O'Brien and Secretary, Department of Employment and Workplace Relations

[2006] AATA 406

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 406

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No A2006/28

GENERAL ADMINISTRATIVE  DIVISION		)
Re		DAMIEN O’BRIEN

Applicant

And SECRETARY, DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS

Respondent

DECISION

Tribunal Mr S. Webb, Member

Date10 May 2006

PlaceCanberra

Decision The decision under review is affirmed.

..............................................

Mr S. Webb, Member

CATCHWORDS

Social Security - parenting payment partnered - overpayment - recipient obligations to notify earnings - failure to provide correct information about partner’s earnings - administrative error not solely the cause of the overpayment - decision affirmed

Social Security Act 1991 ss 503, 1068B, 1223, 1237, 1237A, 1237AAD

Pledger v Secretary, Department of Family and Community Services (2002) FCA 1576

Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 152 ALR 127

Haggerty v Secretary, Department of Education, Training and Youth Affairs (2000) 31 AAR 529

Jazazievska v Secretary, Department of Family and Community Services (2000) 65 ALD 424

Re Beadle v Director-General of Social Security (1984) 6 ALD 1

Groth v Secretary Department of Social Security (1995) 40 ALD 541

REASONS FOR DECISION

10 May 2006 Mr S. Webb, Member         

1.      By this application Damien O’Brien is seeking review of the decision of the Respondent’s delegate, as affirmed by the Social Security Appeals Tribunal, to raise and recover a parenting payment partnered (“PPP”) overpayment debt in the amount of $4,210.08.

2.      Mr O’Brien disputed the amount of the debt and contended that, in any event, the debt was the result of administrative error and should not, therefore, be recovered from him.

3.      Mr O’Brien gave oral evidence at the hearing and presented his case without representation.  Mr Andrew Zhang represented the Respondent.  Materials were tendered and labelled during the hearing.

factual context

4.      Mr O’Brien is partnered with Margaret Abedin.  There are two children:  Eboni (date of birth: 6 July 1989) and Dakota (date of birth: 2 July 2004).

5.      Mr O’Brien ceased employment on 29 October 2004 and did not obtain further employment until after the period in which he received parenting payments.  During the period in question from 2 November 2004 to 18 April 2005 Ms Abedin was employed by Sirius Telecommunication Limited (“Sirius”). 

6.      On 1 November 2004 Mr O’Brien contacted Centrelink and made an appointment on 5 November 2004 with the intention of claiming PPP.  He attended that appointment with Ms Abedin and Dakota and lodged a claim for PPP (T4).  In the claim Ms Abedin’s income was stated to be $350 per week (T4, folio 52), which Mr O’Brien explained was only an estimate of her income at that time.  Before lodging the claim Mr O’Brien was provided with the booklet ‘Information you need to know about your claim for Parenting Payment’ (T3).  The booklet sets out information about the obligation of recipients to tell Centrelink about any change in the earnings of the person or their partner (T3, folio 27).

7.      Responding to a letter dated 5 November 2004 (T6), on 16 November 2004 Mr O’Brien provided Centrelink with copies of Ms Abedin’s payslips from Sirius for the period from 17 June 2004 to 4 November 2004 (T7).  He did so in person at the Queanbeyan Centrelink office.

8.      On or about 1 December 2004 Mr O’Brien telephoned Centrelink about his claim for parenting payment.  He was informed that PPP had been granted. 

9. I pause to note with concern that the documents filed by the Respondent pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (“the AAT Act”) are deficient and do not include documents concerning events that are referred to in the Respondent Secretary’s Statement of Facts and Contentions and that are relevant in these proceedings, the abovementioned telephone communication being but one example. In cases such as this that involve administrative error on the part of the Commonwealth and the recovery of debts from benefit recipients, it is important that all relevant documents, including computer records, are placed before the Tribunal. The Respondent is obligated to assist the Tribunal to make the correct or preferable decision. That obligation is not fulfilled if relevant documents are not filed in the Tribunal and served on the other party in a timely manner that is compliant with subs 37(1) of the AAT Act.

