Lynch and Secretary, Department of Social Services (Social services second review)
[2016] AATA 455
•30 June 2016
Lynch and Secretary, Department of Social Services (Social services second review) [2016] AATA 455 (30 June 2016)
Division
GENERAL DIVISION
File Number(s)
2015/6520
Re
Neil Lynch
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Mr S. Webb, Member
Date 30 June 2016 Place Sydney The decision under review is affirmed.
....................[sgd]....................................................
Mr S. Webb, Member
SOCIAL SECURITY – newstart allowance claim following claims for disability support pension – application of liquid assets waiting period and ordinary waiting period – assessment of liquid assets – date on which liquid assets are to be assessed – duration of liquid assets waiting period – determination of start date of waiting period – meaning of ‘ceased work’ – self-employment in owner operated business – actual or deemed ‘unemployment’ – qualification for newstart allowance not established at dates of claim for disability support pension – newstart allowance claim cannot be back-dated to date of disability support pension claim – partner ceased work – partner served liquid assets waiting period commencing more than 12 months prior to Applicant’s newstart allowance claim – liquid assets waiting period applies from date Applicant ceased work – decision under review affirmed
Legislation
Social Security Act 1991, ss 23, 593, 595, 598, 601, 621
Social Security (Administration) Act 1999, s 15
Cases
Director-General of Social Services v Thompson (1981) 38 ALR 624
Elbehidi v Secretary, Departmentof Employment [2015] FCA 1229
Re Moon and Secretary, Department of Family and Community Services [2003] AATA 676
Secretary, Department of Employment and Workplace Relations v Joss [2006] FCA 884
Secondary Materials
Guide to Social Security Law, ss 1.1.U.30, 3.1.2.20, 3.1.2.70
REASONS FOR DECISION
Mr S. Webb, Member
30 June 2016
For many years, Neil Lynch operated a tree lopping business at Old Bar in New South Wales. Health problems reduced the work that he could do in the business – he worked more slowly and could do less. Nevertheless, he adapted his business and continued as much as he could. His income reduced. On a number of occasions he claimed income support, in the form of a Disability Support Pension (DSP) and Newstart Allowance. His claims for DSP were rejected, but he was subsequently granted Newstart Allowance subject to a liquid assets waiting period (LAWP) – a period in which Newstart Allowance is not payable. Mr Lynch is not happy with the imposition of a LAWP and pressed his rights to review, thus far without success.
During the hearing it became clear that all relevant documents had not been included in the documents provided to the Tribunal. I issued orders for this to be rectified, with time for each party to make any further submissions in writing after the hearing. A large bundle of documents were subsequently filed. The documents are:
(a)Job Capacity Assessment Report dated 12 May 2014 – Exhibit 2;
(b)Job Capacity Assessment Report dated 21 November 2014 – Exhibit 3;
(c)Medical Report by Dr Moore dated 12 April 2014 – Exhibit 4;
(d)Medical Report by Dr Moore dated 14 September 2014 – Exhibit 5;
(e)Centrelink computer records for Mr Lynch – Exhibit 6;
(f)Centrelink program of support computer records in respect of Mr Lynch – Exhibit 7; and
(g)Handwritten note by Mr Lynch dated 22 May 2015 – Exhibit 8.
Both parties made written submissions, to which I have had regard.
Facts
Mr Lynch was born in March 1951 – he is over 55 years old. He is married and resides with his wife. They jointly own assets, including liquid assets in the form of bank deposits.
Mr Lynch is self-employed in a small tree-lopping business. He suffers from emphysema and chronic obstructive lung disease, as well as other medical conditions that affect his capacity for work.[1]
[1] Exhibits 2, 3, 4 and 5.
Mrs Lynch was in employment until in or about March 2014. On 17 March 2014, she claimed Newstart Allowance following cessation of her employment. A LAWP was applied, commencing on 17 March 2014 and ending on 15 June 2014.[2]
[2] T14.
On 3 April 2014, Mr Lynch contacted Centrelink about applying for a DSP. He subsequently lodged a DSP claim on 14 April 2014.[3] In this claim, he ticked ‘Yes’ in answering the question ‘Would you like to be assessed for Newstart Allowance provisional while waiting the outcome of your Disability Support Pension?’.[4]
[3] T5.
[4] Ibid, folio 41.
On 12 May 2014, Mr Lynch underwent a Job Capacity Assessment. The Assessor reported that he had a work capacity of 15 to 22 hours per week within two years with intervention and said “the most appropriate recommendation for future referral is DES/ESS”.[5] The Centrelink computer records record –
“Referral Recommendation: DES – Employment Support Service
DES Action that is required: Referral action required”[6]
[5] Exhibit 2, page 6.
