to the person under the agreement referred to in paragraph (a).
This means that if there are discrepancies or differences between provisions of an international agreement and the ordinary operation of provisions in Australia’s social security law, then the international agreement takes precedence.[10]
[10] Secretary, Department of Families, Housing, Community Services and Indigenous Affairs v Mahrous (No 2) [2012] FCA 1275.
The second point is that all reciprocal social security agreements provide for the exchange of information between the countries who are parties to the agreements. In the Polish Agreement, article 15 provides:
Administrative Arrangement
1. The Competent Authorities of the Parties are authorised to enter into an Administrative Arrangement necessary for the purpose of implementing this Agreement.
2. The Competent Authorities shall appoint Liaison Institutions which are to be listed in the Administrative Arrangement.
Per article 1(2) of the Polish Agreement, the “Competent Authority” in relation to Australia is the Secretary of the Department of Social Services (Centrelink).[11] Per article 1(4), the “Liaison Institution”:
means the institution which ensures coordination and exchange of information between the institutions of both Parties, which participates in applying this Agreement.
[11] Administrative Arrangement for the Application of the Agreement between Australia and the Republic of Poland on Social Security, 7 October 2009 (Administrative Arrangement), s 2(1)(a).
In this instance, in relation to Australia, that Liaison Institution is Centrelink International Services.[12]
[12] Ibid 3(1)(1)(a).
In other words, the Polish Agreement (which takes precedence over other social security legislation as is relevant) authorises the exchange of information between Centrelink International Services and ZUS (head office in Warsaw), which is the “Liaison Institution” designated in relation to the Republic of Poland.[13]
[13] Ibid 3(1)(2)(a).
It is of course axiomatic that contracting parties must be able to exchange information if any reciprocal agreement is to be given effect.
WHAT ARE THE CONSEQUENCES OF RECEIPT OF POLISH SOCIAL SECURITY PAYMENTS?
The Australian age pension, for Australian residents, is paid subject to income and assets tests under which the “ordinary income” of a pension applicant is assessed before the payment is granted and to determine the rate at which the pension is to be paid.
“Income” is defined in section 8(1) of the Social Security Act 1991 (Cth) (Act) as follows:
"income", in relation to a person, means:
(a) an income amount earned, derived or received by the person for the person's own use or benefit; or
(b) a periodical payment by way of gift or allowance; or
(c) a periodical benefit by way of gift or allowance;
but does not include an amount that is excluded under subsection (4), (5) or (8).
The Act defines ‘income amount’ as follows:
income amount means:
(a) valuable consideration; or
(b) personal earnings; or
(c) moneys; or
(d) profits;
(whether of a capital nature or not).
Section 8(2) further provides that:
(2) A reference in this Act to an income amount earned, derived or received is a reference to:
(a) an income amount earned, derived or received by any means; and
(b) an income amount earned, derived or received from any source (whether within or outside Australia).
In Rose v Secretary, Department of Social Security[14] the Full Court of the Federal Court of Australia considered the treatment of a pension paid to an Australian citizen, who was also an Australian resident for social security purposes, from the (former) German Democratic Republic (GDR). The Court held that:
Absence of the words “within or outside Australia” may have enlivened an argument that the source must be limited to a source within Australia. The legislature was concerned to ensure that it mattered not whether the source of derivation or receipt of the moneys was within or outside Australia because it is a definition which forms part of a scheme designed to exclude persons from qualification for pensions under the Act who have access to other forms of “income” irrespective of the territorial location of the source. The words “within or outside Australia” are designed to ensure that there is no reading down of the section to include only persons who earn, derive or receive moneys etc payable from sources within Australia.[15]
…
… according to the tribunal's reasoning process, a construction of the definition to the effect that only “personal earnings, moneys, valuable consideration or profits” available for the person's “own use or benefit” within Australia should be regarded as “income” would be available. We respectfully disagree. No territorial limitation would be implied into the definition of “income” to achieve the result mentioned by the tribunal if the words “within or outside of Australia” are governed only by the immediately preceding words “from any source whatsoever”. The source to which the definition of income is directed is, of course, the source from which the person's earnings or moneys etc are earned, derived or received by him for his own use or benefit by any means, and, as mentioned earlier, the draftsman was concerned to ensure that it mattered not whether that source was within or outside Australia. There is no warrant for importing the constraint into the definition which attracted the tribunal.[16]
[14] (1990) 92 ALR 521.
[15] Ibid 524.
[16] Rose v Secretary, Department of Social Security (1990) 92 ALR 521, 526.
The applicant’s GDR pension was therefore treated by the Full Court to be ‘income’ for the purpose of the income test. This was despite the fact that, as argued by the GDR pension recipient, by law the pension which was paid into a cheque account in the GDR could not be transferred out of that country for his use in Australia.[17] The Full Court acknowledged that while there may be situations where certain profits are not realised such that they cannot be said to have been “earned, derived or received” and treated as ‘income’:
… that conclusion does not avail the appellant in this case. The pension to which the appellant is entitled in, and only in, the GDR is paid into his cheque account there each month. It is not transferable or payable to him outside the GDR; but it is a pension that is available for him to call upon whenever he is in the GDR, as he is for a large part of each year.
The entitlement of the appellant to his GDR pension arises at the latest once the pension payments have been paid into the relevant account of the appellant in the GDR. He is then free to draw upon them and spend them in the GDR. His capacity to remove the pension payments from the GDR and to spend them outside the GDR is prohibited by the law of the GDR; the restraint is upon his transferring the moneys outside the GDR.
