McEvoy and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
[2010] AATA 1038
•22 December 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 1038
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2010/1659
GENERAL ADMINISTRATIVE DIVISION ) Re JOYLENE ANN McEVOY Applicant
And
SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS
Respondent
DECISION
Tribunal Senior Member R W Dunne Date22 December 2010
PlaceAdelaide
Decision The Tribunal affirms the decision under review.
..............................................
R W DUNNE
(Senior Member)
CATCHWORDS
SOCIAL SECURITY – pensions, benefits and allowances – Carer Payment – legislation amended from 20 September 2009 – transitional provisions – whether rate of Carer Payment should be calculated under the transitional provisions or the amended legislation – decision under review affirmed.
Social Security Act 1991(Cth) Schedule 1A
Social Security and Other Legislation Amendment (Pension Reform and Other 2009 Budget Measures) Act 2009
REASONS FOR DECISION
22 December 2010 Senior Member R W Dunne introduction
1. This matter is indeed an unfortunate one. It involves the applicant, Joylene Ann McEvoy, who is in receipt of Carer Payment in respect of her adult son, who suffers severe cerebral palsy quadraplegia athetosis. Her husband is employed and his earnings impact on her Carer Payment entitlement. Following income test changes from 20 September 2009, her rate of Carer Payment was assessed under transitional provisions included in the changed legislation. Her husband had increased earnings and Carer Payment was assessed under new income test rules, resulting in a reduction in the rate of her Carer Payment. Mrs McEvoy disputed the rate assessed, which was affirmed by an Authorised Review Officer and the Social Security Appeals Tribunal (“SSAT”). She has applied to this Tribunal for a review of the decision of the SSAT.
2. At the hearing before me, Mrs McEvoy represented herself (with the assistance of her husband) and Mr A Parker (from the Centrelink Advocacy Branch) appeared for the respondent. I received into evidence the T documents lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Exhibit R1), together with the respondent’s statement of facts and contentions (including Attachments A to D) (Exhibit R2).
issues for the tribunal
3. The issues to be determined by the Tribunal are as follows:
(a)Do the transitional provisions apply to the applicant after 20 September 2009?
(b) Was it correct to calculate Mrs McEvoy’s Carer Payment under the new income test rules in the amended legislation?
(c) Are there any provisions allowing the applicant to have her Carer Payment calculated under the old income test rules?
legislation
4. The legislation that relevantly applies in the present case is contained in the Social Security Act 1991 (“Act”). Changes were made to the pension income test from 20 September 2009 pursuant to the Social Security and Other Legislation Amendment (Pension Reform and Other 2009 Budget Measures) Act 2009. As a result of the changes, transitional provisions contained in Schedule 1A of the Act were implemented to apply to pension assessments for people who were receiving a part rate of pension before 20 September 2009. The transitional provisions are contained in clause 146 of Schedule 1A, which includes reference to Carer Payment.
5. Where a person was entitled to receive a higher Carer Payment rate under the pre-20 September 2009 old income test rules, when compared to the post-20 September 2009 new income test rules, the person’s Carer Payment rate continued to be assessed under the pre-20 September 2009 old income test rules. However, if a person’s Carer Payment rate under the pre-20 September 2009 old income test rules was equal to or lower than that payable under the post-20 September 2009 new income test rules, the Carer Payment assessment would change permanently to an assessment under the post-20 September 2009 new income test rules.
background and evidence
6. The material facts in this case are not in dispute and may be taken from the reasons in writing of the SSAT. In the 2009 Federal Budget, the Government announced a number of changes to the pension system which were implemented from 20 September 2009. The changes included increases in rates of pensions and certain other payments (including Carer Payment) for singles and couples, and a new taper rate from 40 cents to 50 cents. The payments would reduce by 50 cents in the dollar for singles and 25 cents in the dollar each for couples for each extra dollar of income over the income test free area. To ensure that persons receiving the effected payments would not be worse off by these changes, transitional provisions were also introduced, such that they could have their payment assessed under the old and the new rates, and if the old rate produced a better result, the payment would be assessed under that rate until the new rate produced an equal or better outcome. Mrs McEvoy’s husband is employed and his earnings impact on her Carer Payment.
7. In giving her evidence, Mrs McEvoy said that her husband’s normal base salary placed them below the income threshold, such that her Carer Payment would not be affected by the income test. However, if he was required to work extra shifts under his workplace agreement, the extra income would place them over the income threshold and her Carer Payment would be reduced. She said she telephoned Centrelink on 18 August 2009 to ascertain whether any additional earnings her husband received would affect her entitlement to Carer Payment. If it would, her husband would not have undertaken the overtime. She was told that, unless her rate of Carer Payment was reduced to zero for six consecutive fortnights, her payment would not be cancelled.
8. Mrs McEvoy said that she was not told about the transitional provisions and the likelihood that she could come under the new assessment rules. Mr Parker, for the respondent, asserted that she had been sent a letter regarding the changes, but Mrs McEvoy vehemently denied that she had received such a letter. She said that, had she received the letter, she would have read it and contacted Centrelink to enquire about the issue.
9. Because of the reduction in her Carer Payment, a claim was lodged by (or on behalf of Mrs McEvoy) under Centrelink’s Customer Compensation Schemes. It appears the claim was rejected on the basis that it was found there was insufficient evidence that there was any negligent or defective administration (Exhibit R2, Attachment B).
consideration
Do the transitional provisions apply to the applicant immediately after 20 September 2009?
