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

[2023] AATA 2731

KTDN and Secretary, Department of Social Services (Social services second review) [2023] AATA 2731 (25 August 2023)

Division:GENERAL DIVISION

File Number(s):      2022/6164

Re:KTDN

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Emeritus Professor P A Fairall, Senior Member

Date:25 August 2023

Place:Sydney

The decision of the Social Services and Child Support Division (AAT1) dated 1 July 2022 is set aside, and substituted with a decision that the Applicant is entitled to receive parenting payment single from 18 January 2022.

.........[SGD]...............................................................

Emeritus Professor P A Fairall, Senior Member

CATCHWORDS

SOCIAL SECURITY – parenting payment single – eligibility – deemed date of claim – waiting period – personal financial crisis – severe financial hardship – domestic violence – decision under review set aside

LEGISLATION

Social Security Act 1991 (Cth)

Social Security (Administration) Act 1999 (Cth)

Social Security (Administration) (Class of Persons-Intent to Claim) Determination 2018

Social Security (Experiencing a Personal Financial Crisis) Instrument 2017

CASES

Williamson and Secretary, Department of Family and Community Services [2003] AATA 652

Morales and Secretary, Department of Family and Community Services [2004] AATA 669

SECONDARY MATERIALS

Social Security Guide (Version 1.310)

REASONS FOR DECISION

Emeritus Professor P A Fairall, Senior Member

25 August 2023

FACTS

1. On 1 July 2022, the Administrative Appeals Tribunal (AAT1)[1] affirmed a decision by an authorised review officer of Services Australia (Centrelink) to grant the Applicant’s claim for parenting payment single (PPS) from 19 January 2022 (the reviewable decision).[2] The Applicant seeks a second review of this decision. The matter was heard by the Tribunal on 11 July 2023. The Applicant was self-represented, although assisted by her father, while the Respondent was represented by Mr M. Gauci.

   [1] The Social Services and Child Support Division.

   [2] T2, 3.

2. The following narrative is based on evidence given by the Applicant and her father at the hearing.

   The Applicant’s evidence

3. On 3 January 2018, the Applicant separated from her husband. She says that at some point he warned her not to claim Centrelink for the children because he had not done his tax returns.[3] He made violent threats against her.[4] She was frightened of him and did not make any claim for PPS until 12 January 2022, when she felt she could do so without risk.

   [3] Transcript, 11 July 2023, 16.

   [4] Transcript, 11 July 2023, 10.

4. She was under acute financial pressure following her marriage break-down. She was in mortgage arrears and in danger of losing the house. To make ends meet, she relied heavily upon her own father for financial support. She said that her father gave her money to provide for household expenses.[5] He also lent her money to pay the mortgage. He cleared debts raised by her husband over the family home. She says that without her father’s support she would have been homeless. She regards all these advances as loans which she intends to repay. If necessary, she will sell her home to do so. She is the sole proprietor of the former matrimonial home following the property settlement.

   [5] Transcript, 11 July 2023, 25.

5. On 3 February 2021, the Federal Circuit and Family Court of Australia made final orders under which the Applicant has sole parental responsibility for the two children of the marriage, with limited contact for the father.[6]

   [6] T9, 81, 82.

6. In terms of the support that might be available to her, the Applicant told the Tribunal that in or around December 2021 a Centrelink Social Worker informed her that she could provide information to Centrelink without her ex-husband’s knowledge or consent. She was told about the separation details form (Mod S).[7]  

   [7] Separation details form (MOD S) - Services Australia

7. On 22 December 2021, she created a claim online for PPS. On 11 January 2022, she telephoned Centrelink and enquired about her entitlements, including family tax benefit (FTB) and PPS. On 12 January 2022, she submitted her claim for PPS. Centrelink determined that she was entitled to receive PPS from 19 January 2022, applying the ordinary 7 day waiting period. This decision was upheld by an authorised review officer on 2 March 2022.[8]

   [8] T2, 4.

8. She is unhappy with Centrelink’s decision which, as noted above, was affirmed by the AAT1 on 1 July 2022. She therefore applied to the Tribunal for second review. On 27 July 2022 she sent an email to the Registry indicating that she would like to make an application for a second review. She also inquired about free legal services and whether there was any legal impediment to highlighting the decision in the media, given that it concerned “the safety of women and children in domestic violence and abusive situations”.[9]

   [9] T1, 1.