The pension payments made to the appellant in the GDR are moneys “received” by him in the sense of “realised” by him in the GDR. It is not to the point that those moneys are in that sense received by him outside Australia. The payments answer the description of moneys “earned, derived or received” (in the sense of “realised”) by him for his own use or benefit from a source outside Australia and fall within the definition of “income” …[18]
[17] Ibid 521-522.
[18] Ibid 525.
This is not dissimilar to argument made by the Applicant that he does not have access to his Polish bank account in Australia. The Applicant did not go as far to suggest that a law of the Republic of Poland prevents the transfer of his Polish pension received in his Polish bank account outside of the country. However, the Applicant indicated to the Tribunal that he did not have internet banking set up for his Polish bank account such that he would only be able to access his Polish pension when in that country.
The Applicant also asserted that his Polish pensions are excluded amounts that should not be taken into account as part of his ‘income’ for the purpose of the income test because section 8(8)(zc) of the Act[19] provides that:
Excluded amounts – general
(8) The following amounts are not income for the purposes of this Act:
…
(zc) so much of a payment received by the person as is, in accordance with an agreement between the Commonwealth and a foreign country, applied in reduction of the amount of social security payment that would otherwise be payable to the person under this Act;
[19] Applicant’s submissions dated 29 September 2020 at 4; Applicant’s submissions dated 25 November 2020 at 8.
Examples of such exclusions are given in the Social Security Guide at paragraph 4.3.6.10 dealing with income from overseas payments.
However, not all international reciprocal social security agreements are cast in the same terms. Many of them include variations which reflect the specific nature of social security policy and arrangements in foreign jurisdictions.
The Respondent was not entirely correct in its Statement of Facts, Issues and Contentions dated 15 June 2020 (Respondent’s SFIC) at paragraph 6.16(a) in stating that “there is nothing in the Polish Agreement that appears to be excluded as income under social security law”.
The Respondent actually provides some advice on this matter on its website in the following terms:
How are pensions calculated under the Aagreement? (sic)
Australian pensions
People who live in Australia but do not have ten years’ residence in Australia can count their Polish periods of insurance to qualify for an Australian pension, subject to the means-test. During this time (until they have ten years’ residence in Australia) they are paid the normal means-tested pension rate less the amount of any Polish pension - i.e. the Polish pension is ‘topped-up’ to the rate of Australian pension they would receive if they had no Polish pension.[20]
[20] Department of Social Services, Social Security Agreement between Australia and Poland - Frequently Asked Questions (29 July 2019) <>
This corresponds with the procedure for the calculation of Australian benefits as set out in articles 10 – 12 of the Polish Agreement. article 12(4) states that:
4. Subject to paragraph 5, where an Australian benefit is payable only by virtue of this Agreement to a person who is in Australia, the rate of that benefit shall be determined by,
(1) calculating that person's income according to the legislation of Australia but disregarding in that calculation any benefit under the legislation of the Republic of Poland which that person or the partner of that person is entitled to receive if applicable, and
(2) deducting the amount of benefit under the legislation of the Republic of Poland which that person is entitled to receive from the maximum rate of that Australian benefit, and
(3) applying to the remaining amount of benefit obtained under subparagraph (2) the relevant rate calculation set out in the legislation of Australia, using as the person's income the amount calculated under subparagraph (1).[21]
[21] Emphasis added.
Section 8(8)(zc) of the Act and article 12(4) of the Polish Agreement provide that a Polish pension stipulated under the Polish Agreement would be an excluded amount if such Polish pension is “applied in reduction of the amount of social security payment that would otherwise be payable to the person under this Act”. The Polish Agreement, however, only provides for a Polish pension to be treated as a deduction to reduce the amount of an Australian benefit if the Australian benefit, specifically, “is payable only by virtue of this Agreement”. However, when the Applicant is in Australia and is paid an Australian benefit, his entitlement to such Australian pension payments does not arise only by virtue of the Polish Agreement (i.e. his right to receive an Australian pension does not rely on the ‘former Australian resident’ provision in article 10 or the ‘totalisation’ provision in article 11). His entitlement arises because he meets the eligibility criteria as governed by the Act.
Obviously, social security payments made in Australia pursuant to the Act are not income for the purposes of calculating social security entitlement or rates because those payments are specifically excluded by section 8(8)(a) of the Act. The Applicant contended that article 4 of the Polish Agreement means that Polish pensions should be treated as equal to Australian pensions such that they are also “excluded amounts under section 8(8)(a) of the SS Act as Polish ZUS payments should be treated equally as Centrelink payments …”.[22] However, even if article 4 does provide that the pensions of both countries are to be treated as equal as argued by the Applicant, which the Tribunal does not accept is the case, a Polish pension determined by the government of the Republic of Poland and made from Poland, is not a “payment under this Act”. It is a Polish pension made in accordance with Polish social security law (and not pursuant to Australian social security law).
[22] Applicant’s submissions dated 29 September 2020 at 4; Applicant’s submissions dated 25 November 2020 at 8-9.
Turning to article 4 of the Polish Agreement. It appears the Applicant has read into the language of article 4 words and meaning which is not available. Article 4 states:
Equality of Treatment
Unless otherwise provided in this Agreement, all persons to whom this Agreement applies shall be treated equally by a Party in regard to rights and obligations regarding eligibility for and payment of benefits which arise under the social security law of Australia or the legislation of the Republic of Poland or by virtue of this Agreement.
The Tribunal cannot find in the language of article 4 the meaning that social security payments of Australia and social security payments of the Republic of Poland must be treated as equal such that Polish pensions are to be treated as payment “under the Act” and Australian pensions are to be treated as payment “under Polish social security law”.
Therefore, the Applicant’s Polish pensions, as determined by the government of the Republic of Poland and made from Poland in accordance with Polish law, are income for the purpose of the income test in determining the Applicant’s eligibility for, and rate of entitlement to, Australian social security benefits including DSP and AP. None of the exclusions in section 8(8) of the Act avail the Applicant in these proceedings.
