JDKD and Secretary, Department of Social Services (Social services second review)

[2020] AATA 5212

JDKD and Secretary, Department of Social Services (Social services second review) [2020] AATA 5212 (22 December 2020)

Division:GENERAL DIVISION

File Number:           2019/5730

Re:JDKD  

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

AndPVBS

OTHER PARTY

DECISION

Tribunal:Member K. Parker

Date:22 December 2020

Place:Melbourne

The Tribunal affirms the Decision under Review.

..........................[sgd]..............................................

Member K. Parker

Catchwords

SOCIAL SECURITY ENTITLEMENTS – parenting payments – both parents had child which met definition of “PP child” under the Social Security Act 1991 (Cth) - both parents had equal care – determination must be made specifying only one parent to be deemed principal carer – consideration of which parent was most in need of a favourable determination – consideration of factors listed in Social Security Guide – mother earned more income during Qualification Period but father had significantly greater assets including over $700,000 in superannuation funds he was able to access due to his age, albeit subject to taxation – Tribunal not satisfied the father was most in need of favourable determination - decision under review affirmed

Legislation
Administrative Appeals Tribunal Act 1975 (Cth)
Social Security Act 1991 (Cth)
Social Security (Administration) Act 1999 (Cth)

Secondary Materials

Social Security Guide

REASONS FOR DECISION

Member K. Parker

22 December 2020

INTRODUCTION

1. The Applicant, JDKD, and the Other Party, PVBS, are the parents of a child born in 2014 (Child).[1]

   [1] On 21 December 2020, the Tribunal made orders under s 35(3) of the Administrative Appeals Tribunal Act 1975 (Cth) and has applied pseudonyms in place of the names of the Applicant and Other Party in order to protect the confidentiality of the parties. The Tribunal made those orders because this application relates to private matters pertaining to the care of a child and these Reasons for Decision refer to matters pertaining to child support payments.

2. JDKD and PVBS were married on 4 December 2009. They ceased co-habitation on 7 March 2018. Each of them seeks to be specified as the “principal carer” of the Child, by the Secretary; and therefore, eligible to receive parenting payments under the Social Security Act 1991 (Cth) (the Act).

3. On 21 November 2018, the Respondent, the Secretary, Department of Social Services (Secretary), made a determination specifying that JDKD was deemed to be the principal carer of the Child (Original Determination).

4. On 18 December 2018, an authorised review officer (ARO) changed the Original Determination. The ARO made a determination specifying that JDKD was not to be regarded as the principal carer of the Child (ARO Decision). This meant that PVBS was specified as the person to be regarded as the principal carer of the Child.

5. JDKD sought a first-tier review of the ARO Decision by the Social Services and Child Support Division (AAT1) of the Administrative Appeals Tribunal (Decision under Review).

6. On 13 August 2019, the AAT1 affirmed the Decision under Review. JDKD now seeks a second-tier review by the General Division of the Administrative Appeals Tribunal (Tribunal).

7. The Secretary lodged a set of documents with the Tribunal pursuant to its obligations under s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) (T-Documents) totalling 588 pages, and a further set of documents under s 38AA of the AAT Act (ST-Documents) totalling 19 pages.

8. Shortly before the commencement of the hearing of this matter, PVBS lodged a two-page Statement of Financial Position and a letter of support drafted by Social Security Rights Victoria (a non-government organisation assisting PVBS). JDKD took objection to the late service of those documents. Initially, this was resolved on the basis that those two documents would not be admitted into evidence in this application and the hearing would proceed as scheduled. However, as the hearing progressed, the Tribunal called for the provision of further documentation from the parties. Due to this, it was decided that directions would be made providing for the production of those further documents by both parties (and to include the Statement of Financial Position and Social Security Rights’ letter of support). In order to afford procedural fairness, the Tribunal also made directions to allow for the parties to make further written submissions about any of those documents after the conclusion of the hearing. The Tribunal has now closely considered all the materials and submissions lodged by the parties in their entirety.

