Merlacco and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2010] AATA 156

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 156

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2009/3833

GENERAL ADMINISTRATIVE DIVISION		)
Re		Antonietta Merlacco

Applicant

And Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

Respondent

DECISION

Tribunal Mr A Sweidan, Senior Member

Date25 February 2010  

PlacePerth

Decision The Tribunal affirms the decision under review.

.........(sgd) Mr A Sweidan...................

Senior Member

CATCHWORDS

Social security- whether applicant qualified for Economic Security Strategy (“ESS”) payment- whether applicant was paid an instalment of DSP in respect of relevant date (14 October 2008) – applicant not qualified for ESS- decision under review affirmed.

Legislation

Social Security Act 1991 – s1064-A1; ss900(1)(2) s23(1) ss23(2)(4)

Social Security (Administration) Act 1999 ; s 43(1)

Cases

Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and de Waal [2009] AATA 635

Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and McCormick [2009] AATA 746

REASONS FOR DECISION

Mr A Sweidan        

Background

1.      Applicant (Miss Merlacco) seeks a review of a decision to refuse to pay her an economic security strategy (“ESS”) payment.  The decision was reviewed and affirmed by the Social Security Appeals Tribunal (“SSAT”) on 28 May 2009.

Issue for the Tribunal

2.      The issue in this review is whether Miss Merlacco was receiving disability support pension (DSP) in respect of 14 October 2008 such as to be qualified for an ESS payment.

Facts

3.      The relevant facts which are not in dispute are as follows:

4.      Miss Merlacco was granted DSP with effect from 22 September 2003. 

5.      In the fortnight including 14 October 2008, Miss Merlacco received ongoing income of $24,162.24 per annum ($929.31 per fortnight) and reported earnings income of $781.88.    

6.      Pursuant to the application of the income test contained in the Centrelink rate calculator for DSP, there was no DSP payable to Miss Merlacco in respect of the fortnight ending 22 October 2008, due to her earnings from employment.

7.      On 14 October 2008 the Commonwealth Government announced that ESS payments would be made to recipients of various Centrelink payments, including DSP.  One-off lump sums of up to $1,400 were payable to persons receiving payment on a certain day, namely 14 October 2008.

8. Qualification for and payability of the ESS payments announced by the Commonwealth Government in October 2008 was legislated for in amendments to the Social Security Act 1991.

9.      On 17 December 2008 Miss Merlacco was advised by Centrelink that she was not qualified for the ESS payment.  This decision was affirmed by an Authorised Review Officer (ARO) on 5 March 2009.

10.     Miss Merlacco requested a review of the decision not to pay her the ESS payment by the SSAT, and on 28 May 2009 the SSAT affirmed the decision under review.

Tribunal’s findings

11. For DSP, the “rate of pension is a daily rate”: Social Security Act 1991 (the Act), s 1064-A1. The daily rate is calculated by reference to a person’s “income on a yearly basis” (s 1064-E1) and is generally paid fortnightly in arrears: Social Security (Administration) Act 1999 (the Administration Act), s 43(1).

12.     The Tribunal finds that it is clear that Miss Merlacco would only have been qualified for an economic security strategy payment if she had been paid an instalment of disability support pension that included a daily rate of payment in respect of 14 October 2008.  Due to her income from employment, Miss Merlacco was not paid an instalment relating to 14 October 2008 and so she was not qualified for an economic security strategy payment.

13. S900(1) of the Act provides that a person is “qualified for an economic security strategy payment if subsection (2), (3) or (4) applies to the person”. Subsections (3) and (4) relate to persons of age pension age and are not presently relevant.

14.Subsection 900(2) of the Act provides:

This subsection applies to a person if:
(a)  the person was receiving one of the following payments in respect of 14 October 2008:
…
(ii)  a disability support pension...

