Pekar and Secretary, Department of Family and Community Services and Indigenous Affairs

[2007] AATA 1008

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 1008

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2006/42

GENERAL ADMINISTRATIVE DIVISION		)
Re		FRANK PEKAR

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Mr M Griffin

Date12 January 2007

PlaceSydney

Decision The decision under review is affirmed.

.................[sgd].............................

Mr M Griffin
  Member

CATCHWORDS

SOCIAL SECURITY - Assurance of Support - income thresholds for single and married assurers - minimum taxable income threshold not met – no exercise of the discretion - decision under review affirmed

LEGISLATION

Social Security Act 1991, Chapter 2C

Social Security (Assurances of Support) Determination 2004

Guide to Social Security Law

REASONS FOR DECISION

12 January 2007	Mr M Griffin
Introduction

1.        Mr Pekar seeks review of a decision of the Social Security Appeals Tribunal (‘SSAT’). The SSAT decision affirmed a decision made by an Authorised Review Officer (‘ARO’) to reject Mr Pekar’s application to be an assurer and provide an Assurance of Support (‘AoS’) for his wife.

History

2.        Mr Pekar is 67 years of age. He is in receipt of the age pension. He married Mrs Pekar in Thailand in July 2004. On 18 July 2005, the Australian Embassy in Thailand wrote to Mrs Pekar advising her that she was required to provide an acceptable AoS to be considered eligible for the grant of a Visa subclass 309 to enter Australia.

3.        On 20 July 2005 Mr Pekar contacted Centrelink and asked for information about providing AoS. An application form and information pack was sent to him the same day, which stated an income test on the assurer was required.  The annual minimum income required at that time was $18,044 for a single assurer and $33,361 for a married assurer.

4.        Mr Pekar lodged the application on 2 August 2005 declaring his annual income to be ‘approx 16500 per annum inclusive foreign pension’ (Mr Pekar receives an Austrian pension in addition to the Australian age pension). The application was refused by Centrelink because Mr Pekar did not meet the annual income threshold of $18,044. The refusal decision was made on the day the application was lodged by Mr Pekar, that is, on 2 August 2005. A written notice of that decision was sent to Mr Pekar on 2 August 2005. That letter expressly refers to the single income threshold of $18,044. It also advises Mr Pekar that he can make a further application if he ‘can find an Assurer whose income can be combined with yours to meet the required amount. There may be up to 3 Assurers per application.’

5.        At the hearing Mr Pekar told me he had been given conflicting information by Centrelink officers about the income threshold.  He said he was told he did not meet the married assurer threshold of $33,361. He said if he had been told of the lower single assurer minimum then he could have met that with the assistance of a friend who had offered to be a co-assurer. Mr Pekar said the decision was based on the much higher married threshold.  He said he could not meet that higher threshold even with the help of his friend.  He said Centrelink was in error because they made the decision based on the higher amount.  The Centrelink file records show that Mr Pekar received advice from Centrelink officers at different times as to whether he had to meet the single amount or the higher married amount (from file note of 22 July 2005 at T7). 

6.        Indeed, the original decision maker wrote to Mr Pekar one week after the refusal decision, following his request for reconsideration and in that letter referred to the higher threshold of $33,361. In his review decision the ARO stated ‘[a]s a matter of policy, it had been determined in your case that the higher income limit should apply…I have not reviewed whether this is correct, as your income is below either limit, including if the special income limit is considered.’  The ARO quoted from the Guide to Social Security Law as follows: ‘If the potential assurer does not meet the income level requirements, but is within 10 per cent of it, consideration may be given to any assets and liabilities that the potential assurer may have…at least $25,000 per adult assuree.’  The ARO concluded ‘I am satisfied that your income is below the allowable 10% and that you do not have $25,000 readily available.’ The ARO quoted an incorrect figure of $28,252 for the single income threshold. However the ARO’s notes attached to her decision quote the correct single income threshold of $18,252 and demonstrate her calculation of the 10% ‘special income limit’.

Relevant Legislation

7.        Chapter 2C of the Social Security Act 1991 (‘the Act’) and the Social Security (Assurances of Support) Determination 2004 (‘the Determination’) deal with the administration of AoS.

