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

[2021] AATA 4433

Larson; Secretary, Department of Social Services and (Social services second review) [2021] AATA 4433 (2 November 2021)

Division:GENERAL DIVISION

File Number(s):      2021/2843

Re:Secretary, Department of Social Services

APPLICANT

AndAndreas Larson

RESPONDENT

DECISION

Tribunal:Dr L Bygrave, Member

Date:2 November 2021

Place:Sydney

The reviewable decision dated 24 March 2021 is set aside and, in substitution, the Tribunal decides that the proportional rate of age pension applies to Mr Andreas Larson from 10 September 2020 on the basis that his absence from Australia is not temporary and therefore, the discretion in subsection 1220A(6) of the Social Security Act 1991 (Cth) cannot apply to his circumstances.

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

Dr L Bygrave, Member

CATCHWORDS

SOCIAL SECURITY – residing outside of Australia – rate of age pension – nature of accommodation used in Australia considered – nature and extent of family relationships in Australia considered – nature and extent of employment, business or financial ties with Australia considered – nature and extent of assets located in Australia considered – frequency and duration of travel outside of Australia considered – other factors considered – decision under review set aside

LEGISLATION

Social Security Act 1991 (Cth) divs 2-3, pt 4.2, ss 7, 1120A, 1217, 1221, 1212C

Social Security (Coronavirus Economic Response – 2020 Measures No. 10) Determination 2020

Social Security (Coronavirus Economic Response – 2020 Measures No. 14) Determination 2020

Social Security (Coronavirus Economic Response – 2020 Measures No. 16) Determination 2020

CASES

Re Drake and Minister for Immigration and Ethnic Affairs (No 2) [1979] AATA 179; (1979) 2 ALD 634.

REASONS FOR DECISION

Dr L Bygrave, Member

2 November 2021

INTRODUCTION

1. The respondent, Mr Andreas Larson, has received age pension since 4 March 2009.

2. Mr Larson last departed Australia on 11 March 2020. Services Australia[1] (Centrelink), both initially and on review, determined Mr Larson:

   ·had left Australia permanently and, as at 9 September 2020, had been outside Australia for 26 weeks; and, consequently,

   ·was only entitled to receive the proportional rate of age pension from 10 September 2020.

   The proportional rate of age pension paid to Mr Larson was calculated on him having 180 months of Australian working life residence.

   [1] On 26 May 2019, the Prime Minister announced the establishment of Services Australia and, on 1 February 2020, it became an executive agency in the Social Services portfolio.

3. Mr Larson made an application for review to the Social Services and Child Support Division (AAT1) of the Administrative Appeals Tribunal (the Tribunal).

4. On 24 March 2021, the AAT1 decided that Mr Larson’s absence from Australia was ‘temporary’ and he had been ‘unable to return to Australia since 11 March 2020 due to the impact of the coronavirus’.[2] The effect of the AAT1 decision was to entitle Mr Larson to the maximum rate of age pension, rather than the proportional rate of age pension.

   [2] Exhibit T-T2, page 3.

5. The Secretary, Department of Social Services subsequently applied to the General Division of the Tribunal for review.

6. The application was heard by the Tribunal on 1 October 2021. Mr Larson did not have legal representation; he attended the hearing and gave oral evidence by videoconference.

   RELEVANT LEGISLATION

7. The statutory provisions relevant to this matter are set out in the Social Security Act 1991 (Cth) (the Act); and the Social Security (Coronavirus Economic Response – 2020 Measures No. 10) Determination 2020 (Determination No. 10), Social Security (Coronavirus Economic Response – 2020 Measures No. 14) Determination 2020 (Determination No. 14)  and the Social Security (Coronavirus Economic Response – 2020 Measures No. 16) Determination 2020 (Determination No. 16).

8. Part 4.2 of the Act stipulates the requirements for overseas portability: Division 2 outlines portability of social security payments and Division 3 sets out the rate of portable pensions.

9. Pursuant to section 1217 of the Act, a person can receive age pension for an ‘unlimited period’ while they are overseas. Relevantly, however, section 1220A of the Act sets out provisions regarding proportionality for the age pension rate: subsection 1220A(1) stipulates that a person’s rate of age pension is to be calculated using the pension portability rate calculator at section 1221-Module A if the person has been ‘continuously absent from Australia throughout a period of more than 26 weeks’.