[6] Exhibit 6, Document 53.
On 20 May 2014, a Customer Service Advisor informed Mr Lynch that his DSP claim had been rejected.[7] Mr Lynch sought review of this decision. Successive review processes ensued.
[7] Ibid, Document 52.
On 22 July 2014, an Authorised Review Officer affirmed the decision to reject his DSP claim.[8]
[8] Ibid, Document 44.
On 11 August 2014, Mr Lynch contacted Centrelink about Newstart Allowance.[9] It is not clear what, if anything, resulted from this contact.
[9] Ibid, Document 43.
On 25 September 2014, Mr Lynch lodged an additional medical report from Dr Moore, his treating general practitioner, relating to his claim for DSP.[10] It appears that he was advised to either apply for review or lodge a fresh claim.[11]
[10] Exhibit 5.
[11] Ibid; Exhibit 6, Documents 39, 40 and 41 refer.
On 6 October 2014, Mr Lynch lodged a fresh claim for DSP,[12] and on 8 October 2014 he applied for review by the (then) Social Security Appeals Tribunal.[13] In this DSP claim, Mr Lynch marked ‘No’ to the question ‘Would you like to be assessed for Newstart Allowance provisional while waiting the outcome of your Disability Support Pension?’.[14]
[12] T6.
[13] Exhibit 6, Document 37.
[14] T6 folio 69.
On 21 November 2014, Mr Lynch underwent a further Job Capacity Assessment.[15] The Assessor reported that Mr Lynch had a Baseline Work Capacity of 15 to 22 hours per week that would be sustained within two years with interventions. The Assessor referred Mr Lynch to an employment service provider “OCTEC Limited TAREE” (OCTEC), and noted that –
“Work capacity is reduced due to medically related functional limitations inclusive of reduced mobility, endurance and ability for physically demanding tasks. The customer may experience difficulties with sustaining tree lopping work, although may be able to sustain lighter work for longer periods.”[16]
[15] Exhibit 3.
[16] Ibid, pages 7 and 8.
The records in Exhibit 7 show that Mr Lynch had an active placement with OCTEC from 21 November 2014 to 5 January 2015.
On 24 November 2014, the SSAT decided to affirm the decision, rejecting Mr Lynch’s first DSP claim.[17]
[17] Exhibit 6, Document 30.
On 22 May 2015, Mr Lynch lodged an online claim for Newstart Allowance.[18]
[18] T7; Exhibit 6, Document 29 refers.
On 5 June 2015, a delegate of the Secretary decided to grant Newstart Allowance subject to a non-payment period, comprised of a LAWP from 22 May 2015 to 20 August 2015 and an Ordinary Waiting Period (OWP) from 21 August 2015 to 27 August 2015.[19]
[19] T16 folio 131.
On 9 June 2015, Mr Lynch requested review of this decision.[20] Centrelink’s computer records contain the following notes - “the customer has lodged 2 claims for DSP and both of these claims have indicated that the customer did not wish to claim another payment in the interim”.[21] This statement is incorrect.
[20] Exhibit 6, Documents 25 and 26.
[21] T15 folio 127.
On 25 June 2015, an Authorised Review Officer affirmed the LAWP and OWP decisions.[22]
[22] T9.
Following application by Mr Lynch for review, on 2 November 2015 the Social Services & Child Support Division of this Tribunal (formerly the SSAT) decided to affirm the LAWP and OWP decision.[23]
[23] T2.
Mr Lynch applied for further review.
Issues
The issue to be decided is whether or not a non-payment period applies to the grant of Newstart Allowance in Mr Lynch’s circumstances. While the decision under review addressed two non-payment periods, a LAWP from 22 May 2015 to 20 August 2015 and an OWP from 21 August 2015 to 28 August 2015, I understand that Mr Lynch cavils with the LAWP, in particular. For this purpose it is necessary to determine –
(a)whether a LAWP applies; and if so
(b)the duration of the waiting period calculated and the day on which it starts; and
(c)in the particular circumstances, whether there are grounds to exercise discretion to excuse service of all or part of the period.
As I understand Mr Lynch’s case, he does not cavil with the imposition of the 1 week OWP, although the start date of this waiting period depends upon determination of the LAWP issues.
Does a LAWP apply?
The Secretary submits that a LAWP applies in Mr Lynch’s circumstances. This is so because when Mr Lynch claimed Newstart Allowance, his liquid assets exceeded the maximum threshold allowed.