9. For reasons outlined below, the Tribunal affirms the Decision under Review.

   LEGISLATIVE REGIME

10. Section 500 of the Act sets out the requirements for a person to qualify for parenting payments under the Act. One of those requirements is that “the person has at least one PP child (see section 500D)”.[2]

    [2] Refer s 500(1)(a) of the Act.

11. In circumstances where the person is not a member of a couple, s 500D(2) of the Act provides that a child is a PP child if the child has not turned eight years of age and the person is the child’s principal carer.

12. The term “principal carer” is defined under the Act in ss 5(15) to (24) inclusive.

13. Of relevance, those provisions provide that a person is a principal carer of a child if the child is a dependent child of the person; and has not turned 16. The Child is aged under 16 and separately, a dependent of both JDKD and PVBS.

14. Section 5(18) of the Act provides that only one person at a time can be regarded as the principal carer of a child. Section 5(19) provides that if the Secretary is satisfied that, but for s 5(18), two or more persons (adults) would be principal carers of the same child, the Secretary must make a written determination specifying one of the adults as the principal carer of the child.

    Social Security Guide

15. The Department has issued policy guidance in relation to the assessment of eligibility of a person to receive parenting payments, and when a determination is made specifying a person to be deemed the principal carer when they have “equal care” of a PP child. This may be found at section 1.1.P.416 of the Social Security Guide (Guide) and states as follows:

    Equal care

    If the difference in the level of care provided by the 2 carers is less than 10%, care is considered to be shared equally.

    …

    In situations of equal care where only 1 of the carers is claiming or receiving income support, that person should be determined as the principal carer. If both carers are claiming or receiving income support, the carer who is most in need of a favourable determination should be deemed principal carer.

    A decision maker MUST take into account the following factors when deciding which carer is in most need of a favourable determination:

    …

    ·     whether only 1 carer would be eligible for PP

    ·     which carer would receive the higher rate of payment

    ·     any other sources of income the carers may have, whether actual or potential, including both employment and investment income

    o    Note: If either carer has income that fluctuates, the assessment officer may need to look at average income levels over an extended period of time, such as 12 weeks, and

    ·     the asset levels of each carer.

    The following factors MAY be taken into consideration by the decision maker, if further information is required to make the determination:

    ·     the expenses of each carer

    o    Example: Rent, child care

    ·     workforce experience, education levels and future employment prospects of each carer

    ·     the duration that each carer has been on income support and their principal carer status during this time. If there are no substantial differences between the parties, then generally the determination should be favoured which maintains the 'status quo', and

    ·     any other factors considered relevant by the decision maker.

    …

16. In general, the Tribunal considers it appropriate to follow relevant guidance provided in governmental policies unless there are cogent reasons not to do so. The Tribunal does not consider that the guidance provided in section 1.1.P.416 of the Guide is inconsistent with the Act or the Social Security (Administration) Act 1999 (Cth); or that there are any other cogent reasons not to follow this guidance. For these reasons, the Tribunal considers it appropriate to follow the guidance provided in section 1.1.P.416 in this case.

    ISSUE

17. The issue for determination is whether JDKD qualified for the parenting payment under s 500 of the Act at any time in the 13-week period that followed the lodgement of his claim on 28 March 2018 for parenting payment (i.e. 28 March 2018 to 28 June 2018) (the Qualification Period).[3] This will require the Tribunal to be satisfied that JDKD and PVBS have at least one PP child as defined under the Act; that they each had equal care of the PP child; and also to determine whether JDKD should have been specified as the “principal carer” of the PP child.

    [3] Refer s 4 of Schedule 2 of the Social Security (Administration) Act 1999. 

    HEARING

18. JDKD drew the Tribunal’s attention to the following four documents at the commencement of the hearing:

    (a)his letters dated 7 January 2019, 12 June 2020 13 July 2020; and

    (b)a 12-page document authored by him entitled “Marriage summary: 04.12.08 - 07.03.2018” found at T-Document T40.