9. She believes that she should receive PPS from when she separated from her husband in January 2018, or at the very least, from 5 September 2019, when she first spoke to a Centrelink officer. No record or transcript of this conversation has been provided to the Tribunal.[10]

   [10] Transcript, 11 July 2023, 20.

10. She says that she and her father contacted Centrelink on 5 September 2019 about a debt for $9,511.20 that had been raised for overpayment of FTB. The focus of the call appears to have been the FTB debt.[11] She says that although her eligibility for PPS was not discussed then, the Centrelink officer should have raised it with her and explained how she could proceed safely, given her experience of domestic violence.

    [11] Transcript, 11 July 2023, 43.

11. In essence, her contention is that she was entitled to have the payments adjusted retrospectively because Centrelink was derelict in not informing her about the Mod S.

12. The Tribunal drew her attention to information provided on the Centrelink internet page relating to raising kids[12] and separated parents[13] and the Mod S form. In response, she said she was unaware that this information existed but that it should have been drawn to her attention. She said that she didn’t have a computer and she never thought that one could fill in a form and provide separation details without alerting an ex-partner.[14] She said she had no reason to look online and, in any event, if such pages existed in September 2019, she should have been told.[15]

    [12] Raising kids - Services Australia

    [13] Separated parents - Services Australia

    [14] Transcript, 11 July 2023, 42.

    [15] Transcript, 11 July 2023, 43.

13. At no time during this 8-week period prior to 22 December 2021 did she contact Centrelink to find out what support she might be entitled to. She said:

    No. I did not. I was under an extreme amount of stress and anxiety with the court proceedings, my husband’s threats, my son in therapy and everything because of all of the proceedings. He was seeing a psychiatrist and so I was – I was dealing with all of that.[16]

    [16] Transcript, 11 July 2023, 25.

14. She agreed with Mr Gauci that had she been aware that she could make a claim without her ex-partner being alerted, she would have done so.

15. She contends that Centrelink has a duty to provide information to customers and potential customers and failed to do so. She is critical of the Centrelink officer who took her call on 5 September 2019. If she had been told then that she could provide separation details to Centrelink on a form without alerting her ex-husband, she would have applied for parenting payments at that time.

16. Alternatively, and less strenuously, she argues that she should be paid from the date of separation in January 2018 because she was fearful of reaching out to Centrelink because of threats of violence made by her husband.

    Evidence of the father

17. Her father also had a clear recollection of the conversation with a Centrelink officer on 5 September 2019. The focus of the conversation related to what he and his daughter regarded as a false assessment because the husband had failed to lodge his tax returns. He asked the Centrelink officer to chase up the husband but was told it was not Centrelink’s job to do so.

18. He said that when his daughter’s marriage failed, he tried to calm things down. He considered the threat of losing the house to be very real. He was fearful that her estranged husband would take his life or harm the Applicant and his grandchildren.[17] He took out a large loan to cover the husband’s legal costs and his other debts. He wanted to make the husband feel that they were all “on the same page”. He stated:

    We’re not against him. It’s just a situation that has arose from this situation and, you know, we all make mistakes and I agreed to pay, you know, 55, 150, 15 and all of the other debts that, you know, have popped up or cropped up meantime and like my daughter said to you she would’ve been homeless. She was very stressed and her being stressed made my wife very stressed which made me very stressed because one’s my wife, one’s, my daughter. [18]

    [17] Transcript, 11 July 2023, 38.

    [18] Transcript, 11 July 2023, 37.

19. He felt a moral obligation to provide for his daughter and two grandchildren in a time of need. He had promised his deceased father on his deathbed that he would look after them.[19] Nevertheless, he had to postpone his retirement and was working two jobs. As to the matrimonial property, he would have transferred it to his own name but for the transfer fees. As he explained to the Tribunal:

    She could’ve been a tenant without paying but it would’ve cost me another 100 [thousand] so I thought one day I’m going to pass; it’s going to be hers anyway so I’ll leave it in her name. Make her feel comfortable and if he – if it ever came to the situation where I got stuck the agreement was that we sell the house – you know, she buys a unit and I get lumbered – I get the rest of the money if I got to that stage where hypothetically I couldn’t work the hours I’m doing or can’t make the repayments.[20]

    [19] Transcript, 11 July 2023, 44.

    [20] Transcript, 11 July 2023, 38.