Mr Lynch says that a LAWP should not apply in the particular circumstances. He argues that he did not cease work and he is not, therefore, affected by the LAWP provisions. In the alternative, if the LAWP provisions apply, the LAWP should be treated as ‘self-served’ under section 3.1.2.20 of the Guide to Social Security Law (the Policy Guide). This is so, he argues, because he applied for DSP in April 2014 and in so doing he requested provisional assessment for Newstart Allowance. At that time and subsequently, his employment circumstances did not change – he has continued in part-time self-employment as a tree-lopper. He maintains that the DSP application should be treated as a claim for Newstart Allowance or, at least, he should be treated as a transferee to Newstart Allowance when he did not qualify for DSP. In his submission, this is so because he was referred by Centrelink for two Job Capacity Assessments and he was referred to an employment service. Mr Lynch also argues that because his wife served a LAWP within the 12 months before he applied for Newstart Allowance, he should not have to serve another waiting period, and requiring him to do so is not consistent with the intention of the legislation.
The issue is to be determined under s 598(1) of the Social Security Act 1991 (the Act), which provides –
(1) Subject to subsections (4A), (5), (6), (7) and (8), if:
(a) the value of a person’s liquid assets exceeds the person’s maximum reserve on:
(i) the day following the day on which the person ceased work or ceased to be enrolled in a full time course of education or of vocational training; or
(ii) the day on which the person claims a newstart allowance; and
(b) the person is not a transferee to a newstart allowance;
the person is not qualified for a newstart allowance for a period unless the person has served the liquid assets test waiting period in relation to the claim before the beginning of that period.
The terms ‘liquid assets’ and ‘maximum reserve’ are defined in s 14A. ‘Liquid assets’ are the person’s cash and readily realisable assets. The ‘maximum reserve’ for a member of a couple, such as Mr Lynch, is $10,000.
There is no dispute that when Mr Lynch claimed Newstart Allowance on 22 May 2015, he and his wife had liquid assets totalling $154,240.[24]
[24] T7 folio 100 and T11 folio 113.
At first blush, this would appear to satisfy the test under s 598(1). But Mr Lynch raises a number of issues that must be dealt with.
Ceased work
As can be seen, under s 598(1), ‘the day on which the person ceased work’ is relevant to determination of the date on which the person’s liquid assets must be assessed.
Mr Lynch says that he did not cease work at any time – he was working on a reduced part-time basis in his business when he claimed DSP and Newstart Allowance in April 2014. His evidence on this point is that he experienced health difficulties that reduced his capacity to undertake heavy work that he had previously been undertaking in his tree-lopping business – this caused him to claim DSP. This evidence is consistent with the information he set out in his DSP claims.[25] His account of continuing to work performing light duties and reduced hours is consistent with the information set out in the Newstart Allowance claim he lodged on 22 May 2015.[26] He maintains that he has continued to work in his private business at all relevant times, and this is presently ongoing, albeit to a diminishing degree that reflects his reduced capacity. He provided details of his monthly income in Exhibit 1.
[25] T5 folio 62 and T6 folio 90.
[26] T7 folio 97.
The phrase ‘the day on which the person ceased work’ is s 598(1) is explicated to some extent by s 598(9) –
(9) A reference in this section to the day on which a person ceased work (whether the person ceases work permanently, temporarily or by reason of being on unpaid leave) is a reference:
(a) except where the person is on paid leave immediately after last performing work—to the day on which the person last performed work before so ceasing; and
(b) if the person is on paid leave—to the last day on which the person is on that paid leave.
This notwithstanding, there is a question whether the conception of ‘ceasing work’ is to be construed as meaning the cessation of all work.
The words must be construed having regard to the context and objects of the legislation.
The LAWP provisions are in respect of Newstart Allowance. The purpose of the LAWP provisions is to ensure that a person with liquid assets greater than a specified threshold who claims Newstart Allowance draws upon those assets for a period before Newstart Allowance is payable.
The qualification criteria for Newstart Allowance are set out in s 593. As can be seen, the qualification criteria include the person being ‘unemployed’ and satisfying an ‘activity test’. The ‘activity test’ is set out in s 601 and it refers to conceptions of ‘paid work’, being paid work that is not unsuitable for the person to undertake.
I think a similar conception of ‘work’ should be adopted for the purposes of s 598(1) when determining ‘the date on which the person ceased work’.
Thus, the date on which a person ceased work for the purposes of s 598(1) is the day on which he or she ceased paid work, or became ‘unemployed’. In the case of a person in self-employment, this would include the day on which the person ceased working on their own account. As will appear, self-employment may extend to include activities in the conduct of a private business that is intended to generate income, whether or not that occurs.
