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

This matter concerned appeals by Mr and Mrs Lozi against decisions affirming the imposition of an income maintenance period (IMP) on their Jobseeker Payment (JSK) claims. Mr Lozi received a redundancy and leave payment of $275,173 on 27 October 2020. His initial JSK claim was rejected, and subsequent claims were granted from 4 July 2024 due to the IMP. Mrs Lozi's JSK claim was similarly granted from 4 July 2024 due to the IMP. Both applicants sought review of these decisions, which were affirmed by an Authorised Review Officer and subsequently by the Administrative Appeals Tribunal (AAT1). The applicants then sought a second tier review by the General Division of the Tribunal.

The primary legal issues before the Tribunal were whether the applicants were subject to an IMP from 28 October 2020 to 3 July 2024, and if so, whether they were experiencing severe financial hardship due to unavoidable or reasonable expenditure, which would warrant the exercise of discretion to shorten the IMP. The Tribunal was required to consider the relevant provisions of the *Social Security Act 1991* (Cth) and the *Social Security (Administration) Act 1999* (Cth), as well as departmental policy guidance.

The Tribunal found that Mr Lozi's redundancy payment constituted ordinary income under the Act, and as it was not maintenance income or an exempt lump sum, it triggered an IMP. The Tribunal applied sections of the Act defining termination payments, including redundancy and leave payments, as ordinary income. It also considered the method for calculating the period to which such a payment relates, which determined the duration of the IMP. The Tribunal concluded that the applicants had not demonstrated severe financial hardship due to unavoidable or reasonable expenditure, and that their expenditure of Mr Lozi's redundancy payment was overwhelmingly on non-essential items.

Consequently, the Tribunal determined that the discretion under section 1068-G7AM of the Act could not be exercised to shorten the IMP. The reviewable decisions were therefore affirmed.