Laurent and Secretary, Department of Family and Community Services - [2002] AATA 202

DECISION AND REASONS FOR DECISION [2002] AATA 202

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q2001/840

GENERAL ADMINISTRATIVE DIVISION       )
           Re      NATHAN LAURENT
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY & COMMUNITY SERVICES
  Respondent

DECISION

Tribunal Ms J Cowdroy

Date27 March 2002
PlaceBrisbane

Decision      The Tribunal sets aside the decision under review and substitutes its decision that arrears of rent assistance are to be paid to the applicant from 27 September 1999.
  ..................(Sgnd)..................
  Ms J Cowdroy
  Member

CATCHWORDS
SOCIAL SECURITY – newstart allowance - rent assistance – whether 'rent assistance' is a 'social security benefit' or 'social security allowance' – notice requirements – whether decision made and whether applicant notified of that decision

Social Security Act 1991
Social Security (Administration) Act 1999

Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138
Secretary, Department of Family and Community Services v Rogers (2000) 140 FCR 272
Re Secretary, Department of Family and Community Services and Rogers [2001] AATA 94
Re Frost and Secretary, Department of Social Security (AAT 10360, 17 August 1995)
Secretary, Department of Social Security v Marsh (1996) 42 ALD 639

REASONS FOR DECISION

27 March 2002 Ms J Cowdroy

This is an appeal against a decision of the Social Security Appeals Tribunal ("the SSAT") dated 21 August 2001, which affirmed a decision of Centrelink made on 23 January 2001, and varied by an Independent Review Officer on 22 May 2001, not to pay arrears of rent assistance for the period 28 September 1999 to 4 December 2000.

Hearing

The matter was heard on 30 January 2002. The applicant, who did not appear, was represented by Ms C Heyworth-Smith of Counsel, on instructions from the Welfare Rights Centre. The respondent was represented by Mr T Ffrench. The T-documents, pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 were admitted into evidence (exhibit E1) and other material was admitted into evidence as exhibits E2-E9. The matter was determined on the written and oral submissions of both parties.

Background to the Application

The facts that are not disputed are as follows: Mr Laurent was in receipt of newstart allowance and rent assistance until 16 September 1999 when Centrelink canceled his payments. The decision to cancel arose from the applicant's failure to respond to requests for information from the respondent. However, the respondent had sent correspondence to the applicant to the incorrect address, and only realised its error when all correspondence addressed to the applicant was returned.
The decision to cancel newstart allowance was made on 16 September 1999. On 20 September 1999 the respondent's records were amended to reflect the applicant's correct address and his newstart allowance was restored. On that date a letter was sent advising the applicant that normal payments from 12 October 1999 would be $392.70, which included an amount of $76.00 for rent assistance.
On 27 September 1999 a letter from the respondent to the applicant indicated that for the period 14 September 1999 to 27 September 1999 a payment of $386.75 would be made and from 12 October 1999 would be made. No mention is made in relation to payment of rent assistance.
Between 28 September 1999 and 4 December 2000, the applicant was sent various letters from the respondent advising him of the rate of newstart allowance and in none of those letters was rent assistance mentioned. Throughout this period the applicant lodged a number of documents headed "Application for Payment of Newstart Allowance".
The applicant contacted the respondent on 16 January 2001 advising that he had not been paid rent assistance since August 1999 and asked that the matter of rent assistance be reviewed. A decision was made to pay rent assistance from 19 January 2001. This was subsequently altered to 16 January 2001 and, on review by a review officer, it was determined that rent assistance was payable from 4 December 2000. That decision was affirmed by the SSAT and the applicant applied for review of that decision to the Administrative Appeals Tribunal on 17 September 2001.

The Issues

The sole issues for the Tribunal's determination are: (i) was the applicant given notice of the decision to cancel his rent assistance; (ii) if such notice was given, at what time; and (iii) when did the applicant seek review of payment of rent assistance.