20. When pressed as to whether the various advances were genuine loans to his daughter, as opposed to gifts, he refrained from describing them as loans but both father and daughter said that if he was under financial pressure in the future or unable to work because of health issues, they would have to look at selling the house.[21]

    [21] Transcript, 11 July 2023, 43-44.

    CONSIDERATION

21. The detailed rules which determine eligibility and govern the making of claims are set out in the Respondent’s Statement of Facts, Issues and Contentions (RSFIC) dated 10 February 2023, from paragraphs 8 to 21.

    Can 5 September 2019 be regarded as the start day for PPS payment?

22. Subsection 11(1) of the Social Security (Administration) Act 1999 (Cth) (Administration Act) provides that a claim must be made for a social security payment.

23. Section 13 of the Administration Act provides that in certain circumstances, a claim can be taken to have been on the day a person contacts the Department. The section identifies various discrete circumstances. Each circumstance requires that the Applicant was qualified to receive the payment on the day of contact, and lodged the claim within one of two specified periods, either 14 days or, in the longest possible case, 13 weeks.[22]

    [22] Section 5 of the Social Security (Administration) (Class of Persons – Intent to Claim) Determination 2018 identifies various classes of designated individuals (such as those suffering from domestic violence or homelessness) for the purpose of applying section 13: T3, 33.

24. It is accepted that a claim for PPS was lodged by the Applicant on 12 January 2022. She discussed her eligibility the previous day in a telephone call with Centrelink. Even if one allows the 5 September 2019 as a contact day, she did not lodge a claim until some 27 months later. The date of lodgement falls well outside the maximum 13-week extension period.

25. Moreover, 5 September 2019 cannot be regarded as a potential contact day. The Applicant’s evidence is that PPS was not discussed on that occasion, although she says that it should have been.[23] Unfortunately, there is no statutory basis for finding that this was a contact day, regardless of whether the Centrelink officer was, as the Applicant puts it, negligent in failing to notify her of the matter.

    [23] Transcript, 11 July 2023, 23.

    The waiting period

26. Subsection 41(a) of the Administration Act provides that unless another provision of social security law provides otherwise, a social security payment becomes payable to a person on the person’s start day in relation to the social security payment. Section 42 of the Administration Act provides that a person’s start day is worked out in accordance with Schedule 2.[24] This provides the general rule that the start day is the day on which the claim is made,[25] and sections 500WA and 500WB of the Social Security Act 1991 (Cth) (the Act) imply that an ordinary waiting period of seven days applies, subject to limited exceptions.

    [24] T3, 21.

    [25] Schedule 2, clause 3(1).

27. PPS is governed by the ordinary waiting period unless a claimant was in receipt of an income support payment at some point in the 13-week period immediately before their start day,[26] or the Secretary is satisfied that the person is experiencing a ‘personal financial crisis’.[27] The Applicant was not in receipt of an income support payment in the 13-week period immediately before her start day for PPS.[28]

    [26] The Act, paragraph 500WA(1)(a).

    [27] The Act, paragraph 500WA(1)(b).

    [28] T11, 101.

28. I turn to consider whether the Applicant was experiencing a personal financial crisis.

29. A person is experiencing a ‘personal financial crisis’ under the circumstances defined in subsection 19DA(1) of the Act.[29] The statutory definition contains two limbs:

    (a)A claimant must be in ‘severe financial hardship’; and

    (b)The claimant must either have experienced domestic violence at some point in the four weeks prior to the identified start day or incurred unavoidable or reasonable expenditure in the 4 weeks immediately before the person's start day or fall into one of the categories identified in the relevant Instrument.[30] 

    [29] T3, 9.

    [30] The Social Security (Experiencing a Personal Financial Crisis) Instrument 2017: T3, 36.

30. The two limbs are cumulative, in other words, if the claimant is not in severe financial hardship, then it is not necessary to consider the second limb matters at all.

    Was the Applicant in severe financial hardship when she contacted the department on 11 January 2022?

31. Severe financial hardship is defined in subsection 19C(2) of the Act for persons who are not a member of a couple. It provides:

    (2) A person who is not a member of a couple and who makes a claim for parenting payment… is in severe financial hardship if the value of the person’s liquid assets (within the meaning of 14A(1)) is less than the fortnightly amount at the maximum payment rate of payment, benefit, pension or allowance that would be payable to the person:

    …

    (f) if the person’s claim were granted…

32. Section 14A of the Act relevantly defines “liquid assets” as cash and readily realisable assets and includes amounts deposited with, or lent to, a bank or other financial institution by the person, whether or not the amount can be withdrawn or repaid immediately.

