Kalaba and Secretary, Department of Education, Employment and Workplace Relations

[2013] AATA 69

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2012/2971
Re	Milisav Kalaba
APPLICANT
And	Secretary, Department of Education, Employment and Workplace Relations
RESPONDENT

DECISIONS

Tribunal	The Hon R J Groom AO (Deputy President)
Date	14 February 2013
Place	Hobart

(a)The 2008 cancellation decision is affirmed.

(b)The 2011 cancellation decision is set aside and the matter remitted to the respondent for the purpose of assessing the applicant’s entitlement to newstart allowance in accordance with this decision.

[Sgd Hon R J Groom]

Deputy President

SOCIAL SECURITY – newstart allowance – allowance cancelled in 2008 and again in 2011 –delay in seeking review of the 2008 cancellation - section 109(2) of the Social Security (Administration) Act 1999 applied - no entitlement to arrears – applicant again granted newstart allowance in May 2011 –– newstart allowance cancelled in November 2011 because of a failure to attend appointment and to enter into an Employment Pathway Plan – not satisfied that proper notice was given of appointment – applicant prepared to enter into plan – did not fail to enter plan – 2008 cancellation decision affirmed – 2011 cancellation decision is set aside

Social Security Act 1991, s 593

Social Security (Administration) Act 1999, ss 63(2), 63(4), 64(1), 109(2), 593, 605(3)

Guide to the Social Security Law, 3.1.13.20

Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138

Secretary, Department of Family and Community Services v Rogers [2000] FCA 1447

REASONS FOR DECISIONS

The Hon R J Groom AO (Deputy President)

INTRODUCTION

On two separate occasions, the first in 2008 and the second in 2011, Mr Kalaba’s newstart allowance was cancelled by Centrelink.
At Mr Kalaba’s request those cancellation decisions were reconsidered by Centrelink. They were both affirmed. The two decisions were then reviewed by an Authorised Review Officer who agreed with the earlier decisions. The decisions were then further considered by the Social Security Appeals Tribunal (“SSAT”). On 27 June 2012 the SSAT decided as follows:
(a) It affirmed the decision that Mr Kalaba was not entitled to be paid newstart allowance from 10 December 2008, and
(b) It varied the decision to cancel Mr Kalaba’s newstart allowance from 1 November 2011, by directing that the cancellation should take effect from 3 November 2011.
This Tribunal is now asked to conduct a merits review of the 2008 and 2011 cancellation decisions.

BACKGROUND

Mr Kalaba resides in a mining town on the West Coast of Tasmania. He lives there with his parents. There is no Centrelink office in the town. Mr Kalaba is now 29 years of age. He told the Tribunal that he has never been in paid employment.
Prior to the cancellations Mr Kalaba had been relying for his living expenses on the payment to him of newstart allowance. When not receiving the allowance he has been supported by his parents.
Newstart allowance had been paid to him since March 2007. In late 2008 it was alleged that he had failed to complete an “Employer Skills Profiler” and then did not contact Centrelink when required to do so. As a result of this “Participation Failure” his allowance was cancelled effective from 10 December 2008. (The “2008 cancellation”)
It was some 2 ½ years after the 2008 cancellation that Mr Kalaba again made contact with Centrelink. This was on 23 May 2011. On that date he again applied for the newstart allowance and was successful. Mr Kalaba commenced receiving payment of the allowance effective from 23 May 2011. Later in 2011 Centrelink determined that Mr Kalaba had failed to attend an appointment and enter into an Employment Pathway Plan (“EPP”). It decided to cancel the allowance from 1 November 2011. (The “2011 cancellation”)