10. In 2009, changes were made to the way the Carer Payment rate was determined. The changes took effect from 20 September 2009 and included transitional provisions inserted into Schedule 1A of the Act as clauses 146 to 149. Under clause 146(1), the transitional provisions would apply if, on 19 September 2009, a person was receiving one of the Social Security pensions referred to in the clause, including Carer Payment. As Mrs McEvoy was receiving Carer Payment on 19 September 2009, the transitional provisions in Schedule 1A applied to her immediately after 20 September 2009.
11. Whether Mrs McEvoy’s Carer Payment would be affected would depend on whether her husband’s income, in the future, placed them over the relevant income threshold.
Was it correct to calculate the applicant’s Carer Payment under the new income test rules in the amended legislation?
12. I have no reason to believe that, in giving her evidence, Mrs McEvoy was not a witness of truth. According to that evidence, in August 2009, her husband was asked to undertake a “reasonable amount” of overtime under his workplace agreement. I accept that she contacted Centrelink to ascertain whether the additional overtime earnings would affect her Carer Payment. I also accept that she was incorrectly advised that, provided certain conditions were satisfied, her Carer Payment would not be reduced or cancelled. I accept further that she was not informed about the transitional provisions, about the possibility that the new rules under the amended legislation might apply and that she did not receive the letter from Centrelink to indicate that the assessment rules had changed. Clearly, had she known about the changes and been aware that her husband’s additional income would have placed them over the higher income threshold for her Carer Payment entitlement, her husband would have refused the extra overtime to maintain their income below the old income threshold.
13. It appears that, in the fortnight ended 9 November 2009, her husband’s income was above $2,274 and Mrs McEvoy’s Carer Payment was calculated under the transitional provisions, resulting in a nil rate payable under the old income test rules. As this was equal to, and was no worse than, the rate calculated under the new rules, she was transferred so that her rate was calculated, from that point onwards, under the new rules. In the fortnight ended 23 November 2009, the rate of payment was also calculated under the amended legislation. For this fortnight, Mr McEvoy’s income was at a level that precluded Mrs McEvoy from Carer Payment under the new rules. Mrs McEvoy’s payment rate was also calculated to be zero in the fortnight ended 7 December 2009.
14. Mrs McEvoy’s complaint was that she was not advised of the transitional provisions and of the change to the threshold amount. Notwithstanding this, given the level of Mr McEvoy’s income in the fortnight ended 9 November 2009, Mrs McEvoy would be precluded from payment under the new provisions and her payment rate for that fortnight would be nil. On the evidence and having regard to the transitional provisions contained in Schedule 1A of the Act, I am satisfied that Mrs McEvoy’s Carer Payment in the fortnights ended 9 November 2009, 23 November 2009 and 7 December 2009 have been correctly calculated.
Are there any provisions to allow the applicant to have her Carer payment calculated under the old income test rules?
15. The changes to the pension system that are contained in Schedule 1A of the Act contain transitional provisions that apply to allow pension payments (including Carer Payment) to be assessed under old and new income test rates. If the old rate produced a better result, the pension payments would be assessed under that rate until the new rate produced an equal or better outcome. In Mrs McEvoy’s case, her Carer Payment entitlement had been transferred to the new income test rules because an equal or better outcome had been reached.
16. Mr Parker submitted that, pursuant to clause 146(5) of Schedule 1A, where the transitional provisions do not result in the provision of a higher rate than the rate under the amended legislation, Mrs McEvoy’s Carer payment cannot ever again be paid under the transitional provisions. I accept that this submission is correct. It follows that, in Mrs McEvoy’s case, the transitional provisions applied to her at any time after the first day of the fortnight ended 23 November 2009. Her rate of Carer Payment for the whole of the fortnight ended 7 December 2009 and thereafter, therefore, fell to be determined under the new rules, without recourse to the transitional provisions. The Act does not provide for reversion to assessment of Carer Payment rate under the old income test rules once the transitional provisions no longer apply.
17. In a communication to the Tribunal before the hearing, Mrs McEvoy said “all we want is to go back on to the old threshold and we would be happy”. I am bound to apply the provisions of the Act as they are enacted and have no power to provide relief which is outside the operation of the relevant provisions.
18. The circumstances in which Mrs McEvoy and her husband now find themselves are most regrettable and I sympathise with them. On the material provided to me, they have apparently been given mistaken advice by Centrelink officers on more than one occasion. They have suffered a significant loss of income as a result of the changes made to the calculation of the Carer Payment. Mrs McEvoy is unable to work herself because of her severely disabled son and she believes that she has been treated unfairly by Centrelink. She has been unsuccessful in her claim under the Centrelink’s Customer Compensation Schemes. However, as Centrelink has suggested when refusing the claim, consideration should be given to making a claim under the Compensation for Detriment caused by Defective Administration scheme (“CDDA”). I would recommend that this course be pursued. If a CDDA claim fails, I would also recommend that Mrs McEvoy apply to the Department of Finance and Deregulation for an act of grace payment or other consideration. The success or otherwise of such an application will, of course, depend upon the decision of the Minister for Finance and Deregulation.
decision
19. For the reasons outlined above, I must affirm the decision under review.
I certify that the 19 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member R W Dunne
Signed: ............J Coulthard...........................................
AssociateDate of Hearing 28 October 2010
Date of Decision 22 December 2010
Advocate for the Applicant Self-representedAdvocate for the Respondent Mr A Parker
Centrelink Advocacy Branch
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