Re Males and Secretary, Department of Family and Community Services
[1999] AATA 863
•24 July 2015
Williams and Secretary, Department of Social Services (Social services second review) [2015] AATA 544 (24 July 2015)
Division General Division File Number
2015/0934
Re
Brett Williams
APPLICANT
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Senior Member A C Cotter
Date 24 July 2015 Place Brisbane The decision under review is set aside. In substitution, the Tribunal decides, under s 1184K of the Social Security Act 1991 (Cth), that so much of the compensation payment is to be treated as not having been made so as to ensure that the preclusion period ends as of the date of this decision.
...............................[SGD].......................................
Senior Member A C Cotter
CATCHWORDS
SOCIAL SECURITY – lump sum workers’ compensation payment – preclusion period – whether special circumstances exist to justify the exercise of the discretion to disregard all or part of the compensation payment being made – compensation payments spent – applicant’s circumstances ‘special’ – decision under review is set aside.
LEGISLATION
Social Security Act 1991 (Cth), ss 17, 1169, 1170, 1184, 1184A, 1184K
CASES
Director-General of Social Services v Hales (1983) 47 ALR 281
Ivovic and Director-General of Social Services (1981) 3 ALN 61
Males and Secretary, Department of Family and Community Services [1999] AATA 863
Martin and Secretary, Department of Social Security [1990] AATA 768
Rankin; Department of Family and Community Services [1999] AATA 496
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Secretary Department of Social Security and Winterbotham [1990] AATA 808
Secretary, Department of Social Security and VYS [1995] AATA 371
Secretary, Department of Social Security v Hales (1998) 51 ALD 695
Secretary, Department of Social Security v Hulls (1991) 22 ALD 570
Secretary, Department of Education Employment and Workplace Relations [2008] AATA 619
REASONS FOR DECISION
Senior Member A C Cotter
24 July 2015
INTRODUCTION
When Brett Williams received a payout from the settlement of his workers’ compensation claim in November 2012, he did what most people would do. He paid off his debts and outstanding loans. He was also generous to his family, buying cars for his two daughters and his sister, and helping them financially. At the same time, he spent money having repairs done to his own car.
By May the following year, however, he realised that much of the payout had gone. Estimates now put him as having at that time approximately $80,000.00 remaining from a net payout of about $200,000.00. That was of concern to him as he was still suffering from a number of medical conditions which prevented him from working. He also knew that he could not count on receiving social security benefits for some considerable time. That was because, on receiving his workers’ compensation settlement, a preclusion period was applied by Centrelink which effectively excluded him from receiving such benefits until February 2016.
Faced with that realisation, he turned to gambling in an attempt to “strike it lucky”. He failed. By August 2014, his settlement proceeds were exhausted and he had accumulated fresh debt. He turned to Centrelink, applying for the Disability Support Pension (“DSP”) in September that same year. Predictably, that claim was declined because he was still within the preclusion period.
Under the relevant legislation, the Secretary of the Department of Social Services has discretion, if it is thought appropriate to do so in the “special circumstances” of the case, to effectively reduce the length of the preclusion period, either partly or completely.
Neither an Authorised Review Officer nor the Social Security Appeals Tribunal (“SSAT”) were of the opinion that such special circumstances existed, and confirmed Centrelink’s refusal of the DSP claim. Mr Williams seeks a review of the SSAT’s decision.
The central issue for determination by me is whether there are any “special circumstances” in Mr Williams’ case which would justify the exercise of the discretion. Before dealing with that issue, there is a threshold question to be considered – whether the length of the preclusion period has been correctly calculated and whether the start and end dates of the period have been correctly determined. It is also timely to reflect briefly on the legislative context and relevant provisions.