10. Section 1221-Module A of the Act sets out how to calculate a person’s portability rate based on their Australian working life residence. A person’s Australian working life residence is described in section 1221-Module B of the Act.

11. As part of measures introduced in 2020 to address the impact of COVID-19, the Australian Government (by way of Determination No. 10, and subsequently, Determination No. 14 and Determination No. 16),[3] varied section 1220A of the Act to add subsection 1220A(6). Subsection 1220A(6) of the Act provides:

    (6) If:

    (a) the 26 weeks mentioned in paragraph (1)(a) ends on or after 11 March 2020; and

    (b) the Secretary is satisfied that the person’s absence from Australia is temporary; and

    (c) the Secretary is satisfied that the person is unable to return to Australia before the end of that 26-week period because of the impact of the coronavirus known as COVID-19;

    the Secretary may, in relation to the person, determine that a reference to 26 weeks in paragraph (1)(a) is taken to be a reference to another number of weeks. However, the Secretary must ensure that the determination does not result in a period referred to in that paragraph that ends after 24 September 2020. [emphasis added]

    [3] Determination No. 10 was amended on 28 August 2020 by Determination No. 14. Determination No. 10 was repealed on 18 December 2020 by Determination No. 16.

12. Determination No. 16 extended the period for the non-proportionalised rate of age pension to be paid until 31 March 2021 based on the same conditions in Determination No. 10.

13. For the purpose of subsection 1220A(6) of the Act, the meaning of ‘temporary absence’ from Australia is set out in section 1212C of the Act as follows:

    Meaning of temporary absence

    For the purposes of this Part, a person’s absence from Australia is temporary if, throughout the absence, the person does not cease to reside in Australia (within the meaning of subsection 7(3)).

14. Subsection 7(3) of the Act states:

    (3) In deciding for the purposes of this Act whether or not a person is residing in Australia, regard must be had to:

    (a) the nature of the accommodation used by the person in Australia; and

    (b) the nature and extent of the family relationships the person has in Australia; and

    (c) the nature and extent of the person’s employment, business or financial ties with Australia; and

    (d) the nature and extent of the person’s assets located in Australia; and

    (e) the frequency and duration of the person’s travel outside Australia; and

    (f) any other matter relevant to determining whether the person intends to remain permanently in Australia. [emphasis added]

15. Residence requirements and in particular, making a determination about whether a person is residing in Australia, are also set out as follows in the Social Security Guide (the Guide):

    When making a determination about whether a person is ‘residing’ – in other words ‘living’ – in Australia, the key point is to establish that Australia is the person’s settled or usual place of abode – i.e. that the person makes Australia his or her home. In general, it is not possible for a person to be residing in more than one country at the same time. In most cases, the balance of a person’s ties will weigh more heavily in favour of one country than another.

    The decision as to whether a person is residing in Australia must be based on the balance of all the available evidence. No single factor should be taken to be conclusive on its own and some factors will usually provide a greater indication than others, however in the majority of cases the most weight should be given to the time spent in Australia. In general, it is also expected that a person who resides in Australia will be able to demonstrate strong ties to Australia under a number of different criteria listed in…section 7(3) [of the Act].[4]

    [4] Social Security Guide released 27 September 2021, part 3.1.1.10.

16. I note the Guide is government policy and should be considered unless there are cogent reasons not to do so: Re Drake and Minister for Immigration and Ethnic Affairs (No 2).[5]

    [5] [1979] AATA 179; (1979) 2 ALD 634.

    ISSUES

17. The issue for determination by the Tribunal is whether the proportional rate of age pension should apply to Mr Larson from 10 September 2020. This requires consideration of whether:

    ·Mr Larson’s absence from Australia is ‘temporary’; and, if so,

    ·the discretion to extend the 26 week period in accordance with subsection 1220A(6) of the Act should be exercised.

    CONSIDERATION

18. The following sets out the evidence before the Tribunal.

19. Mr Larson is currently aged 84 years old. He was born in and is a citizen of Canada.

20. In 1987, Mr Larson migrated to Australia with his former wife and their three children. He became an Australian citizen in 1991.

