Librizzi and Secretary, Department of Health (Social services) - [2018] AATA 2278

Librizzi and Secretary, Department of Health (Social services) [2018] AATA 2278 (17 July 2018)
Division:GENERAL DIVISION
File Number: 2017/5495
Re:Concetta Librizzi
APPLICANT

AndSecretary, Department of Health
RESPONDENT

AndAntonietta Owen
OTHER PARTY

DECISION
Tribunal:Member C Edwardes
Date:17 July 2018
Place:Perth

The Tribunal affirms the decision under review.
............[sgd]............................................................
Member C Edwardes
CATCHWORDS
AGED CARE – age care provider – asset – assessment – residential aged care assessment – financial hardship qualification – sole home owner – close relative renting property – unrealisable asset – decision under review affirmed
LEGISLATION
Aged Care Act 1997 (Cth) – ss 44-26A(6), ss 44-26A (7), ss 44-26B(1), s 52K-1, s 84-1,
s 85-4, s 85-5, s 85-8, ss 92-2(5), 92-2(7), schedule 1 clause 1
Fees and Payments Principles 2014 (Cth) – s 4, s 38, ss 38(2), ss 38(4)
Subsidy Principles 2014 (Cth) – ss 48(1)
Social Security Act 1991 (Cth) – ss 11(12), ss 11(13), s 23(1), s1129
CASES
Atkinson and Secretary, Department of Families, Housing Community Services and Indigenous Affairs [2013] AATA 325
Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
Farrow and Secretary, Department of Social security (1986) 10 ALN N151
SECONDARY MATERIALS
Guide to Social Security Law – 4.6.7.50
REASONS FOR DECISION
Member C Edwardes
17 July 2018
THE APPLICATION

This is an application for review of the decision of the Authorised Review Officer (ARO) of the Department of Human Services, dated 8 September 2017 (the Reviewable Decision). The Reviewable Decision rejected the Applicant’s claim seeking financial hardship assistance for the purpose of residential aged care.
BACKGROUND
Since making this Application, the Applicant has sadly passed away.
This application is being continued by the Applicant’s daughter, Ms Owen, as Executor of the Applicant’s estate.
The Tribunal contacted Ms Owen and Mr Bishop from Mills Oakley, representing the Secretary, to seek their advice as to whether the application could proceed on the papers. Both parties concurred with this approach.
The Applicant claimed financial hardship assistance on 1 May 2015 (T8 105) (R1). The Applicant claimed her Fremantle property as an unrealisable asset. Her daughter, son-in-law and their two children have resided at that property since 1991.
Her daughter holds an Enduring Power of Attorney (T6 93) (R1).
The Applicant claimed she would not sell the Fremantle property, as her extended family do not own a home of their own.
The Department decided on the 13 May 2015 that the Applicant qualified for financial hardship assistance and assessed that her accommodation payment was reduced to $0.00 per day from the time she entered care accommodation (T10 134) (R1).
The Applicant entered care accommodation on the 26 May 2015 (T13 141) (R1).
The Department determined that the Applicant qualified for financial hardship assistance from 26 May 2015 to 28 April 2017 (T10 134, T18 224) (R1).
The Applicant was advised that the assistance would cease on the 28 April 2017 and that a further application would be required if deemed necessary (T18 224) (R1).
The Applicant lodged a further application on 5 April 2017 for financial hardship assistance for residential aged care, in conjunction with an application for hardship assistance in support of her age pension.
The Department advised the Applicant on 25 May 2017 that her application for hardship assistance relating to her age pension had been rejected (T30 289) (R1).
On 13 June 2017 the Applicant was further advised by the Department that her application for financial hardship assistance had not been approved as it was deemed that the Fremantle property was a realisable asset (T35 301) (R1).
The Applicant requested a review of the Department’s decision and on 8 September 2017 the ARO made the following determination:
‘Financial hardship’ occurs when a person is left with less than 15% of the maximum basic single rate Age Pension per fortnight after paying their essential expenses. At the time of your financial hardship assistance claim, this currently equates to $121.25.
People who have gifted more than $10,000 in the previous 12 months, or more than $30,000 in the previous 5 years are also not eligible for financial assistance, as is a person who has more than $34,643.70 in assets to assist them.