The Applicant's Case

Counsel maintained that none of the letters from the respondent dated 27 September 1999, 28 September 1999, 13 January 2000, 21 June 2000, 5 July 2000, 11 September 2000, 2 October 2000 and 4 December 2000, which advised the applicant as to the amount of payment he was receiving, made any mention of rent assistance as a component of the payment. It was contended that if the respondent determined to change the rate of payment, such a decision had to be communicated. The letters merely set out the rate of payment of newstart allowance, which, it was contended, was not sufficient to constitute notice that rent assistance was not being paid.
In support of that contention, the Tribunal was referred to Cooper J in Secretary, Department of Family and Community Services v Rogers (2000) 104 FCR 272, in which it states effectively that the matter to be communicated in a notice involves two elements: the fact that a decision has been made and the content of the decision. Similarly, in Austin v Secretary, Department of Family and Community Services (1999) 92 FCR 138, Drummond J stressed the distinction between a clear statement that a decision has been made fixing the rate of payment at a particular figure or cancelling or suspending newstart allowance, as opposed to providing information from which an inference could be drawn that a decision had been made.
Further, it was submitted that the absence of the words 'rent assistance' in the letters of advice to the applicant does not constitute communicate that a decision has been made in regard to rent assistance. It was contended that the applicant would only have become aware of that a decision had been made in respect to rent assistance if he compared the letter of 20 September 1999 with the letters sent from 27 September 1999, and he would then be required to draw an inference that rent assistance had been cancelled.
The applicant suggested that the fact that one letter states that rent assistance is being paid and the later letters are silent on this issue, either taken in isolation or together, do not constitute a "decision" within the meaning of that term.
The second issue is in relation to the time at which the applicant sought review of the decision. On the assumption that the letters referred to earlier constitute communication of a decision, then, applying s 109(1) of the Social Security Administration Act 1999 ("the Administration Act"), the applicant must lodge an application for review of a decision within thirteen weeks of that decision, in order to have arrears payable from the date on which the determination containing the original decision took effect.
In this context, it was argued by counsel that the applicant's completion and lodgment of fortnightly forms entitled "Application for payment of Newstart Allowance" constituted a request for review. The information provided on the fortnightly form is information utilised by the respondent to determine whether the allowance should be paid and at what rate. It was contended that each time an application was lodged, the respondent was obliged to consider the information in the application and make a fresh determination.
Support for that view was said to be found in the matter of Re Secretary, Department of Family and Community Services and Rogers [2001] AATA 94 where Senior Member Beddoe considered the effect of lodgment of a Sole Parent Review Form. Senior Member Beddoe stated that it was reasonable "to infer that a person returning a completed Sole Parent Review form … would expect that the person's entitlement to a pension was being reviewed" (at par 61).
It was pointed out that the failure of the forms submitted by the applicant on a fortnightly basis to contain the word 'review' does not detract in any way from their status as documents on which review of rent assistance is based. In this context, the matters of Re Frost and Secretary, Department of Social Security (AAT 10360, 17 August 1995) and Secretary, Department of Social Security v Marsh(1996) 42 ALD 639 were referred to as support for the proposition that it was appropriate for the department to accept applications for review couched in a variety of methods.
The applicant also took issue with the respondent's contention that rent assistance is not an "allowance" in its own right under the Act, and therefore notification of the amount of the amount of newstart allowance is sufficient notice of a decision having been made. Under s 23 of the Social Security Act 1991, ("the Act"), an allowance falls within the definition of "social security payment". The applicant's position is that rent assistance is an 'allowance' in is own right and support for that contention is evident in the fact that rent assistance has a separate set of qualifications to newstart allowance; it has a separate purpose to newstart allowance; it is accounted for separately and nothing in the Act requires an interpretation that excludes "rent assistance" from the term "allowance".
Further, the term "allowance" is not defined in the Act, and recourse to a dictionary definition (Exhibit 4) reveals that "rent assistance" falls squarely within the definition of "allowance". It is therefore a social security payment under the Act. It was also pointed out that the words 'allowance' and 'assistance' are synonymous.