WAS THE APPLICANT OBLIGATED TO ADVISE THE RESPONDENT OF HIS POLISH PENSIONS?
Yes.
The AAT1 records that:[23]
On or around September 2016 the Department of Human Services (“Centrelink”) lodged an application to the Polish pension office (“ZUS”) for age pension on behalf of Mr Imielski. In March 2017 ZUS informed Centrelink that the age pension had been granted and in May 2018 ZUS provided historical payment information going back to 1 October 2010 (which Is the date Poland and Australia entered into a social security agreement).
[23] T documents at 9[3].
It is clear from the Department’s correspondence that after its letter of 18 May 2015,[24] the Respondent sent the Applicant some application form for the Polish pension, which the Department then forwarded to ZUS in Warsaw.[25] In the Department’s letter to the Applicant it states clearly:
If you are receiving an Australian payment and you are advised of the outcome of your foreign pension claim or you start to receive payments (whichever happens first), you must contact Centrelink International Services within 14 days (28 days if residing outside Australia).
If you are granted the foreign pension:
·your Australian payment(s) will be reassessed and may be reduced when your foreign payment begins; and
·if you receive back payments, you may need to repay some of your Australian payment(s).
[24] T documents at 293.
[25] Ibid 300.
There can be absolutely no doubt that the Applicant knew, or ought to have known, that in applying for a Polish payment there was some chance that his Australian payment(s) would be reduced. The advice from the Department cannot be clearer.
The March 2017 information from ZUS[26] alerted the Respondent to the fact that the Applicant was in receipt of pension payments from ZUS and, accordingly, the Department wrote to the Applicant on 15 February 2018 requesting information as follows:
Our records indicate you commenced action to claim an Old Age/Seniority Pension from Poland.
We are writing to enquire about the progress of this claim.
What you need to do
If your Poland claim has been finalised, please fill in the attached form and return it to us so that we can update our records.
If you are not sure of the progress of your claim please call us so that we can advise you on how to proceed.
It is important that you reply to this letter within 3 weeks of receiving it or your Australian payment may be stopped.
This is a request for information given under the social security law.[27]
[26] Ibid 65-69.
[27] T documents at 302.
The reference in the last line above is to section 68 of the Administration Act which states:
(1) Subsection (2) applies to a person to whom a social security payment (other than utilities allowance or energy supplement under Part 2.25B of the 1991 Act) is being paid.
(2) The Secretary may give a person to whom this subsection applies a notice that requires the person to do any or all of the following:
(a) inform the Department if:
(i) a specified event or change of circumstances occurs; or
(ii) the person becomes aware that a specified event or change of circumstances is likely to occur;
(b) give the Department one or more statements about a matter that might affect the payment to the person of the social security payment;
(c) give the Department one or more statements about a matter that might affect the operation, or prospective operation, of Part 3B in relation to the person.
It is a statutory requirement which cannot be ignored. It requires a social security recipient to answer and provide the details requested and to do so within any timeframe outlined. A social security recipient has no right to refuse to provide the requested information and to the extent a recipient does refuse/ fails to provide the requested information, he/ she risks a loss of entitlements or reduction in payments.
Section 66A of the Administration Act is in similar terms but provides the general requirement for social security recipients to give information about a change of circumstances. It provides that a person who has made a claim for a social security payment or is the recipient of a social security payment must notify the Department within 14 days of “an event or change of circumstances … that might affect the payment of that social security payment”.
HAD THE APPLICANT RECEIVED PREVIOUS NOTICES ABOUT HIS NEED TO INFORM THE DEPARTMENT ABOUT A CHANGE OF CIRCUMSTANCES?
Yes.
On 24 August 2010 the Department wrote to the Applicant to advise him that, in relation to his DSP payments, he had an obligation to inform the Department, within 14 days, of any change in his income. In particular that letter indicated that the Applicant had to provide information if he received:
Income … get money from ANY other source.[28]
[28] T document at 259. Emphasis in original.
The letter also advised that data matching information supplied by the Applicant might be used to check for the accuracy of information provided.[29]
[29] Ibid 259.
It is thus clear that as from, at least, 24 August 2010 the Applicant was on notice that he had a legal obligation to report to Centrelink any changes in his financial circumstances which might have a bearing on his entitlement to, or the rate at which he was paid, his Australian pensions. This was also an enduring and ongoing obligation. There is evidence before the Tribunal of at least 8 other such pieces of correspondence, in similar terms, addressed to the Applicant.[30]
[30] Respondent’s SFIC at [3.7]-[3.14].
In August 2015, in relation to his AP payments, again, the Applicant was informed about his obligation to inform the Department about changes to:
Income: Your … gross income. Changes means your income starts, stops recommences or amounts vary. Gross income includes, but is not limited to:
…
Pensions and annuities: … income streams or pensions from other countries.
Other income: Income from … other regular payments … or any other income from any source (including income from other countries).[31]
[31] T documents at 296.
DID THE APPLICANT PROVIDE ADVICE ABOUT HIS POLISH PENSIONS?
No.
The Applicant replied to the Department’s 15 February 2018 request for information on 12 March 2018. His reply was incomplete and hence misleading. He was asked to provide answers to a number of questions such as the date on which he received his Polish old age pension, the amount (in złoty) of his pension payments and the regularity of the payments. All of these details were known, or ought to have been known, to the Applicant and he simply left the form blank. In relation to a question on the form directed at a Polish old age pension applicant whose claim had been rejected and seeking reasons why the pension claim was rejected, he wrote “N/A” which was clearly a correct answer.[32] It demonstrated an understanding of the form and its contents. He then signed and dated the form.