19. At the hearing, Mr Bryn Overend, the solicitor representing PVBS, submitted that JDKD had $1.3m in cash, superannuation and assets, which could have been accessed by him during the Qualification Period; and that he had a history of significant earning potential. Mr Overend compared this to PVBS, who had $20,000 in cash and assets and limited earning potential. He said PVBS was earning limited and variable income working as a cleaner.

20. The hearing provided an opportunity for the Tribunal to seek clarification from JDKD and PVBS as to their respective circumstances, referred to in detail below.

    CONSIDERATION

    Equal Care

21. Section 1.1.P.416 of the Guide provides that the parent with the higher percentage of care of a PP child is generally regarded as the principal carer. However, where the difference between each parent’s percentage of care of the PP child is less than 10%, they are each considered to have “equal care” of the PP child.

22. At the hearing Mr Overend accepted that as at the time of the Qualification Period, JDKD and PVBS had equal care of the Child.

23. The Tribunal notes that, in an affidavit sworn by PVBS on 3 July 2019 for the Family Law Proceeding (PVBS’s 2019 Affidavit), there is a reference to interim orders having been issued in the Family Court Proceeding on 28 March 2018, which provided for the Child to be cared for by the parents equally on a “week about” basis. PVBS states in her affidavit that this arrangement was in place for about 12 months.

24. Based on this evidence, the Tribunal finds that JDKD and PVBS had “equal care” of the Child during the Qualification Period.

    Consideration of the factors listed in the Guide

25. The Guide provides that when both parents have equal care for a PP child, a decision-maker will need to determine which parent is “most in need of a favourable determination”.  The Guide sets out a list of mandatory and discretionary factors for the decision-maker to consider when making this determination. 

    Factor 1: “Whether only 1 carer would be eligible for PP”

26. The Secretary contends that but for the application of s 5(18) of the Act, both JDKD and PVBS were eligible for parenting payments. There is no dispute about this, and the Tribunal finds accordingly. This factor is a neutral consideration in respect of deciding which parent of the Child was most in need of a favourable determination during the Qualification Period.

    Factor 2: “Which carer would receive the higher rate of payment”

27. The Secretary contends that it is possible that the parties would have received different rates of parenting payments if they were specified as the principal carer. Both ordinary income and assets are factored into the calculation of this payment, as provided for under the Pension PP (Single) Rate Calculator appearing at s 1068A of the Act.

28. JDKD claims that he was unemployed during the Qualification Period. During that time, PVBS was employed as a casual clearer earing a modest, fluctuating income.

29. During the Qualification Period, once a person earns more than $188.60 gross per fortnight, their rate of their parenting payment will start to reduce on a sliding scale. PVBS submitted that she earned on average $500 to $600 per week as a casual cleaner.[4] However, a person’s assets are also considered when calculating the rate of parenting payment. JDKD held assets of a much higher value than PVBS during the Qualification Period.

    [4] Refer paragraph [32] of JDKD’s Statement of Facts, Issues and Contentions (undated) prepared by Mr Overend (JDKD’s SFIC).

30. No evidence was placed before the Tribunal by either party to provide a precise calculation as to which parent of the Child would have received a higher rate of parenting payments if they were specified as the principal carer. Accordingly, the Tribunal did not have information before it to make a definitive finding in this regard. This being the case, the Tribunal has treated this factor as neutral for the purpose of determining which parent is most in need of a favourable determination.

    Factor 3: “Any other sources of income the carers may have, whether actual or potential, including both employment and investment income” and “workforce experience, education levels and future employment prospects of each carer”

    Employment income - actual

31. JDKD lodged with the Tribunal a financial statement that was signed by him during the Qualification Period (i.e. on 15 May 2018) (JDKD’s Financial Statement).

32. JDKD’s Financial Statement states that he received $152 per week through government benefits listed as “Australian Government Families”. The Secretary informed the Tribunal that JDKD was initially receiving the Family Tax Benefit of $336.70 per fortnight, which was reduced to $169.78 by the end of the Qualification Period. It was not in dispute between the parties, given the matters set out in paragraphs [28] and [29] above, that during the Qualification Period PVBS was earning a higher level of employment income than JDKD. In fact, it was reported that toward the end of the Qualification Period PVBS commenced paying a modest amount of child support to JDKD, pursuant to a Child Support Assessment. Specifically, the Child Support Transaction summary provided to the Tribunal recorded that PVBS had paid JDKD a total of $50.31 for the period from 8 June 2018 to 30 June 2018.

