McKie and Secretary Department of Employment and Workplace Relations

[2006] AATA 748

Administrative

Appeals

Tribunal

 

WRITTEN REASONS FOR ORAL DECISION [2006] AATA 748

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2006/18

GENERAL ADMINISTRATIVE  DIVISION		)
Re		KIRSTIE MCKIE

Applicant

And SECRETARY DEPARTMENT OF EMPLOYMENT AND WORKPALCE RELATIONS

Respondent

DECISION

Tribunal  Senior Member, Mrs Josephine Kelly

Date of Oral Decision             14 August 2006

Date of Written Reasons       1 September 2006

Place Sydney

Decision The reviewable decision is affirmed.

[Sgd] Senior Member, Mrs Josephine Kelly

CATCHWORDS

SOCIAL SECURITY PAYMENT – Parenting Payment single – change of status to partnered – administrative error – debt raised – whether special circumstances exist to waive – special circumstances not found – decision affirmed.

LEGISLATION

s1237A & 1237AAD Social Security Act 1991  

WRITTEN REASONS

1. At the conclusion of the hearing of this matter in Wollongong, the terms of the decision made and the reasons for that decision were stated orally. The Respondent requested the Tribunal to furnish a statement in writing of the reasons for its decision pursuant to sub-section 43(2A) of the Administrative Appeals Tribunal Act 1975.

2.      The oral reasons for decision have been transcribed by Auscript, the Commonwealth Reporting Service, and edited only to the extent necessary to ensure clarity of expression, without in any way changing the reasons.  The edited transcript comprises the reasons for the Tribunal’s decision and is annexed, and is furnished to the Applicant and to the Respondent. 

WRITTEN REASONS FOR ORAL DECISION

Senior Member, Mrs Josephine Kelly

The following is my decision in the matter of Kirstie McKie v The Secretary, Department of Employment and Workplace Relations. 

Background

1.      Ms Kirstie McKie (“Ms Mckie”) has two sons, aged 20 and 17, and a daughter who is 15 years old.  Ms McKie was receiving Parenting Payment single in 2005.  It is not in dispute that on 15 February 2005 (T8) that Ms McKie moved in with her partner, Mr Geoffrey Forster (“Mr Forster”).  It is also not in dispute that on 11 March 2005, Ms McKie and Mr Forster informed Centrelink personally that they were residing together. 

2.      Centrelink concedes that, as a consequence of its administrative error, Ms McKie continued to receive the parenting payment single from 11 March 2005 until 6 April 2005.  It is also not in dispute that Ms McKie received Parenting Payment single from 15 February 2005 to 11 March 2005.  Centrelink determined that Ms McKie was not entitled to Parenting Payment single for that whole period and raised a debt of $1,762.82.  Ms McKie disputes that she should have to pay back the debt, in particular the debt arising after she and Mr Forster advised Centrelink on 11 March 2005 that they were residing together, because that debt arose due to Centrelink’s error. 

The Issue

3.       The issue in this matter is whether the debt against Ms McKie should be recovered or whether it should be written off or waived due to administrative error or because there are special circumstances. 

Waiver of debt arising from error

4.      The relevant provision relating to waiver of debts arising from administrative error is section 1237A.   Subsection (1) provides that: 

“Subject to subsection (1A) the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth, if the debtor received, in good faith, the payment or payments that gave rise to the proportion of the debt.” 

Subsection (1A) provides that: 

“Subsection (1) only applies if:

(a) the debt is not raised within a period of 6 weeks from the first payment that caused the debt; … “

Consideration

5.      Unfortunately for Ms McKie, the debt was raised within a period of six weeks from the first payment that caused the debt due to administrative error after 11 March 2005.  Therefore, pursuant to section 1237A(1A)(a), the provision relating to waiver for administrative error cannot apply in this case.

6.      The next issue is whether there are special circumstances that justify waiver of the debt.  The relevant provision is section 1237AAD: 

“The Secretary may waive the right to recover all or part of the debt if the Secretary is satisfied that:

(a)  the debt did not result wholly or partly from the debtor or another person knowingly: 

i)making a false statement or a false representation; or

ii)failing or omitting to comply with the provision of this Act or the (1947) Act; 

(b)  there are special circumstances (other than financial hardship alone) that make it desirable to waive; and 

(c)  it is more appropriate to waive than to write off the debt or part of the debt.” 