[32] T documents at 71.
The Department also wrote to the Applicant in relation to his AP and in those letters his rate of pension was advised based upon a stated “annual income figure”. On several occasions this annual income figure was shown to be as low as $0.26[33] which the Applicant knew to be untrue because of his income from Poland. He failed to advise the Department of his Polish pension and that their calculations were incorrect.
[33] Ibid 298 and 306.
WAS THE APPLICANT IN A POSITION TO PROVIDE THE REQUIRED INFORMATION TO THE DEPARTMENT?
Yes.
Although the Applicant indicated at the Tribunal hearing that he suffered from a number of health conditions and that he had great difficulty reading or comprehending correspondence, there is no evidence that this was the case as far back at 2010. If anything, the evidence is to the contrary.
As noted supra, the Applicant made two overseas trips (in 2013 and 2015) and it was the evidence of his daughter that he made these trips on his own and without her accompaniment. He was clearly in a position to manage his affairs and look after himself at those stages.
There is also some degree of confusion about the role and responsibilities of the Applicant’s daughter in terms of the management of his affairs, including his correspondence with the Department.
There is a Departmental record which shows that on 12 August 2014 the Applicant allegedly made some sort of contact with the Department to authorise his daughter to act as his “correspondence nominee” in accordance with section 123C of the Administration Act.[34] It provides:
Subject to section 123D, the Secretary may, in writing, appoint a person (including a body corporate) to be the correspondence nominee of another person for the purposes of the social security law.
[34] Respondent’s SFIC at [3.16].
The conditions imposed by section 123D are as follows:
(1) A person may be appointed as the payment nominee and the correspondence nominee of the same person.
(2) The Secretary must not appoint a nominee for a person (the proposed principal) under section 123B or 123C except:
(a) with the written consent of the person to be appointed; and
(b) after taking into consideration the wishes (if any) of the proposed principal regarding the making of such an appointment.
(3) The Secretary must cause a copy of an appointment under section 123B or 123C to be given to:
(a) the nominee; and
(b) the principal.[35]
[35] Emphasis in original.
Whilst the Department has provided a letter acknowledging the appointment of the Applicant’s daughter as his correspondence nominee (letter dated 12 August 2014 and addressed to the Applicant) in compliance with section 123D(3)(b) and whilst the letter indicates that a corresponding copy of the appointment has been provided to the nominee, the Respondent has not been able to produce such evidence. In addition, contrary to the requirement in section 123D(2)(a), the Applicant’s representative denied that she had ever consented to such an appointment or had signed any documents of consent. The Respondent has also not been able to provide evidence of her written consent to be appointed as the Applicant’s correspondence nominee.
Furthermore, even if such an appointment had been made properly, the Department continued to address all correspondence to the Applicant at his recorded address (in Redfern) and not to the Applicant’s daughter’s address (in Blacktown). This was required by section 123I of the Administration Act:
123I Giving of notices to correspondence nominee
(1) Any notice that the Secretary is authorised or required by the social security law to give to a benefit recipient may be given by the Secretary to the benefit recipient’s correspondence nominee.
(2) The notice:
(a) must, in every respect, be in the same form, and in the same terms, as if it were being given to the benefit recipient; and
(b) may be given to the correspondence nominee personally or by post or in any other manner approved by the Secretary.
(3) If:
(a) under subsection (1), the Secretary gives a notice (the nominee notice) to a benefit recipient’s correspondence nominee; and
(b) the Secretary afterwards gives the benefit recipient a notice that:
(i) is expressed to be given under the same provision of the social security law as the nominee notice; and
(ii) makes the same requirement of the benefit recipient as the nominee notice;
section 123J ceases to have effect in relation to the nominee notice.
(4) If:
(a) under subsection (1), the Secretary gives a notice (the nominee notice) to a benefit recipient’s correspondence nominee; and
(b) the Secretary has already given to the benefit recipient a notice that:
(i) is expressed to be given under the same provision of the social security law as the nominee notice; and
(ii) makes the same requirement of the benefit recipient as the nominee notice;
section 123J does not have effect in relation to the nominee notice.[36]
[36] Emphasis in original.
If the Applicant’s representative was properly appointed as the correspondence nominee, then it would have fallen to her to respond to correspondence from the Department after 12 August 2014 under the terms of section 123J:
123J Compliance by correspondence nominee
(1) If, under section 123I, a notice is given to a benefit recipient’s correspondence nominee, the following paragraphs have effect:
(a) for the purposes of the social security law, other than this Part, the notice is taken:
(i) to have been given to the benefit recipient; and
(ii) to have been so given on the day on which the notice was given to the correspondence nominee;
(b) any requirement that the notice makes of the benefit recipient may be satisfied by the correspondence nominee;
(c) any act done by the correspondence nominee for the purpose of satisfying a requirement of the notice has effect, for the purposes of the social security law (other than Part 6 of this Act), as if it had been done by the benefit recipient;
(d) if the correspondence nominee fails to satisfy a requirement of the notice, the benefit recipient is taken, for the purposes of the social security law, to have failed to comply with the requirement;
(e) for the purposes of determining whether anything done by the correspondence nominee constitutes compliance with the notice, the social security law has effect as if a reference in the notice to the benefit recipient becoming aware that a specified event or change of circumstances is likely to occur were a reference to the correspondence nominee becoming so aware.
