Ireland and Secretary, Department of Family and Community Services

DECISION AND REASONS FOR DECISION [2002] AATA 872

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N2001/1543

GENERAL ADMINISTRATIVE DIVISION       )
           Re      RAYMOND IRELAND
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY & COMMUNITY SERVICES
  Respondent

DECISION

Tribunal Ms N Bell, Member

Date2 October 2002
PlaceSydney

Decision The decision under review is affirmed.

..............................................
Ms N Bell,
Member

CATCHWORDS
SOCIAL SECURITY – newstart allowance – preparing for work agreement – failure to enter into newstart activity agreement – unreasonable delay – activity test breach rate reduction period

Social Security Act 1991 – sections 593; 607; 625; 644AA; 644AB; 644AE

REASONS FOR DECISION

N Bell, Member

This is an application by Mr Raymond Ireland ("the Applicant") for review of a decision of the Social Security Appeals Tribunal ("SSAT") dated 6 September 2001 which affirmed the decisions of a Centrelink delegate of the Secretary, Department of Family and Community Services ("the Respondent") dated 8 June 2001 and 4 July 2001 (T2). The first decision of the Centrelink delegate was to impose an activity test breach rate reduction on Mr Ireland's newstart allowance of 18 per cent for 26 weeks (T6) and the second decision was to impose an activity test breach rate reduction on Mr Ireland's newstart allowance of 24 per cent for 26 weeks (T7). Both decisions were reviewed and affirmed by an authorised review officer on 1 August 2001 (T15).
The Applicant attended the Tribunal and spoke on his own behalf. Ms Cheryl Collis, an advocate from the Advocacy and Administrative Law Team at Centrelink, represented the Respondent. The Applicant and his wife, Susan Jopling, gave oral evidence to the Tribunal. The Tribunal had before it the documents lodged under section 37 of the Administrative Appeals Tribunal Act 1975 ("the T-documents"), the Respondent's Statement of Facts and Contentions (Exhibit R1) and the statutory declaration of Susan Jopling dated 23 January 2002 (Exhibit A1).

background

The Applicant had been in receipt of newstart allowance since 1994 when Centrelink wrote to him asking him to attend Mission Employment at Bega on 29 March 2001 in order to negotiate a Preparing for Work Agreement ("the agreement"). It is not in dispute that the Applicant attended on that day and discussed the agreement but no agreement was concluded. Following further contact between the Applicant and Mission Employment, and no agreement being entered into, Centrelink wrote to the Applicant on 8 June 2001 advising him that he had breached the newstart activity test and that his rate would be reduced by 18 per cent for 26 weeks until 6 December 2001. Centrelink wrote again to the Applicant on 4 July 2001 advising him that he had breached the newstart activity test a second time and that his rate would be reduced by 24 per cent for 26 weeks until 1 January 2002. These decisions were reviewed, at the Applicant's request, by an authorised review officer who, on 1 August 2001, affirmed both decisions.

issues

Section 593 of the Social Security Act 1999 ("the Act") provides that in order to qualify to receive newstart allowance a person must be prepared to enter into a Newstart Activity Agreement ("the agreement"). Section 607 of the Act provides that if the Secretary is satisfied that a person is unreasonably delaying entering into an agreement then, following notice being given to the person, the person is taken to have failed to enter into the agreement. Sections 625 and 644AA, 644AB and 644AE of the Act provide for the imposition of activity test penalties for failure to negotiate an agreement, such as the imposition of a breach rate reduction period.
The issue for the Tribunal to consider in this application is whether the Applicant unreasonably delayed entering into an agreement and should therefore incur an activity test breach rate reduction period pursuant to section 625.