10.     In the days following 1 December 2004 Mr O’Brien received an amount of $666.30 by electronic funds transfer into his bank account and a notice date 30 November 2004 (T8).  Mr O’Brien stated that he did not receive the letter at T9.  The 30 November 2004 notice set out the amount of Mr O’Brien payment during the period from 1 November 2004 to 29 November 2004 ($666.30) and the amount of ‘Regular payment from payday 15/12/2004”, being an amount of $351.00 after deduction of $5.00 in tax.  The notice does not state that the ‘regular payment’ amount is a fortnightly payment of parenting payment.  That is left for a reader to infer.  Nevertheless, the notice also sets out “INFORMATION USED FOR CALCULATING YOUR REGULAR PAYMENT”, as follows:

“Assets  $27,202.00

Your partner’s annual other income  $2.86

Your partner’s fortnightly earned income  $0.00

Your annual other income  $2.86

Your fortnightly earned income  $0.00”

The notice then states that parenting payment is worked out using the income of the person and the partner.  Information concerning Mr O’Brien’s obligations is set out on the reverse of the notice (T8, folio 70).  That information includes the statement:

“You must tell us if…

…

Your partner’s total personal income goes over $594.00 a fortnight;”

11.     Mr O’Brien received ‘regular’ payments of PPP on the days and in the amounts set out at T25.  His evidence was that he monitored his bank account and the parenting payments he received.

12.     Mr O’Brien stated that he did not receive the letter at T11 requesting information about his partner’s employment before 30 December 2004.  However, Mr O’Brien contacted Centrelink on 30 December 2004 and the Centrelink record of that conversation (T13) includes:

“…cus advised that ptr has had the same employer for 2 years but recently details changed.  Advised cus to lodge ptrs payslips from date of change to now so we have correct information on file.  Cus is aware of due date for payslips.”

13.     On 6 January 2005 Centrelink wrote to Sirius requesting details of Ms Abedin’s earnings (T14).  The information provided by Sirius on 19 January 2005 (T15) reveals that Ms Abedin’s employment status changed from casual to part-time on 8 November 2004.  Thereafter she regularly worked at least 75 hours per fortnight.  Ms Abedin’s pay records reveal that she earned the following amounts in the period from 1 November 2004 to 18 April 2005 (T15 and T17):

Period ending  Amount
5 November 2004  $207.68
19 November 2004  $2,025.95
3 December 2004  $1,201.78
17 December 2004  $1,603.47
31 December 2004  $1,362.38
14 January 2005  $1,340.23
28 January 2005  $1,484.23
11 February 2005  $1,455.63
25 February 2005   $1,503.47
11 March 2005  $1,308.85
25 March 2005  $1,554.38
8 April 2005  $1,414.89
21 April 2005  $1,478.70

14.     Mr O’Brien did not dispute that he received the following amounts of parenting payment (T18 and T25):

Date  Amount
2 December 2004  $666.30
15 December 2004  $356.00
24 December 2004  $356.00
12 January 2005  $356.00
25 January 2005  $356.00
9 February 2005  $356.00
23 February 2005  $356.00
9 March 2005  $356.00
22 March 2005  $356.61
6 April 2005  $360.30

20 April 2005  $360.30

During the hearing the Respondent conceded that no amount of earned income for Mr O’Brien or Ms Abedin was taken into account when calculating these PPP payments to Mr O’Brien.

15.     It is clear from the Centrelink records at T12 that on 15 February 2005 Centrelink was aware that Mr O’Brien had been overpaid as Ms Abedin’s earned income had not been taken into account.  Nonetheless, no action was taken to communicate the error to Mr O’Brien or to suspend his PPP payments at that time. 

16.     On or about 20 April 2005 Centrelink ceased payment of Mr O’Brien’s parenting payments.  Mr O’Brien’s evidence was that he had no advance notice that the payments would cease and no explanation was provided.  Mr O’Brien stated that he rang Centrelink to find out what was going on and was told that the payment had been suspended.  There is no record of this telephone conversation in the materials before the Tribunal.  Nor is there evidence that Centrelink informed Mr O’Brien that PPP payments would be suspended on or about 20 April 2005.