You entered Age Care on 25 May 2015, and at that time your former home … [in] … Fremantle was valued at $900,000. You have a daughter and her family that have resided in that residence for more than 20 years.
A person’s house is considered to be an asset for aged care purposes if they are single and do not have a close family member who has resided there for more than 5 years and who is eligible for an income support payment.
As your daughter is not an income support recipient, the house is considered to be an asset.
For financial hardship assistance purposes, real estate can be considered to be an unrealisable asset if the person has a family member who has resided at the house for more than 10 years; or the family member provided substantial care for the person at the home; or the family member is a child and disabled. It can also be considered unrealisable if the house has been for sale, at market value, for at least 6 months.
You were granted financial hardship assistance for aged care purposes from 25 May 2015 to 28 April 2017.
You re-applied for financial hardship assistance in April 2017 and this claim was rejected. While it is accepted that your daughter and her family are residing in the house, you are the sole owner of the property. As you have decided to rent out the property instead of selling it, it is considered that you are not in financial hardship as you have not made a decision that would alleviate your financial difficulty.
I have also noted that for Age Pension purposes, a financial hardship claim has been accepted which has allowed an exemption of your property to be assessed as an assessable asset. This has enabled you to remain in receipt of the Age Pension when otherwise it would be cancelled due to value of your assets.
I am satisfied that the decision to reject your claim for financial hardship assistance is correct (T1 7-8) (R1).
On 13 September 2017, the Applicant applied to the General Division of the Administrative Appeals Tribunal (the Tribunal) to review the decision of the ARO.
The Tribunal has jurisdiction to review the Reviewable Decision pursuant to section 85-8 of the Aged Care Act 1997 (Cth) (the Act). The Reviewable Decision to reject the Applicant’s claim on the basis of section 52K-1 of the Act for financial hardship assistance is a reviewable decision pursuant to section 85-1 of the Act. The Secretary can delegate the application of section 85-4 of the Act or section 85-5 of the Act to the Chief Executive Centrelink. The Chief Executive Centrelink can sub-delegate the power or function to a Departmental employee pursuant to subsections 96-2(5) and (7) of the Act.
The Applicant’s application for review stated:
APPEAL: P278929 Concetta has been in Residential Care since 26/05/2015. Financial Hardship was granted for the first two years. We need to apply for this every year, Her circumstances have not changed, this year, but this year Financial Hardship was rejected. Her daughter (Antonietta Owen) and her family have lived with Concetta for 26 years (and have provided proof of living there for 26 years) and were her carers in her family home before she went into care. Unreasonable to sell an asset An asset would be considered unrealisable if the asset is a house occupied by a near relative: • who has lived in the house for at least 10 years; My daughter, Antonietta Owen and her Husband, … and two sons, … have lived in my house for 26 years and are still living there. I can attach proof of this. I am Italian and we have lived together in an extended family situation as per my Italian culture since April 1991. My grandchildren have grown up in my home and consider this home their family home as does my daughter and her husband. They have helped me with maintenance of the property when required also. Also •the near relative has previously provided care for me in my former home; My daughter Antonietta Owen and her family have previously provided care for me in my former home and she has my Enduring Power of Attorney. She had been receiving Carer Allowance for me for many years but this ceased when I entered The … Nursing Home on 25/05/2015. There is nothing on the SA461.1609 form to say that this is only for the first two years that Concetta is in residential care, then its considered realisable. I believe the act has not been considered properly: 4.6.7.50 Unrealisable Assets – Unable or Unreasonable to Sell or Borrow Against Act reference: SSAct section 11(1)-‘unrealisable asset’ Policy reference: SS Guide 4.4.1.40 Exemption of Financial Investments from Deeming, 4.6.7.10 General Provisions (T1 1) (R1).
RELEVANT LEGISLATION
The Tribunal has been referred by the Secretary to the following legislation which governs this matter (T3 34-54) (R1).
The relevant legislation is contained in the:
·the Act;
·the Fees and Payments Principles 2014 (No. 2) (Cth) (the Fees and Payments Principles);
·the Social Security Act 1991 (Cth) (the Social Security Act); and
·the Subsidy Principles 2014 (Cth) (the Subsidy Principles).