Respondent's Case

Counsel submitted that it was a spurious argument for the respondent to contend that the applicant was not advised that a decision had been made about his rate of newstart allowance. It was contended that rent assistance is a component of newstart allowance, and notwithstanding any reference in the letters to rent assistance, the letters nonetheless conveyed to the applicant notice that rent assistance had been cancelled. Counsel argued that qualification for payment of rent assistance is clearly a component of newstart allowance, in that a person needs to be qualified for newstart allowance in order to receive rent assistance. The Secretary's power to make a determination to start paying rent assistance can only be made under s 78 of the Administration Act, being a determination relating to the "rate at which a social security payment is being, or has been paid". The applicant's request for review under s 129 of the Administration Act of the decision to pay him rent assistance from 27 September 1999 resulted in a determination under s 78 of the Administration Act to increase the rate of his newstart allowance. It followed that s 109 of the Administration Act is to be utilised in determining when the determination takes effect.
The respondent contends that the applicant was given appropriate notice of a decision to change the rate of newstart allowance on 27 September 1999, and that each subsequent letter (referred to in paragraph 9) also constitutes notice.
The respondent relied on the Federal Court decision of Austin v Secretary, Department of Family and Community Services in which Drummond J held that letters advising the applicant "of the making of a decision fixing the rate of NSA for the period the decision in fact remained 'operative' would be sufficient notices" (at p 341).
Also cited as support for the respondent's contentions is the decision of Secretary, Department of Family and Community Services v Rogers. It was submitted that the notices which advised a decision had been made to pay newstart allowance at a certain rate and advising what the components of that rate was, fulfilled the two elements set out by Cooper J, namely: the fact that a decision has been made and the content of the decision. It was also pointed out that Cooper J stated: "The subsections make no reference to any requirement that the notice contain reasons or sufficient information for the recipient of the notice to understand the main reason for the decision and so be in a position to know whether or not to exercise the person's right to seek a review" (par 33).
Turning to the issue of when the application for review was made, the respondent argued it was not appropriate for the applicant to rely on Rogers, insofar as the facts in that matter are distinguishable from the facts in the present matter. In Rogers the word 'review' appeared in bold type heading on the form and it sought comprehensive information from the applicant. The fortnightly forms, which required completion and lodgment by the applicant for continuation of his newstart allowance, did not ask comprehensive questions.
Additionally, in order to constitute a review, the person who is dissatisfied with the decision must indicate that dissatisfaction in some manner. It was contended that, in completing his fortnightly forms, Mr Laurent was not seeking a review of the rate of his newstart allowance. Even if the Department's action in determining what rate of benefit is payable, is said to constitute a 'review', it cannot be a review under s 129 of the Administration Act, as that provision only applies to a review requested by a person affected by a decision, in this case, the recipient of a social security payment.
The Legislation and its Application
It is not in dispute that the applicant's address was incorrectly recorded by the respondent. Consequently, the letter sent by the respondent asking the applicant to provide rent verification information by 27 September 1999 was never received by the applicant.
In any event, the applicant had previously advised of his correct address and had provided rent verification details to the respondent. The decision to cancel newstart allowance on 16 September 1999 was also sent to an incorrect address. It is not clear the basis upon which the respondent was made aware of the error, however, the applicant's newstart allowance was restored on 20 September 1999 and this information was conveyed to the applicant in a letter dated 20 September 1999 (T12-35), which this time, was sent to the correct address.
However, a further error on the part of the respondent occurred at that time, in that the applicant's rent details were still recorded in the computer records as unverified. As a result, the decision to cancel rent assistance occurred as a result of the operation of a computer program, which, presumably, automatically on 27 September 1999 recalculated the rent assistance payable to the applicant as nil, on the basis that the form (which he had never received) had not been returned. However, the recalculation, and in particular the fact that rent assistance was now assessed at nil, was never mentioned on the letter of advice to the applicant dated 27 September 1999. In fact, it omits any reference to rent assistance whatsoever.
The first issue for the Tribunal is to decide whether that letter and subsequent letters sent to the applicant set out earlier in these reasons, constitute appropriate notice that the amount of rent assistance had been changed.
The respondent contends that rent assistance is not a "social security payment" for the purposes of the Act. It was argued that as rent assistance is a component of newstart allowance, the notification of the rate of newstart allowance is sufficient notice of a decision having been made in relation to a social security payment.
Dealing with that issue, s 23 of the Act defines "social security payment" as meaning: (a) a social security pension; or (b) a social security benefit; or (c) an allowance under the Act; or (e) a payment under Chapter 2; or (f) a pension, benefit or allowance under the 1947 Act. The terms "social security pension" and "social security benefit" are defined and do not include rent assistance. It was not contended, and the Tribunal agrees, that rent assistance does not fall within (e) or (f).
In considering whether rent assistance fits within (c), the Tribunal notes that some allowances, eg job search allowance, newstart allowance, mature age allowance, are named in the definition of "social security benefit". However, rent assistance is not mentioned. Further, the term "allowance" is not defined in the Act, but adopting the Macquarie Dictionary version provided to the Tribunal (Exhibit 4), it means:
"1. a definite amount or share allotted; a ration … 2. a definite sum of money allotted or granted to meet expenses or requirements …3. an addition on account of some extenuating or qualifying circumstance. 4. a deduction …"

