Re Charan and Secretary, Department of Social Services
[2015] AATA 760
•29 September 2015
Charan and Secretary, Department of Social Services (Social services second review) [2015] AATA 760 (29 September 2015)
Division
GENERAL DIVISION
File Number
2015/2334
Re
Anuradha Charan
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
File Number
2015/2335
Re
Suresh Charan
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Deputy President J W Constance
Date 29 September 2015 Place Sydney
The decision under review, being the decision of the Social Security Appeals Tribunal to refuse Mr and Mrs Charan’s application for the age pension, is affirmed.
........................[sgd]................................................
Deputy President J W Constance
CATCHWORDS
SOCIAL SECURITY – age pension – International Agreement – whether residence requirements for age pension satisfied – extension of definition of resident – decision affirmed
LEGISLATION
Social Security Act 1991 (Cth) ss 7(2), 7(2A), 7(2D), 7(5),43
Social Security (International Agreements) Act 1999 ss 3, 6, Sch 3
CASES
Secretary, Department of Families, Housing, Community and Indigenous Affairs v Mahrous [2013] FCAFC 75
REASONS FOR DECISION
Deputy President J W Constance
29 September 2015
Mr and Mrs Charan lodged separate claims for the age pension in October 2014.
These claims were rejected by Centrelink on the ground that Mr and Mrs Charan did not satisfy the residence requirements for the grant of the pension. This decision was affirmed by an Authorised Review Officer and then by the Social Security Appeals Tribunal.
Mr and Mrs Charan have applied to this Tribunal for a review of the decision of the Social Security Appeals Tribunal.
For the reasons which follow, the decision under review will be affirmed.
BACKGROUND
Mrs Charan was born on 27 January 1946. Her husband, Mr Charan, was born on 22 February 1943. Each was born in Fiji.
On 1 January 2005, Mrs Charan moved to New Zealand. Mr Charan joined her not long after on 30 June 2005.
Subsequently, Mrs Charan relocated to Australia on 14 February 2014, with Mr Charan joining her on 5 March of that year. Both Mr and Mrs Charan arrived in Australia on, and continue to hold, a subclass 444 special category visa.
LEGISLATION
The grant of age pension is governed by the Social Security Act 1991 (Cth). Section 43 of the Act provides in part:
(1) A person is qualified for an age pension if the person has reached pension age and any of the following applies:
(a) the person has 10 years qualifying Australian residence;
(b) the person has a qualifying residence exemption for an age pension;
...
Section 7(5) of the Act stipulates that a person has 10 years of qualifying residence “if and only if” the person meets either of the following requirements:
(a) the person has, at any time, been an Australian resident for a continuous period of not less than 10 years; or
(b) the person has been an Australian resident during more than one period and:
(i) at least one of those periods is 5 years or more; and
(ii) the aggregate of those periods exceeds 10 years.
An Australian resident is defined in section 7(2). It provides:
An Australian resident is a person who:
(a) resides in Australia; and
(b) is one of the following:
(i) an Australian citizen;
(ii) the holder of a permanent visa;
(iii) a special category visa holder who is a protected SCV holder.
A protected SCV holder is defined in sections 7(2A) to 7(2D) of the Act. In very general terms, those subsections each require a person to have been residing in Australia, or in Australia on a special category visa, on 26 February 2001.
Mr and Mrs Charan seek to qualify for the pension pursuant to the operation of the Social Security (International Agreements) Act 1999. That Act provides that the provisions of international agreements which are included as schedules to the Act have effect despite anything in the Commonwealth social security law.[1]
[1] Subsection 6(1)
Section 3 of the Social Security (International Agreements) Act 1999 provides:
(1) Unless a contrary intention appears, an expression that is used in the Social Security Act 1991 has the same meaning, when used in this Act, as in the Social Security Act 1991.
(2) A reference in this Act (other than the reference in section 4) to the social security law is a reference to this Act, the Social Security Act 1991 and any other Act that is expressed to form part of the social security law.
Schedule 3 of the Act contains the relevant agreement between Australia and New Zealand. Article 12 of that Agreement provides:
1. Where a person to whom this Agreement applies has claimed an Australian benefit under this Agreement and has accumulated:
(a) a period as an Australian resident that is less than the period required to qualify that person, on that ground, under the social security law of Australia for a benefit;
(b) a period of working age residence in Australia equal to or greater than the period identified in accordance with paragraph 3; and
(c) a period of working age residence in New Zealand.
then:
That period of working age residence in New Zealand shall be deemed to be a period in which that person was an Australian resident only for the purposes of meeting any minimum qualifying periods for that benefit set out in the social security law of Australia.