applicant's evidence

The Applicant told the Tribunal that he had contact with Mission Employment on three occasions. He said that on the first occasion he met with an officer called Kathy (Ms Boyne) for approximately two and a half hours and arranged for a work agreement. He said that he told Kathy he was an artist and that Mission Employment decided that he should attend technical college. The Applicant said that his second meeting with Mission Employment was arranged to take place at a restaurant. He said that Kathy had asked him to meet her there but he insisted that his wife attend as well. The Applicant said that Kathy turned up late and they decided to go to McDonalds. He said that the time with Kathy was spent in discussing her childhood in Canada and that Kathy invited a man sitting nearby to come and sit with them and he talked about matters unrelated to the Applicant's work agreement. The Applicant said that Kathy crossed out huge sections of the agreement that had been prepared and asked the Applicant to sign it. The Applicant said that he told Kathy he would sign it when it was typed up and told her that he would attend Mission Employment to sign it on the following Friday. The Applicant said that he was however unable to make it on that Friday and attended instead on the following Monday.
The Applicant said that on that Monday, being the third time he met with Mission Employment, he was sitting in the vestibule of Mission Employment when Kathy gave him a copy of the agreement. He said that he asked Kathy if he and his wife could read it and that Kathy said that they could not. He said that he would not sign an agreement that he had not read. When the Tribunal asked the Applicant what material had been crossed out by Kathy, he said he was unable to remember.
The Applicant told the Tribunal that he only ever missed one arranged interview and that was because he had been unable to get a lift to the meeting. He was generally unable to recall dates of events of which he gave evidence and appeared to be somewhat vague or confused about the sequence of events.
In order to assist the Applicant in giving some focus to his evidence to the Tribunal, the Tribunal asked the Applicant to read through the SSAT's summary of his evidence to the SSAT. The Applicant did so and made the following comments.
The Applicant said that when he attended Workways at Merimbula, the job network member he was initially referred to, the manager demanded that he know his "social security number" and pushed a book on the "rules of conduct" in his face in an attempt to antagonise him. He said that he, the Applicant, then said "don't worry about it" and left. The Applicant said that people are jealous of his lifestyle and that explained their negative conduct towards him.
The Applicant agreed that some time later Centrelink wrote to him to attend Mission Employment at Bega and that he attended that appointment and spoke to Kathy for about two hours. The Applicant confirmed his evidence that they agreed that he would put his paintings into contests and restaurants and that Kathy told him she wanted to meet him in Merimbula in two weeks at a restaurant.
The Applicant said that he was unable to attend the appointment on the following Friday at the Bega office to sign the agreement because he got half way there but was unable to get another lift. He confirmed his evidence to the SSAT that he attended the Bega office on the following Monday to sign the agreement. He said that there were about 20 people in the office including a large number of Aboriginal people and Kathy told him she had no time to see him and asked him to sign the agreement immediately, having refused his request to read it first.
The Applicant confirmed that a few days later he returned to the Bega office and spoke to a person called Shaun about teaching art at technical college. He said he was advised that the agreement was no longer at Bega and that he would have to go to Mission Employment in Eden to sign it. He confirmed that he received a letter for an appointment at Mission Employment in Eden and attended the interview but the person he was supposed to see was not there because of possible flooding. He confirmed that he was offered an interview by telephone and that he agreed to this on the condition that all his interviews would be conducted by telephone in the future, but that this was not agreed to. He left and was driven home by a priest of his acquaintance.
The Applicant denied that he had withdrawn his paintings from exhibition at two Merimbula restaurants because he found selling his work too stressful. He said that he was unable to have his paintings framed and so could not proceed with exhibiting them. He also denied that he wants to be an art teacher and said that he would be prepared to do "any job, any time, any where".
In cross examination the Applicant denied having missed an interview at the Bega office on 1 May 2001.
The Applicant said that Kathy's idea was that he would be a professional artist and suggested that he enter the Archibald Prize. He said that he considered this to be ridiculous and that he was never given the opportunity to suggest any alternative work to art.
The Applicant said that it took him a long time to sign the agreement, which he then admitted that he had never signed, because Kathy would not let him or his wife read it. The Applicant was referred to Ms Boyne's evidence to the SSAT, as summarised in the SSAT's statement of reasons, and stated that her evidence is wrong. He said that he was serious about signing the agreement but that unfortunately "Mission Employment is serious about breaching people".
The Applicant was referred in particular to Ms Boyne's evidence to the SSAT that when she discussed with the Applicant things that might be included in an activity agreement he insisted that every activity must be stated to be "for the glory of God", in those exact words. The Applicant denied that he had said this.
Finally, the Applicant told the Tribunal that he had been in receipt of sickness benefits since the breaches were imposed and when his knees are better he wishes to sign a work agreement and possibly attend technical college. The Applicant asked the Tribunal to look carefully at "the relationship between the first interview and the date of the breach".