CONTENTIONS

2008 CANCELLATION DECISION

The reason given by Centrelink for the 2008 cancellation was that “… we have not received your Application for Payment Form”. (See Centrelink letter dated 7 January 2009 at T4 page 25). Mr Kalaba said that on 22 December 2008 he had lodged his “Application for Payment Form” at the Rosebery Post Office with a request that it be faxed to Centrelink. It is not disputed by the respondent that the form was faxed to Centrelink on 22 December 2008 and received by Centrelink on that date. (See page 3 of the Authorised Review Officer’s decision of 10 May 2012)
The respondent submits that the reason for the 2008 cancellation was the participation failure by Mr Kalaba. He was advised of this failure by letter dated 15 December 2008. (Attachment B of the Respondent’s Statement of Facts and Contentions) Mr Kalaba was warned in that letter that if he did not contact Centrelink by the next payday payment may stop. The respondent submits that the payment form forwarded on 22 December 2008 could not be processed because of the continuing participation failure.
The respondent further submits that even if the 2008 cancellation decision was incorrect, which the Secretary does not concede, because Mr Kalaba had not requested a review of that decision within 13 weeks then in accordance with section 109 of the Social Security (Administration) Act 1999, in the particular circumstances of this case, he cannot now be paid any arrears. The respondent says that Mr Kalaba did not advise Centrelink that he disagreed with the 2008 cancellation decision until he wrote a letter about it on 5 September 2011.
Mr Kalaba contends that the only reason given for the cancellation from 10 December 2008 was that Centrelink had not received his Application for Payment Form. He submits that he did forward his application form on the 22 December 2008. As mentioned the respondent does not dispute that the form was sent and received on that date.

2011 CANCELLATION DECISION

According to Centrelink’s letter to Mr Kalaba of 17 November 2011 (T15 page 63) the 2011 cancellation resulted from a failure “to go to a new appointment”. It also refers to the requirement to “… start doing your activity” and that “you will need to claim your payment and enter into an Employment Pathway Plan before we can pay you”.
The respondent contends that a reason for the cancellation is that Mr Kalaba had refused to sign an EPP when attending a meeting on 5 October 2011 at Choose Employment at Rosebery. The respondent argues that Mr Kalaba refused to sign the form because his first name was typed in the document as three separate words “MI LI SAV”. Mr Kalaba was given a chance to correct this error in handwriting but declined to do so.
Mr Kalaba agrees that this was the reason he refused to sign the EPP. He acknowledges that he was told he could correct his name in his own handwriting. He insisted that the name on the form was “false” and that it had to be typed correctly before he would sign it. He believed making changes in his own handwriting was “illegal”. He was willing to sign the plan once his name was typed correctly.
The respondent submits that Mr Kalaba failed to attend a meeting on 2 November 2011 which was held for the purpose of discussing and signing the EPP. Mr Kalaba says that he was not given proper notice of the meeting and was expecting to receive a letter about it.
Mr Kalaba contends that this decision and the earlier decision in 2008 were both wrong and that he should receive arrears of payment from “December 2008 through to May 2011” and from “November 2011 right through to the present time”.

THE ISSUES

The principal issues to be determined by the Tribunal are as follows:
(a)Was Centrelink’s decision to cancel Mr Kalaba’s newstart allowance from 10 December 2008 correct?
(b)If the 2008 decision was not correct is there any entitlement to payment of the arrears of newstart allowance accruing after that date?
(c)Was Centrelink’s decision to cancel Mr Kalaba’s newstart allowance from 1 November 2011 correct?
(d)If the 2011 decision was not correct is there any entitlement to arrears?
The relevant legislative provisions are set out in the Social Security Act 1991 (“the Act”) and the Social Security (Administration) Act 1999 (“the Administration Act”).
The Tribunal will now separately consider the 2008 and 2011 cancellation decisions.