8. The SSAT decided that Mr Pekar was to be treated as a single person for the purposes of the income threshold assessment, pursuant to the discretion provided in section 24 of the Act. The SSAT quoted from the Guide to Social Security Law as follows: ‘A significant body of case law has established that the inability to pool resources is a “special reason” to exercise the discretion in section 24.’ On the evidence, at the time of his application Mr Pekar was in Australia and Mrs Pekar was in Thailand and their ability to pool resources was limited. I find that the facts support the exercise of the discretion to treat Mr Pekar as a single person for the income threshold.

9. Section 11 of the Determination sets out the criteria for meeting the income threshold requirement. The section requires the person to meet the applicable income requirement for the current financial year and two previous years. Section 11(4) states: ‘For the purpose of establishing that the person meets the income requirement for each previous financial year, the person must give to the Secretary a notice of assessment issued by the Australian Taxation Office in relation to the person and the year.’

10. Section 14 provides for the exercise of the discretion referred to as the ‘special income limit’ by the ARO and which she quoted as a 10% test from the Guide to Social Security Law. The section does not refer to a percentage as such but provides ‘[i]f the person’s taxable income for a financial year is less than but close to the amount required…and the person is likely to have the financial capacity to meet any liability arising under section 1061ZZGG…the person is taken to meet the income requirement…the person’s assets and liabilities may be taken into account.’

Evidence

11.      The uncontested evidence is that Mr Pekar has not provided any notices of assessment issued by the Australian Taxation Office.  Mr Pekar said his pension income was tax exempt and he did not have to lodge tax returns. He said it was unfair to low-income people to have such a requirement. The ‘current financial year’ for this application was 2005/2006. The SSAT estimated Mr Pekar’s taxable income for that year at $16,245.85.  Mr Pekar did not contest that estimate. That figure gives rise to a shortfall of almost $2000 below the single assurer’s income threshold.  As to assets and liabilities, the evidence is that Mr Pekar owns his own home, has about $2000 in savings and has no significant debts. 

12. However, the evidence is that Mrs Pekar, who now lives in Australia with her husband, is not working and that Mr Pekar must support them both from his limited pension income. Mr Pekar told me he could not afford to be an assurer for his wife to cover any social security benefits she may receive (see section 1061ZZGG of the Act which refers to social security payments the assuree may claim during the two year AoS period). The evidence is that Mrs Pekar began to receive social security payments following her arrival in Australia, although Mr Pekar says these payments have now ceased.

Findings

13.      The AoS provisions require evidence of taxable income to be provided by the applicant in the form of a notice of assessment issued by the Australian Taxation Office.  I find that Mr Pekar has not met that requirement.

14. The AoS provisions require an applicant to meet a minimum taxable income threshold for the current and two previous financial years. I find that Mr Pekar has not met that requirement. The provisions allow for the exercise of a discretion where the applicant’s income is less than but close to the threshold minimum. I find that because Mr Pekar’s estimated income is almost $2000 below the threshold, it is not close to the minimum amount required. Taking into account his assets and liabilities, I find that he would not likely have the capacity to meet any liability arising under section 1061ZZGG of the Act. I find that the section 14 discretion should not be exercised in these circumstances.

15.      Mr Pekar, on the evidence, did receive inconsistent advice from Centrelink Officers about the income threshold that would be applied to his application to provide an AoS for his wife. That is unfortunate. Nevertheless, the original decision sent to him did refer to the lower threshold and advise him of the opportunity to make a further application with a co-assurer. He did not take that action.  In any event, his wife joined him in Australia on a subclass 309 Visa and they now live together in his home.

16.      Despite the conflicting advice from Centrelink Officers as to which threshold income amount applied to him, I find on the evidence that at the relevant time Mr Pekar did not meet the statutory requirements to provide an AoS.

Decision

17.      The decision under review is affirmed.

I certify that the 17 preceding paragraphs are a true copy of the reasons for the decision herein of Mr M. A. Griffin, Member

Signed:          K. Portus

Associate

Dates of Hearing  15 December 2006
Date of Decision  12 January 2007
Appearance for Applicant               Self-represented        

Advocate for the Respondent        Ms P. Sharma of Centrelink Legal Services