(2) In order to avoid doubt, and without limiting subsection (1), it is declared as follows:
(a) if the notice requires the benefit recipient to inform the Department of a matter within a specified period and the correspondence nominee informs the Department of the matter within that period in accordance with the notice, the benefit recipient is taken, for the purposes of the social security law, to have complied with the requirement set out in the notice;
(b) if the notice requires the benefit recipient to give a statement about a matter, or produce a document, to the Department within a specified period and the correspondence nominee gives a statement about that matter, or produces the document, as the case may be, to the Department within that period in accordance with the notice, the benefit recipient is taken, for the purposes of the social security law, to have complied with the requirement set out in the notice;
(c) if the notice requires the benefit recipient to inform the Department of a matter within a specified period and the correspondence nominee does not inform the Department of the matter within that period in accordance with the notice, the benefit recipient is taken, for the purposes of the social security law, to have failed to comply with the requirement set out in the notice;
(d) if the notice requires the benefit recipient to give a statement about a matter, or produce a document, to the Department within a specified period and the correspondence nominee does not give a statement about that matter, or produce the document, as the case may be, to the Department within that period in accordance with the notice, the benefit recipient is taken, for the purposes of the social security law, to have failed to comply with the requirement set out in the notice.
If in fact the Applicant’s daughter had become the Applicant’s correspondence nominee after 12 August 2014, then there would have been an onus on her to respond to Departmental correspondence or at least ensure that it was responded to. Section 123O(1) states:
It is the duty of a person who is the payment or correspondence nominee of another person at all times to act in the best interests of the principal.
Similarly, it would have absolved the Applicant of responsibility per the provisions of section 123M:
123M Protection of principal against liability for actions of nominee
Nothing in this Part has the effect of rendering a person guilty of an offence against this Act in respect of any act or omission of the person’s correspondence nominee.
The Applicant’s representative informed the Tribunal on numerous occasions that she had not received any correspondence from the Department in relation to the Applicant and that, while she helped him in the preparation of material for the Tribunal’s review, she had no responsibility for the management of, or information about, his financial affairs. As noted, there are no records of any correspondence addressed to the Applicant after 12 August 2014 also being sent to an address other than his at Redfern. There are also no letters before the Tribunal addressed to the Applicant’s representative dealing with any of the Applicant’s matters.
Nevertheless, from the Applicant’s perspective it appears that he believed his daughter was his correspondence nominee and that she had acted on his behalf as such. In a letter to Centrelink dated 22 February 2019, the Applicant stated:
On 29/01/19, I have called Centrelink (call to 131 673) to clarify the matter. Ref. Number 588567. My nominated person, Ms Agnieszka Imielska, has been trying to clarify the matter for me with the person take the call. He has refused to provide any clarifications. He has advised Ms Imielska that he is not the person who is involved in this matter and has promised that the person who deals with the matter will call me back.
The person has called me back. He has refused to provide his name. Ms Imielska has talked to him requesting copies of documents based on which the calculation of alleged overpayments has been made. She also requested withdrawal of deductions from my age pension as I dispute the decision.[37]
[37] T documents at 88.
However, based on the Applicant’s representative’s denial that she had ever given written consent to become the Applicant’s correspondence nominee, and the Respondent’s lack of evidence that the Applicant’s daughter had in fact provided written consent to be appointed and that a copy of the alleged appointment had been provided to her, the nominee appointment was not properly effected per section 123D.
If the Applicant’s daughter was not properly appointed because she had not consented (and perhaps the Applicant had not asked her to be his nominee), then the onus remains on the Applicant to provide the Department with requested information or information of a change in circumstances. However, in the event that the Applicant’s daughter can be taken to have been properly appointed, given that all the relevant correspondence was given to the Applicant, section 123I(3) and (4) appear to indicate that the correspondence nominee’s compliance obligations under section 123J ceased to have effect or did not have effect in relation to any alleged nominee notice that may have been provided to her. Again, the onus therefore falls back on to the Applicant to provide the Department with requested information or to inform it of any change of circumstances.
WAS THE INFORMATION ABOUT THE POLISH PENSIONS PROPERLY IN THE HANDS OF THE DEPARTMENT?
Yes.
The Applicant’s representative raised, in some detail, an argument that the provision of information by ZUS to the Department constituted a breach of the provisions of the General Data Protection Regulation (GDPR) of the European Union, of which Poland is a member.
Some of the provisions of European data protection legislation to which the Applicant’s representative referred[38] is in relation to the old Personal Data Protection Act of 29 August 1997. Some of the provisions have been superseded or repealed by the GDPR which was adopted on 27 April 2016[39] and came into effect on 25 May 2018.[40] Nevertheless, the GDPR (in article 44) imposes restrictions on the transfer of “personal data” from European Community members to “third countries” (i.e. non-EU members) unless those third countries have been granted “adequacy” status by the Commission (per article 45(1)):
A transfer of personal data to a third country or an international organisation may take place where the Commission has decided that the third country, a territory or one or more specified sectors within that third country, or the international organisation in question ensures an adequate level of protection. Such a transfer shall not require any specific authorisation.
[38] Applicant’s submissions dated 29 September 2020 at 10.
[39] Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) [2016] OJ L 119/1.
[40] Office of the Australian Information Commissioner, Australian entities and the EU General Data Protection Regulation (GDPR) (8 June 2018) <>
To date, some 12 countries have been granted adequacy status. Australia is not one of them.[41]
[41] European Commission, Adequacy decisions: How the EU determines if a non-EU country has an adequate level of data protection <ec.europa.eu/info/law/law-topic/data-protection/international-dimension-data-protection/adequacy-decisions_en>.
The Office of the Australian Information Commissioner advises:
However, there is some complexity involved in assessing whether the GDPR applies or is intended to apply to Australian government agencies. Relevant considerations include whether the GDPR is intended to apply to foreign government agencies, and if so, whether European foreign state immunity laws apply to the agency’s activities.