17.     On 29 April 2005 Centrelink sent a letter to Mr O’Brien setting out his reporting obligations (T16) and telephoned Sirius to request further earnings information in relation to Ms Abedin (T12, folio 78).  Sirius provided Centrelink with earnings data for Ms Abedin on 6 May 2005 (T17).

18.     On 6 May 2005 Centrelink raised an overpayment debt against Mr O’Brien in the amount of $4,210.08 (T18) and cancelled Mr O’Brien’s PPP.  The letter by which this information was communicated by Centrelink to Mr O’Brien is not in the T documents.  There is evidence that Mr O’Brien telephoned Centrelink on 10 May 2005 and was advised of the reason his PPP had been cancelled. Mr O’Brien tendered a document he received in relation to the debt (Exhibit A1).  That document is an account dated 20 June 2005, which specifies the debt amount and the due date (being 6 June 2005).  On 20 June 2005 Mr O’Brien contacted Centrelink seeking an explanation for the debt (T20).

19.     On 14 July 2005 a Centrelink officer determined to affirm the debt (T21).  On 25 October 2005 an authorised review officer decided to affirm the decision “to raise an overpayment of $4,210.08” (T22, folios 124 and 126).  Curiously, the same officer purportedly decided to waive $666.30 of Mr O’Brien’s debt (T22, folio 121).  On 1 December 2005, proceeding on the basis that the decision under review specified a recoverable debt in the amount of $3,543.78, the Social Security Appeals Tribunal decided to affirm that decision (T2).

issues for determination and legislation

20.     The issues for determination are whether Mr O’Brien has a debt to the Commonwealth as a result of overpayment of PPP and, if so, whether there are grounds to waive the Commonwealth’s right to recover the debt.  Neither party asserted that there are grounds to write off any such debt.

21.     The Social Security Act 1991 (“the Act”) applies. Under the Act the rate of PPP is to be calculated using the relevant rate calculator (ss 503 and 1068B) and is affected by the amount of earned income of Mr O’Brien or his partner. If a person receives a social security payment to which they were not entitled the amount of the payment is a debt due to the Commonwealth (s1223). The Commonwealth’s right to recover the debt may be waived in certain circumstances (s 1237; see 1237AAD). In the case of a debt that is attributable solely to Commonwealth administrative error the debt must be waived if the debt amount was received in good faith (s 1237A).

consideration

22.     Making this decision I have carefully considered all of the evidence, the submissions of the parties, the relevant legislation and caselaw.

debts

23. I am satisfied that Mr O’Brien was paid amounts of PPP totalling $4,210.08 to which he was not entitled. The amounts Ms Abedin earned in employment were not taken into account when calculating the rate of Mr O’Brien’s PPP pursuant to s1068B of the Act. It follows that the amount Mr O’Brien was overpaid, $4,210.08, is a debt due to the Commonwealth pursuant to s 1223 of the Act.

right to recover debts

24.     For reasons that will appear I am reasonably satisfied that there are no grounds to waive the Commonwealth’s right to recover the debt from Mr O’Brien.

25.     In Mr O’Brien’s submission the debts arose solely as a result of Centrelink’s failure to properly take into account information about Ms Abedin’s earnings.  On his parenting payment claim form Mr O’Brien estimated Ms Abedin’s earnings to be $350.00 per week and subsequently provided payslips from her employer.  Centrelink failed to take account of that information when calculating the rate of his parenting payment.  Furthermore, it was conceded that Centrelink incorrectly coded Ms Abedin’s income as income of Mr O’Brien and did not act promptly to limit overpayments to Mr O’Brien following the provision of earnings information by Sirius on 19 January 2005.

26. Nevertheless, the Commonwealth’s right to recover a debt resulting from administrative error may only be waived in certain circumstances that are set out at s 1237A of the Act. Such a debt, or part thereof, may only be waived it is solely attributable to the administrative error of the Commonwealth and the amount thus paid was received in good faith by the person.