THE 2008 CANCELLATION DECISION

The material before the Tribunal establishes to its satisfaction that Centrelink received a report that Mr Kalaba may have incurred a “participation failure” in December 2008 by refusing to complete an “Employer Skills Profiler”.
The Tribunal finds that following that alleged failure Centrelink wrote to Mr Kalaba on 15 December 2008 requiring him to contact them about the failure. In that letter it was noted that unless Mr Kalaba contacted Centrelink by the next payday his “payments may stop until you contact us”.
Mr Kalaba made no further contact with Centrelink to discuss the alleged participation failure. He did however attend the post office at Rosebery on 22 December 2008 and arranged for his “Application for Payment Form” to be faxed to Centrelink.
Section 63(2) of the Administration Act authorises Centrelink to forward a notice to the person requiring the person to contact Centrelink. Section 64(1) of that Act provides that if a person is so notified and the requirement in the notice is reasonable then the payment the person has been receiving is “not payable”.
The Tribunal is satisfied that the requirement in the notice was “reasonable”. It finds that the notice was posted to Mr Kalaba’s last known address. The evidence does not reveal any reasonable excuse for failing to make contact with Centrelink.
The reason given in the letter of cancellation namely “… because we have not received your Application for Payment Form” was wrong. Mr Kalaba had forwarded his application to Centrelink on 22 December 2008, more than a fortnight before the letter of 7 January 2009 was sent. The payment form was received by Centrelink on 22 December 2008.
The Tribunal is satisfied that Mr Kalaba received the letter of 7 January 2009 informing him that his newstart allowance was cancelled. It finds that the letter was received within a few days after that date. As mentioned the letter did not include the correct reason for the decision. There is, however, no requirement at law to provide reasons for such a decision. It is sufficient if a person is given proper notice of the fact that a cancellation decision has been made. Mr Kalaba was given such notice. He was then able to exercise his right to seek a review of the decision. (See Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138 and Secretary, Department of Family and Community Services v Rogers [2000] FCA 1447 at para 33 to 34).
Section 109(2) of the Administration Act provides as follows:
(2) If:
(a) a decision (the original decision) is made in relation to a person’s social security payment; and
(b) a notice is given to the person informing the person of the original decision; and
(c) more than 13 weeks after the notice is given, the person applies to the Secretary, under section 129, for review of the original decision; and
(d) the favourable determination is made as a result of the application for review;
the favourable determination takes effect on the day on which the application for review was made”.
After receiving the advice that his newstart allowance had been cancelled Mr Kalaba took no early action to have the decision reviewed or even to contact Centrelink to enquire about the decision. The Tribunal finds it surprising that there was no timely follow up contact of any kind with Centrelink. Mr Kalaba explained in evidence that he considered the cancellation decision to be a mistake made by Centrelink and not by him. He said it was therefore up to Centrelink to correct that decision.
It was not until some 2 ½ years after his newstart allowance had been cancelled that Mr Kalaba finally made contact with Centrelink. This was on 23 May 2011when he again applied for newstart allowance. But even then he did not challenge the 2008 cancellation decision. The evidence is that by letter dated 5 September 2011 Mr Kalaba first raised questions with Centrelink about the 2008 decision.

CONCLUSION

By letter dated 7 January 2009 Mr Kalaba was informed of the decision to cancel his newstart allowance. The Tribunal is satisfied that he received that letter soon after that date. He did not question the decision until September 2011. Mr Kalaba commenced again to receive newstart allowance on and from 23 May 2011. The effect of section 109(2) of the Administration Act is that he is not entitled to be paid any arrears of the allowance from 10 December 2008 until 23 May 2011. After that date events were overtaken by the further grant of the allowance and the subsequent 2011 cancellation.
As provided in section 109(2) there is no entitlement to arrears even if a favourable determination was made on the application for review. There is therefore no point proceeding to decide whether the 2008 cancellation decision was the correct decision in the circumstances.

