Ollivier and Secretary, Department of Family and Community Services

[2004] AATA 1081

Administrative

Appeals

Tribunal

 

DECISION AND ORAL REASONS FOR DECISION [2004] AATA 1081

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No S2004/30

GENERAL ADMINISTRATIVE DIVISION		)
Re		ARNOLD OLLIVIER

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Senior Member WJF Purcell

Date11 October 2004

PlaceAdelaide

Decision For the reasons given orally at the Hearing of this matter, the Tribunal affirms the decision under review.

(Signed)

WJF PURCELL
  (Senior Member)

CATCHWORDS

SOCIAL SECURITY - pensions, benefits and allowances – Age Pension – compensation affected payment – should weekly compensation payments be treated as direct deduction –grounds for treating all or part of compensation payments as not having been made – decision affirmed

Social Security Act 1991 ss 17, 1173, 1184K

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

ORAL REASONS FOR DECISION

11 October 2004   Senior Member WJF Purcell

1.      This is an application for review of a decision of the Social Security Appeals Tribunal (the SSAT) of 19 November 2003, which affirmed the decision of an Authorised Review Officer of 9 October 2003, to treat ongoing compensation payments from the Department of Veterans’ Affairs (DVA) as a direct deduction against the applicant’s Age Pension entitlement.

2. The evidence before the Tribunal comprised the documents lodged pursuant to s 37 of the Administrative Appeals Tribunal Act1975 (the T documents). The applicant appeared on his own behalf.  Mr Kilderry represented the respondent (the Department).

3.      The applicant, who is 66 years of age, was injured whilst serving in the Australian Army as an ambulance driver between 1963 and 1966.  He has had ongoing problems with ulcers on his legs since Army doctors performed an operation on his legs for varicose veins.  Since 1982 he has been in receipt of continuous compensation payments from the DVA.  On 25 August 2003, his 65^th birthday, these payments were reduced from $514.28 to $128.57 per week gross.  This is the amount he will continue to receive from the DVA for the rest of his life.

4. On 25 August 2003 the applicant was granted Age Pension. In assessing his rate of payment of Age Pension, a decision was made on 26 August 2003, to treat his ongoing weekly compensation payment of $128.57, as a direct deduction from his rate of Age Pension, pursuant to s 1173 of the Social Security Act 1991 (the Act) which, as far as is relevant for the purposes of this review, provides:

“(1)     If:

(a)       a person receives periodic compensation payments; and

(b)the person was not, at the time of the event that gave rise to the entitlement of the person to the compensation, qualified for, and receiving, a compensation affected payment; and

(c)the person receives or claims a compensation affected payment in relation to a day or days in the periodic payments period;

the rate of the person’s compensation affected payment in relation to that day or those days is reduced in accordance with subsection (2).

(2)The person’s daily rate of compensation affected payment is reduced by the amount of the person’s daily rate of periodic compensation.

(3)The reference in subsection (2) to a daily rate of periodic compensation is a reference to the amount worked out by dividing the total amount of the periodic compensation payments referred to in paragraph (1)(a) by the number of days in the periodic payments period.

(4)       If:

(a)       a person receives periodic compensation payments; and

(b)at the time of the event that gave rise to the entitlement of the person to compensation, the person was qualified for, and was receiving, a compensation affected payment; and

(c)the person receives or claims a compensation affected payment in relation to a day or days in the periodic payments period;

the periodic compensation payments are to be treated as ordinary income of the person for the purposes of this Act.”

5. Section 17 of the Act provides:

“17(1)  In this Act, unless the contrary intention appears:

compensation has the meaning given by subsection (2).

compensation affected payment means:

(aa)     an age pension; or

…

17(2)    Subject to subsection (2B), for the purposes of this Act, compensation means:

(a)       a payment of damages; or

(b)a payment under a scheme of insurance or compensation under a Commonwealth, State or Territory law, including a payment under a contract entered into under such a scheme; or

(c)a payment (with or without admission of liability) in settlement of a claim for damages or a claim under such an insurance scheme; or

(d)       any other compensation or damages payment;

(whether the payment is in the form of a lump sum or in the form of a series of periodic payments and whether it is made within or outside Australia) that is made wholly or partly in respect of lost earnings or lost capacity to earn resulting from personal injury.”

6.      On 8 September 2003 the applicant requested a review of this decision.  In reconsidering the decision, the original decision-maker also gave consideration as to whether circumstances existed that made it appropriate to treat all or part of the compensation payments as not having been made, or not liable to be made; but concluded no such circumstances existed.  This decision was affirmed by an Authorised Review Officer, and then subsequently by the SSAT on 19 November 2003. 