Financial hardship and unrealisable asset provisions
Section 52K-1 of the Act states:
52K-1 Determining cases of financial hardship
1The Secretary may, in accordance with the Fees and Payments Principles, determine that a person must not be charged an *accommodation payment or *accommodation contribution more than the amount specified in the determination because payment of more than that amount would cause the person financial hardship.
Note: Refusals to make determinations are reviewable under Part 6.1.
2In deciding whether to make a determination under this section, and in determining the specified amount, the Secretary must have regard to the matters (if any) specified in the Fees and Payments Principles. The specified amount may be nil.
3The determination ceases to be in force at the end of a specified period or on the occurrence of a specified event, if the determination so provides.
Note: Decisions to specify periods or events are reviewable under Part 6.1.
…
8If the Secretary makes the determination, the notice must set out:
(a)any period at the end of which; or
(b)any event on the occurrence of which;
the determination will cease to be in force.
Section 38 of the Fees and Payments Principles sets out the matters to which the Secretary must have regard in deciding whether to make a financial hardship determination and states:
38 Matters to which Secretary must have regard in deciding whether to make financial hardship determination
1For section 52K-1 of the Act, this section sets out matters to which the Secretary must have regard in deciding whether to make a financial hardship determination in relation to a person.
2The Secretary must not make a financial hardship determination in relation to a person if:
(a)the person’s means have not been assessed in accordance with the Act; or
(b)the value of the person’s assets (worked out under section 44-26A of the Act and section 47 of the Subsidy Principles 2014) is more than 1.5 times the sum of the annual amount of the following (worked out under the Social Security Act):
(i)     the basic age pension amount;
(ii)    the pension supplement amount;
(iii)    the clean energy supplement; or
(c)the person has gifted:
(i)     more than $10 000 in the previous 12 months; or
(ii)    more than $30 000 in the previous 5 years.
Note: Basic age pension amount is defined in clause 1 to Schedule 1 to the Act.
3In determining the value of a person’s assets for paragraph (2)(b), unrealisable assets are not to be included.
Note: Unrealisable asset is defined in section 4.
(Original emphasis.)
Subsection 44-26A(6) and (7) of the Act states:
6In working out the value at a particular time of the assets of a person who is or was a * homeowner, disregard the value of a home that, at the time, was occupied by:
(a)the * partner or a * dependent child of the person; or
(b)a carer of the person who:
(i)     had occupied the home for the past 2 years; and
(ii)    was eligible to receive an * income support payment at the time; or
(c)a * close relation of the person who:
(i)     had occupied the home for the past 5 years; and
(ii)    was eligible to receive an * income support payment at the time.
7In working out the value at a particular time of the assets of a person who is or was a * homeowner, disregard the value of a home to the extent that it exceeded the * maximum home value in force at that time.
Homeowner is interpreted in subsection 48(1) of the Subsidy Principles which relevantly states that for the purposes of the Act:
(a)a person who is not a member of a couple is a homeowner if:
(i) the person has a right or interest in the person’s principal home; and
(ii) the person’s right or interest in the person’s principal home gives the person reasonable security’ of tenure in the home. (Original emphasis.)
Close relation is defined in subsection 44-26B(1) of the Act, which relevantly states that for the purposes of section 44-26A, “‘close relation’, in relation to a person, means … a child … of the person”.
The definition of income support payment in schedule 1, clause 1 of the Act has the meaning given in subsection 23(1) of the Social Security Act.
Subsections 11(12) and (13) of the Social Security Act provide the definition of unrealisable asset pursuant to section 4 of the Fees and Payments Principles, as follows:
12An asset of a person is an unrealisable asset if:
(a)the person cannot sell or realise the asset; and
(b)the person cannot use the asset as a security for borrowing.
13For the purposes of the application of this Act to a social security pension (other than a pension PP (single), an asset of a person is also an unrealisable asset if:
(a)the person could not reasonably be expected to sell or realise the asset; and
(b)the person could not reasonably be expected to use the asset as a security for borrowing. (Original emphasis.)
The Tribunal is assisted by the policy document the Guide to Social Security Law (the Guide). The Guide provides assistance to those who administer the Social Security Act. Whilst not bound to apply policy guidelines, the Tribunal will usually do so unless there are cogent reasons not to do so (Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634).