On this construction, in Mr Lynch’s case, it refers to the date on which he ceased work in self-employment. The evidence establishes that Mr Lynch did not cease work in his private business – he continued in that employment, albeit to a reduced degree. His evidence of monthly earnings tends to confirm this conclusion.
A difficulty arises in respect of the information Mr Lynch provided to Centrelink. On 22 May 2015, in his online Newstart Allowance claim he stated “I have not undertaken paid work in the last 12 months” and nominated 21 May 2015 as the ‘End date’.[27] In a Customer Declaration Form on or about 10 July 2015 for the purposes of his claim for Newstart Allowance – he recorded “Not currently working” and “Ceased Work: Self Employed 21/05/2015”.[28] When examined on this point, Mr Lynch explained that he completed the forms online, and the forms required him to include a date when he ceased work, even though he had not, actually, ceased working in his business. To an extent, this explanation is supported by his oral evidence and the hand written note Mr Lynch made on 22 May 2015.[29]
[27] T7 folio 99.
[28] T11 folio 114.
[29] Exhibit 8.
While I can accept that Mr Lynch did not cease work prior to 21 May 2015, it may be inferred from the Centrelink records in Exhibit 6 that he did not declare any earned income from employment on or after 22 May 2015. There are two possibilities – either Mr Lynch earned income in paid work that he failed to declare to Centrelink, or he did not earn income in paid work. I cannot resolve this conflict on the present materials.
In all likelihood, Mr Lynch continued to seek paid work after 21 May 2015, insofar as his physical restrictions permitted him to do so. It is clear enough that his tree-lopping business was not wound up on 21 May 2015. But it does not follow that he did not cease work on that day or that he cannot be treated as ‘unemployed’ thereafter. Not having but seeking to obtain paid work and being available to undertake it are characteristics of unemployment. Whether, or to what extent, if any, Mr Lynch’s efforts on and after 22 May 2015 to obtain paid work through his business and on the open market were successful, I am unable to determine on the present materials.
I think the preferable conclusion is that Mr Lynch should be taken to have ceased work on 21 May 2015. It follows that the date under s 598(1)(a)(i) would be 22 May 2015.
If this is not correct, and Mr Lynch did not cease work on that day, he is not within the terms of s 598(1)(a)(i). But the date on which he ceased work is but one of two options for determining the date on which his liquid assets are to be assessed. The second option under s 598(1)(a)(ii) is the date on which he claimed Newstart Allowance.
Newstart Allowance claim
There is no doubt that Mr Lynch lodged a claim for Newstart Allowance on 22 May 2015.
Mr Lynch argues that the Newstart Allowance claim he made on 22 May 2015 was consequent to previous claims for income support in respect of DSP and Newstart Allowance and related assessment processes. Mr Lynch asserts that these earlier processes related to, but did not properly resolve, his request for provisional assessment for Newstart Allowance under the DSP claim he lodged on 14 April 2014.
There is some evidence to support this contention. In his DSP claim on 14 April 2014, Mr Lynch ticked ‘Yes’ to the question ‘Would you like to be assessed for Newstart Allowance provisional while waiting the outcome of your Disability Support Pension?’.[30]
[30] T5 folio 41.
In these circumstances there is a question whether Mr Lynch’s DSP claim on 14 April 2014, itself, is to be treated as a claim for Newstart Allowance. I think there is little doubt about this – by expressly electing to be assessed for Newstart Allowance, albeit provisionally, Mr Lynch’s DSP claim should be treated as sufficient claim for the purposes of assessing his qualification for Newstart Allowance.
The Secretary contends, however, that this may not assist Mr Lynch – the LAWP assessment with which he cavils was made in respect of the claim for Newstart Allowance he lodged on 22 May 2015 and not in respect of any earlier claim or deemed claim.
That may be so, but it is not the end of the matter. Section 15(1) of the Social Security (Administration) Act 1999 (the Administration Act) makes provision for a claim for a ‘social security payment’, including Newstart Allowance, to be back-dated to the date of an ‘incorrect claim’ (s 15(2)) in certain circumstances. For this to occur, the person must be found to have made an incorrect claim, being a claim for a social security payment for which he or she was not qualified, and a later successful claim for a different social security payment for which he or she is qualified at the date of the incorrect claim. A test of reasonableness also applies.
For these provisions to apply in Mr Lynch’s case, his qualification for Newstart Allowance at the date of his first claim for DSP on 14 April 2014 must be established by evidence.
