Lewington and Secretary, Department of Family and Community Services
[2005] AATA 664
•12 July 2005
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2005] AATA 664ADMINISTRATIVE APPEALS TRIBUNAL Nº V2005/10
GENERAL ADMINISTRATIVE DIVISION
Re:IAN LEWINGTON
Applicant
And:SECRETARY,
DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Respondent
DECISION
Tribunal: Regina Perton, Member
Date: 12 July 2005
Place: Melbourne
Decision:The Tribunal affirms the decision under review.
(sgd) Regina Perton
Member
SOCIAL SECURITY – pension bonus scheme – part year period – time limit for registration – lack of discretion – decision under review affirmed
Social Security Act 1991 ss 92A, 92B, 92C, 92T, 93D, 93E, 93F
Social Security (Administration) Act 1999 s 23
Banfield and Secretary, Department of Family and Community Services [2005] AATA 268
REASONS FOR DECISION
12 July 2005 Regina Perton, Member
1. This is an application by Ian Lewington (the applicant) for review of a decision of the Social Security Appeals Tribunal (SSAT) dated 14 December 2004. The SSAT affirmed a decision of a delegate of the Secretary to the Department of Family and Community Services (the respondent) dated 23 November 2004 to refuse an application for payment under the Pension Bonus Scheme (PBS) because the applicant did not lodge a claim within the required time.
2. At the hearing on 29 March 2005, the applicant represented himself and Mr Wayne Zita, a Centrelink advocate, represented the respondent.
3. The Tribunal received into evidence the documents lodged under s 37 of the Administrative Appeals Tribunal Act 1975 (T1‑T18).
BACKGROUND
4. The applicant was born on 16 January 1937 and became eligible for age pension on his 65th birthday on 16 January 2002. He contacted Centrelink on 5 and 16 September 2002 regarding the PBS and was issued with information on the scheme and registration/claim forms.
5. The applicant lodged his registration for the PBS on 7 October 2002. At that time, he was still working. The applicant ceased working on 28 November 2003.
6. On 17 August 2004, the applicant lodged a claim for a Pension Deferred Bonus (pension bonus). The claim was rejected on 18 November 2004 on the basis that it was not lodged within the required time.
7. The applicant sought a review of this decision and on 23 November 2004, an Authorised Review Officer (ARO) varied the delegate’s decision. The ARO determined that pension bonus was payable for the period 16 January 2002 to 15 January 2003 but not for the period from 16 January 2003 to 28 November 2003.
8. On 26 November 2004, the applicant lodged an appeal with the SSAT. On 14 December 2004, the SSAT affirmed the ARO’s decision.
9. Following the SSAT decision, the applicant lodged an application with the Tribunal on 10 January 2005.
10. The issue before the Tribunal is the amount of pension bonus that the applicant is entitled to receive.
EVIDENCE
11. The applicant told the Tribunal that having registered for the PBS and then continuing to work beyond 65 years of age, he should be entitled to the pension bonus for the whole of the period for which he continued to be employed. The applicant said that it was difficult to decipher the legislation and that he felt it was unfair he had missed out because of technicalities of which he was unaware. The applicant said that he had registered soon after receiving the requisite paperwork. He said that after his first call to Centrelink, he had to put in a second call as the pamphlet and claim form had not been sent out.
12. The applicant said that he ceased work on 28 November 2003. He said that he did not apply until eight and a half months later because his accountant took time to do the necessary paperwork. The applicant said that he had been running a sandwich business at the University of Melbourne and the accounts took some time to be finalised after he stopped working.
13. The applicant reiterated his concern about the convoluted rules. He queried why there was discretion to pay him the full year from January 2002 to January 2003 but not the ten subsequent months that were closer to his date of claim.
CONSIDERATION OF THE ISSUES
14. Section 92A of the Social Security Act 1991 (the Act) provides a simplified outline of the PBS:
* A person who qualifies for an age pension but defers claiming that pension may be able to get a single lump-sum pension bonus.
* A person who wants to get a pension bonus must register as a member of the pension bonus scheme.
* To get a pension bonus, a person must accrue between 1 and 5 bonus periods while deferring age pension.
* Generally, a bonus period runs for 1 year.
* To accrue a bonus period, the person must pass the work test for that period.
* To pass the work test for a year, either the person, or the person's partner, must gainfully work for at least 960 hours during that year.
* The amount of a person's pension bonus depends on the number of accrued bonus periods and the person's annual rate of age pension. A person may get a bigger bonus by accruing more bonus periods
15. Definitions of pertinent key terms are found in s 92B, including:
"bonus period "has the meaning given by section 92T.
"full-year period" means a continuous period of 365 days.
"part-year period" means a continuous period of less than 365 days.