    Employment income - potential

33. JDKD gave evidence that he was a Marine Engineer, Class 1. He told the Tribunal that he held a Diploma in Engineering. JDKD told the Tribunal that he also gained a trade as a motor mechanic, when he was a teenager. He said he was now out of touch with this trade as the car industry had changed so much. JDKD told the Tribunal that he was a member of the Australian Institute of Marine and Power Engineers and that before the pandemic, he used to attend the institute’s monthly meetings.

34. JDKD gained substantial work experience as a marine engineer. At the hearing, he told the Tribunal that his work history was set out in his document entitled “Marriage summary”.[5]  He said he had worked for [Company A] for about five years and left them due to politics. He said he worked for [Company B] for about five years, and that they changed ownership three times, and that their agent was [Shipping Company A]. He said he had worked for [Company C], where he was involved in picking up a boat in a country in Asia and it was delivered to Australia. He said he had worked for [Company D] and that they were happy with his performance and status; and that he was still on good terms with that company. JDKD said his last job in the marine industry was around Christmas 2016.

    [5] Refer T-Document T40.

35. JDKD gave evidence that since then, he had performed volunteer work, which had included carrying out maintenance at a kindergarten/childcare centre. JDKD also told the Tribunal that, on occasion, he had picked up work as a builder’s labourer; for which he was paid $50 or $100 for a day’s work “here and there”. 

36. In terms of study, JDKD told the Tribunal he had completed a few short computer courses offered by the local council.

37. JDKD said that he had applied for a job as a surveyor with a safety authority but that he did not “fit the parameters of what they were looking for”. He said this safety authority had him in their system and that should something come up, that he would be considered as an attractive candidate, in terms of his experience etc.

38. JDKD contends that the Tribunal should consider JDKD’s earning potential, even though he was not realising that potential during the Qualification Period. Specifically, PVBS submitted that:[6]

    42. At the qualification period [JDKD] also continued to have strong prospects to earn a dramatically higher income than [PVBS]. [JDKD] had worked for at least 10 years as a marine engineer. It is noted that in his tax return for the 2013-14 financial year, [JDKD’S] estimated total income is listed as $153,452 (T6, 38). In a fortnightly payslip from April 2015, [JDKD’S] gross pay is listed as $3,637.12 (T10, 50). It is submitted that this should be considered indicative of the salary range that [JDKD] could earn during the qualification period.

    43. There has been no documentary evidence put before the Tribunal to date that would demonstrate that [JDKD] was prevented from returning to work at the qualification period. It is submitted that the Tribunal may find, as was found by the ARO who investigated this matter (T30, 185-6) and Member Moreland of the AAT SSCSD (T2, 15), that [JDKD] was not forced to remain unemployed but rather this was by choice.

    [6] Refer paragraphs [42] and [43] of the JDKD’s SFIC.

39. The Tribunal noted a reference in PVBS’s 2019 Affidavit that JDKD worked for Shipping Company A in the “early stages” of their relationship and he was earning approximately $110,000 to $120,000 per annum. PVBS states as follows in her affidavit:

    12. … According to [JDKD’S] documents he has retired permanently from paid employment, however he has disclosed to [name of doctor omitted] that he is working and intends to continue working. As far as I am aware, he is able to work. I understand that [JDKD] was terminated from his previous position for a serious breach of procedures while on probation… Apart from very poor hearing, [JDKD] is in relatively good health.

40. The Tribunal notes that annexed to this affidavit are letters from two of JDKD’s former employers. The first letter was sent in about February 2014 advising JDKD that his work had not met the required standard and notifying him that his employment was terminated. The second letter was sent in about May 2015 asserting that there had been a serious breach by JDKD of his employer’s company procedures and that his employment was terminated effective immediately.

