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

Mr Lazarov sought merits review of a decision by the Social Services & Child Support Division of the Administrative Appeals Tribunal, which affirmed a decision by Services Australia (Centrelink) to apply a compensation preclusion period (CPP) to his compensation payments. Mr Lazarov had received statutory insurance benefits following a motor vehicle accident and subsequently settled his claim for a lump sum. He contended that the CPP was incorrectly applied and calculated, and that special circumstances warranted disregarding the compensation received.

The primary legal issue before the Tribunal was whether Mr Lazarov had received "compensation" as defined by the relevant legislation, and if so, whether the CPP was correctly calculated. A secondary issue was whether special circumstances existed under section 1184K of the Social Security Act 1991 (Cth) to justify disregarding the whole or part of the compensation payment when calculating the preclusion period. Mr Lazarov argued that the settlement did not include a component for economic loss, thus negating the basis for a CPP, or alternatively, that the application of the CPP created such unfairness that it should be disregarded.

The Tribunal considered the definition of "compensation" under subsection 17(2) of the Act, which includes payments made in settlement of a claim for damages or under an insurance scheme for lost earnings or earning capacity resulting from personal injury. It noted the principle that a person should not receive both compensation for economic loss and a social security payment for the same period. The Tribunal found that there were no special circumstances that would warrant disregarding the compensation payment in calculating the preclusion period.

Consequently, the Tribunal affirmed the decision under review, upholding the application and calculation of the compensation preclusion period by Services Australia.