Foreign states are generally entitled to be granted immunity from the jurisdiction of the courts of another state. Exceptions depend on the laws of the particular jurisdiction and may include commercial transactions of a foreign state.[42]
[42] Office of the Australian Information Commissioner, Australian entities and the EU General Data Protection Regulation (GDPR) (8 June 2018) <>
It is also possible that such transfers are covered under the provisions of article 46(3) of the GDPR:
Transfers subject to appropriate safeguards
…
3. Subject to the authorisation from the competent supervisory authority, the appropriate safeguards referred to in paragraph 1 may also be provided for, in particular, by:
(a) contractual clauses between the controller or processor and the controller, processor or the recipient of the personal data in the third country or international organisation; or
(b) provisions to be inserted into administrative arrangements between public authorities or bodies which include enforceable and effective data subject rights.
It is perfectly within the competence of two sovereign states, the Commonwealth of Australia and the Republic of Poland, to enter into an agreement for the exchange of data as is provided for by the specific arrangements outlined in article 16 of the Polish Agreement.
ARTICLE 16
Exchange of Information and Mutual Assistance
1. The Competent Authorities, Liaison Institutions and Competent Institutions responsible for the application of this Agreement shall to the extent permitted by their national laws:
(1) communicate to each other any information necessary for the application of this Agreement or their legislation,
(2) provide assistance to one another, with regard to the determination or payment of any benefit under this Agreement or under the legislation to which this Agreement applies as if applying their own legislation,
(3) communicate to each other, without delay, all information about the measures taken by them for the application of this Agreement or about changes in their respective legislation insofar as these changes affect the application of this Agreement.
2. This assistance shall be free of charge subject to exceptions to be agreed in an Administrative Arrangement made pursuant to Article 15.
3. In no case shall the provisions of paragraph 1 be construed so as to impose on the Competent Authority, Liaison Institution or Competent Institution of a Party the obligation to:
(1) carry out administrative measures at variance with the laws or the administrative practice of that or the other Party, or
(2) supply particulars which are not obtainable under the laws or in the normal course of the administration of that or the other Party.
Article 17 of the Polish Agreement goes on to deal with matters of the protection of personal data:
ARTICLE 17
Protection of Personal Data
1. If, in accordance with this Agreement, the Competent Authority, Liaison Institution or Competent Institution of a Party transfers personal data to the Competent Authority, Liaison Institution or Competent Institution of the other Party, then such transfers are subject to the privacy legislation applicable in the territory of the Party providing the data. All such data is subject to the privacy legislation applicable in the territory of the Party receiving the data.
2. Any information about an individual which is transmitted in accordance with this Agreement to the Competent Authority, Liaison Institution or Competent Institution of that Party by the Competent Authority, Liaison Institution or Competent Institution of the other Party is confidential and shall be used only for the purposes of implementing this Agreement and the legislation to which this Agreement applies.
3. Notwithstanding any laws or administrative practices of a Party, no information concerning a person which is received by that Party from the other Party shall be transferred or disclosed to any other country or to any organisation within that other country without the prior written consent of that other Party.
The adoption of the Applicant’s representative’s position would, of course, render utterly meaningless and make impossible the implementation of Australia’s suite of reciprocal international social security agreements with other European Union members: Italy, Spain, Malta, the Netherlands, Ireland, Portugal, Austria, Cyprus, Croatia, Denmark, Germany, Belgium, Hellenic Republic, Finland, Czech Republic, Slovak Republic, Slovenia, Hungary, Latvia and Estonia.
Even were there any degree of validity in the Applicant’s representative’s submission, the Tribunal, although itself not bound by the strict rules of evidence,[43] would have relied upon the provisions of section 138 of the Evidence Act 1995 (Cth) to exercise the discretion in favour of admitting the evidence:
138 Discretion to exclude improperly or illegally obtained evidence
(1) Evidence that was obtained:
(a) improperly or in contravention of an Australian law; or
(b) in consequence of an impropriety or of a contravention of an Australian law;
is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained.
[43] Administrative Appeals Tribunal Act 1975 (Cth) s 33(1)(c): “In a proceeding before the Tribunal … the Tribunal is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate”.
It is necessary in terms of safeguarding the integrity of the social security system and the public revenues[44] that decision-makers have access to relevant information which allows their decisions to be made on an informed basis. Access to data about the extent of social security payments received by the Applicant from the Polish government is vital information which cannot be concealed behind an artificial and unsubstantiated cloak of alleged breach of European Commission privacy laws.
[44] Skinner and Secretary, Department of Social Services (Social services second review) [2015] AATA 569, [48].
HAS THE APPLICANT BEEN TREATED UNFAIRLY ON THE BASIS OF HIS NATIONAL OR ETHNIC ORIGIN?
No.
The Applicant’s representative has argued that the actions of the Respondent fall foul of the provisions of the Racial Discrimination Act 1975 (Cth) (RDA). As the Tribunal understands it, the gravamen of these arguments is as follows:
·Section 10(1) of the RDA prohibits the Commonwealth from treating any person unequally compared with any other person on the basis of their race, nationality or ethnic origin:
If, by reason of, or of a provision of, a law of the Commonwealth or of a State or Territory, persons of a particular race, colour or national or ethnic origin do not enjoy a right that is enjoyed by persons of another race, colour or national or ethnic origin, or enjoy a right to a more limited extent than persons of another race, colour or national or ethnic origin, then, notwithstanding anything in that law, persons of the first‑mentioned race, colour or national or ethnic origin shall, by force of this section, enjoy that right to the same extent as persons of that other race, colour or national or ethnic origin.
·Section 5(f) of the RDA amends section 18 to ensure that reference to a person’s national or ethnic origin should be read so as to encompass the status of that person as being an immigrant.