ms jopling's evidence

Ms Jopling, the Applicant's wife, also gave evidence to the Tribunal in a statutory declaration and orally. In her statutory declaration she said that she attended a meeting with Ms Kathleen Boyne from Mission Employment in Bega, at McDonalds in Merimbula with Mr Ireland and their children. She said that Ms Boyne was late and talked for the first hour about her childhood in Canada and her husband who was unable to get work. She said that a member of the public then asked if he could join Kathleen and she said yes and they talked for about half an hour about the Riverina area and Ms Boyne took notes in her book. She said that finally, discussing the work agreement and mutually agreeing to cross out whole paragraphs of the agreement and to replace those with new ones, Ms Boyne said she had to go to an important meeting at Eden and finished the interview saying that she would have the agreement rewritten and Mr Ireland could come in to the office and sign it.

respondent's evidence

The Respondent relied on the evidence given by Ms Kathleen Boyne and Ms Howarth to the SSAT at its hearing of the Applicant's appeal. For convenience, that evidence, as summarised by the SSAT, is extracted below:
"19.     Ms Boyne said Mr Ireland was referred to Mission Employment at Bega by Centrelink and she saw him for the first time on 29 March 2001. She spoke to him for two and a half hours on that day. She said he was unco-operative at the start and said he did not like coming to Bega because it made him feel dirty and he wanted to go to Eden. Mr Ireland responded that he meant this as a joke. Ms Boyne said he was erratic and distracted and would not sit down for long at a time. He kept getting up and going to the window or going to the kitchen to make cups of cold coffee. She thought he may have been drug-affected. … Ms Boyne said when male staff members walked past the room, he would call out at them that they were gay. …
20.      Ms Boyne said she did not try to get him to sign an agreement on that day because she wanted to concentrate on trying to understand his behaviour and to find his skills and strengths. She did manage to find out that he was interested in painting and she talked about various things that he could do, including entering for the Dobell and Blake prizes. When she discussed things they might include in an activity agreement, he insisted that every activity must be stated to be for the glory of God; he wanted those exact words. … Ms Boyne said she did not know if she was allowed to include conditions like that in an agreement and told him she would check with the Department and they should meet again in a fortnight. He said he would like to meet in Merimbula. She said she would be coming to Merimbula on 14 May and they could meet at the Waterfront Café, where she sometimes met Merimbula clients because they could have some privacy there. Mr Ireland agreed.
21.      On 12 April (sic), Ms Boyne wrote to Mr Ireland asking him to come to an interview on 1 May at the Bega office. He did not attend and gave no reason for his failure during a subsequent phone call. …
22.      On 14 May, Ms Boyne met Mr Ireland and his wife outside the Waterfront Café. He said he would prefer to go to McDonalds, so they walked to McDonalds and stayed there for around two and a half hours. They talked about Mr Ireland enrolling in some adult education classes and entering for the Dobell and Blake Prizes. Ms Boyne had a draft activity agreement with her but Mr Ireland would not sign it. She said there were no changes he wanted to make to the agreement; he did not have a reason for not wanting to sign, he simply would not sign it and after looking at it, he walked out of McDonalds. …
23.      The Tribunal asked Ms Boyne abut the incident Mr Ireland described in which another person interrupted their interview for half an hour. She said there was a person at another table who became involved because Mr Ireland kept calling out to him about what a terrible thing it was he was being forced to look for work. Ms Boyne said her impression was this was a device employed by Mr Ireland to avoid having to talk about work and sign the agreement.