21. Mr Larson was employed in the ‘communication networking field’ in the period from 1987 to 2008.[6] Based on the provisions in section 1221-Module B of the Act, his Australian working life residence commenced on 1 March 1987 and ended on 25 February 2002; this has been ‘rounded up’ to an Australian working life residence of 180 months.[7]

    [6] Exhibit R1, page 2.

    [7] Exhibit T-T18, page 119.

22. In late 2008, Mr Larson separated from his former wife and departed their family home in Sydney during a period of difficult personal circumstances. Mr Larson subsequently gifted his share of the family home as well as his superannuation to his former wife.

23. From 2009 to 2011, Mr Larson lived in remote areas of Australia where he received free accommodation in return for looking after a house or property. He then purchased and lived on a boat at a marina in Sydney from 2012 to 2016.[8]

    [8] Exhibit R1, page 1.

24. In 2016, Mr Larson attempted to sail solo around the world but lost his boat and possessions in the Bering Sea. He then returned to Australia where he underwent surgery in November 2016 and recuperated with a friend in Brisbane for three months.[9]

    [9] Exhibit R1, page 1.

25. Since 2017, Mr Larson has been overseas for the following periods:

    ·2017: 4 February 2017 to 8 September 2017 and 16 September 2017 to 7 December 2017.

    ·2018: 15 May 2018 to 14 August 2018 and 29 August 2018 to 8 December 2018.

    ·2018–2019: 18 December 2018 to 16 March 2019.

    ·2019: 20 March 2019 to 11 September 2019.

    ·2019–2020: 14 September 2019 to 10 March 2020.

    ·2020–2021: 11 March 2020 to the present.[10] 

    [10] Exhibit T-T18, page 110.

26. At the hearing, Mr Larson said he is unable to afford to live in Australia on the age pension. Consequently, he departed Australia in February 2017 and travelled to Vietnam, Cambodia and Thailand.

27. Mr Larson told the Tribunal he returned to Australia during 2017 and 2018 primarily for the purpose of finalising divorce proceedings and mediating a financial settlement with his former wife. During these periods in Sydney, he either stayed with friends or at ‘Airbnb’ accommodation. In a written statement dated 7 July 2021, Mr Larson noted that his travel outside Australia in 2018 was ‘purely so [he] could exist [financially], while paying roughly 60 percent of [his] pension to [his] legal counsel’.[11]

    [11] Exhibit R1, page 3.

28. Mr Larson travelled to Thailand in December 2018 after finalising his divorce and associated legal proceedings in Australia.

29. In February 2019, Mr Larson married his wife, Mrs Phakjira Larson, in Thailand. Mrs Larson completed a ‘Mod P – Partner details’ Centrelink form on 6 May 2019 in which she declared she lives with Mr Larson, her permanent address is Samut Prakan Province in Thailand, she owns a home and a car (confirmed by Mr Larson at the hearing as being held in Thailand), and she has bank accounts in Thailand.[12]

    [12] Exhibit T-T4, pages 24-36.

30. Mr Larson briefly returned to Australia from 16 to 20 March 2019 and 11 to 14 September 2019. He told the Tribunal that the purpose of these trips to Australia was to ‘reset the clock’: that is, he was aware that his age pension would be reduced if he remained continuously absent from Australia for more than 26 weeks and so he returned to Australia within the 26 weeks-period to maintain his payment of age pension at the maximum rate.

31. On 11 September 2019, Mr Larson provided a written statement to Centrelink. He declared that:

    ·he was ‘separated from [his] partner who has left the marriage to move back with her parents’;

    ·the separation is due to his ‘inability to support’ his wife due to the reduced amount of age pension he was receiving; and

    ·he is aware he must inform Centrelink if he re-partners.[13]

    [13] Exhibit T-T9, page 49.

32. At the Tribunal hearing, Mr Larson said that he and Mrs Larson had experienced difficulties in their marriage related to finances and an expectation by Mrs Larson that they would go to Australia after they married. Their financial issues were exacerbated when Mr Larson’s rate of age pension was reduced to the ‘partnered’ rate; however, his rate of age pension resumed at the single rate after he notified Centrelink of his separation from Mrs Larson.