THE LEGISLATIVE FRAMEWORK
Briefly, the Social Security Act 1991 (Cth) (“the Act”) sets up a scheme which provides that if a person receives a “compensation affected payment”[1] (which relevantly includes, for present purposes, DSP and Newstart Allowance), and they receive a lump sum payment by way of compensation for past or future loss of income as a result of a personal injury, the compensation affected payment is not payable to the person in relation to any days during what is called the “lump sum preclusion period”.[2] The length of the preclusion period is determined by the amount of compensation received and is calculated under s 1170 of the Act. In effect, the scheme is aimed at excluding the payment of Centrelink benefits during the period for which the recipient or applicant has received separate compensation in respect of lost income.
[1] See s 17(1) of the Act.
[2] See s 1169 of the Act.
If any compensation affected payments are made during the preclusion period, they are recoverable under ss 1184 and 1184A of the Act.
Under s 1184K of the Act, the Secretary may, where there are “special circumstances” in a particular case, treat part or all of the compensation monies as not having been made. That has the effect of reducing the length of the preclusion period.
CONSIDERATION
The Length and Determination of the Preclusion Period
Although he questioned the calculation of the preclusion period, Mr Williams did not specifically challenge it. The Secretary maintained that the calculation of 201 weeks was correct.
Having reviewed the material produced to me, I am satisfied that the length of the preclusion period was correctly calculated. Mr Williams settled his claim for $300,000.00 clear of the WorkCover Queensland (“WorkCover”) refund.[3] The total payments made by WorkCover to that time (and in respect of which it would otherwise have been entitled to a refund out of the settlement proceeds) were $72,145.55,[4] which effectively made the “gross” settlement $372,145.55. Of the amount paid by WorkCover during the course of the claim, $30,103.33 was paid as periodic compensation payments.[5] That figure is to be deducted from the gross settlement amount,[6] which equates to (for the purposes of the calculation) the total amount of the lump sum compensation payment as $342,042.22. That figure is in turn to be divided by half to derive the compensation part,[7] giving a figure of $171,021.11. Under s 1170(4) of the Act, that figure is then to be divided by the “income cut-out amount”[8] to determine the number of weeks’ duration of the preclusion figure. Using the divisor of $848.60,[9] a figure of 201.53 weeks results, which is then rounded down to 201 weeks.[10]
[3] Exhibit 1, T Documents, T5, f33.
[4] Exhibit 1, T Documents, T5, f38. There is a slight discrepancy between the figures mentioned in the Release and Discharge (Exhibit 1, T-Documents T5, ff 34-36) and the actual payments recorded by WorkCover; it is not material. For present purposes, I have relied on the latter figures.
[5] Exhibit 1, T Documents, T5, f38.
[6] See s 17(4) of the Act.
[7] See s 17(3) of the Act.
[8] See s 17 (1) and s 17(8) of the Act.
[9] The divisor at the applicable date of 1 July 2012: Exhibit 1, T Documents, T15, f170.
[10] See s 1170(5) of the Act.
Under s 1170(1) of the Act, the preclusion period is taken to begin on the day following the last day of the periodic payments period, which was 30 March 2012.[11] Therefore, the preclusion period commenced on 31 March 2012 and ends on 5 February 2016. I therefore accept that the preclusion period commencement and conclusion dates have been correctly determined.
[11] Exhibit 1, T Documents, T6, f54.
Before I leave this issue, I should also address the calculation of the compensation charge. Mr Williams received Newstart Allowance payments from 31 March 2012 to 16 November 2012, totalling $9,518.72.[12] As Newstart Allowance is a “compensation affected payment” and as it was paid during the preclusion period, it was a recoverable amount under ss 1184 and 1184A of the Act. That amount was therefore properly refunded to Centrelink[13] in November 2012.
[12] Exhibit 1, T Documents, T16, f177.
[13] Exhibit 1, T Documents, T 16, f178.
Are there “special circumstances” in this case?
Mr Williams gave evidence at the hearing. Essentially, his claim of special circumstances was based on a combination of health and financial hardship issues, as well as a claim that he was not properly advised by his lawyers. I summarise in some detail below what he told me, before considering whether the circumstances of his case are sufficiently “special” to justify the exercise of the discretion under s 1184K of the Act.