16. Section 92C of the Act states:
92C. A person is qualified for a pension bonus if:
(a)both:
(i)the person starts to receive an age pension at or after the time when the person makes a claim for the pension bonus; and
(ii)that age pension is received otherwise than because of a scheduled international social security agreement (within the meaning of section 1208); and
(b)the person has not received an age pension at any time before making a claim for the pension bonus; and
(c)the person is registered as a member of the pension bonus scheme; and
(d)the person has accrued at least one full-year bonus period while registered as a member of the pension bonus scheme;…
17. It is undisputed that the applicant registered for the PBS on 7 October 2002 with the date effective from the date of his 65th birthday on 16 January 2002 and the Tribunal finds accordingly.
18. Section 92T of the Act provides for the accrual of bonus periods:
Full-year bonus period
92T(1) The first bonus period that accrues to a person is the full-year period of the person's accruing membership of the pension bonus scheme:
(a)that began on whichever of the following dates is applicable:
(i)f the person was an accruing member of the pension bonus scheme on the date the person's registration as a member took effect—the date the registration took effect;
(ii)n any other case—the date on which the person first became an accruing member of the pension bonus scheme; and
(b)for which the person passes the work test.
92T(2) Each succeeding full-year period of the person's accruing membership of the pension bonus scheme:
(a)that is specified in the person's claim for pension bonus; and
(b)for which the person passes the work test;
is a bonus period that accrues to the person.
Part-year bonus period
92T(3) A part-year period of the person's accruing membership of the pension bonus scheme is a bonus period that accrues to the person if:
(a)the person passes the work test for that period; and
(b)the person specifies the period in the person's claim for pension bonus; and
(c)the period begins immediately after the end of a full-year bonus period that accrues to the person; and
(d)the period is the last bonus period that accrues to the person…
19. It is undisputed that the applicant accrued a full year bonus period between 16 January 2002 and 16 January 2003 and a part year bonus period between 16 January 2003 and 28 November 2003 and the Tribunal finds accordingly.
20. Section 23 of the Social Security (Administration) Act 1999 (the Administration Act) imposes time limits on claims for pension bonus where the last bonus period was a part year period:
23(1) If a person's last bonus period is a part-year period, the lodgement period for a claim by the person for pension bonus is:
(a)the period of 13 weeks beginning at the end of that bonus period; or
(b)if the Secretary allows a longer period—that longer period
….
(2) If:
(a)subsection (1) applies to a person's claim for pension bonus; and
(b)the claim is lodged within a period allowed under paragraph (1)(b);
Division 6 of Part 2.2A of the 1991 Act has effect, in relation to the calculation of the amount of that pension bonus, as if the person had not accrued the part-year bonus period.
21. Division 6 of Part 2.2A referred to above comprises s 93D to s 93J of the Act. Sections which are applicable in this matter are:
93D(1) To calculate the amount of a person's pension bonus:
(a)work out which of the person's bonus periods count as qualifying bonus periods (see section 93E);
(b)work out the person's overall qualifying period (see section 93F):
….Note: Bonus period is defined by section 92T.
93E(1) For the purposes of this Division, if a person has accrued only one bonus period, that bonus period is the person's qualifying bonus period.
93E(2) For the purposes of this Division, if a person has accrued only 2 bonus periods, each of those bonus periods is a qualifying bonus period …
93F(1) For the purposes of this Division, if a person has only one qualifying bonus period, that period is the person's overall qualifying period.
93F(2) For the purposes of this Division, if a person has 2 or more qualifying bonus periods, the person's overall qualifying period is the period:
(a)beginning at the start of the first qualifying bonus period; and
(b)ending at the end of the last qualifying bonus period.
However, any period of non-accruing membership of the pension bonus scheme is taken not to form part of the person's overall qualifying period.
22. The applicant ceased work on 28 November 2003 and he lodged his claim on 17 August 2004, which was more than 13 weeks after the end of the last qualifying period (s 23(2) of the Administration Act). The legislation confers discretion on the decision maker to pay a full-year bonus period despite the claim being more than 13 weeks after the end of the qualifying period but does not accord the same discretion in relation to a part-year period. However, the legislation clearly distinguishes between the two types of period in terms of using discretion to allow for payments where the claim is lodged more than 13 weeks after the end of the bonus period. This is the same conclusion reached in the recent case of Banfield and Secretary, Department of Family and Community Services [2005] AATA 268.
23. Given the circumstances of the applicant, who as a self-employed person was relying on his accountant to provide financial information following the windup of his business before making his claim, the Tribunal would have been likely to exercise discretion to allow for payment for the part-year period if it had the legislative power to do so. However, like the ARO and the SSAT, it is unable to do any more than exercise discretion in relation to the full-year period.
DECISION
24. The Tribunal affirms the decision under review.
I certify that the twenty-four [24] preceding paragraphs are a true copy of the reasons for the decision of:
Regina Perton, Member
(sgd) Nathaniel Wills
Administrative Assistant (Legal)
Date of hearing: 29 March 2005
Date of decision: 12 July 2005
Advocate for the applicant: Self-represented
Advocate for the respondent: Mr Wayne Zita, Centrelink
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