The Secretary argues that the qualification requirements for Newstart Allowance are such that this cannot be assessed presently, in retrospect, by the Tribunal in these proceedings. Authority for this proposition is drawn from the case of Re Moon and Secretary, Department of Family and Community Services.[31] Mr Moon was in receipt of Youth Allowance payments as a student. It was found that he did not satisfy the requirements for this payment – his study load and progress as a student fell short. In consequence, an overpayment debt was raised against him. It was in this context the provisions of s 15 of the Administration Act arose – if he qualified for Newstart Allowance during the period he was overpaid Youth Allowance, and Newstart Allowance is able to be backdated under s 15(1), his Youth Allowance debt might be expunged under the legislation as it stood at the time. In the result, the Tribunal (differently constituted) concluded at [32] that it was not possible to properly assess Mr Moon’s qualification for Newstart Allowance in retrospect –
The Tribunal accepts the submission of Mr Huttner that newstart allowance has a number of requirements for eligibility, which cannot be satisfied retrospectively. As the applicant's evidence was that that he was applying himself to his studies, it is difficult for him to argue that he was genuinely seeking work, which is a requirement for newstart allowance. Nor would he have been eligible for that payment at the times that he was working.
[31] [2003] AATA 676.
To the extent that a person must meet the requirements of s 593(1) of the Act to qualify for Newstart Allowance, I agree that making a retrospective assessment is a matter of some difficulty – it is something that would require very detailed and extensive evidence, week by week, in respect of the period in question. Furthermore, similar difficulty could be anticipated in respect of proof of unemployment and other qualification requirements under s 593(1B) and s 593(1D). These are matters for proof and evidence facing any Newstart Allowance claimant seeking relief under s 15 of the Administration Act. That said, I do not accept that the Tribunal’s comments in Re Moon can or should be adopted as a general rule; to do so would be to misconstrue what the Tribunal said in that case and would limit operation of the legislation without proper authority. I do not accept the proposition put for the Secretary that qualification for Newstart Allowance cannot be assessed in retrospect. Each case must be assessed on its facts and the available evidence.
But all of this does not assist Mr Lynch.
For Mr Lynch to be found to qualify for Newstart Allowance on 14 April 2014 or subsequently, among other things, it must be established by evidence that he was ‘unemployed’. The state of being ‘unemployed’ refers to circumstances in which the person does not have paid work during the particular period, or where the Secretary is satisfied that the discretionary deeming provisions of s 595 should apply – where the person has paid work that should be disregarded in the circumstances.
The Secretary’s submission that any paid work is inconsistent with the conception of being ‘unemployed’ raises a question about the meaning of the term ‘unemployed’ for the purposes of s 593 of the Act. In a society where casual work and self-employment is increasingly common, and the vicissitudes of under-employment are matters of public discourse in the mainstream media, some flexibility may be required in attributing meaning to this term. It is perhaps for this reason that the word ‘unemployed’ is not given particular meaning in the social security legislation. The Policy Guide sets out the following on this point at 1.1.U.30 in respect of Newstart Allowance -
“… an unemployed person is, in broad terms, someone who does not have paid work but wants to have paid work. An essential requirement is that the person has a present intention to be part of the labour market. It is not sufficient that the person is simply without work”.
There is long established authority that ‘paid work’ is the antithesis of unemployment.[32] But it has also long been accepted that the state of being ‘unemployed’ is a matter of fact and degree, where the intentions of the person must be considered in respect of activities that are undertaken and the extent to which these bear upon an assessment of whether the person is ‘unemployed’. In Elbehidi v Secretary, Department of Employment,[33] White J said at [6] –
“[The term ‘unemployed’] has been held to have the meaning of “not engaged in work of a remunerative or potentially remunerative nature”, whether in the service of another or in self-employment. This meaning encompasses the circumstances of a person engaged in activities directed towards the production of income, even if those activities do not bear fruit.” [Citations removed]
[32] Director-General of Social Services v Thompson (1981) 38 ALR 624 at 626-627.
[33] [2015] FCA 1229.
Thus, if it is found that Mr Lynch was self-employed during a period, working on his own account with the intention of obtaining a remunerative return, this is inconsistent with him being ‘unemployed’ for the purposes of s 593 of the Act during the same period.[34]
[34] Secretary, Department of Employment and Workplace Relations v Joss [2006] FCA 884 at [35].
By his own account, Mr Lynch was working part-time in his private business to the extent of his medically reduced capacity. His evidence is that he was working about 20 hours per week for which he charged and was paid for only 8 to 10 hours. In all likelihood this would not be consistent with him being ‘unemployed’ at the time.
The Secretary asserts that Mr Lynch should be taken to be employed until 21 May 2015 as prior to that date the discretion under s 595 of the Act had not been exercised. This is correct.