2. Where a person's period of working age residence in Australia and a period of working age residence in New Zealand coincide, the period of coincidence shall be taken into account once only by Australia for the purposes of this Article as a period as an Australian resident.
3. The minimum period of working age residence in Australia to be taken into account for the purposes of subparagraph 1(b) shall be 12 months, of which at least 6 months must be continuous.
...
5. A claimant for an age pension must be at least 65 years of age to be able to obtain the benefit of this Article.
It is important to note that clause 6 of Part B of the Agreement amends the operation of 12(3) as follows:
Article 12 of the Agreement is amended by deleting paragraph 3, and substituting the following paragraph:
"3. The minimum period of Australian working age residence to be taken into account for the purposes of paragraph 1(b) shall be as follows:
(a) for the purposes of an Australian benefit payable to a person residing outside Australia, the minimum period shall be one year of which at least 6 months must be continuous; but
(b) for the purposes of an Australian benefit payable to an Australian resident, there will be no minimum period."
Working age residence is defined in Article 5(5) as;
"working age residence" in relation to a person means a period of residence between the ages of 20 and 64 years inclusive (being a maximum of 45 years) but does not include any period deemed pursuant to Article 8 or Article 12 to be a period in which that person was an Australian resident or a New Zealand resident.
THE ARGUMENT OF MR AND MRS CHARAN
Mr and Mrs Charan agree that when their New Zealand residence is combined with their Australian residence, they have accumulated 10 years of residence.
I accept the figures in the below table provided by Mr Charan as correct:
Mrs Charan
Total Days
Mr Charan
Total Days
Period of residence in New Zealand
1 January 2005 to 14 of February 2014
3331
30 June 2005 to 4 April 2014
3200
Period in Australia
15 February 2014 to 1 January 2015
320
5 April 2014 to 30 June 2015
452
It is claimed that the Tribunal should consider Mrs Charan’s time in Australia and New Zealand up until 1 January 2015. This was the date on which it was intended for her claim to take effect. Similarly, it is argued that Mr Charan should be granted the age pension from 1 July 2015.
Mr Charan argues that article 5(1) of the Social Security (International Agreements) Act 1999 operates to deem residence in New Zealand as residence in Australia. Accordingly, he and his wife meet the 10 year residence requirement in accordance with the above table.
With respect to Article 12, and the issue of whether only working age residence can be counted, Mr Charan states that residence should be counted up until the date an application is made. Subsection 7(5) of the Social Security Act defines the 10 year residence requirement as requiring a person to have continuously been an Australian resident at any time. Should there have been a restriction on the period to be calculated this should have been expressly stated in the Agreement.
It is argued that as Mr and Mrs Charan are deemed to be Australian residents under Article 5, they do not attract the operation of Article 12(1) as they had fully met the residence requirements for the grant of age pension under the Social Security Act 1991 (Cth). Article 12(1)(a) provides that Article 12 will apply only where a person has:
(a) a period as an Australian resident that is less than the period required to qualify that person, on that ground, under the social security law of Australia for a benefit;
Therefore, in the view of Mr and Mrs Charan, Article 12 has no application.
CONSIDERATION
It is clear that, considering the Social Security Act 1991 (Cth) alone, Mr and Mrs Charan do not meet the residence requirements for the grant of age pension. They were not Australian citizens, holders of a permanent visa or protected SCV visa holders for a continuous period of 10 years. As such, if I applied the Social Security Act 1991 (Cth) in isolation, they would not qualify for the age pension.
The Social Security (International Agreements) Act 1999 operates to modify the operation of the Australian social security law to enable people, who would not otherwise qualify, to qualify for social security payments where they are covered by one of a number of international agreements. These agreements are incorporated as schedules to the Act.
Section 6 of the Act provides that:
(1) The provisions of a scheduled international social security agreement have effect despite anything in the social security law.
(2) Subsection (1) applies to a provision of an agreement only in so far as the provision is in force and affects the operation of the social security law.
(3) If:
(a) immediately before he or she reaches pension age, a person is receiving a social security payment (other than age pension) solely because of the operation of a scheduled international social security agreement; and
(b) on reaching pension age, the person becomes qualified for age pension because of the operation of paragraph 43(1)(c) of the Social Security Act 1991 ;
the age pension is taken to be payable to the person under the agreement referred to in paragraph (a).