Instruction 4.6.7.50 of the Guide provides the following further clarification with respect to unrealisable assets:
An unrealisable asset is an asset that cannot be sold or borrowed against, or which a pensioner cannot be reasonably expected to sell or borrow against.
…
Unable to sell or borrow against an asset
Accept that a person is unable to sell or borrow against an asset if:
·the asset is on the market but cannot attract a buyer and the asking price is no higher than 10% above the assessed assets test value, OR
·the person has been found eligible for Farm Household Allowance, OR
·there is a legal restriction or court order which prevents the asset being sold or borrowed against, or the asset is subject to a pending property settlement, OR
·the asset is a jointly owned home and the person has fled the home as a result of domestic violence, OR
·the asset is owned jointly with another person and this person refuses to consent to the sale of the asset, OR
·the asset is owned as a tenant in common and the practical effect of this form of ownership is that the asset would be unsaleable.
Unreasonable to sell an asset
The hardship rules for pensioners include a test of whether it would be unreasonable to expect the pensioner to sell an asset.
For pensioners accept that it would be unreasonable for them to sell an asset if:
…
·the asset is a house occupied by a near relative AND the near relative has lived in the house for at least 10 years OR the near relative has previously provided care for the pensioner in the house (which was formerly the pensioner’s home) OR the near relative is a handicapped child of the pensioner and the pensioner is providing the house to promote the child’s independent living OR the near relative has dependent children and the family income of the near relative does not exceed the FTB income ceiling.
ISSUE FOR DETERMINATION
The issue for determination is whether the Fremantle property should be included as an assessable asset under the Act.
EVIDENCE
The Tribunal has received into evidence the following documents:
·Exhibit A1 – Applicant’s submission in reply (undated) to the Respondent’s Statement of Issues, Facts and Contentions.
·Exhibit A2 – Deed of variation to Resident and Accommodation Agreement made on 13 June 2017.
·Exhibit A3 – Applicant’s Statement of Account.
·Exhibit A4 – Letter from Centrelink to the Applicant dated 11 April 2017.
·Exhibit A5 – Letter from Centrelink to Antoinetta Owen dated 25 May 2017.
·Exhibit A6 – Letter from Centrelink to Antoinetta Owen dated 25 May 2017 rejecting the Applicant’s claim under the hardship provisions.
·Exhibit A7 – Amended page 2 of Form SA461.1609.
·Exhibit A8 – Concetta Librizzi’s Passbook.
·Exhibit A9 – Concetta Librizzi’s Term Deposit Maturity Notification.
·Exhibit A10 – Antoinetta Owen and her husband’s income and expenses spreadsheet.
·Exhibit R1 – Section 37 documents (T1-40 1-322).
·Exhibit R2 – Respondent’s Statement of Issues, Facts and Contentions dated 8 January 2018.
The Tribunal is satisfied that all relevant evidence is before it.
The Secretary contends:
Application of law and policy
Is … [the Fremantle property] … an assessable asset?
23Pursuant to section 52K-1 of the Act, a decision to reduce a person’s accommodation payment or contribution due to financial hardship must be made in accordance with the Fees and Payments Principles.
24Pursuant to subsection 38(2) of the Fees and Payments Principles, a person is not in financial hardship if the value of their assets is more than 1.5 times the sum of the annual basic age pension amount, pension supplement amount and clean energy supplement. The Secretary submits that as at 5 April 2017 this amount was $34,643.70.
25The Secretary contends that the Applicant is a homeowner and that … [the Fremantle property] … is an assessable asset under section 44-26A of the Act. Subsection 44-26A(7) of the Act provides that in working out the value at a particular time of the assets of a person who is or was a homeowner, the value of a home is to be disregarded to the extent that it exceeded the maximum home value in force at that time.2 The effect of this section of the Act is that the value of a homeowner’s home must be included in the assessment of assets for the purposes of residential aged care, up to the applicable maximum home value. The maximum home value in force at the time the value of the Applicant’s assets was assessed on 13 June 2017 was $162,087.20.