THE 2011 CANCELLATION DECISION

After considering the material before it the Tribunal concludes that the management of the 2011 cancellation decision was defective in a number of respects.
The basis for this cancellation arose out of meeting on 5 October 2011 between Mr Kalaba and an employee of “Choose Employment”, his employment services provider. At that meeting an EPP was presented to him with a request that he sign it.
It is not in dispute that the EPP presented to Mr Kalaba had his first name typed “MI LI SAV” with spaces between “MI”, “LI” and “SAV”. He was asked to sign the plan. He declined because he believed the name in the format in which it was typed was “false”.
Mr Kalaba agrees that an employee of Choose Employment told him he could correct the error in his own handwriting and then initial the alteration. Mr Kalaba told the Tribunal that such an alteration would, in his opinion, be “illegal”.
Mr Kalaba asked the person from Choose Employment to provide another typed EPP with his name correctly typed. A corrected version was not provided.
It now transpires that the EPP contained a further error (see T17 page 72). The EPP included an incorrect date. This was not apparent to Mr Kalaba at the time and therefore was not a further reason for not signing the document. It does however suggest that the document was not typed with proper care.
Mr Kalaba was then given two days to “think about signing” the EPP. This was apparently the uncorrected EPP. This really amounted to an ultimatum to sign that document (T17 page 68).
Mr Kalaba was advised by letter dated 18 October 2011 (T12) that he would be required to attend a further appointment and to enter into an EPP. He was warned in the letter that failure to attend and enter into the EPP may result in the payment of the allowance ceasing. The letter did not mention any details of the appointment.
The evidence is that Mr Kalaba was requested orally to attend the appointment on 2 November 2011. He did not attend. The precise terms of that request are not clear. No witnesses were called by the respondent to explain details of this oral request. In giving evidence Mr Kalaba seemed unsure of a request to attend a meeting on 2 November. He said that he had been expecting to receive a letter about a further meeting. No written advice was provided to him of the date and time of a meeting on 2 November 2011.
Section 605(3) of the Act states:
(3) The Secretary is to give a person who is required to enter into a Newstart Employment Pathway Plan notice of:
(a) the requirement; and
(b) the places and times at which the plan is to be negotiated”.
There does not appear to be a requirement that this notice be in writing but obviously it should be clearly and effectively communicated to the person concerned. It is preferable that such notices be in writing. The letter of 18 October gave Mr Kalaba notice of the requirement but no details of the place and time of the meeting.
Mr Kalaba was later informed by letter dated 3 November 2011 (T13 page 60) that his newstart allowance had been suspended because:
“… you did not attend your activity or an appointment and as a result we have made a decision to stop your newstart allowance from 3 November 2011”.
Centrelink’s decision making becomes quite puzzling when one examines two separate letters forwarded to Mr Kalaba on the same day namely 17 November 2011.
The first letter dated 17 November 2011 (T15 page 62) was apparently written by, or on behalf of, Linda Myers, Manager of the Burnie Centrelink Office. This letter exonerates Mr Kalaba for the failure to attend the meeting on 2 November 2011. It states in part:
“Dear Mr Kalaba
After careful consideration about how you did not attend an appointment with your Employment Services Provider on 2 November 2011, a decision has been made that no failure has occurred.
It is important that you continue to meet your participation requirements”.
The second letter of that same date, namely 17 November 2011, (T15 page 63) appears to be in conflict with the other letter sent by the same organisation on the same day (unfortunately only the first page of this letter is included in the T Documents). It is interesting that neither letter refers to the existence of the other letter.
The second letter is headed “Cancellation of your Newstart Allowance”. It states:
“You were asked to go to a new appointment or start doing your activity in order for you to meet the conditions for receiving your payment.
As you have not done this you are not meeting the conditions of your payment and it has been decided that you are no longer eligible for your payment.
This means your Newstart Allowance has been cancelled from 1 November 2011”.
The Tribunal notes that in her decision of 10 May 2012 the Authorised Review Officer stated that the reason for the cancellation was Mr Kalaba’s failure to attend the appointment on 2 November 2011. In the decision (T17 page 69) the

