Phillips and Secretary, Department of Social Services (Social services second review)

This matter concerned an appeal by Mr. Phillips against a decision by the Secretary of the Department of Social Services to raise a debt against him. The dispute centred on whether the Department had erred in calculating this debt, which arose from underreported income. Mr. Phillips contended that any discrepancy was due to a sole administrative error within Centrelink. The case was heard by P J Clauson SM.

The primary legal issue before the Tribunal was whether the Secretary was obliged to waive the recovery of the debt under section 1237AD of the Social Security Act 1991 (Cth). This section allows for waiver in special circumstances, provided the debt did not result from the applicant knowingly making a false statement or failing to comply with a legislative provision. Mr. Phillips argued that the debt arose from administrative error, implying that he had not acted knowingly or failed to comply.

The Tribunal considered Mr. Phillips' evidence that his wife, Patricia Phillips, had always reported her earnings by telephone to Centrelink. He stated he did not report her earnings as he had no income of his own and believed the error lay elsewhere within Centrelink, not with the employee who extracted the figures. Mr. Phillips relied on past experiences of Centrelink errors, including a disputed loan and instances where his pension was cancelled due to administrative issues. However, the Tribunal found that Mr. Phillips acknowledged his wife might have provided incorrect information and did not dispute the Department's calculations as being factually correct, but rather attributed the error to Centrelink's internal processes. The Tribunal concluded that Mr. Phillips had not established that the debt arose from a sole administrative error in the manner required to compel a waiver under section 1237AD.

The Tribunal affirmed the decision of AAT1, dated 27 March 2019, which had also upheld the Department's decision to raise the debt.