Evidence 

7.      Ms McKie acknowledged that she was aware of her obligation to notify Centrelink of her change in circumstances.  She did so outside the 14 day period specified in the legislation. 

8.      Mr Forster is now living with and supporting Ms McKie and her family.  In the partner details provided to Centrelink, Mr Forster recorded that he had $20,000 in savings, in an account at the Commonwealth Bank.  He indicated that he was employed as a Rigger/Dogman and that his weekly earnings were $1,130 before tax (T9). 

9.      At T11, is a payslip of Mr Forster’s which indicates that his net pay is $1,366.57 per week.  At T12 it is estimated that his taxable income is $50,000.  At T24, Ms McKie indicates that Mr Forster is now trying to maintain his own financial circumstances but also support herself and her three children. 

10.     At the hearing I heard evidence from Ms McKie and Mr Forster.  That evidence was not seriously challenged and I accept their evidence. 

11.     In summary, the following was put forward as being relevantly special circumstances.  Around February 2005, when Mr Forster and Ms McKie moved in together, Ms McKie’s mother was in intensive care for 3 weeks, one of her sons suffered a drug overdose, her daughter returned to reside with her after spending some months with her father and step-mother for the first time, and Ms McKie was focusing on establishing a retail business. 

12.     Ms McKie emphasized that she has brought up her children on her own with no help from the children’s father, that she is setting up a business and that she does not want to depend on Centrelink payments. 

13.     At the present time her eldest son is working intermittently and her youngest son is studying welding.  The two younger children live with her and Mr Forster and the older son comes and goes.  Mr Forster does shift work.  As in many families with children of similar ages, there are tensions within the family.  Mr Forster has been supporting Ms McKie and her children financially.  He does not have the savings he previously had.  Ms McKie and Mr Forster purchased a unit in Kiama in about November 2004 for $349,000 but are now having to sell it because they are unable to keep up the mortgage payments.  Mr Forster had borrowed $350,000.  Mr Forster also owns a home in Nowra which is currently being rented out but which they intend to move in to.  Before borrowing for the Kiama property there was no mortgage on the Nowra property. 

14.     Mr Forster is now employed full-time rather than casually, and his wages have fallen by $5 an hour.  Ms McKie has had to move her retail premises, her business loses money and has always lost money. 

15.     Ms Mckie is currently receiving Family Tax Benefit at a rate of $51.10 per fortnight.  She has also had an arrears payment of $1,041.77 from the Australian Taxation Office and received arrears payments of $594.24 and $730.00 this year because her Family Tax Benefit had been cancelled and then reinstated.  She is repaying the current debt at the rate of $12.00 per fortnight. 

16.     Ms McKie also has a medical condition which is being monitored and about which she is very concerned. 

17.     Ms Mckie believes that she is being punished even though she has done nothing wrong.  She also felt that she has not been treated properly by Centrelink at various times which she told me about at the hearing. 

Were the circumstances special? 

18.     I understand Ms McKie’s frustration and belief that she should not have to repay the debt which arose from administrative error.  However, the law does not apply in that respect as I have already pointed out. 

19.     Further, I am not satisfied that the circumstances Ms McKie relies on are relevantly special circumstances.  As said in Beadle v Director General of Social Security (1985) 6 ALD 1 by Toohey J one has to look at the context in which the circumstances occur.

20.     While Mr Forster and Ms McKie have faced difficulties and continue to, as they described, their circumstances, in my view are not special circumstances within the meaning of section 1237AD. 

Decision

21.     Accordingly, the decision under review is affirmed. 

I certify that the 21 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member,
Mrs Josephine Kelly

Signed: Ms Preethi Nimmagadda
   Associate

Date of Hearing  10 August 2006 
Date of Oral Decision                14 August 2006
Date of Written Reasons          1 September 2006
Solicitor for Applicant                Applicant self-represented
Advocate for the Respondent   Centrelink Legal Services Branch