26Subsection 44-26A(6) of the Act allows the value of a former home to be disregarded in certain circumstances. The Secretary accepts that Applicant’s daughter is a close relation who had previously cared for the Applicant and had lived in the home for more than five years. However, the Applicant’s daughter was not eligible to receive an income support payment at the relevant time based on the level of her and her partner’s combined income of in excess of $100,000 and therefore subsection 44-26A(6) does not apply and … [the Fremantle property] … remains an assessable asset.
27The Secretary contends that the assessable value of [the Fremantle property] exceeds $34,643.70.
Is … [the Fremantle property] … an unrealisable asset?
28The Tribunal in Re Farrow and Secretary, Department of Social Security (1986) 10 ALN N151 considered the intention of hardship provisions and noted the comments of the Minister for Health when introducing the Social Security and Repatriation (Budget Measures and Assets Test) Bi/11984 as follows:
... The exclusion of the principal home and the asset exemption levels mean that the assets test will not affect the majority of pensioners. However, special provision is made to ensure that people affected by the assets test are not placed in severe financial hardship. In keeping with the intention of the assets, these provisions will generally apply only where it would be unreasonable or impossible to sell or raise money on an asset, and that as a result of not exempting all or part of the assets the pensioner would have insufficient income. They will be administered on a case by case examination of individual circumstances, but will not be generally available to people whose hardship results from having deprived themselves of assets or income ...4
29The Full Federal Court in Repatriation Commission v Hall (1988)15 ALO 84, considered the question of whether it was reasonable to sell or realise an asset or use it as security for borrowing. The Court determined that it was not appropriate to confine such consideration to the personal financial circumstances of the claimant. Rather, an objective test is to be applied by considering personal and social factors as well as financial and economic factors and the community interest.
30Senior Member Kenny in Atkinson and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2013] AATA 325 applied the Full Federal Court’s reasoning in Repatriation Commission v Hall in considering the question of whether an asset was unrealisable. Senior Member Kenny also agreed with the Respondent’s submissions that ‘...an overall aim of social security law was to ensure that persons utilise assets available to them to provide for their financial support rather than rely upon payments under the Act and that exercising a discretion to treat the … [Applicant’s] … property as unrealisable did not give effect to that policy.’5
31Senior Member Kenny further agreed that the because the (sic) relevant property could be sold or used as security for a reverse mortgage loan which required no periodic repayments, the discretion to treat the property as unrealisable should not be exercised.6
32An example of a property being found to be unrealisable was in the case of Luca and Secretary, Department of Social Services [2014] AATA 14 in which the Tribunal determined that the relevant properties were unrealisable because Applicant was unable to sell, realise or use the property as security for borrowing due to Family Court proceedings.
33The Secretary accepts that the Applicant satisfies paragraph 11(12)(a) and/or 11(13)(a) of the Social Security Act in that she could not reasonably be expected to sell or realise the asset, as pursuant to the Guide, ‘the asset is a house occupied by a near relative AND the near relative has lived in the house for at least 10 years OR the near relative has previously provided care for the pensioner in the house (which was formerly the pensioner’s home)’.
34However, subsections 11(12) and 11(13) contain the conjunctive term ‘and’ such that a person also be unable to use the asset as a security for borrowing. The Secretary contends that … [the Fremantle property] … could reasonably expected to be used as a security for borrowing and therefore it is not an unrealisable asset in accordance with subsections 11(12)(b) and 11(13(b) (sic) of the Social Security Act.
35The Applicant has not contended nor provided any evidence on how or why … [the Fremantle property] could not reasonably be used as a security for borrowing, for example, through a reverse mortgage. Furthermore, the Applicant does not appear to meet any of the non – exhaustive examples set out in the Guide, which generally provides that an asset cannot be sold or borrowed against if it is on the market and cannot attract a buyer, there is a legal restriction such as a court order or there are restrictions on the sale imposed by a third party e.g. joint owner.
36Therefore, the Secretary contends that … [the Fremantle property] … is not an unrealisable asset and in accordance with subsection 38(2) of the Fees and Payments Principles, the Secretary must not make a financial hardship determination because the Applicant’s assets are more than 1.5 times the sum of the relevant annual amount ($34,643.70).