41. The Tribunal notes those matters because it may not be as simple as PVBS contends, for JDKD to have realised his earning potential during the Qualification Period with this blemished work history. In addition, the Tribunal notes that JDKD’s parental responsibilities toward the Child as a single parent at that time, given the industry within which JDKD had been working, imposed a further restriction on the type of roles he could take up; particularly if they required him to be away from home overnight.

42. The Tribunal considers it unlikely that JDKD had a realistic prospect of securing work as a Marine Engineer or otherwise in the marine industry, on a six-figure salary during the Qualification Period, as he had been able to do so previously, for the reasons mentioned in the above paragraph. However, the Tribunal is satisfied that, if JDKD had elected to do so, he could have secured paid employment during the Qualification Period in a lesser position, whether full-time or part-time.

1. At the hearing, JDKD confirmed that he did not have any disability that would have prevented him from working. He said he was unable to apply for work for which he was qualified because of his parenting situation. But there was no evidence before the Tribunal that he had attempted to gain any other type of employment; and as an able-bodied person, who is educated to a Diploma level, the Tribunal considers that he could have done so. For example, he could have started his own business as a handyman doing maintenance on a paid basis, such as he was doing on a volunteer basis for the kindergarten/childcare centre. Or JDKD could have worked as a cleaner, just as PVBS had sought to do.

2. The Tribunal considers that the only reason JDKD was not working during the Qualification Period was because of a personal choice not to do so.

3. By contrast, PVBS completed ten years of secondary school education in a non-English speaking country (leaving school at the age of 17) and she holds a Certificate-III level qualification in Pathology Collection. She has not managed to secure employment in the occupation of pathology collection. PVBS moved to Australia from her home country as an adult. The Tribunal observed her proficiency in spoken English at the hearing to be satisfactory, but at a basic level, not at a level that could be described as good or excellent. The Tribunal notes PVBS’s evidence at the hearing that it had been very difficult for her to find a job where she lives (the Tribunal noting that it is somewhat, but not entirely, geographically remote), and that she had tried very hard to do so.

4. The Tribunal finds that during the Qualification Period, PVBS was earning a modest income; and that there was no real prospect of her earning a higher salary by seeking alternative employment. The Tribunal considers that it is most likely that PVBS’s earning potential had been fully realised during the Qualification Period, by doing the work she was doing at that time, as a cleaner.

   Investment income – actual and potential

5. JDKD’s assets were recorded in JDKD’s Financial Statement as including two lump sum cash amounts held at the National Australia Bank (NAB) totalling approximately $72,000. At the hearing, JDKD did not dispute the accuracy of the information contained in his Financial Statement.

6. In terms of investment earnings, the bank statements indicate that JKDK received the following interest payments from cash funds held in NAB account ####798 during the Qualification Period:

   (a)29 May 2018: $86.14;

   (b)30 April 2018: $90.04;

   (c)31 May 2018: $82.04.

7. JDKD’s Financial Statement also records that he held superannuation funds of approximately $725,000 with Maritime Super. The Tribunal directed that JDKD produce a copy of the Maritime Super annual statement issued by his superannuation fund for the 2017/2018 financial year, and he did so after the hearing. The front page of this statement records the following:

   (a)JDKD’s annual salary as at 1 July 2018 was $72,000. This may have been an error because on JDKD’s parenting payment claim form dated 29 March 2018, he stated that he had been unemployed for the previous 12 months and did not receive any income from work. JDKD confirmed that this was the case at the hearing, except perhaps for the occasional work as a builder’s labourer, where he would receive $50 or $100 “here and there”;[7]

   (b)JDKD’s withdrawal benefit as at 1 July 2018 was $746,112.79;

   (c)JDKD’s preservation age was 55 and that the withdrawal amount was made up of:

   (i)$729,611.79 - preserved;

   (ii)$16,501 – unrestricted non-preserved;

   (d)the transaction history shows that no pension was paid to JDKD during the 2017/2018 financial year.

   [7] Refer T-Documents T23/162.