33. Mr Larson said he wishes to obtain an Australian visa for his wife but understands the process could take two years and costs more than $7,000. Mr Larson advised he does not have this money in savings and so he intends to return to Australia to ask family members and/or friends to provide financial assistance for this process.

34. Mr Larson last arrived in Australia on 10 March 2020 and returned to Thailand the following day, 11 March 2020. He said this trip was cut short when his wife phoned him extremely upset while he was at the airport in Bangkok because her brother had been diagnosed with coronavirus. Mr Larson said he travelled to Australia in order to ‘reset the clock’ for his age pension and then immediately returned to Thailand. He said he had intended to return to Australia in May 2020 and had booked (and rebooked) flights to Australia in October 2020, January 2021 and April 2021.

35. Mr Larson told the Tribunal that his situation since 11 March 2020 has been the following:

    ·he lives in an apartment in Bangkok owned by Mrs Larson and pays her rent;

    ·his wife lives primarily with her parents, although they see each other regularly;

    ·he has personal possessions stored at a friend’s home in Sydney and also uses this home as his Australian postal address;

    ·he has two children and four grandchildren living in Australia who he periodically communicates with by email;

    ·his wife’s siblings and two children reside in Thailand;

    ·his age pension is paid into his Australian bank account and he then transfers the money into his bank account in Thailand;

    ·he has been unable to return to Australia since March 2020 due to the closure of Australian borders by the Australian government in response to COVID-19; and

    ·he has not applied for COVID-19 overseas financial assistance (either a loan or grant) through the Australian Department of Foreign Affairs and Trade.

    CONSIDERATION

    Issue 1: Is Mr Larson’s absence from Australia temporary?

36. In considering whether Mr Larson’s absence from Australia is temporary, and whether he is residing in Australia, I must have regard to the factors listed in subsection 7(3) of the Act. I make the following findings in relation to each of these factors:

    The nature of the accommodation used by Mr Larson in Australia

37. Mr Larson’s view is that he lost his home and most of his possessions when he lost his boat at sea in 2016. Since 2016, he has not owned any property in Australia or overseas.

38. When Mr Larson was in Australia during periods between 2017 and 2020, he stayed in short-term ‘Airbnb’ accommodation or with friends. He has possessions stored at a friend’s home in Sydney and uses this home as his Australian postal address, although he has not stayed at this address since 2017.

39. Since August 2019, Mr Larson has lived in an apartment in Thailand that is owned by his wife.

40. I am satisfied that Mr Larson has used temporary accommodation for the periods he has been in Australia since 2017 and, since 2016, he has not held permanent accommodation (for example, a long-term rental arrangement or ownership of a property such as a house or boat) in Australia.

    The nature and extent of the family relationships Mr Larson has in Australia

41. Mr Larson has two children and four grandchildren who reside in Sydney. His relationship with his children has been strained, particularly since the legal proceedings with his former wife in 2018. He has not seen his children in person since December 2018 and he primarily communicates with them by email.

42. Mr Larson’s wife lives in Thailand; she also has two children and extended family members in Thailand.

43. I am satisfied that the nature and extent of family relationships Mr Larson has in Australia is limited. His main current family relationship is with his wife, who lives in Thailand.

    The nature and extent of Mr Larson’s employment, business or financial ties with Australia

44. While Mr Larson was employed in Australian businesses between 1987 and 2008, he has no current employment or business ties with Australia.

45. Mr Larson holds bank accounts in Australia and Thailand.

46. I am satisfied that Mr Larson’s sole financial tie with Australia is a bank account.

    The nature and extent of Mr Larson’s assets located in Australia

47. The only assets held by Mr Larson in Australia (or elsewhere) are possessions that are stored at a friend’s home in Sydney and any personal possessions he has in Thailand.

48. I am satisfied that the nature and extent of Mr Larson’s assets located in Australia are solely personal possessions.

    The frequency and duration of Mr Larson’s travel outside Australia

49. Since December 2018, Mr Larson has spent approximately eight days in Australia. His brief trips to Australia in March 2019 (four days), September 2019 (three days) and March 2020 (one day) were primarily to ‘reset the clock’ to ensure he received the maximum rate of age pension. There is no evidence these trips were to visit family members or undertake particular activities related to him residing in Australia.