24.      Ms Boyne said Mr Ireland rang her in the afternoon on 14 May and asked her to enrol him in a drawing class. He rang her again on 15 May and asked her to pay for an adult education class. He told her Centrelink wanted him to apply for disability support pension. … Ms Boyne reported that he said he would come in to the Bega office to sign the agreement at 9am on 18 May. On 18 May, he did not attend and he did not ring to say why.
25.      Ms Boyne said Mr Ireland arrived at the Bega office unexpectedly on the morning of 21 May. She wanted him to sign the agreement. He refused to sign the agreement and did not want to stay in the office to discuss it. He wanted to take the agreement away with him to read it. She refused because she said it was important that she go through it with him at the time he signed it. He then left the office. The Tribunal put Mr Ireland's version of this occasion to Ms Boyne. She said she was not too busy to talk to him. She actually wanted him to stay and talk about it but he would not stay. …
26.      Ms Boyne said on 29 May, Mr Ireland attended the Bega office and met Jeff Bolton, another case manger. Mr Ireland offered to conduct art classes for unemployed people. Mr Bolton told him they did not run art classes and he should offer his services to Adult Education. They agreed to pay for Mr Ireland to enter the Dobell Prize. He attended again on 4 June and had another similar conversation with Mr Bolton, who again suggested he should offer his services to Adult Education. Also on 4 June, Ms Boyne discussed with Mr Ireland whether he would sign the agreement. On Centrelink's advice, she put it to him in terms of whether or not he wanted intensive assistance. He said all he wanted to do was to run art classes. She reiterated that they did not offer art classes and offered various kinds of help. He said he did not want to sign the agreement, nor did he want to exit intensive assistance. … Also on 4 June, Mr Ireland said he would rather deal with the Eden office in future. A letter was prepared on that day for him to attend an appointment at the Eden office on 19 June with Ms Howarth.
27.      Ms Howarth said Mr Ireland did not attend the appointment on 19 June and she notified Centrelink of the breach on the same day. …
28.      On 29 June, Mr Ireland was notified by letter to attend an appointment at Bega on 12 July at 1.30pm. On 12 July, there was torrential rain in Eden and those staff at Mission Employment who did not live in town were advised to leave because the Pambula bridge would be under water. Ms Howarth cancelled all her appointments for the day, except Mr Ireland, whom she was unable to contact by telephone, and worked out of the Bega office for the reminder of the day. Mr Ireland turned up at Eden on the bus at around 11am and they spoke by telephone. He yelled at her when she offered to discuss activities over the telephone, saying that she should be there. She apologised but Mr Ireland told her he would only conduct the appointment by telephone if he could conduct all his subsequent appointments by telephone. She said she could not do that. She offered him an appointment on another day but he refused and said he would not sign the agreement anyway and rang off. …"
Attachment 4 to the Respondent's Statement of Facts and Contentions (Exhibit R1) is a letter to the Applicant requiring him to attend an interview at Mission Employment at Bega on 1 May 2001. Document T6 is a letter dated 8 June 2001 to the Applicant notifying him that he has incurred a breach rate reduction of 18 per cent for 26 weeks. Document T5 dated 6 June 2001 is a letter to the Applicant requiring him to attend Mission Employment in Eden on 19 June 2001. Document T9 is a letter dated 20 June 2001 to the Applicant advising him that he had failed to negotiate an agreement. Document T7 is a letter dated 4 July 2001 to the Applicant notifying him that he had incurred a breach rate reduction of 24 per cent of a period of 26 weeks.