Other financial hardship criteria
37Subsection 38(4) of the Fees and Payments Principles states:
(4)In deciding whether to make a financial hardship determination in relation to a person, the Secretary may have regard to the following matters:
(a) the person’s total assessable income (worked out under section 44-24 of the Act and section 41 of the Subsidy Principles 2014);
(b)     whether the amount of income available to the person after expenditure on essential expenses is less than 15% of the basic age pension amount;
(c)     the person’s financial arrangements;
(d)     the person’s entitlement to income support:
(i)under the Social Security Act; or
(ii)under the Veterans’ Entitlements Act 1986; or
(iii)from any other source;
(e)     whether the person has taken steps to obtain information about his or her entitlement to a pension, benefit or other income support payment;
(f)     whether the person has access to financial assistance:
(i)under section 1129 of the Social Security Act (relating to access to financial hardship rules for pensions); or
(ii)under the pension loans scheme under Division 4 of Part 3.12 of the Social Security Act; or
(iii)from any other source;
(g)     whether any income of the person is income that he or she does not reasonably have access to;
(h)     whether there is a charge on the person’s income over which the payment of an accommodation payment or accommodation contribution cannot practically take precedence;
(i)     whether the person is in Australia on a temporary basis;
(j)     any other matters the Secretary considers relevant.
Note: Essential expenses is defined in section 39.
38Notwithstanding the application for review is primarily in respect of whether the … [the Fremantle property] … is an unrealisable asset, the other criteria for determining financial hardship in section 38 of the Fees and Payments Principles also support the Secretary’s decision not to grant the Applicant financial hardship assistance.
39The Secretary notes that the Applicant is currently in receipt of age pension with assistance also being obtained through the financial hardship provisions in section 1129 of the Social Security Act (i.e. she is receiving an increased rate of pension). There is no evidence that the Applicant cannot meet her living expenses and … [the Fremantle property], which she appears to own outright, is worth approximately $900,000.
40As noted by the authorised review officer, the Applicant is able to alleviate her financial difficulty through various means, for example, by selling … [the Fremantle property] (R2 5-9).
(Original emphasis.)

The Applicant makes the following comments in respect to the Secretary’s contentions:
2The issue to be decided in this application is whether the Applicant is eligible for financial hardship assistance pursuant to section 52K-1 of the Aged Care Act 1997. In particular, whether the Applicant’s former home at … [the Fremantle property] … for which she is the sole owner, is an unrealisable asset.
It was considered an unrealisable asset from 25/05/15 to 28/04/2017…
39The Secretary notes that the Applicant is currently in receipt of age pension with assistance also being obtained through the financial hardship provisions in section 1129 of the Social Security Act (i.e. she is receiving an increased rate of pension). There is no evidence that the Applicant cannot meet her living expenses and … [the Fremantle property] …, which she appears to own outright, is worth approximately $900,000.
If Mum was receiving assistance through the financial hardship provisions in section 1129, then her property would have been considered unrealizable for age pension rules section 1130(1)
The reason we applied for Financial Hardship in residential care was because we didn’t meet carer/ISP customer exemption for RCA claim due to not being eligible for an ISP. (T11 136).
Why was granted for the first two years? Property was still exempt, age pension was paid also Financial hardship in Residential Care was paid.
33The Secretary accepts that the Applicant satisfies paragraph 11(12)(a) and/or 11(13)(a) of the Social Security Act in that she could not reasonably be expected to sell or realise the asset, as pursuant to the Guide, ‘the asset is a house occupied by a near relative AND the near relative has lived in the house for at least 10 years OR the near relative has previously provided care for the pensioner in the house (which was formerly the pensioner’s home)’.
34However, subsections 11(12) and 11(13) contain the conjunctive term ‘and’ such that a person also be unable to use the asset as a security for borrowing. The Secretary contends that … [the Fremantle property] could reasonably expected to be used as a security for borrowing and therefore it is not an unrealisable asset in accordance with subsections 11(12)(b) and 11(13(b) (sic) of the Social Security Act
Why can it now be used as security for borrowing, when for the first two years it wasn’t questioned? What has changed? Subsections 11(12)(b) and 11(13)(b) do contain the conjunctive term ‘and’ but this relates to social security pensions not accommodation payments in residential care (A1 1-2).
(Paragraph numbers as per Exhibit A1.)