7.      The SSAT, as part of its review, sought clarification of the applicant’s compensation entitlement from the DVA.  In a letter dated 17 November 2003 the DVA confirmed that the applicant has an accepted claim for compensation, and has been in receipt of incapacity benefit continuously since 1982; that the payments made to him are made under ss 132 and 134 of the of the Safety Rehabilitation and Compensation Act 1988; that the amount of the weekly payments, as from his 65^th birthday, was reduced to $128.57; that this rate of payment is frozen for life, and that the current payment is for economic loss. 

8.      The applicant has applied now to this Tribunal for review of the SSAT decision.  He attached an addendum to his application for review in the following terms:

“To whom it may concern

In 1980 I left my employ as state manager (metals div.) of Noyes Bros. Pty Ltd. because of the condition of my legs.  I missed out on 24 years of superannuation which would have been worth over 250,000 dollars at retirement.

Am I to receive no financial compensation for loss of income, for pain and suffering and for depleted use of my legs?

The D.V.A. pays me $128.57 per week because of loss of income.  Centrelink then denies me that income by reducing my pension by the same amount.  This is not fair.

I cannot walk for more than 200 metres without severe pain, and I am currently receiving ongoing medical treatment for infected ulcers on my leg.

I earnestly request in the name of fairness, that the Centrelink decision be reversed.”  [T1]

9. The applicant submits that he was forced to give up his job in 1980, and has not worked since. He has been dependent entirely on the DVA compensation payments. He now receives the same level of payment as any fit 66-year-old aged pensioner; whereas he is unable to do any extra jobs to earn extra money. He is thus disadvantaged as compared with other aged pensioners; and this is a special circumstance, and the discretion available pursuant to s 1184K(1) of the Act should be exercised in his favour. Section 1184K(1) of the Act provides:

“(1)For the purposes of this Part, the Secretary may treat the whole or part of a compensation payment as:

(a)       not having been made; or

(b)       not liable to be made;

if the Secretary thinks it is appropriate to do so in the special circumstances of the case.”

10.     The Department contends that the applicant's payments from the DVA are in the form of periodic payments, paid under a compensation scheme operating under Commonwealth law, and are paid wholly in respect of a loss of earning capacity as a result of the injury he suffered whilst in the Army.  For the purposes of the Act the applicant is in receipt of compensation.  He is in receipt of Age Pension, and is therefore in receipt of a "compensation affected payment".

11. The Department contends further, that the applicant commenced receiving period compensation payments in 1982. At that time, he was not in receipt of any compensation affected payments from the Department. He commenced receiving Age Pension, a compensation affected payment, as from 25 August 2003, and pursuant to s 1173 of the Act, his rate of Age Pension must be reduced by the amount of his weekly compensation payment, while both payments continue to be received.

12. Section 1184K of the Act, the Department submits, allows the Secretary to treat all or part of the compensation payment as not having been made, or not liable to be made if it is appropriate in the special circumstances of the case. The applicant’s circumstances cannot be considered so exceptional, uncommon or unusual to warrant this discretion being exercised.

13. I am satisfied that the payments of compensation the applicant receives from the DVA fall within the definition of "compensation" in accordance with s 17(2) of the Act. Age Pension is a "compensation affected payment", in accordance with s 17(1) of the Act; and s 1173 of the Act provides that the periodic compensation payments are to be treated as ordinary income for the purposes of the Act.

14. Turning to the question of whether it is appropriate that the discretion provided by s 1184K(1) of the Act should be exercised in the applicant's favour. In the matter of Re Beadle and Director-General of Social Security (1984) 6 ALD 1, the Tribunal said:

“An expression such as ‘special circumstances’ is by its very nature incapable of precise or exhaustive definition.  The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional.  Whether circumstances answer any of these descriptions must depend upon the context in which they occur.  For it is the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases.  This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.”

15.     The applicant is convinced that his circumstances are special and unique, in that his injury means that he cannot earn any additional income.  He is now 66 years of age, and receives the same rate of payment as any other aged pensioner in his financial circumstances; and he has continuing eligibility for free treatment for his accepted condition, through the DVA.  I do not consider that his circumstances are so unusual that they could be described as special.

16.     For these reasons the Tribunal affirms the decision under review.

I certify that the 16 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member WJF Purcell

Signed:         .....................................................................................
  Associate

Date of Hearing  11 October 2004
Date of Decision  11 October 2004
Counsel for the Applicant         In person
Solicitor for the Applicant          -
Counsel for the Respondent     Mr R Kilderry
Solicitor for the Respondent     Centrelink Service Recovery Team