33. There was considerable discussion as to whether the Applicant was in severe financial hardship at the time of the claim. In her claim form she stated that she had $764.00 in her Commonwealth Bank account and $7.00 in a St George’s Bank account. At the hearing, she said that the balance of the CBA account was not $764.00 but was in fact zero.[31] However, she accepted that it showed a balance of $1,995.77. She had no other cash and $7.00 in the St George account.[32] The maximum rate of PPS that would be payable to the Applicant is $880.30 per fortnight.[33] The admitted balance is more than this and therefore she cannot be regarded as being in financial hardship.

    [31] Transcript, 11 July 2023, 33.

    [32] Transcript, 11 July 2023, 47.

    [33] T5, 46.

34. Moreover, the Applicant’s bank statements show that between November 2021 and January 2022, she received regular transfers from her father of some $3,000.00. The Applicant’s bank statements were provided to the Tribunal as an attachment to the RSFIC.

35. The Respondent has referred to various decisions of the Tribunal in relation to the treatment of informal loans, or gifts:

    33. In Williamson and Secretary, Department of Family and Community Services [2003] AATA 652 (Williamson) considered whether monies from a loan ought to be considered as a “liquid asset”. The Tribunal, at paragraph [24], found that there was no “charge or encumbrance present in relation to the monies” and that “the monies were available to the applicant to use at his discretion and that section 1121 does not operate in this case to reduce the value of the applicant’s asset.”

    34. Similarly, the Tribunal in Morales and Secretary, Department of Family and Community Services [2004] AATA 669 adopted the reasoning in Williamson and at paragraph [12], found that the monies borrowed by Mr Morales for home renovations were properly regarded as liquid asset in his hands.[34]

    [34] RSFIC, paras [33], [34].

36. The conclusion, no doubt frustrating for the Applicant and her father, is that because she is not regarded as experiencing financial hardship on 12 January 2022 when she made the claim, the Tribunal cannot reduce the waiting period for PPS. Given that the waiting period is 7 days, the Tribunal has no power to reduce it further.

    The second limb issues

37. Even if the Tribunal were to find that the Applicant was experiencing financial hardship in December 2021, I do not think that she satisfies the second limb.

38. The Applicant stated that by the end of 2021 the threat of domestic violence had reduced.[35] Her affidavit dated 30 October 2020[36] prepared for Family Court proceedings provides ample evidence of physical and emotional abuse during the earlier period. Her former husband’s affidavit prepared for those proceedings does not extend beyond an admission of property damage committed in early 2018.[37] The Tribunal was not taken to any contemporaneous apprehended violence order relating to her ex-husband. On the materials, there is no basis for a positive finding that in the four weeks prior to 12 January 2022, the Applicant experienced any form of domestic violence.

    [35] Transcript, 11 July 2023, 48.

    [36] T9, 59.

    [37] T9, 72.

39. For completeness, I am satisfied that the Applicant did not experience unavoidable or reasonable expenditure in the relevant period.[38] The relevant period under subsections (2) and (3) of section 19DA of the Act, is the period of 4 weeks prior to the start date. The Applicant only identified legal fees that may have been paid in this period, but in any event, these were paid by the Applicant’s father.

    [38] Transcript, 11 July 2023, 49.

40. I am satisfied on the evidence that the Applicant did not fall into any of the categories identified in section 5 of the Financial Crisis Instrument.[39]

    [39] T3, 38.

41. However, as previously noted, this is not a live issue, because of the finding with respect to the financial hardship limb. 

    Amended start date

42. The Respondent identified two other potential contact dates that the Tribunal may weigh up for the purpose of the deemed claim provisions, the first being 22 December 2021, when the Applicant created the online PPS claim form.[40] The Applicant confirmed that she had started filling out the form but could not submit it, as she had technical issues.[41] Despite this, it was not until 11 January 2022 that the Applicant telephoned Centrelink in relation to her PPS claim. The Respondent contends that this 22 December 2021 date cannot be regarded as the contact date, as the claim was not validly lodged pursuant to subsection 16(1) of the Administration Act.[42] I accept the Respondent’s submission, as the claim form confirms that the claim submission date was 12 January 2022.[43]

    [40] Transcript, 11 July 2023, 15.