CONSIDERATION
The Applicant relies on the Guide at Instruction 4.6.7.50 (T4 65-66) (R1), in particular the provisions relating to “Unreasonable to sell an asset” and “Unable to sell or borrow against an asset”.
The Tribunal notes, as outlined above, the Guide at Instruction 4.6.7.50 outlines the situations in which a pensioner is unable to sell or borrow against an asset.
In respect to the assertion that it would be unreasonable to require the Applicant to sell the asset, the Guide states it would be unreasonable if:
·the asset is a property AND the pensioner has lived there for at least 20 years AND the property cannot be subdivided to allow the pensioner to retain the portion their home is on, Or
…
·the asset is a house occupied by a near relative AND the near relative has lived in the house for at least 10 years OR the near relative has previously provided care for the pensioner in the house (which was formerly the pensioner’s home) OR the near relative is a handicapped child of the pensioner and the pensioner is providing the house to promote the child’s independent living OR the near relative has dependent children and the family income of the near relative does not exceed the FTB income ceiling.
The Applicant is relying on subsections 11(12) and 11(13) of the Social Security Act.
The Tribunal has carefully considered all the evidence before it and applies the law below, accordingly.
Section 52K-1 of the Act provides that the Secretary has the power to assess cases of financial hardship. The Secretary can do this in line with the Fees and Payment Principles.
Subsection 38(2) of the Fees and Payment Principles outlines that the Secretary must not make a financial hardship determination in relation to a person “if the value of the person’s assets (worked out under section 44-26A of the Act and section 47 of the Subsidy Principles) is more than 1.5 times the sum of the annual amount of the following …” : the basic age pension amount, the pension supplement amount, and the clean energy supplement; and if the person has gifted more than $10,000 in the previous 12 months or more than $30,000 in the previous 5 years.
The value of the person’s assets pursuant to section 38(2) of the Fees and Payment Principles was calculated by the Secretary to amount to $34,643.70 as at 5 April 2017. Therefore, if the Applicant’s home is an assessable asset, then this value would exceed the value established in section 38(2) of the Fees and Payment Principles.
The Tribunal is satisfied that the Applicant’s home … [the Fremantle property] is assessable under section 44-26A of the Act and subsection 44-26A(7) of the Act. Subsection 44-26A(7) of the Act states “In working out the value at a particular time of the assets of a person who is or was a * homeowner, disregard the value of a home to the extent that it exceeded the * maximum home value in force at that time”. The Secretary has assessed the maximum home value in force at the time that the Applicant’s assets were assessed on 13 June 2017 to be valued at $162,087.20. Therefore, the assessable value of the Applicant’s home exceeds the value established in subsection 38(2) of the Fees and Payments Principles.
The Tribunal accepts the relationship between the Applicant and her daughter. It also accepts that the daughter resided with and cared for her mother, the Applicant, for a considerable period of time.
The Secretary contends the combined income of the daughter and her partner of $100,000 precluded the daughter at the time from receiving an income support payment.
The Tribunal agrees that subsection 44-26A(6) of the Act does not apply in this instance.
The Tribunal has examined the case law proposed by the Secretary and supports the contentions proposed.
Whilst the Tribunal accepts the contention of the Applicant in respect to subsection 11(12)(a) and/or 11(13)(a) of the Social Security Act and supports the proposition that the person cannot sell or realise the asset, it is also mindful of subsections 11(12)(b) and 11(13)(b) of the Social Security Act.
The Tribunal finds there would be an expectation by the public that there should be the contribution of private funds towards aged care, if such funds are available.
The Tribunal therefore finds it is reasonable in this instance for the property to be sold or a loan secured against the property for the age care requirements of the Applicant.
There is no evidence before the Tribunal to suggest such an approach has been considered.
The Tribunal also finds that there is no evidence to suggest that the Applicant is suffering financial hardship, especially given the asset value of her home of almost $900,000 which she owns unencumbered (T1 14 and T6 76) (R1).
DECISION
The Tribunal affirms the decision of the ARO.

I certify that the preceding 53 (fifty -three) paragraphs are a true copy of the reasons for the decision herein of Member C Edwardes

.................[sgd].....................................................
Administrative Assistant Legal
Dated: 17 July 2018

Date of hearing: On the papers