The Full Court of the Federal Court discussed the operation of section 6 in Secretary,Department of Families, Housing, Community and Indigenous Affairs v Mahrous.[2] The Court stated in part:[3]
Section 6 of the International Agreements Act provides that the provisions of scheduled agreements, such as the Agreement with which this appeal is concerned, “have effect despite anything in the social security law”, although “only in so far as the provision is in force and affects the operation of the social security law”. As already noted, the term “social security law” includes the Social Security Act and the Administration Act. Hence, by virtue of s 6 of the International Agreements Act, where the provisions of the agreement are in force and affect the provisions of the Social Security Act or the Administration Act (or, indeed, any other part of the social security law), the provisions of the agreement override the provisions of those enactments. The effect of s 6 of the International Agreements Act is, in this way, to enact the overriding provisions of the Agreement as part of the law of Australia.
Only certain provisions of the Agreement are enacted as part of Australian law. Thus, s 6 does not enact as part of Australian law a provision of the Agreement that does not affect the operation of a social security law, such as a provision solely directed to the obligations of State parties to one another in their capacity as State parties.
[2] [2013] FCAFC 75.
[3] [2013] FCAFC 75, at para [39-40].
Article 5 operates to extend the definition of Australian resident in the Social Security Act, for the purposes of the Social Security Agreement. The definition is extended to include a New Zealand citizen who is not the holder of an Australian permanent visa but is lawfully residing in Australia. Article 5(1) provides:
"Australian resident" has the meaning given to that term in the social security law of Australia but for the purposes of the Agreement also includes a New Zealand citizen who is not the holder of an Australian permanent visa but is lawfully residing in Australia. In deciding whether a person is residing in Australia, regard must be had to the following factors:
(a) the nature of the accommodation used by the person in Australia;
(b) the nature and extent of the family relationships the person has in Australia;
(c) the nature and extent of the person's employment, business or financial ties with Australia;
(d) the nature and extent of the person's assets located in Australia;
(e) the frequency and duration of the person's travel outside Australia; and
(f) any other matter relevant to determining whether the person intends to remain permanently in Australia;
and "residence in Australia" has a corresponding meaning.
The Secretary’s position is that Article 5(1) does not render the Applicants “Australian residents” for the purposes of the Social Security Act. The Agreement modifies the operation of section 7(2) of the Act “for the purposes of the Agreement”.
Article 12 operates to allow an applicant’s residence in New Zealand to be counted towards the fulfilment of residence obligations for the grant of an Australian social security payment. Article 12(1) provides that the deeming provisions apply where, amongst other criteria, a person has accumulated “a period as an Australian resident that is less than the period required to qualify that person, on that ground, under the social security law of Australia for a benefit”. The extended definition of Australian resident would appear to apply here. Consequently, if a New Zealand citizen residing in Australia meets the extended definition in Article 5 for a continuous period of 10 years, they would necessarily fall outside this provision. They would also simultaneously fail to meet the residence requirements in the Social Security Act as they are not a citizen, permanent resident or a protected SCV visa holder.
It appears perverse that a New Zealand citizen who is not a permanent resident but living and working in Australia, would not qualify by virtue of the operation of the International Agreement, but someone in the same position but living and working in New Zealand would.
Although raising an interesting question, it is not necessary for me to decide it in this case. Should Mr and Mrs Charan’s argument be correct and a person can qualify as an Australian resident under the Act by virtue of Article 5, it would not benefit Mr and Mrs Charan as they were not Australian residents for the required 10 year period.
Article 5(1) does not deem all New Zealand residents to be Australian residents. Nor does it render all periods of residency in New Zealand as periods of residency in Australia. The Article clearly states that it extends the definition of an Australian resident to include New Zealand citizens who are “lawfully residing in Australia”.
It is accepted by Mr and Mrs Charan that the Agreement does not modify the requirement that a person must have “10 years qualifying Australian residence” in order to qualify for age pension. Taking into account the extended definition of Australian resident, the question is whether Mr and Mrs Charan were lawfully residing in Australia for such a period. The fact that the Charans currently meet the expanded definition of Australian resident is not determinative of whether they were Australian residents previously. They must be held to have been lawfully residing in Australia for the required period, having regard to the factors noted in the subparagraphs to Article 5(1).