ARO states:
“On 18 October 2011 Centrelink verbally advised you to attend an appointment on 2 November 2011 with Choose Employment Rosebery at the Rosebery Neighbour Centre on Angus Street, Rosebery.
You failed to attend this appointment.
As you failed to re-engage with your provider, Centrelink made a decision to cancel your Newstart Allowance from 1 November 2011 as you were no longer qualified for payment. This decision was made on the basis that you were asked to go to an appointment in order for you to meet the conditions for receiving your payment, but you failed to do so”.
That reasoning appears to ignore the fact that Centrelink had previously informed Mr Kalaba in writing of its decision that the failure to attend the 2 November 2011 meeting was not a participation failure.
The EPP sets out the commitments the recipient of a newstart allowance must make as a prerequisite to receiving the allowance. The EPP is normally drafted by the person’s Employment Services Provider. The individual involved does however have a right to express his or her own views about the requirements and to suggest possible changes. This was plainly the intention of the legislature when enacting the relevant provisions of the Act. See, for example, section 605(3) of the Act.
The plural “times” and “places” in section 605(3) indicates that the process of negotiating the EPP may on occasions take some time and require more than one meeting.
After observing Mr Kalaba in the witness box and reading the material before it (for example T11 page 48) the Tribunal is left with the impression that he can sometimes be pedantic and is inclined to have firm views about what should be done. This attitude must make the task of both Centrelink and his Employment Services provider rather difficult.
Nevertheless, in the Tribunal’s view, it is not unreasonable in the course of negotiating an EPP for the individual to request that his name be typed correctly.
In this computer age that kind of error can usually be corrected and a new document printed almost immediately. Perhaps the relative isolation of the town where the meeting of 5 October 2011 took place prevented that occurring. It is interesting that there is no evidence indicating that the EPP had been typed correctly after the 5 October meeting so that it could be signed by Mr Kalaba if he attended the meeting on 2 November.

Despite some suggestion to the contrary the Tribunal is satisfied that Mr Kalaba was indeed prepared to enter into this particular EPP provided his name was typed correctly in the document. He said in evidence that he had no other concerns about the EPP.
The Tribunal notes that it was suggested at the hearing by the respondent’s solicitor that the reported comments of Mr Kalaba at T11 page 48 relate to this particular EPP which he had declined to sign. In the Tribunal’s view that record does not refer to this EPP.
To ask for such a minor change does not in any way alter the substance of the EPP and cannot, in the Tribunal’s view, be construed as a failure to enter into the EPP. As mentioned the EPP did include another error which had not been corrected when Mr Kalaba was asked to sign it.
The legislation does not envisage the Employment Services Provider placing an EPP in front of a person and that person being required immediately to sign it without question. If the name is not typed in the normal way it is not unreasonable for the person to request that it be corrected. Similarly if a date on the document is wrong the person is entitled to expect that the correct date would be included.
It is, of course, common for typed documents to be amended in the person’s own handwriting and for the change to be initialled. It was entirely proper for the Choose Employment employee to make this suggestion. This would often be a sensible and practicable way to overcome this problem. To make the change in this way obviously would not be an illegal act. The difficulty here is that Mr Kalaba believed that this was not a proper way to correct the error. The Tribunal is satisfied that this belief was genuinely held by Mr Kalaba.
The failure to attend the 2 November meeting was excused by Centrelink and was not considered by it to be a participation failure. The purpose of that particular meeting was to again ask Mr Kalaba to sign the EPP. There was obviously a need for another meeting to further discuss the EPP and to endeavour to overcome Mr Kalaba’s concerns. Those concerns of course could have been overcome by simply typing the document correctly. It seems quite inconsistent to excuse the non-attendance at the meeting and yet still claim Mr Kalaba has failed to enter into an EPP.
It is the view of the Tribunal that an experienced and competent officer of Centrelink or employee of the Employment Services Provider should have been able to sensibly address Mr Kalaba’s concerns and arrange for a typed correction to be made. The Tribunal is satisfied that the EPP would then have been signed. Importantly a person who was otherwise entitled to receive newstart allowance would then have continued to receive social security support.