8. JDKD was 59 years of age during the Qualification Period. So he was past preservation age and entitled to draw on those funds as a source of income or pension. The impression given to the Tribunal by JDKD at the hearing was that if he drew down on those funds, they would be taxed. There were no specifics provided about this. The Secretary did not dispute the accuracy of this proposition. So if JDKD had elected to access all or a portion of those funds during the Qualification Period, the Tribunal is satisfied this would have been at a cost to JDKD because, in effect, he would have “lost” a portion of those funds by needing to pay tax, when this would not be the case if he drew on them later.

9. Be that as it may, those funds (minus any applicable tax) were still able to be accessed by JDKD during the Qualification Period. JDKD confirmed at the hearing that he drew down on some of the unreserved tax-free component to pay for legal fees, but otherwise he had “not touched” his superannuation. He explained that he was saving it for the Child and to be used for his education.

10. By contrast, PVBS states in her 2019 Affidavit that she held a total amount of $7,830 in two superannuation funds: Hesta and Maritime Super.[8] As at the qualification period, PVBS was in her 40s and employed. The Tribunal infers from this that she was unable to access her superannuation funds but makes no definitive finding, as there was insufficient evidence before the Tribunal. It is not a large sum of money in any event, and the Tribunal’s decision does not turn on whether PVBS had access to those funds.

    [8] Refer paragraph [72] of the JDKD 2019 Affidavit.

11. On the face of it, a comparison of the actual income of PVBS and JDKD during the Qualification Period weighs in favour of finding that JDKD was more in need of a favourable determination in respect of who should have been specified as the principal carer of the Child. However, this is counterbalanced by the finding of the Tribunal that, had JDKD chosen to do so, he could have been earning income at that time, and at least as much income as PVBS, by seeking out alternative employment, for example the type of work identified in paragraph [43].

12. On balance though, this factor weighs in favour of determining that JDKD was more in need of a favourable determination; but not to a great extent, for the reasons set out in paragraph [43].

    Factor 4: “The asset levels of each carer”

13. In contrast to PVBS, JDKD had a significant asset base. At the time of the Qualification Period, he held the two cash lump sums totalling approximately $72,000, as detailed in paragraph [47].[9]

    [9] The Secretary submitted to the Tribunal that JDKD’s bank statements (just prior to the qualification period) showed the following:

    (a)NAB statement (Acc 873202798) for period 7 March 2018 to 21 March 2018 (T21, p142) recorded a balance of $71,644.94; and

    (b)NAB statement (Acc 532551671) for the period 1 March 2018 to 23 March 2018 recorded a balance of $4,941.29.

14. JDKD also held approximately $725,000 in superannuation funds, held with Maritime Super as referred to in paragraph [49]. The Secretary contends as follows in relation to this asset:

    While the Applicant had superannuation, the Secretary contends that in accordance with section 1118(1)(f) of the Act, superannuation is to be disregarded in calculating a person’s assets for the purpose of assessing the rate of social security payment they may receive until the person reached pension age or starts to receive a pension or annuity out of the fund. However, as he had passed preservation age, it is a potential source of income for him, but there is no evidence regarding whether the Applicant received a pension out of his superannuation fund or how much this would be per week.

15. The Tribunal does not consider that it necessarily follows that because a particular asset may not counted for the purpose of calculating the rate of a social security payment, that it follows that it should not be taken into account when reaching a state of satisfaction as to which parent is more in need of a favourable determination as in the present context. This is a different assessment to be made; and there is nothing in the legislation which specifies that only those assets that would be counted for the purpose of calculating the rate of the social security benefit are to be considered when making the general assessment about who is more in need.

16. The fact remains, that JDKD was past preservation age at the Qualification Period; and as such, he could access all or a portion of those funds (albeit that they would be taxed), should he have chosen to do so. For this reason, the Tribunal considers it appropriate to consider his superannuation funds as an asset that should be considered when assessing which parent was more in need of a favourable determination.