27.     In the Respondent Secretary’s submission the debt was not solely attributable to administrative errors of the Commonwealth and recovery cannot, therefore, be waived.  Mr O’Brien contended that the total amount of the debt is attributable to Centrelink errors and must be waived.  As will appear, I do not agree.

28.     Mr O’Brien received the notice dated 30 November 2004 and it was his responsibility to read the information contained therein.  In his submission he did not properly read that letter.  If he had done so he would have known that the information about his partner’s fortnightly earned income was incorrect.  Having failed to read the letter, Mr O’Brien did not contact Centrelink to query the information in the letter and confirm that his partner’s earnings were properly being taken into account.  Nonetheless, the information about Ms Abedin’s earnings was clearly set out on the front of the letter.  Ms Abedin’s fortnightly earned income was not $0.00. 

29.     Mr O’Brien asserted that he did not know and had not been properly informed about the significance of his partner’s earned income in calculating the rate of his parenting payments.  However, Mr O’Brien was provided with a booklet setting out that information in relation to parenting payment prior to lodging his claim on 5 November 2004.  That 18 page booklet sets out information about the income test (T3, folio 20) and specifies the obligations of claimants to inform Centrelink about changes in circumstances, including any change in earnings (T3, folio 27).  Mr O’Brien’s evidence was that he did not read that booklet.

30. Was the booklet that Mr O’Brien was given a notice within the meaning of s 68 of the Social Security (Administration) Act 1999 (“the Administration Act”)? I am satisfied that it was not. Mr O’Brien’s uncontested evidence was that he was given the booklet prior to completing and lodging his claim for parenting payment. On that basis alone the booklet does not conform to the notice provisions under the Administration Act. At the time Mr O’Brien was given the booklet he was not within the terms of ss 67, 68 or 69 of the Administration Act. Thus, even if the booklet was a notice for the purposes of s 72 of the Administration Act it was not a notice that applied to Mr O’Brien for the purposes of s 67 of that Act when it was given to him.

31.     Nevertheless, the booklet set out information that was pertinent to Mr O’Brien’s claim for parenting payment.  While there is a burden on the Respondent Secretary to provide ready access to information to a claimant about a payment being claimed, there is also a burden of responsibility on a claimant to read the information provided about the payment being claimed and to ensure that the information on which the payment is based is correct.

32.     I accept that Mr O’Brien attempted to do so to the extent that he provided information about his partner’s earnings in the claim form he lodged and he subsequently provided copies of her payslips on 16 November 2004.  However, he did not inform Centrelink about changes in Ms Abedin’s earned income thereafter.  Nor did he seek to correct the erroneous information about her earnings that was set out in the letter dated 30 November 2004 (T8). 

33.     In the Respondent Secretary’s submission those omissions were factors that contributed to the overpayment of parenting payment to Mr O’Brien, and therefore to his debt, after 30 November 2004.  I do not agree.  Mr O’Brien was not properly notified that he must inform Centrelink of any change in his or his partner’s income. 

34. Subsequently, on 9 December 2004 Mr O’Brien was sent a notice by which he was required to confirm his partner’s employment details by 30 December 2004 (T11). Mr O’Brien gave oral evidence that he did not receive this notice. However, the Centrelink records reveal that Mr O’Brien telephoned Centrelink on 30 December 2004 and was aware of the due date for the provision of information about his partner’s earnings (T13). However, there is no evidence that he provided the required information. It follows that from 30 December 2004 Mr O’Brien’s failure to comply with the notice he was given contributed to the amount of his debt thereafter and I so find. On that basis, recovery of the proportion of Mr O’Brien’s debt that accrued after 30 December 2004 cannot be waived pursuant to s 1237A of the Act.