    [41] Transcript, 11 July 2023, 5.

    [42] RSFIC, [39]; Transcript, 11 July 2023, 45.

    [43] T4, 39.

1. Additionally, the Respondent submits that the creation of the claim form on 22 December 2021 does not constitute “contact” within the ambit of section 13 of the Administration Act.[44] The Applicant telephoned Centrelink on 21 December 2021 but did not discuss PPS. “Contact” is left undefined in the Act and Administration Act. However, paragraph 8.1.1.60 of the Social Security Guide (the Guide)[45] provides that contact includes, but is not limited to: post, telephone, facsimile, computer equipment (such as by email) or other electronic means. The Guide states that the “intention is to allow anything that would be ordinarily understood as contact with [Centrelink].” I accept that the creation of a claim form does not accord with the ordinary meaning of “contact” with Centrelink, particularly in the context of the Act and Administration Act which clearly delineate between the dates of contact and, for example, claim lodgement.

   [44] Transcript, 11 July 2023, 45.

   [45] 8.1.1.60 Contacting Services Australia about a claim | Social Security Guide (dss.gov.au)

2. The second date is 11 January 2022, when the Applicant contacted Centrelink by telephone. Mr Gauci drew the Tribunal’s attention to the transcript of that telephone conversation. He noted that PPS was discussed during that conversation and suggested that 11 January 2022 could be regarded as the date of contact for the purpose of the deeming provisions.[46] Having regard to the transcript and paragraph 8.1.1.60 of the Guide, I accept that this conversation satisfies the requirements of contact for the purposes of section 13 of the Administration Act.

   [46] Transcript, 11 July 2023, 46.

3. Applying the 7-day waiting period, I am satisfied that the Applicant is entitled to receive PPS from 18 January 2022.

   Potential alternative remedy

4. The Applicant and her father have a sense of injustice that she was pursued for a FTB debt that may have arisen because of the estranged husband’s unwillingness to file tax returns. This sense of grievance is fuelled by her experience as a victim of serious domestic abuse, compounded by the phone call of 5 September 2019 with Centrelink. The Tribunal has not seen a transcript or a record of this conversation. Presumably, such a record exists. The Applicant says that the Centrelink officer was interested only in debt recovery. She fervently believes that she should have been told about possible sources of relief, including PPS.

5. I note that in some cases, compensation for purely economic loss may be made under the Scheme for Compensation for Detriment caused by Defective Administration (CDDA Scheme).[47] Under the CDDA scheme, an ex-gratia payment may be made in certain circumstances, such as where Centrelink failed to give proper advice that was within their power to give. In a case where the circumstances clearly indicate that a Centrelink customer is in a precarious financial situation, a failure to direct them to available benefits during a debt recovery interaction may fall under the CDDA Scheme. This is especially so where the debtor is in a degree of crisis because of family breakdown, has the care of young children, and is heavily reliant on the kindness of others. Of course, the circumstances would need to be looked at carefully.

   [47] Scheme for Compensation for Detriment caused by Defective Administration (CDDA Scheme) | Department of Finance

6. Finally, I endorse the following comment made by the AAT1:

   16. The Tribunal does not doubt, as attested to in the Federal Circuit Court papers which were provided to the Tribunal by [the Applicant], that [the Applicant] was in a very difficult situation with her husband. Nor does the Tribunal doubt the sincerity of [the Applicant’s father] in doing everything he could to protect and care for his family – at great personal cost to him.

   17. The Tribunal is, however, bound by the social security law and must apply the start date and ordinary waiting period as mandated by the law.[48]

   [48] T2, 5.

   DECISION

7. The decision of the Social Services and Child Support Division (AAT1) dated 1 July 2022 is set aside, and substituted with a decision that the Applicant is entitled to receive Parenting Payment Single from 18 January 2022.

I certify that the preceding 49 (forty-nine) paragraphs are a true copy of the reasons for the decision herein of Emeritus Professor P A Fairall, Senior Member

.......[SGD].................................................................

Associate

Dated: 25 August 2023

Date(s) of hearing:	11 July 2023
Applicant:	In person
Solicitors for the Respondent:	Mr M. Gauci, Hunt & Hunt Lawyers