consideration

Section 607(1) of the Act provides:
"Newstart Activity Agreements – failure to negotiate
Section 607(1) If:
(a) a person has been given notice under subsection 605(3) of a requirement to enter into a Newstart Activity Agreement; and
(b) because the person did not:
(i) attend the negotiation of the agreement; or
(ii) respond to correspondence about the agreement; or
(iii) agree to terms of the agreement proposed by the Secretary;
or for any other reason, the Secretary is satisfied that the person is unreasonably delaying entering into the agreement;
then:
(c) the Secretary may give the person notice that the person is being taken to have failed to enter the agreement; and
(d) if the notice is given—the person is taken to have so failed.
Note: refusal to enter a Newstart Activity Agreement disqualifies a person for newstart allowance—see paragraph 593(e)."
The Tribunal is satisfied that the Respondent gave the Applicant notice of the requirement to enter into an agreement and the places and times for the agreement to be negotiated, in letters sent by the Respondent to the Applicant dated 17 April 2001 (Attachment 4 to Exhibit R1) and 6 June 2001 (T5). The Tribunal, in the absence of any other evidence, accepts the evidence of Ms Boyne that the Applicant failed to attend the interview arranged for 1 May 2001 (as notified in the letter of 17 April 2001) and that the Applicant made no contact with Mission Employment prior to the interview date. The Tribunal also accepts, in the absence of any other evidence, the evidence of Ms Howarth that Mr Ireland did not attend the appointment arranged for 19 June 2001 notified in the letter dated 6 June 2001. The Tribunal is mindful of the Applicant's evidence that he missed only one of the interviews arranged for him. However, the Applicant gave no details in his evidence of dates or times and was generally vague in his recollections. The Tribunal notes on the other hand that, according to the SSAT summary of their evidence, Ms Boyne and Ms Howarth referred to the notes made on the Mission Employment file relating to the Applicant. The Tribunal prefers the evidence of Ms Boyne and Ms Howarth.

The Tribunal also accepts Ms Boyne's evidence that the Applicant refused to sign the draft agreement at their meeting at McDonalds in Merimbula on 14 May 2001 and at that meeting tried to avoid dealing with the agreement by involving a member of the public in the discussion. The Tribunal notes Ms Jopling's evidence that parts of the agreement were crossed out and were to be replaced with new sections, and that the agreement would be rewritten so that the Applicant could attend the office and sign it. This evidence is not inconsistent with the Applicant having refused to sign the agreement. The Tribunal also notes that in his evidence to the Tribunal, the Applicant was unable to tell the Tribunal which parts of the agreement he had wanted changed.
The Tribunal accepts the Applicant's evidence, which is largely in accord with that of Ms Boyne, that he had arranged to attend Mission Employment in Bega on the following Friday but was unable to obtain transport and then attended the office on the following Monday to sign the agreement. The Tribunal does not accept the Applicant's evidence that he was refused an opportunity to read the agreement before signing it and prefers instead the evidence of Ms Boyne, based on her file notes, that she refused to allow the Applicant to take the agreement away with him to read it because she wanted to go through it with him at the time he signed it. The Tribunal finds that on this occasion the Applicant again refused to sign the agreement but did have an opportunity to read it.
The Tribunal accepts Ms Boyne's evidence that on 4 June 2001 the Applicant attended the Bega office and had a discussion with Ms Boyne about whether he would sign the agreement and he indicated that he did not want to sign the agreement and would prefer to deal with the Eden office in the future. The Tribunal notes that document T5 is a letter to the Applicant advising him to attend the Eden office on 19 June 2001. The Tribunal does not accept the Applicant's evidence that he was told on 4 June 2001 that the agreement was no longer at the Bega office and that he would have to go to Eden to sign it. Again, the Tribunal prefers the evidence of Ms Boyne because she referred, in giving her evidence, to the notes she had made at the time of the discussion.
The Tribunal accepts the evidence of Ms Howarth that the Applicant did not attend the appointment on 19 June 2001 and that a further appointment made for 12 July 2001 at the Eden office could not be kept by her because of torrential rain and flooding. The Tribunal also accepts Ms Howarth's evidence that she was able to speak to the Applicant by telephone on that day and Ms Howarth offered to have a discussion about the Applicant's activities over the telephone but he refused to do so unless he could conduct all his subsequent appointments over the phone. Ms Howarth did not agree to this but offered him an appointment on another day, but he refused and would not discuss the matter further. This is broadly in accordance with the Applicant's evidence.
The above findings of fact lead the Tribunal to conclude that the Applicant consistently and unreasonably avoided, throughout the period from April 2001 to at least July 2001, entering into an agreement. It follows that the Applicant unreasonably delayed entering into an agreement within the terms of section 607 of the Act and may therefore be taken to have failed to enter the agreement.
The consequences of such a failure are set out in sections 625, 644AA, 644AB and 644AE of the Act. Section 625(1) of the Act provides:
"Section 625 Activity test penalties for failure to enter Newstart Activity Agreement
625(1) Subject to subsection (2), if:
(a) a person is required to enter into a Newstart Activity Agreement in order to qualify, or to continue to qualify, for a newstart allowance; and
(b) the person fails to enter into a Newstart Activity Agreement (the "failure");
a newstart allowance is not payable to the person because of the failure."