Simply because the Act does not specifically mention rent assistance, does not mean it cannot be an allowance under the Act. While it is a component of a payment and is determined by reference to the rate calculators appropriate to the specific pension or benefit, neither does that detract from its status as an allowance. Nor does the fact that in determining the rate of newstart allowance, regard must be had to the rate calculator which states, at 10689-A1, that determining the applicable amount of rent assistance is the third step in calculating the rate of a "benefit" (newstart allowance is within the definition of "social security benefit"). In my view, the method of calculation simply reinforces the fact that rent assistance is an identifiable amount, separate to newstart allowance.
It is payable to some recipients of newstart allowance and not others. That is because the qualification requirements are different than those applying to the payment of newstart allowance. To place an interpretation on the meaning of the word "allowance" to exclude "rent assistance" would be artificial and arbitrary.
Section 78 of the Administration Act, provides that if the Secretary is satisfied that the rate at which a social security payment is being or has been paid is less than the rate provided for by the social security law, the Secretary must (a) determine that the rate is to be increased to the rate provided by the social security law; and (b) specify the last-mentioned rate in the determination. Once the respondent was alerted to the non-payment of rent assistance, this activates s 78 of the Administration Act.
The respondent had referred to s 85 of the Act which allows the Secretary to resume payment of a "social security payment" after a cancellation, if, after reconsideration, the Secretary believes the payment was or is payable. If my categorisation of "rent assistance" as an "allowance" is correct, then it would fall within the definition of 'social security payment' and s 85 could be utilised. However, there was no argument on this aspect by the applicant and in any event the reconsideration in the present matter followed the applicant seeking review of the matter of rent assistance pursuant to s 129 of the Act.
What notice then was the respondent required to give the applicant and having determined that issue, was such notice given? These issues are important because the date of implementation of the increase in the applicant's rate of newstart allowance is dependent on whether (a) notice was given of a decision to reduce his rent assistance and (b) if notice was given, when did he seek review of that decision. In this context, the following extract from s 109 of the Administration Act is relevant. It states:
"(1) 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) within 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 determination embodying the original decision took effect.
(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.
(3) If:
(a) a decision (the original decision) is made in relation to a person's social security payment; and
(b) the person is not given notice of the original decision; and
(c) 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 determination embodying the original decision took effect."

