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

Pierre and Secretary, Department of Social Services (Social services second review) [2021] AATA 2931 (18 August 2021)
Division:GENERAL DIVISION
File Number(s): 2019/2276
Re:Laval Pierre
APPLICANT

AndSecretary, Department of Social Services
RESPONDENT

DECISION
Tribunal:Senior Member A Poljak
Date:18 August 2021
Place:Sydney

The decision under review is affirmed.
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Senior Member A Poljak
CATCHWORDS
SOCIAL SECURITY – age pension – where the applicant’s compensation payments increased three times during the relevant period – whether the payments are periodic compensation – whether special circumstances exist to treat the whole or part of the payments as not having been made – whether the applicant was overpaid age pension during the relevant period – whether the debt can be waived or written off – decision under review affirmed
LEGISLATION
Social Security Act 1991 (Cth) ss 17, 1160, 1161, 1173, 1184K, 1184K, 1223, 1236, 1237A, 1237AAD
Social Security (Administration) Act 1999 (Cth) s 68
CASES
Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25
Beadle v Director-General of Social Security (1985) 60 ALR 225
Drake v Minister for Immigration and Ethic Affairs (1979) 2 ALD 60
Hogan v Secretary, Department of Employment, Education and Workplace Relations [2011] AATA 162
Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126
SECONDARY MATERIALS
Social Security Guide Instruction 4.13.4.20 – Factors to consider when determining special circumstance provisions
REASONS FOR DECISION
Senior Member A Poljak
18 August 2021