Section 625(1A) of the Act provides:
"625(1A) If a newstart allowance becomes payable to the person after the time it ceases to be payable under subsection (1), then:
(a) if the failure is the person's first or second activity test breach in the 2 years immediately before the day after the failure—an activity test breach rate reduction period applies to the person; or
(b) if the failure is the person's third or subsequent activity test breach in the 2 years immediately before the day after the failure—an activity test non-payment period applies to the person.
Section 644AA of the Act provides:
"Section 644AA Activity test breach rate reduction periods
If an activity test breach rate reduction period applies to a person under this Part, the period applicable to the person is 26 weeks."
Section 644AB(1) of the Act provides:
"Section 644AB(1) Commencement of activity test breach rate reduction periods Subject to section 644AC, if an activity test breach rate reduction period applies to a person under this Part, the Secretary must give to the person a written notice informing the person of the commencement of the activity test breach rate reduction period applicable to the person."
Pursuant to the above provisions of the Act, a letter was sent by Centrelink to the Applicant on 8 June 2001 in respect of his failure to enter into the agreement as of 8 June 2001 and advising him of a breach rate reduction of 18 per cent until 6 December 2001 (T6 and T14). A further letter was sent to the Applicant by Centrelink on 4 July 2001 in respect of his failure to enter into the agreement as of 4 July 2001 and advising him of a breach rate reduction of 24 per cent until 1 January 2002 (T7 and T14).
Section 644AE(2) of the Act provides:
"644AE(2) A person's rate reduction amount is worked out as follows:
(a) If the activity test breach is the person's first breach in the 2 year period:
Maximum payment rate x 0.18
(b) If the activity test breach is the person's second breach in the 2 year period:
Maximum payment rate x 0.24"
The combined effect of these provisions is that, given the Applicant's failure to enter into an agreement over the period from April 2001 to at least July 2001, he incurs, in respect of his failure up until 8 June 2001, a breach rate reduction of 18 per cent of his newstart allowance until 6 December 2001 and, in respect of his failure up until 4 July 2001, a breach rate reduction of 24 per cent of his newstart allowance until 1 January 2002.

decision

The decision under review is affirmed.
I certify that the 37 preceding paragraphs are a true copy of the reasons for the decision herein of Ms N Bell, Member
Signed:         .....................................................................................
  Associate
Date of Hearing  6 August 2002
Date of Decision  2 October 2002
Applicant  self-represented
Advocate for the Respondent Cheryl Collis

[2002] AATA 872

2 October 2002

Key Legal Topics

Areas of Law

Social Security Law

Legal Concepts

Unreasonable Delay

Activity Test

Breach Rate Reduction Period

Newstart Allowance

Preparing for Work Agreement