35.     In the position contended for by the Respondent Mr O’Brien failed to inform Centrelink that his partner’s income rose about $594.00 after 30 November 2004.  Had Mr O’Brien read the information on the back of the letter at T8 he would have known that he must inform Centrelink if her fortnightly income rose above $594.00.  He did not do so.  Mr O’Brien asserted that he had already informed Centrelink of that fact in his claim form (specifying her income as $350.00 per week) on 5 November 2004, and that is plainly the case.  I note in passing that the information on the back of the letter at T8 does not require Mr O’Brien to inform Centrelink about any change in his or his partner’s income, only if his income rose above $62.00 per fortnight, or his partner’s income rose above $594.00 per fortnight, or “if you or your partner’s income goes down”.

36.     Nevertheless, I am reasonably satisfied that the letter dated 30 November 2004 (T8) contained sufficient information to alert Mr O’Brien to the fact that Centrelink had made an error recording his partner’s fortnightly earned income.  On receipt of that letter and having previously been provided with information set out in the booklet at T3, I am satisfied that he either knew, or had reason to know, that information on which his parenting payments were based was incorrect.  He did nothing to address that circumstance. 

37.     The term ‘good faith’ has been considered in numerous decisions of the Courts and this Tribunal.  What is required is an assessment of the subjective state of mind of the person concerned (see Pledger v Secretary, Department of Family and Community Services (2002) FCA 1576 at [59]; Secretary, Department of Education, Employment, Training and Youth Affairs v Prince (1997) 152 ALR 127 at 129-130; Haggerty v Secretary, Department of Education, Training and Youth Affairs (2000) 31 AAR 529 at [16] and [17]). A person who turns a blind eye or who chooses to disregard something that is known to be incorrect wants for good faith (see Jazazievska v Secretary, Department of Family and Community Services (2000) 65 ALD 424 at [40]-[41]).

38. On that basis, I am satisfied that Mr O’Brien did not receive the amounts of parenting payment he was paid after 30 November 2004 in good faith. For that reason recovery of the proportion of Mr O’Brien’s overpayment debt that arose after 30 November 2004 cannot be waived pursuant to s 1237A of the Act.

39.     As I comprehend the Respondent’s case, as presented and as set out in the Secretary’s Statement of Facts and Contentions, it is not disputed that recovery of the proportion of Mr O’Brien’s debt that accrued prior to 30 November 2004 must be waived.  That conclusion is consistent with my own and I so find.

40. Are there sufficient grounds to waive recovery of the remaining amount of Mr O’Brien’s debt on the basis of special circumstances pursuant to s 1237AAD? I am satisfied that there are not. Mr O’Brien’s evidence was that his son, Dakota, had health problems during the period in question that required regular medical interventions, including hospitalisation and the insertion of a nasal feeding tube. Dakota’s ill-health was the cause of significant worry and stress for Mr O’Brien and Ms Abedin. However, other than that stress, both parents experience good health and Dakota’s health has subsequently improved. Eboni attends boarding school at Mossvale and assisted her parents as she could. She has good health.

41.     Mr O’Brien explained the financial circumstances of the family in some detail.  Plainly enough on his evidence there have been times when his financial circumstances have been straitened.  Nonetheless, the family has been able to cover their expenses on a week to week basis and their financial circumstances have improved since both Mr O’Brien and Ms Abedin are earning in employment.

42.     Having considered the evidence I am satisfied that there are no circumstances in this case that constitute ‘special circumstances’, that is circumstances that are unusual, uncommon or exceptional (Re Beadle v Director-General of Social Security (1984) 6 ALD 1) or that recovery of the debt would result in anything unfair, unjust or unreasonable (Groth v Secretary Department of Social Security (1995) 40 ALD 541).

43.     It follows, therefore, that there is no basis on which to waive the Commonwealth’s right to recover that part of Mr O’Brien’s debt arising from the erroneous PPP payments he received in the period from 30 November 2004 to 18 April 2005.

decision

44.     The decision under review is affirmed.

I certify that the 44 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member

Signed:     Peter Edwards

Associate

Date of Hearing  5 May 2006
Date of Decision  10 May 2006
Applicant  Unrepresented
Representative for the Respondent             Mr Andrew Zhang