·Therefore, to the extent that the Department distinguishes between an Australian-born pension recipient and an “immigrant” Australian pension recipient, at least in terms of a determination of what constitutes “income”, the actions of the Department (as an agency of the Commonwealth) are discriminatory and invalid.[45]
[45] Applicant’s submissions dated 29 September 2020 at 8-10.
What this argument fails to understand is the basis of the RDA, namely that the tests which it applies are comparative. That is, an action, law or policy amounts to (racial) discrimination only when it applies to a person on the grounds of their nationality, ethnicity, immigrant status (or any other specified characteristic) in a way which does not apply to people who do not have those characteristics. The Applicant’s representative cannot identify the section 10 comparator in this instance.
The definition of income in the Act relates to the purpose and the source of the income and not the characteristic of the income recipient. That may be discriminatory, but it is not discrimination based on a prohibited characteristic and it applies equally to all recipients of monies for the legislated purpose and from the legislated source.
Article 5(e)(iv) of the International Convention on the Elimination of All Forms of Racial Discrimination, which is also included as a schedule to the RDA, specifies that:
In compliance with the fundamental obligations laid down in article 2 of this Convention, States Parties undertake to prohibit and to eliminate racial discrimination in all its forms and to guarantee the right of everyone, without distinction as to race, colour, or national or ethnic origin, to equality before the law, notably in the enjoyment of the following rights:
…
(e) Economic, social and cultural rights, in particular:
…
(iv) The right to public health, medical care, social security and social services;
It is to be assumed that the Australian government’s social security policies adhere to this standard and there has been no indication from any of the oversight bodies (such as the Racial Discrimination Commissioner or the Australian Human Rights Commissioner) that this is not the case.
In any event, as the Tribunal has made clear, the “discriminatory” aspect relevant in this matter relates to the purpose and the source of income and nothing else.
The Tribunal notes that the Disability Discrimination Act 1992 (Cth) addresses this issue more directly by exempting the payment of pensions (including those paid under the International Agreements Act) from its operation.[46]
[46] Disability Discrimination Act 1992 (Cth) s 51(1)(d), (da) and (db).
IS THERE A DEBT ARISING FROM THESE DETERMINATIONS?
Yes.
During the debt period the Applicant’s income from his Polish pension(s) had not been included as income for the purpose of the income test applied to the DSP and AP. As the evidence indicates that the Applicant did receive pensions from Poland during the debt period, it follows that he was overpaid and hence a debt arises.
WHAT IS THE EXTENT OF THAT DEBT ?
$12,004.46 (relevant reviewable debt) plus $3,338.64 which was determined following a remittal by the AAT1 and recalculation by the Respondent.
It must be remembered that the total figure of $15,343.10 is composed of the relevant reviewable debt of $12,004.46 determined in the original debt decision which was before the AAT1 and which is now subject to review by this Tribunal, plus the additional $3,338.64 which was added after the AAT1 had remitted the matter to the Department for recalculation in line with its findings about the starting date of the debt calculations. This latter amount is not subject to this Tribunal’s review in these proceedings.
As discussed above in paragraphs 7 – 8 and as stated in paragraphs 5.1 – 5.3 of the Respondent’s SFIC, although from the Respondent’s perspective the Applicant has a total debt of $15,343.10:
(a)the AAT2’s jurisdiction is limited to a review of that part of the debt in the sum of $12,004.46 concerning the period 1 March 2013 to 16 April 2018 and to decide whether or not to write off or waive that part of the debt that has been quantified as $12,004.46, and
(b)the AAT2 does not have jurisdiction to review that part of the debt in the sum on $3,338.64 for the period 1 October 2010 to 28 February 2013 and to decide whether or not to write off or waive that part of the debt that has been quantified as $3,338.64.
The Tribunal has not made an independent calculation of the relevant reviewable debt as it does not have access to the relevant details, such as the conversion rate of Polish złoty to Australian dollars throughout the debt period or the rates of the pension entitlements over time.
Pension entitlements are worked out via a complicated formula set out in the Pension Rate Calculator at section 1064 of the Act and the Tribunal relies upon the Department to have made those calculations correctly in the first place and particularly so, on a second occasion, following remittal by the AAT1 requiring the Respondent to recalculate the debt for the whole debt period.
IS THE DEBT RECOVERABLE?
Yes.
Section 1223(1) of the Act provides that debts arising from overpayment of benefits should be recovered and in particular this applies where “the payment was made as a result of a contravention of the social security law, a false statement or misrepresentation”.[47]
[47] Social Security Act 1991 (Cth) s 1223(1AB)(d).
The Respondent rightly contends that the failure of the Applicant to notify the Department of his receipt of the Polish pensions, despite being put on notice that he was required to inform the Department of any change in his circumstances (including financial) or to inform it of his receipt of Polish pensions, constitutes a contravention of the Act and the Respondent asserts that the Applicant had made a false representation.
SHOULD THE DEBT BE WRITTEN OFF OR WAIVED?
No.
There are provisions under section 1236, 1237A and 1237AAD of the Act for debts to be written off or waived in a variety of circumstances.
Debts may be written off where a debtor has no capacity to make repayments or where his/ her whereabouts are unknown. The debt may also be written off if it is irrecoverable at law or where it would not be cost effective to try to recover it.
None of those circumstances apply in the relation to the Applicant. The Applicant submitted a Statement of Financial Circumstances form dated 9 January 2020 which list his regular expenses at a rate of some $754.40 per fortnight (some $1,508.80 per month).[48] It should be noted that on this form the Applicant clearly stated he also receives the Polish pension but, as the Applicant contends, only “in Poland”.
[48] T documents at 108-112.