On the evidence before me, Mr and Mrs Charan were residing in New Zealand from 2005 to early 2014. They worked in New Zealand and lived there permanently. It was not suggested, beyond the argument that Article 5 deems their New Zealand residence to be Australian residence, that they were in fact living in Australia. I can see no reason to regard Mr and Mrs Charan as residing anywhere other than New Zealand in the period before they arrived in Australia. As such, they could not be regarded as residing in Australia whilst they were in New Zealand.
Accordingly, Mr and Mrs Charan were not Australian residents within the definition in Article 5(1) before they moved to Australia in 2014. They cannot therefore rely upon Article 5 to satisfy the 10 year residence requirement for the grant of age pension.
Article 12 provides for residence in New Zealand to be considered towards the residence requirements for age pension. Article 12(1), however, only permits “working age residence” to be counted. That is made clear in the provision, which states in part:
1. Where a person to whom this Agreement applies has claimed an Australian benefit under this Agreement and has accumulated:
(a) a period as an Australian resident that is less than the period required to qualify that person, on that ground, under the social security law of Australia for a benefit;
(b) a period of working age residence in Australia equal to or greater than the period identified in accordance with paragraph 3; and
(c) a period of working age residence in New Zealand.
then:
... That period of working age residence in New Zealand shall be deemed to be a period in which that person was an Australian resident only for the purposes of meeting any minimum qualifying periods for that benefit [emphasis added]
Working age residence is defined as residence between the ages of 20 and 64, inclusive.
The Article could not be clearer in its terms that it is only working age residence which can be deemed to be Australian residence. Mr Charan referred to Article 12(5), which states that “A claimant for an age pension must be at least 65 years of age to be able to obtain the benefit of this Article”. In referring back to the Article, the subparagraph merely seeks to limit the circumstances in which an applicant for age pension can benefit from the deeming provisions, in that an applicant must be over the age of 65. It does not change the substance of those provisions, but merely stipulates when an applicant for age pension can benefit from them.
Turning to the operation of the Article, as Mr and Mrs Charan did not have a period of Australian residency equivalent to that required for grant of the age pension, they meet sub-paragraph (a). Mr and Mrs Charan do not require a minimum period of working age residence. The question therefore is whether the Charans have a sufficient period of working age residence in New Zealand such that, when combined with their Australian residence, they will qualify for the age pension.
Mr Charan turned 65 on 22 February 2008. Mrs Charan did so on 26 January 2011. As Article 12(1) only relates to working age residence, any residence in New Zealand after this period cannot be considered.
Taking this into account, Mrs Charan had approximately 73 months of working age residence at the date of her claim. Combined with her Australian residence, this gives her a period of 80 months. This is considerably less than the 10 years or 120 months required before an individual is eligible for the age pension.
Mr Charan had approximately 32 months of working age residency in New Zealand. Combined with his five months of residency in Australia at the time of claim, he falls even further short of the aggregate period of 10 years required under the Act.
I note that when they lodged their claims, Mr and Mrs Charan sought payment of the age pension from a date in the future. This was the date on which they expected to qualify for the age pension, being 1 January 2015 for Mrs Charan and 30 June 2015 for Mr Charan. This ignores the provisions with respect to the start date of payments under social security law. Clause 4 of Schedule 2 of the Social Security (Administration) Act provides:
Start day--early claim
(1) If:
(a) a person (other than a detained person) makes a claim for a relevant social security payment; and
(b) the person is not, on the day on which the claim is made, qualified for the payment; and
(c) assuming the person does not sooner die, the person will, because of the passage of time or the occurrence of an event, become qualified for the payment within the period of 13 weeks after the day on which the claim is made; and
(d) the person becomes so qualified within that period;
the claim is taken to be made on the first day on which the person is qualified for the social security payment.
Eligibility is assessed at the date of claim or in the thirteen weeks thereafter. In the case of Mr Charan, had I accepted his argument, he would still not have achieved 10 years qualifying residence until June 2015. This is almost some 9 months after the date on which his claim was lodged. He could not therefore have qualified for the age pension with respect to this present claim.
CONCLUSION
For the above reasons, the decision under review will be affirmed.
I certify that the preceding 46 (forty –six) paragraphs are a true copy of the reasons for the decision herein of Deputy President J W Constance ..................................[sgd]......................................
Associate
Dated 29 September 2015
Date of hearing On the papers Date final submissions received 24 August 2015 Applicants In person Solicitors for the Respondent R Kougellis, of Department of Human Services
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