17. JDKD owns (outright) a residential property in a coastal town two hours from Melbourne. JDKD’s Financial Statement suggests that the property in Town C was valued at approximately $450,000. The Secretary contends that the Tribunal should disregard JDKD’s property at Town C as an asset, because it was and still is his principal place of residence; and such an asset would not be counted for the purpose of calculating a person’s social security benefit. The Tribunal does not necessarily agree that one follows the other, as explained above. However, even if the Tribunal was to disregard this asset, the Tribunal’s decision would not turn on this asset due to the considerable superannuation funds held by JDKD. At the very least, by JDKD owning his principal place of residence outright, he is not required to pay rent or any mortgage payments to provide for accommodation for the Child and himself. The Tribunal considers it appropriate to take this aspect of his ownership of the Town C property into account, as part of making a comparison of the likely day-to-day expenses of JDKD and PVBS during the Qualification Period.

18. JDKD owns (outright) a further property in a rural area in Ireland, said by him to be valued at approximately $95,000.  At the hearing, JDKD said this property was worth about $60,000 to $70,000 once the outstanding taxes (which had been accruing for the last 10 years) had been paid on it. He confirmed there was no mortgage over this property and that it was derelict place which he had purchased in 1989.

19. JDKD also owned several motor vehicles at the Qualification Period, including the following:

    (a)a car valued at approximately $25,900;[10]

    (b)a motorbike valued at approximately $8,000;[11]

    (c)a station wagon valued at approximately $4,000;[12]

    (d)a utility vehicle valued at approximately $2,000;

    (e)a truck valued at approximately $8,000.[13] 

    [10] Refer T-Documents T19/117 and JDKD’s Financial Statement.

    [11] Refer T-Documents T23/163 and JDKD’s Financial Statement.

    [12] Ibid.

    [13] Ibid.

20. In JDKD’s Financial Statement he states that he has tools, equipment and a shed valued at approximately $11,000.

21. By contrast, PVBS had an extremely modest asset base during the Qualification Period. PVBS did not own her home but instead was living in rental accommodation.  The Tribunal was informed that PVBS’s personal assets as at the Qualification Period were limited to household items and a motor vehicle valued at approximately $3,000.  Her savings ranged from about $8,000 to $15,000 during this time. In PVBS’s Newstart Allowance claim lodged on 16 April 2018, her savings were disclosed as being $14,575.[14]

    [14] Refer T-Documents T44/346.

22. As mentioned above, the amount of superannuation funds held by PVBS were minimal compared to those held by JDKD and did not exceed $10,000. PVBS received $195,000 as the property settlement following the breakdown of her marriage to JDKD. But those monies were received well after the end of the Qualification Period and so they have not been taken into account by the Tribunal for the purpose of the present assessment.

23. The Tribunal finds that, relative to PVBS, JDKD held a sizable asset base as at the Qualification Period. The Tribunal is satisfied that this factor weighs heavily in favour of finding that PVBS was most in need of a favourable determination as to which parent should be specified as the principal carer of the Child.

    Factor 5: “The expenses of each carer”

24. The Tribunal was informed that after PVBS moved out of the family home, she was assisted by a community housing program to obtain private rental accommodation at subsidised rental payments of $165.00 per week during the Qualification Period. PVBS’s Statement of Financial Position (SFP) referrable to the Qualification Period, lodged shortly before the hearing, discloses that PVBS was paying $100 per week in subsidised rent. Whether PVBS was paying $165 or $100 in subsidised rent at that time has not influenced the Tribunal decision in this matter at all. The Tribunal finds that PVBS was paying at least $100 per week in rent during this time.

25. A general statement was made that PVBS was “more reliant on her parenting payment to assist in meeting the cost of caring for [the Child], such as clothes, medical expenses and recreational activities”. However, PVBS’s SFIC did not contain specifics of her other expenses during the Qualification Period to benefit the Child other than payment of standard utility and food bills. Those specifics were provided in the SFP, showing that during the Qualification Period, PVBS had total household income after tax of $5,729 and total living expenses (comprising her residential, transport, education, children, personal and family expenses) of $4,917.