Sub-section (a) requires a decision be made in relation to a person's social security payment. Section 83 of the Administration Act states that where the rate of payment is increased, reduced, cancelled or suspended because of the operation of a computer program under the control of the Secretary, and the program causes the change for a reason for which the Secretary could make the change of determination, the change is taken to have been made by the Secretary by determination.
I have some difficulty with this insofar as the word "determination" implies that the decision-maker has turned his or her mind to the matter under consideration and made a decision. Whilst I accept that the Secretary could have made the change by determination, it was not likely to have done so, because the decision-maker would have considered whether the rent details had been provided and would (or should) have reached the conclusion that the change of address and rent details had been provided (T4-23). However, applying s 83(1), the change in the rate of payment made to the applicant is deemed to be a determination by the Secretary.
The respondent relied on Drummond J in Austin. Mr Austin was in receipt of newstart allowance and due to an error directly attributable to the Department, he was underpaid. Drummond J examined the letters forwarded to Mr Austin over the relevant period and considered that some of them were capable of constituting 'notice' within s 660K(2) or (3) of the Act, which is a former provision, corresponding essentially with the wording of s 109 of the present Act.
Drummond J stated (at p 147):
"A clear statement by the respondent that a decision has been made fixing the rate of payment of Newstart Allowance at a particular figure or that a decision has been made cancelling or suspending Newstart Allowance, as opposed to information from which an inference to one or other of those effects might be drawn, is, in my opinion, required before a communication can constitute a 'notice'…"
In Rogers, Cooper J stated that the giving of notice comprises two elements: the fact that a decision has been made and the content of the decision.
The Tribunal noted that the letters which Drummond J found were capable of constituting notice contained the following information: a letter dated 22 March 1996 which informed the recipient that he had been paid $201.94 for newstart allowance for a particular period; a letter dated 3 April 1996 advising that the net fortnightly rate of newstart allowance had been changed from a certain date to $207.54, a rate less than the maximum payable because the recipient and his wife had other income; a letter dated 25 July 1996 informing Austin of a further reduction in the net fortnightly rate of his newstart allowance to $108.31 made for the same reason.
In Rogers, the letter sent stated that pension would be $153.70 and went on to state: "Your pension has been reduced because of a change in your circumstances". Cooper J stated that that sentence "conveys to the reader that a decision has been made to reduce her pension to the stated amount for the stated reason" (at pp 285-286). Leaving aside the need for reasons, noting that Cooper J states that the decision maker was under no obligation to give any reasons (at p 284) it is clear that both Drummond J and Cooper J require definity in the manner in which the decision is conveyed, hence Drummond J's reference to "a clear statement". Cooper J commented on the letter sent to Mrs Rogers in the following terms (at p 286):
"Any reasonable recipient in the position of Mrs Rogers would know upon reading the letter that a decision had been made to reduce her sole parent pension to $153.70 per fortnight from 8 April 1993 because the decision maker believed that there had been a change in her circumstances which required a reduction in the pension. The letter provided sufficient information to enable Mrs Rogers to make a decision whether or not to seek review of the decision if she thought it was wrong."
Applying the principles set out in both Austin and Rogers, I find that notice was not given to the applicant, either in the letter dated 27 September 1999 or the letters that followed. In reaching that determination, regard was had to the following:

It would have been necessary for the applicant to have compared the letters to be aware of the fact that rent assistance was not being paid and this is contrary to the principles outlined in Austin and Rogers; in particular, Austin required a clear statement that a decision had been made to cancel or suspend newstart allowance, as opposed to information from which an inference to one or other of those effects might be drawn.
The key issue is that the recipient of a notice should be advised that a decision has been made to change the rate of payment. No mention was made of a change in payment of rent assistance; the only advice conveyed was the amount of newstart allowance being paid;
That as rent assistance is a separate payment to newstart allowance, (but for administrative purposes it is paid to the recipient at the same time as newstart allowance), in order to constitute notice of a decision regarding cancellation, it must do more than merely notify the recipient that an amount is payable in respect of newstart allowance. Consequently, the letters do not contain the particularity required of 'notices'.

Accordingly, s 109(3) of the Administration Act is relevant to the applicant's circumstances, in that he was not given notice of the original decision to cancel rent assistance. Consequently, the favourable determination (the decision to commence payment of rent assistance), as a result of his application for review takes effect on the day on which the original decision took effect.
It was therefore unnecessary for me to make a finding as to whether the fortnightly forms lodged for continuation of newstart allowance should be treated as an application for review.
The Tribunal sets aside the decision under review and substitutes its decision that arrears of rent assistance are to be paid to the applicant from 27 September 1999.
I certify that the forty-seven (47) preceding paragraphs are a true copy of the reasons for the decision herein of Ms J Cowdroy, Member
Signed:         .....................................................................................
  Associate
Date/s of Hearing   30 January 2002
Date of Decision   27 March 2002
Counsel for the Applicant         Ms C Heyworth-Smith
Solicitor for the Applicant          Welfare Rights Centre
Solicitor for the Respondent    Mr T Ffrench, Advocacy and Admin Law Team