Mr Pierre, the applicant, is in receipt of the age pension (AP). The applicant has previously been in receipt of Newstart allowance from 23 August 2000 to 24 July 2001; Newstart allowance from 22 August 2001 to 14 January 2002; Newstart allowance from 30 January 2002 to 12 February 2002; and Disability support pension from 12 February 2002 to 4 December 2011.
From the year 2000, the applicant has been in receipt of compensation payments from the Dust Disease Board (DDB). From 16 November 2004, these payments were considered in calculating the applicant’s AP benefits. On 25 October 2018, the applicant provided details which showed the applicant’s rate of payments had increased to $179.10 from 26 July 2013; $470.20 from 13 May 2015; and $961 from 12 April 2016. The Secretary contends that prior to this, the applicant had failed to advise Centrelink of any increases to his compensation payments.
The applicant seeks review of a decision made by the Administrative Appeals Tribunal’s Social Services and Child Support Division (SSCSD) on 13 March 2019 (decision under review). The decision affirmed the decisions made by the Secretary, Department of Social Services (Secretary) to reduce the applicant’s rate of age pension; and raise and recover an age pension debt of $30,742.49 for the period from 26 July 2013 to 29 October 2018.
Issues
The issues for determination in this matter are:
(a)whether the applicant is being paid the correct rate of age pension, this requires consideration of:
(i)whether the applicant’s payments from the DDB have been correctly assessed as periodic compensation; and
(ii)whether it is appropriate in the special circumstances of the case to treat the whole or part of a compensation as not having been made.
(b)whether the applicant was overpaid age pension in the amount of $30,742.49 during the period from 26 July 2013 to 29 October 2018; and
(c)whether there is any basis to write off or waive part or all of the debt resulting from the overpayment.
Relevant Legislative Provisions
Part 3.14 of the Social Security Act 1991 (Cth) (the Act) includes provisions that deal with compensation payments. Section 1160 provides:
1160 General effect of Part
(1) This Part operates in certain specified circumstances to do one or more of the following;
(a) reduce a person's compensation affected payment;
(b) render a person's compensation affected payment not payable;
(c) require the repayment of some or all of a person's compensation affected payment;
because of the receipt of compensation by the person or the person's partner.
(2) This Part applies whether or not there is any connection between the circumstances that give rise to the person's qualification for the compensation affected payment and the circumstances that give rise to the receipt of compensation by the person or the person's partner.
Section 1161 relevantly provides:
1161 Application of Part
(1) Subject to subsections (2) to (6A), payments of a compensation affected payment are affected under this Part if:
…
(b) in the case of any other kind of compensation affected payment, the compensation was received on or after 1 May 1987 and the claim for the compensation affected payment was made on or after 1 May 1987.
…
Section 17 of the Act defines ‘compensation affected payment’ and ‘compensation’ as:
17 Compensation recovery definitions
(1) In this Act, unless the contrary intention appears:
compensation has the meaning given by subsection (2).
Note: See also section 1163B.
compensation affected payment means:
…
(aa) an age pension; or
(a) a disability support pension; or
…
(c) a social security benefit; or
…
Compensation
(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. (emphasis added)
Section 1173 of the Act provides as follows:
1173 Effect of periodic compensation payments on rate of person’s compensation affected payment
(1) If:
(a) a person receives 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.
Consideration
The applicant’s age pension is a ‘compensation affected payment’ as defined by subsection 17(1) of the Act and is subject to Part 3.14. There is no dispute that the applicant is currently in receipt of fortnightly payments made by the DDB under the New South Wales iCare scheme (iCare), currently at a rate of $961 per fortnight.
The applicant’s disability has been assessed by iCare at 100% from 12 April 2016. The applicant’s periodic compensation payments are made, at least partly, having regard to his lost capacity to earn. Accordingly, the applicant’s payments fall within the definition of ‘compensation’ under subsection 17(2) of the Act. The date of the applicant’s compensable injury occurred on 27 June 2001. On this date, the applicant was in receipt of newstart allowance. As such, the applicant’s periodic compensation is to be assessed as ordinary income in accordance with subsection 1173(4) of the Act.
Unless the applicant is found to have ‘special circumstances’ in accordance with section 1184K of the Act, his periodic compensation must be assessed under section 1173 of the Act. Relevantly, section 1184K provides:
1184K Secretary may disregard some payments
(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.
The term ‘special circumstances’ is not defined in the Act. What may amount to special circumstances has been considered in a number of cases in the Federal Court and in the Tribunal. It has been generally accepted by this Tribunal that special circumstances are those that are unusual, uncommon or exceptional, making the case markedly different from the usual run of cases.
In Beadle v Director-General of Social Security (1985) 60 ALR 225, the Full Court did not think it possible to lay down precise limits or rules to circumscribe the discretion of the decision maker when considering whether special circumstances exist. Rather, the Court said that what constitutes special circumstances in any particular case is a matter for the Departmental head having regard to the purpose for which the power is given. However, because no precise limits or rules can be set, whether or not a particular kind of circumstance could (not should) be considered special is not merely a matter for the administrative decision maker.
14. In Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25, Besanko J considered the observations in Beadle at first instance that special
circumstances are those that are ‘unusual, uncommon or exceptional.’ His Honour opined at [33] that it:
… was not the intention of Parliament to confine the exercise of the discretion to
an exceptional case. There is less risk of overstatement if the words ‘unusual’ or
‘uncommon’ are emphasised.
Generally, in Hogan v Secretary, Department of Employment, Education and Workplace
Relations [2011] AATA 162 at [82] it was held that in determining whether ‘special circumstances’ exist the Tribunal has ‘a broad discretion to respond to a wide variety of circumstances’.
The applicant contends that his medical condition and financial circumstances amount to special circumstances.
The applicant’s Asbestos Related Pleural Disease is verified in the reports of Dr Corte of 18 November 2019 and Dr Baker dated 29 May 2001. It is a serious medical condition that has a significant impact on the applicant. This is accepted by the Secretary.