It appears that his income is some 3,186.38 Polish złoty per month (at current exchange rate that is approximately A$1,110) and his Australian pension is $771.85 gross per month.[49] The Applicant’s representative told the Tribunal that the Applicant suffered financial hardship and was reliant on charitable support from his friends but there is no independent verification of this situation.
[49] Respondent’s SFIC at [3.44].
The Applicant’s representative argued before the Tribunal that the Polish payments were not genuinely “available” to the Applicant because they were held in Poland and were somehow “managed” by other (unspecified) persons. She referred to such persons as being “authorised” to do this, without providing any further details. The AAT1 noted:
When asked if he [the Applicant] could have been getting a disability support pension from ZUS prior to receiving the age pension he said he didn’t remember and said his pension goes to friends living in Poland and they controlled the payments.[50]
[50] T documents at 11[13].
There does not appear to be any legal barrier to the Applicant accessing his bank account in Poland where his Polish pension is deposited[51] and the Tribunal knows of no restrictions which prevent the transfer of funds from Poland to Australia – indeed, there are several such services advertised on various websites.
[51] Supplementary T documents at 2.
It is also possible for debts to be waived where they are “attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments”.[52]
[52] Social Security Act 1991 (Cth) s 1237A(1).
The Tribunal believes that there may potentially have been some sort of administrative error by the Department in terms of the correspondence nominee matter discussed above and the management of correspondence and notifications regarding the Applicant’s reporting requirements after 14 August 2014 when the correspondence nominee arrangements were purportedly put in place. However, in any event, the Tribunal does not find that the debts arose solely as a result of the Commonwealth’s potential administrative error. The Applicant himself had both the responsibility, and the capacity, to respond to correspondence between 24 August 2010 and 14 August 2014 but failed to do so. In relation the proportion of the debt arising after 14 August 2014, as discussed above, there is no conclusive evidence that the nominee had been properly appointed and therefore it remained the Applicant’s responsibility to comply with the information requests or to comply with his obligation to provide the Department with information about changed circumstances, which he was aware of.
It is not necessary to canvass the extensive authority on the meaning of “solely” in the legislative provision[53] because, as the Tribunal has already determined, the Applicant failed to comply with his notification obligations under the Administration Act and so contributed to his own debt. Any error was, therefore, not “solely” the responsibility of the Commonwealth.
[53] Respondent’s SFIC at [8.7], [8.8] and [8.17].
The Respondent has also argued that the payments, in any event, were not received “in good faith” because, it alleges, the failures to notify were deliberate and designed to mislead.
The Tribunal makes no finding in this regard other than to say that neither naivety[54] nor ignorance of the law[55] are acceptable reasons for not complying with statutory obligations.
[54] Love and Secretary, Department of Social Services (Social services second review) [2016] AATA 8, [57].
[55] Secretary, Department of Social Services and Cannon (Social services second review) [2015] AATA 1028, [17].
The Applicant has referred to a number of health conditions, including dementia, from which he suffers. There is no reason to doubt that he has problems with his eyesight or that he may be suffering from some reduced degree of cognitive capacity, although there is no corroborative medical evidence before the Tribunal.
Neither this, nor his allegedly straitened financial circumstances, amount to what the Act refers to as “special circumstances” which might, if established, enliven the waiver provisions of section 1237AAD of the Act. There is nothing exceptional, unusual or out of the ordinary in the Applicant’s case such as to distinguish him from many other people in similar circumstances.[56] “Special circumstances” are related to how the debt arose[57] and how much it resulted from failure to fulfil reporting obligations or declare assets.[58]
[56] See the authorities listed in the Respondent’s SFIC at [8.44]-[8.48].
[57] Dranichnikov v Centrelink [2003] FCAFC 133, [66] and [79] in reference to similar provisions in the A New Tax System (Family Assistance)(Administration) Act 1999 (Cth).
[58] Mirza and Secretary, Department of Families, Community Services and Indigenous Affairs [2007] AATA 1309, [43].
WHAT HAS BEEN CONCLUDED?
The Tribunal finds that:
(a)the Applicant was in receipt of Polish pensions under the provisions of the reciprocal Polish Agreement, with payment of those Polish pensions commencing from 1 October 2010.
(b)under the provisions of social security law in Australia those Polish payments constitute income for the purpose of the income tests for the calculation of Australian pension payments.
(c)the Department notified the Applicant of his obligations to provide them with updated information about his income on several occasions. He was obliged, at law, to respond to the notifications.
(d)the Applicant was capable of responding to the notifications from the Department and failed to do so.
(e)the Applicant has been overpaid both DSP and AP as a result of his actions in not fully reporting his income.
(f)a debt has thereby arisen.
(g)that debt can be recovered and there are no reasons, either within Australian social security law or extrinsic to it, why it should not be.
The Tribunal is conscious that its jurisdiction is limited in the manner outlined above but is also aware that the Respondent has, on recalculation, found that there is a further debt of $3,338.64 (in addition to the $12,004.46).
As the AAT1 correctly found that the original debt of $12,004.46 was incorrect and that it did not reflect the Applicant’s total debt for the entire debt period, and limited by section 179(2)(d) of the Administration Act to review only the “directions or recommendations” of the AAT1, the Tribunal finds that the AAT1’s direction that the debt be recalculated taking into account the entire debt period from 1 October 2010 to 16 April 2018 was correct.
DECISION
The decision under review is affirmed.
I certify that the preceding 123 (one hundred and twenty-three) paragraphs are a true copy of the reasons for the decision herein of Chris Puplick AM, Senior Member
..................................[sgd]..................................
Associate
Dated: 12 February 2021
Date(s) of hearing: 16 December 2020 Date final submissions received: 21 December 2020 Advocate for the Applicant: Ms A Imielska Solicitors for the Respondent: Dr S Thompson, Services Australia
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