50. Mr Larson has been unable to return to Australia since March 2020 due to Australia’s border closure. He has indicated that he is seeking to return to Australia to obtain financial assistance from family and/or friends so that he can apply for an Australian visa for his wife.

51. The Guide states:

    For Australian residence to be maintained during an absence, a person must demonstrate continued physical ties to Australia, the absence must be for a short duration, there must be a purpose for the absence and there must be a proposed end date for the absence…

    When looking at the pattern and duration of time spent outside Australia, if a person regularly spends more than 6 months a year outside Australia, then their residence in Australia is questionable.

    The purpose of an overseas absence may indicate whether a person continues to reside in Australia…[14]

    [14] Social Security Guide released 27 September 2021, part 3.1.1.10.

52. Mr Larson’s primary reason for travelling outside Australia since February 2017 appears to be financial: he has repeatedly stated that he cannot afford to reside in Australia on the age pension. Since his marriage in February 2019, he has also stated that he cannot afford the money required to apply for a visa for his wife to come to Australia.

1. I note these submissions are not necessarily consistent with an intention for Mr Larson to reside permanently in Australia in the future. First, there is no indication that his financial circumstances have improved to the extent that he is now able to afford to live in Australia; and second, Mr Larson’s wife owns realisable assets (property and a car in Thailand) that could potentially pay for a visa for Mrs Larson.

2. I am satisfied that Mr Larson has primarily lived outside Australia since at least December 2018. I am also satisfied there is nothing in the pattern and duration of Mr Larson’s travel – even prior to the Australian border closing in March 2020 – that suggests he resides permanently in Australia.

   Any other matter relevant to determining whether Mr Larson intends to remain permanently in Australia

3. Mr Larson, since at least December 2018, has travelled overseas to Thailand where he is able to afford to live on age pension. He has returned to Australia approximately every 26 weeks to ‘reset the clock’ and maintain his payment of age pension at the maximum rate. Unfortunately for Mr Larson, this pattern of travel has been affected by closure of the Australian borders due to COVID-19. While I accept he has attempted to book flights to Australia that have been cancelled, there is no evidence that he has registered with the Australian Department of Foreign Affairs and Trade as seeking to travel to Australia or as requiring financial assistance.

4. I have also considered whether Mr Larson can be considered to be residing in any other country. I am satisfied that Mr Larson has primarily resided in Thailand since December 2018, has been married to a citizen of Thailand since February 2019 and has lived in his wife’s apartment in Thailand since at least August 2019.

   Conclusion

5. Weighing the evidence and my findings in relation to each of the factors in subsection 7(3) of the Act, I am satisfied that Mr Larson’s absence from Australia is not temporary. This is because he has mainly resided outside Australia since December 2018, and there is no evidence he owns or maintains any accommodation or holds assets (apart from some stored personal possessions) in Australia, his financial ties to Australia are limited to his bank account, and his primary family relationship (with his wife) is in Thailand (although he does have two children and four grandchildren living in Australia).

   Issue 2: Should the discretion to extend the 26 week period pursuant to subsection 1220A(6) of the Act be exercised?

6. For the reasons set out in paragraphs 36 to 57 above, I find that Mr Larson’s absence from Australia is not temporary. It therefore follows that the discretion in subsection 1220A(6) of the Act to extend the 26 week period cannot be exercised in relation to his circumstances.

   DECISION

7. The reviewable decision dated 24 March 2021 is set aside and, in substitution, the Tribunal decides that the proportional rate of age pension applies to Mr Andreas Larson from 10 September 2020 on the basis that his absence from Australia is not temporary and therefore, the discretion in subsection 1220A(6) of the Social Security Act 1991 (Cth) cannot apply to his circumstances.

I certify that the preceding 59 (fifty -nine) paragraphs are a true copy of the reasons for the decision herein of Dr L Bygrave, Member

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

Associate

Dated: 2 November 2021

Date(s) of hearing:	1 October 2021
Solicitors for the Applicant:	Ms Cara Hammerton, Services Australia
Respondent:	In person