Even if this is not correct, on the available materials, even though the facts in this case are clearly distinguished from those in Re Moon, I cannot determine that Mr Lynch’s request for provisional assessment for Newstart Allowance was made out when he claimed DSP on 14 April 2014. The evidence is not sufficient to establish his qualification for Newstart Allowance on 14 April 2014 or thereafter at any time prior to 22 May 2015.
For reasons that have not been explained, it appears that Mr Lynch’s qualification for Newstart Allowance was not assessed in respect of his 14 April 2014 DSP claim. On 12 May 2014, an assessment was made of his reduced work capacity by a Job Capacity Assessor and he was referred for employment support service interventions. On the present materials, it appears that no such referral was carried through by Centrelink.
The Secretary says that the Job Capacity Assessments in May and September 2014 were solely in respect of Mr Lynch’s DSP claims and no assessment of his qualification for Newstart Allowance was undertaken. The reference to Newstart Allowance in Centrelink’s 11 August 2014 record is, in the Secretary’s submission, an error – the reference should have been to DSP. Mr Lynch’s participation in employment services from 21 November 2014 to 5 January 2015 was, the Secretary asserts, purely in a voluntary capacity – this had no connection to Newstart Allowance.
If this is correct, it is likely that an error was made, and no assessment of Mr Lynch’s qualification for Newstart Allowance was made, despite his express request on 14 April 2014. As the present materials are not sufficient to establish his qualification for Newstart Allowance on or after that date, I can go no further on this point. Mr Lynch’s complaint about this unfortunate circumstance is not able to be remedied in these proceedings.
In these circumstances, I am compelled to conclude that the date on which Mr Lynch’s liquid assets are to be assessed is the date on which he claimed Newstart Allowance – 22 May 2015.
As can be seen, this is the same date that is derived in respect of his ceasing work.
That being so, under s 598(1) of the Act, Mr Lynch’s liquid assets must be assessed as of 22 May 2015, unless it is dis-applied by another provision of the legislation.
Exclusions
The Act provides a number of exclusions which, if established, dis-apply s 598(1). These are set out in s 598 (4A) to (8).
Mr Lynch asserts that s 598(4A) applies in the circumstances – his wife served a LAWP from 17 March 2014 to 15 June 2014.
Section 598(4A) dis-applies s 598(1) in certain circumstances –
(4A) Subsection (1) does not apply to a person if, at any time during the 12 months preceding:
(a) the day following the day on which the person ceased work or ceased to be enrolled in a full time course of education or of vocational training; or
(b) the day on which the person claims a newstart allowance;
the person or their partner was serving a liquid assets test waiting period that started during that 12 months.
As can be seen, this section has two limbs: the first step is to determine the date on which the 12 month period ends, and the second step is to determine whether a LAWP served by the person’s partner started during that 12 month period.
Under the first step, at least one of the elements set out in (a) or (b) must be satisfied – the earliest date will apply. Thus, if Mr Lynch ceased work on 21 May 2015, the date under (a) would be 22 May 2015. It was on that day he lodged a claim for Newstart Allowance for the purposes of (b). It follows that, unless it can is established that Mr Lynch is taken to have claimed Newstart Allowance at an earlier date, the ‘preceding 12 month period’ commenced on 22 May 2014.
The second step is to determine whether the LAWP served by Mr Lynch’s wife ‘started’ during that 12 month period. It is quite clear that it did not - it started on 17 March 2014.
I do not think it is permissible to construe this section to apply in circumstances where a person’s partner serves a LAWP that ends within the 12 month period. To do so would be to torture the plain language and meaning of the text – the word ‘started’ cannot be taken to mean ‘ended’.
Mr Lynch argued that the Policy Guide allows for this to occur. In particular, he draws hope from part of what is said in s 3.1.2.70 of the Policy Guide –
A person may also be exempted from the LAWP if the person or their partner has been subject to a LAWP that started within the last 12 months (which includes where only part of a LAWP has been served).
The reference to service of only part of a LAWP within the 12 month period must be understood in context – this refers to circumstances in which a LAWP has started but not been completely served within the 12 month period. Mr Lynch submits that allowance for service of part of a LAWP at the end of the 12 month period should also be made at the beginning of the period, in circumstances where the LAWP started before and ended during the 12 month period. I do not agree.
The Policy Guide is just that. It is the terms of the legislation that must be applied. The policy of applying a 12 month limit in respect of the start of a prior LAWP may appear somewhat arbitrary. But a time limit, by its very nature, is somewhat arbitrary. This does not allow a decision-maker to construe the limit imposed into something that it is not, by stretching the plain meaning of the text, or by contorting the purposes of the legislation.