15. S23(1) of the Act provides that the term “receive” has the meaning given by ss (2), (4), and (4AA) S23(1) also refers to ss(3) and (4AB), but these were repealed by Act No. 132 of 1998, s 3, Schedule 1(21) and Act No. 55 of 1994, s 6, Schedule 2, Part 1(12) respectively.. S23(2) provides that “a person is taken to be receiving a payment under this Act from the earliest day on which the payment is payable to the person even if the first instalment of the payment is not paid until a later day”. S23(4) then provides that “a person is taken to be receiving a social security payment until the latest day on which the payment is payable to the person even if the last instalment of the payment is not paid until a later day”. S23(4AA) extends the definition of “receiving” for the purposes of certain provisions of the Act, but not for the purposes of section 900.

16. The effect of subsections 23(2) and (4) is clearly to link the receiving of a social security payment to the concept of the payment being “payable”. Generally, a social security payment becomes “payable” to a person on the person’s “start day”, which is normally the date the person claimed the payment: Administration Act ss 41, 42, and Schedule 2. A social security payment then ceases to be “payable” on the happening of certain events. One of those events is set out in section 98(1) of the Act:

Subject to subsection (2), a disability support pension is not payable to a person if the person’s disability support pension rate would be nil.

17.     S98(2) deals with advance payments of pharmaceutical allowance, and is not presently relevant.  Amongst other things, a person’s rate of disability support pension is calculated with reference to income from employment: Act s1064.

18. The Tribunal finds that the effect of these provisions is that the reference in s 900 of the Act to “receiving” disability support pension “in respect of 14 October 2008” means the person’s pension must have been “payable” for 14 October 2008.

19.     In Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and de Waal [2009] AATA 635, Deputy President Jarvis of the Tribunal considered the meaning of “receiving” for the purposes of s 900. In that case, the pensioner was not paid a DSP instalment in respect of 14 October 2008 due to earnings. Jarvis DP concluded that the pensioner “did not ‘receive’ a payment in this sense, because no payment was made to him with respect to 14 October 2008” and as such the pensioner “was not receiving DSP in respect of 14 October 2008 within the meaning of s900(2)”. This approach to the meaning of “receiving” was confirmed in Secretary, Department of Families, Housing, Community Services and Indigenous Affairs and McCormick [2009] AATA 746.

20.     The extrinsic material also supports this interpretation.  The economic security strategy payment was introduced by the Social Security and Other Legislation Amendment  (Economic Security Strategy) Bill 2008.  The Explanatory Memorandum to the Bill for that Act explains the intention behind the amendments:

The intention is that the person must have received an amount of the payment for the relevant instalment period that included a daily rate of payment in respect of 14 October 2008.

21. Finally, the Tribunal notes that section 38B of the Act provides for a deemed notional continuous period of receipt for certain purposes. Section 38B(1) states:

The object of this section is to treat a person in certain circumstances as having received an income support payment in respect of a continuous period even though the person did not actually receive such a payment during a part or parts of the period.

22. Section 38B only provides for determining the “continuous period in respect of which the person has received income support payments” (s38B(2), (3), (4)). It does not affect the payability of any social security payment, and does not operate to deem a person to have received a payment in respect of any particular date. In the Tribunal’s opinion section 38B does not assist a person to qualify for economic security strategy payment under section 900 of the Act (see de Waal (above) at paragraphs 48-54).

23.     Miss Merlacco earned employment income at a level that resulted in her rate of disability support pension for 14 October 2008 being nil.  This meant her pension was not payable (section 98) and she was not paid an instalment in respect of 14 October 2008.  The result is that Miss Merlacco was not “receiving” disability support pension “in respect of 14 October 2008” and so was not qualified for an economic security strategy payment.

Decision

24.     The Tribunal finds that Miss Merlacco was not qualified for the ESS payment and accordingly affirms the decision under review.

I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of Mr A Sweidan

Signed: …(sgd) Ms L Huynh.....................................................
  Associate

Date/s of Hearing  Decided on the Papers
Date of Decision  25 February 2010
Solicitor for the Applicant          Self Represented   
Solicitor for the Respondent     Mr P Maishman
  Centrelink Legal Services Branch