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

This matter concerned an appeal by the applicant, Mr. Keskin, against a decision by the Secretary, Department of Social Services, to refuse a Disability Support Pension due to a Compensation Preclusion Period. The central dispute revolved around whether this preclusion period had been correctly calculated, specifically whether certain portions of a compensation payment should have been disregarded, and if special circumstances warranted such disregard. The Administrative Appeals Tribunal (AAT) considered the applicant's appeal.

The legal issues before the Tribunal included determining the correct method for calculating the Compensation Preclusion Period and whether the applicant's expenditure of his compensation payment was such that it should be disregarded, in whole or in part, for the purposes of that calculation. The Tribunal was also required to consider whether any special circumstances existed that would justify a departure from the standard calculation of the preclusion period.

The Tribunal's reasoning was informed by the principle that compensation provisions are intended to ensure that individuals receiving a lump sum compensation payment support themselves from their own resources for a period before seeking public support. This principle, as articulated in cases like *Rice* and *Secretary, Department of Social Security and Winterbotham*, suggests that a compensation payment is meant to provide for the recipient's maintenance at a level approximating that of social security benefits, and recipients have an obligation to manage these funds responsibly. Expenditure deemed extravagant, frivolous, or unnecessary, leading to financial distress, does not create an entitlement to taxpayer-funded assistance.

Ultimately, the Tribunal accepted that certain items of expenditure were properly included in the calculation. However, it set aside the original decision and remitted the matter to the Respondent with a direction that the Compensation Preclusion Period be recalculated, excluding the sum of $250,000.00 from the gross lump sum compensation payment.