However, noting that the applicant receives periodic fortnightly compensation of $961 per fortnight in respect of this condition, the Instruction 4.13.4.20 – Factors to consider when determining special circumstance provisions of the Social Security Guide (the Social Security Guide) provides that in relation to ill health, an injury that a person received compensation for cannot generally be regarded as a special circumstance. The Social Security Guide should be applied unless it is inconsistent with the provisions or objectives of the Act; Drake v Minister for Immigration and Ethic Affairs (1979) 2 ALD 60.
Regarding the applicant’s financial circumstances, he claims that since his age pension has reduced, he is struggling financially to pay his bills and buy food. He says that he needs the full AP to ‘make ends meet’. The applicant says that because of his medical condition, he needs to employ carers to shower him, cook and do all his shopping, cleaning, and washing. He says he spends $480 per week ($960 per fortnight) on carers consisting of:
(a)Two women who come four times per week for four hours who assist the applicant in showering, cleaning, changing his bed linen, shopping and cooking; and
(b)One man who comes once or twice per week for one to two hours who looks after his garden.
The applicant currently receives an income of $1,496.74 per fortnight, consisting of periodic compensation payments of $961, and age pension of $535.74 (after $15 is deducted to repay his debts). The applicant’s fortnightly income is substantially more than standard age pensioners, and more than age pensioners in receipt of the same amount of compensation but subject to the direct deduction test under subsection 1173(2) of the Act.
The applicant does not utilise subsidised government services, such as home care packages available through aged care because he claims he has had bad experiences with Home Care NSW, including being robbed three times. There is no objective evidence, such as police reports or complaints to Home Care NSW, of these incidents occurring.
At hearing, when questioned about whether he had made any recent enquiries about obtaining a home care package such as a ‘high level care package’ for approximately $150.50 a fortnight, the applicant said he had not as he did not want any strangers in his house. He said that when he had previously had care from NSW Health, his carers were different people every time and he ‘had too many problems’. He said he was fearful of obtaining care through a government agency. While I can understand that the applicant may have some trepidation about receiving care through a government agency, it has been some time since he accessed such services and he may have positive experience through the service in the future. The ‘high level care package’ can include daily visits at a very reasonable price. The services are available to many Australians and there is no evidence to suggest that the care provided is unsuitable or unethical.
I have considered the matters raised by the applicant in respect of special circumstances and I do not consider them sufficiently unusual, exceptional, or uncommon to warrant use of the discretion contained in section 1184K of the Act.
Overpayment
From 26 July 2013 to 29 October 2018, the applicant was paid age pension based on receiving periodic compensation payments of $84.90 per fortnight. On 25 October 2018, the applicant provided details from iCare which showed the applicant’s rate of payments had increased to $179.10 from 26 July 2013; $470.20 from 13 May 2015; and $961 from 12 April 2016.
On the basis that the correct amount of the applicant’s periodic compensation payments were not taken into account, debt calculations were completed that showed the applicant had been overpaid age pension in the amount of $30,742.49 during the period from 26 July 2013 to 29 October 2018.
The overpayment of $30,742.49 of age pension to the applicant constitutes a legally recoverable debt under subsection 1223(1) of the Act.
Can the Debt Be Waived or Written Off?
Section 1236 of the Act sets out circumstances in which a debt may be written off. There is no evidence that the applicant’s debt is irrecoverable at law or that he has no capacity to repay the debt given that his whereabouts are known. The applicant is currently repaying his debts at a rate of $15 per fortnight withheld from his age pension.
Subsection 1237A(1) of the Act provides:
Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt.
For the debt to be waived under section 1237A of the Act, it must be found that the debt was caused solely by administrative error; see Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126 at [35].
There is no evidence that the applicant ever advised Services Australia that his periodic compensation payments increased, even though they increased on three separate occasions in 2013, 2015 and 2016. This is despite the applicant receiving numerous notices under section 68 of the Social Security (Administration) Act 1999 (Cth) advising him to inform Services Australia if his circumstances changed. As such, the debt has not arisen due to the Departments sole administrative error and therefore cannot be waived under section 1237A of the Act.
Section 1237AAD of the Act provides:
The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:
(a) the debt did not result wholly or partly from the debtor or another person knowingly:
(i) making a false statement or a false representation; or
(ii) failing or omitting to comply with a provision of this Act, the Administration Act or the 1947 Act; and
(b) there are special circumstances (other than financial hardship alone) that make it desirable to waive; and
(c) it is more appropriate to waive than to write off the debt or part of the debt.
Each of the three limbs of the section must be satisfied before the debt may be waived.
The applicant did not receive the payments in ‘good faith’. The applicant’s compensation increased three times during the debt period but he did not advise Centrelink on any occasion. The Secretary contends a reasonable person would have expected their increased compensation to decrease their rate of their social security payment, especially in circumstances where the applicant was notified on numerous occasions to advise Centrelink of his income and compensation.
There are no special circumstances that would make it desirable for the applicant’s debt to be waived. There is no harsh or unfair outcome produced in expecting the applicant to repay this overpayment of AP. The applicant can repay his debt through deductions from his AP, and the deduction amount can be negotiated with the Debt Management Team. The applicant is currently repaying his debt at a rate of $15 per fortnight deducted from his age pension. These are reasonable deductions.
There is no evidence to support the proposition that it would be more appropriate to waive the applicant’s debt compared to writing it off. Paragraph 1237AAD(c) of the Act is not satisfied.
Decision
The decision under review is affirmed.

I certify that the preceding 36 (thirty-six) paragraphs are a true copy of the reasons for the decision herein of Senior Member A Poljak

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Associate
Dated: 18 August 2021

Date of hearing: 2 February 2021

Applicant: Self-represented

Solicitors for the Respondent: Ms E Ulrick, Services Australia

[2021] AATA 2931

18 August 2021

Key Legal Topics

Areas of Law

Administrative Law

Statutory Interpretation

Legal Concepts

Judicial Review

Statutory Construction

Remedies

Appeal

Date of hearing:	2 February 2021
Applicant:	Self-represented
Solicitors for the Respondent:	Ms E Ulrick, Services Australia