It is unfortunate for Mr Lynch that the request he made in his claim for DSP on 14 April 2014 to be assessed for Newstart Allowance was not acted upon. Had it been, the relief he now seeks under s 598(4A) may have been available. The effect of Centrelink’s failure to act on his request cannot be rectified under s 598 - there is no general discretion to waive the imposition of a LAWP in circumstances of this kind. Considerations of this kind, however, may be relevant to the test of reasonableness under s 15 (1) or s (4A) of the Administration Act. As I have said, these provisions require evidence of qualification for the particular social security payment at the date of an incorrect claim, and this is not presently established.
As other exclusions under s 598(5), (6), (7) and (8) are not made out, s 598(1) applies and Mr Lynch’s liquid assets must be assessed on the date of his Newstart Allowance claim on 22 May 2015.
What is the duration of the LAWP and when does it start?
Mr Lynch’s liquid assets waiting period is to be worked out under s 598 (2A), (2B) and (2C). Applying the formula in s 598(2A), a period of 144 weeks is obtained. Section 598(2B) caps the waiting period at 13 weeks. It follows that Mr Lynch’s LAWP is of 13 weeks duration.
The next step is to determine the start date of the LAWP. This is to be worked out under s 598(3AA), (3A), (3B) or (4). On the present evidence, only s 598(3A) is relevant –
(3A) Subject to subsections (3B) and (4), if the person is a member of a couple, the liquid assets test waiting period in relation to the claim starts on the last occurring of the following days:
(a) the day following the day on which the person ceased work or ceased to be enrolled in a full time course of education or of vocational training;
(b) if, when the claim is made, the person’s partner has ceased work—the day following the day on which the person’s partner ceased work;
(ba) if, when the claim is made, the person’s partner has ceased to be enrolled in a full time course of education or of vocational training—the day following the day on which the person’s partner so ceased;
(c) if, when the claim is made, the person’s partner is incapacitated for work—the day on which the person’s partner became incapacitated for work.
Mr Lynch’s evidence is that he did not cease work. In his written submission he states –
“I applied to Centrelink for assistance as a self employed tree lopper, unable, due to physical limitations, to carry out the majority of work available to me and which I had been carrying out successfully for most of my working life. I was actively seeking further employment both within the scope of my business and also anything else available in the open job market. I accepted and completed any work that I was physically able to do. This situation continues to the present day”.[35]
[35] Applicant Submissions in Reply to the Secretary, 3 June 2016, page 1.
If this is correct, and his submission is consistent with his unchallenged evidence, the first start date criterion does not apply.
The Secretary has noted that if Mr Lynch did not cease work, and was not ‘unemployed’ on 22 May 2015, he cannot qualify for Newstart Allowance unless the discretion conferred by s 595 is exercised in his favour. No such exercise of discretion has occurred.
In the alternative, if it is accepted that Mr Lynch ceased work on 21 May 2015, as he stated in the Newstart Allowance claim he lodged on 22 May 2015, then, so the argument goes, that date should apply under s 598(3A)(a).
There is merit in these submissions.
The Tribunal is required to make the correct or preferable decision on the materials and evidence before it. Mr Lynch’s evidence is unequivocal and clear – he did not cease work on 21 May 2015. I cannot simply step over or disregard that fact.
The question whether Mr Lynch was ‘unemployed’, or should be treated as ‘unemployed’, on 22 May 2015 and subsequently then arises. His qualification for grant of Newstart Allowance turns on this point. This is not a matter for me to determine.
There are four things to say about this.
Firstly, on the present materials, it appears that Mr Lynch did not declare any income from paid work to Centrelink after 22 May 2015 – the records from 4 September 2015 to 27 November 2015 include the words “No income reported for Customer”.[36] If that is correct, and Mr Lynch did not earn income from paid work after 22 May 2015 despite his job seeking efforts through his business and otherwise in the open labour market, he may well be found to be ‘unemployed’ for the purposes of s 593.
[36] Exhibit 6, Documents 8 to 15.
Secondly, the policy of encouraging Newstart Allowance claimants into casual work is a matter of public record. This policy is consistent with the objectives of the legislation, which provides an ‘ordinary income test’ under s 1068-G7A of the Act to the rate of Newstart Allowance that is payable to a person in a period. Quite clearly, this is for the purpose of ensuring that a claimant’s periodic earned income is taken into account when determining the rate of Newstart Allowance that is payable for the period.