CONCLUSIONS

As far as the 2011 cancellation decision is concerned the respondent relied in part on section 593 of the Act. It contends that “by failing to enter into an EPP without a reasonable excuse the applicant ceased to qualify for NSA (newstart allowance) as that is a qualification requirement: section 593 of the Act”.
For the reasons explained above the Tribunal is satisfied that Mr Kalaba was prepared to enter into an EPP. It concludes from the evidence that Mr Kalaba did not fail to enter into an EPP as he was prepared to do so as long as a simple change was made correcting the way his first name had been typed. It therefore finds that Mr Kalaba did not fail to comply with the relevant requirements of section 593 of the Act. He agreed to enter into the EPP prepared by Choose Employment and was willing to sign it as soon as his name was correctly typed.
The Guide to the Social Security Law at 3.1.13.30 (See Attachment E to the respondent’s Statement of Facts and Contentions) states as follows:
“Continued refusal to enter an EPP may also result in a loss of qualification”.
The Tribunal finds that there was no “continued (Tribunal’s emphasis) refusal to enter an EPP” in this case.
With respect to the non-attendance at the meeting the Tribunal is not satisfied that Mr Kalaba was given proper notice of the time and place for the meeting of the 2 November 2011 at which the EPP was to be negotiated. Such a notice is required by section 605(3) of the Act. Centrelink had informed Mr Kalaba that his non-attendance at this particular meeting was not considered a failure by him. Unfortunately there is no evidence explaining why Centrelink determined that his failure to attend should be excused in this way.
Under section 63(2) of the Administration Act a person can be notified that he or she is required, within a specified time, to “attend a particular place for a particular purpose”. The person can be notified by prepaid post or “in any other way the Secretary considers appropriate”.
Section 64 provides that a requirement in a notice given under section 63(2) must be reasonable. If the Secretary is satisfied that the person had a reasonable excuse for not complying with the requirement then the failure is not a basis for disqualification from receiving payment.
The letter of 18 October 2011 did not specify a “particular place”. It did not say when the proposed appointment was to occur. It stated Mr Kalaba may lose his payment “… from the date of this appointment” yet it did not specify that date. It would have been preferable for that letter to have explained very clearly exactly when, where and at what time the appointment was to take place. No other letter was written specifying those details. It appears that the oral advice of the appointment on 2 November was not sufficiently clear to amount to proper notice of the appointment as required by section 63(2) of the Administration Act.
For the above reasons it is the intention of the Tribunal to set aside the 2011 cancellation decision. It considers that Mr Kalaba should be entitled to receive newstart allowance on and from the date payments ceased in 2011. However it does not have sufficient information about other aspects of his continuing eligibility to determine that arrears of newstart allowance are to be paid for the whole of the period since that date. The Tribunal therefore considers it appropriate to remit that matter to the Secretary to assess Mr Kalaba’s entitlement to newstart allowance in accordance with these decisions.

DECISIONS

(a) The 2008 cancellation decision is affirmed.
(b)The 2011 cancellation decision is set aside and the matter remitted to the respondent for the purpose of assessing the applicant’s entitlement to newstart allowance in accordance with this decision.

I certify that the preceding 67 (sixty-seven) paragraphs are a true copy of the reasons for the decision herein of The Hon R J Groom AO (Deputy President)

.............[Sgd]..............

Administrative Assistant

Dated : 14 February 2013

Date(s) of hearing	11 December 2012
Applicant	In person
Counsel for the Respondent	Mr B Sparkes
Solicitors for the Respondent	Program Litigation and Review Branch

[2013] AATA 69

14 February 2013

Key Legal Topics

Areas of Law

Social Security Law

Legal Concepts

Limitation Periods

Res Judicata

Administrative Law

Entitlement to Benefits

Review of Administrative Decisions