26. The Tribunal notes that there were some invoices provided by PVBS for car rental costs during April 2018, when her motor vehicle reportedly broke down. PVBS contends that her transportation costs increased after the breakdown of the family unit because she was required to drive from her new rental home to Town C, where the Child was attending school. 

27. PVBS’s SFIC refers to an NAB bank account ####743 in her name, but that she was not the beneficiary of the money in this account and those funds from that account were used for food, clothes, books and other expenses for the Child. The bank statements provided by JDKD relevant to the Qualification Period showed that he had made a monthly deposit of $50 into this account.

28. JDKD stated in his written submissions that he had taken the Child to several places including, without limitation, the Zoo, the Melbourne Aquarium and the Melbourne Museum. This was consistent with deductions made from JDKD’s bank statement. From this the Tribunal infers that JDKD paid for himself and the Child to attend those recreational activities. JDKD stated that he had enrolled the child in a secondary school but during the Qualification Period the Child was of primary school age, so this was not applicable to current expenses that JDKD had been paying in respect of the Child during the Qualification Period.   

29. From the structure of the care arrangements for the Child, being alternating care for the Child on a “week about” basis; the fact that JDKD and PVBS maintained separate households during the Qualification Period; and that they each covered their own day-to-day household living costs, with JDKD paying the modest $50 per month into the NAB bank account to pay for the Child’s expenses and PVBS paying a modest amount of child support payments to JDKD toward the end of this period; the Tribunal is able to infer that they provided equally for the Child during the Qualification Period.

30. On balance, the Tribunal considers this factor as a neutral consideration; and as such, it does not support a conclusion one way or the other as to which parent was most in need of a favourable determination as to which parent should be specified as the principal carer.

    CONCLUSION

31. In accordance with policy guidance provided in the Guide, the Tribunal does not consider it necessary to address the additional discretionary factors, as it is comfortably satisfied after taking into account each of the mandatory factors addressed above, that the size of the asset base of JDKD in contrast to PVBS’s asset base, is significant and far outweighs the differential that existed during the Qualification Period as to the level of the parents’ respective income. In that regard, JDKD’s income was minimal in that he was receiving social security benefits and bank interest payments of a modest amount, while PVBS was receiving modest income and barely enough to fund the living expenses of the Child and herself. However, during the Qualification Period, had JDKD chosen to do so, he could have accessed superannuation funds from his Maritime Super account, even though it was subject to taxation. The Tribunal accepts JDKD’s evidence that he had chosen not to do because he was saving it for the Child and his education. Even so, those funds were still present and accessible to JDKD during the Qualification Period.

32. JDKD also had significant cash reserves on hand, upon which he could draw to support himself and the Child financially as at the Qualification Period. Further, as mentioned above, JDKD had the potential at that time to seek out paid employment of some type, even if it was not the type of work that he had undertaken previously in the marine industry or remunerated at a lower level than previously.

33. By contrast, PVBS barely had any assets upon which she could rely during the Qualification Period. Instead, PVBS was in a financial position where she was required to rely upon the charity of others (for instance, by seeking a crisis rental subsidy at that time) and to pursue work as a cleaner (i.e. not in PVBS’s chosen field of pathology collection) in order to make ends meet.

34. The Tribunal is not satisfied that JDKD was most in need of a favourable determination during the Qualification Period; and instead, that it was PVBS who was most in need. For this reason and because they each had equal care of PP Child, the Tribunal specifies that PVBS (and not JDKD) should have been regarded as the principal carer of the Child during the Qualification Period. The Tribunal concludes that JDKD did not meet the eligibility requirements to receive parenting payments under s 500 of the Act.

35. Accordingly, the Tribunal affirms the Decision under Review.

78.     

I certify that the preceding 77 (seventy-seven) paragraphs are a true copy of the reasons for the decision herein of Member K. Parker

......[sgd]..................................................................

Associate

Dated: 22 December 2020

Date of hearing:

Date last document lodged:

29 July 2020

28 September 2020

Applicant:

By telephone

Advocate for the Respondent:

Ms Kellie Latta

Advocate for the Other Party:

Mr Bryn Overend