Thirdly, in the event that a person engages in casual or periodic paid work while claiming Newstart Allowance to the extent that he or she ceases to be ‘unemployed’ for the purposes of s 593, the discretion conferred by s 595, if enlivened, allows some flexibility to treat the person as ‘unemployed’ if it is reasonable to do so in the circumstances.
Fourthly, service of a LAWP is governed by s 23(10A) –
(10A) If a person is subject to a liquid assets test waiting period for a social security benefit, the person is to be taken to have served the waiting period if, and only if:
(a) the waiting period has ended; and
(b) the person was, apart from the liquid assets test provision concerned, qualified for the benefit throughout so much of the waiting period as occurs after the claim for the benefit was made.
As can be seen, where a LAWP applies, service is dependent upon the person qualifying for the social security payment claimed during any part of the LAWP after the date of claim. The only evidence that Mr Lynch did not cease paid work on 21 May 2015 is his own account.
Mr Lynch did not strike me as a dishonest man and it is not presently established that he engaged in paid work but failed to declare resulting income to Centrelink. His evidence does not compel a finding of that kind. It suggests, however, that he continued to seek paid work in the various ways that were open to him.
Considering all this, I think the preferable conclusion is that Mr Lynch ceased paid work on 21 May 2015. This is so even though he may have continued to seek work through his business and on the open market thereafter.
That being so, the date for the purposes of s 598(3A)(a) is 22 May 2015.
The remaining start date criteria are in reference to the person’s partner.
There is very scant evidence before the Tribunal in respect of the circumstances of Mr Lynch’s wife. On Mr Lynch’s evidence, she ceased work in March 2014, when her job was abolished. This is consistent with the available Centrelink records, which indicate that she served a LAWP that started on 17 March 2014. It may be inferred that this was the day following the day on which she ceased work – 16 March 2014. I will proceed on that basis. There is no evidence before the Tribunal that Mrs Lynch has worked since 16 March 2014. Thus, the date for the purposes of s 598(3A)(b) is 17 March 2014.
I should say at this point that the terms of the second start date criterion are not expressly subject to any temporal limit. This is rather odd when a 12 month time limit applies under s 598(4A) in respect of prior service of a LAWP by the person’s partner. It is at least arguable that a 12 month limit should also apply in respect of the start date criteria that hinge on the person’s partner. Without such a limit, it may be argued, there is a question whether s 598(4A) has any work to do. That section, however, has the clear purpose of dis-applying the threshold LAWP provision in s 598(1) in certain circumstances. The purpose of s 598(3A) is quite different – it provides a mechanism to determine the start date of a LAWP. While it may appear odd to find that the LAWP Mrs Lynch served does not excuse Mr Lynch from serving another, in the particular circumstances, when the LAWP he must serve is determined to start on the same day in those circumstances. Odd it may appear, but the effect of having to serve a LAWP, albeit with a start date in the past, may well be different than not having to serve a LAWP at all. The one may affect Mr Lynch’s qualification for Newstart Allowance, such that it is not payable to him for the period of the LAWP, whereas the other does not have that effect.
Considering all this, the date under s 598(3A)(b) is 17 March 2014.
The present evidence does not establish that the remaining two start date criteria are satisfied.
The latest date resulting from the start date criteria under s 598(3A) is applicable.
It follows that this is the date following the day on which he ceased work – 22 May 2015. This is the date on which Mr Lynch’s LAWP starts. As the LAWP runs for 13 weeks, it will end on 20 August 2015. As this period, in its entirety, falls after he claimed Newstart Allowance on 22 May 2015, the proviso in s 23(10A) in respect of service applies. The present evidence does not establish that Mr Lynch was not qualified for Newstart Allowance at any time after 22 May 2015. That being so, the LAWP ends on 20 August 2015.
Under s 621(3), the OWP commences on the next day – 21 August 2015 and runs for 7 days, ending on 27 August 2015.
Are there grounds to excuse service of the LAWP?
Mr Lynch submits that the LAWP should be set aside or excused in the circumstances – Centrelink should have determined his eligibility for Newstart Allowance in April 2014 and, had that occurred, he would not have been subject to a LAWP.
That may be so, but the Act does not provide a general discretion to set aside or waive service of a LAWP in such circumstances. As his circumstances do not come within the exclusions under s 598(4A) to (8), there are no grounds to waive or otherwise excuse Mr Lynch from service of the LAWP.
Decision
The decision under review is affirmed.
I certify that the preceding 109 (one hundred and nine) paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member .......................[sgd]........................................
Associate
Dated 30 June 2016
Date of hearing 13 May 2016 Final submissions received 3 June 2016 Applicant In person Solicitors for the Respondent Department of Human Services
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