Mr Williams’ evidence
Mr Williams was injured at work in 2011. That followed an earlier injury in 2009. Both injuries were the subject of workers’ compensation claims, with the settlement being in respect of both claims – those being back and neck injury claims. When he entered into the settlement, Mr Williams had the intention of returning to employment.
In June 2012, a few months before his settlement, he suffered his first heart attack. That was followed by a second attack some six to eight months later. Following that attack, he moved to the Gold Coast to be with one of his daughters and her partner. When asked what effect his heart attacks had on him, Mr Williams said that he was prescribed medication and told to keep his stress at manageable levels. He said that he experiences weakness in his legs and tiredness.
While at the Gold Coast, he started to experience further neck pain. He consulted a local doctor who referred him for a CT scan which revealed degenerative disc disease and spondylotic changes.[14] He was subsequently put on the waiting list for treatment at the Gold Coast Hospital. Due to his several changes of address, Mr Williams did not receive the notice of his appointment at that hospital in time, and his name was removed from the waiting list. As a result, that condition remains untreated and it continues to cause him pain.
[14] Report of Dr David Homewood (South Coast Radiology) dated 5 March 2014. Exhibit 1, T Documents, T10, ff145-146.
Later in 2014, Mr Williams also started to experience further pain in his lower back. A CT scan of the lumbosacral spine revealed disc protrusion with likely impingement on the left L4 and L5 nerve roots.[15]
[15] Report of Dr Mark Ready (Queensland X-Rays) dated 29 August 2014. Exhibit 1, T Documents, T10, f137.
The neck and back complaints referred to in the preceding paragraphs appear to have formed the basis for Mr Williams’ claim for DSP, which is at the centre of this application.[16]
[16] See Medical Report of Dr Marlene Schulz dated 1 September 2014. Exhibit 1, T Documents, T10, ff126-136.
Mr Williams also reported suffering depression, especially after his second heart attack. In particular, he said that he was hospitalised for a period in about September 2014 after threatening suicide. He saw his doctor in about October or November 2014 who prescribed Valium, and referred him to a psychiatrist. He has done nothing about that referral as yet, because he is continually moving residence.
Besides his back and neck conditions and depression, Mr Williams told me he suffers from a haemorrhoid condition.
During cross-examination, Mr Williams was questioned in detail about how his compensation monies were spent.
From the $300,000.00 compensation funds he received, close to $100,000.00 went in paying legal costs and refunds. He paid his lawyers approximately $50,000.00 and paid Medicare a refund of about $37,000.00, in addition to the compensation charge of $9,518.72 refunded to Centrelink, leaving him with approximately $200,000.00. He received those funds in about November 2012.
Mr Williams was asked whether he received from Medicare any refund of the monies paid to it. He said that he did not, but had since wondered about that, given that he had also paid a refund to WorkCover. He had discussed that with his daughter, but had not raised it with Medicare directly or with his lawyers (although he recalls them saying to contact them if he needed their assistance on that matter). He did, however, ask Centrelink if it could put him in touch with a financial adviser. Nothing appears to have come of that.
Mr Williams reiterated what he told the SSAT about the early expenditure of funds.[17] He spent about $5,000.00 buying furniture for rental premises that he moved into at Woodridge with one of his daughters and her family in November 2012. Cars for both his daughters were purchased for approximately $18,000.00 in total in about December 2012, with another car bought for his sister for $2,000.00 in the following January. He spent some $5,000.00 in April 2013 on repairs to his own car. By about April 2013, he paid off some $30,000.00 in debts (including an amount of $16,000.00 to GE Money). His share of the rental at the Woodridge premises was $250.00 per fortnight. Mr Williams told the SSAT that he also bought birthday and Christmas presents for family members and helped his daughters out with money when they needed it. Notwithstanding that initial bout of expenditure, he agreed that by about April 2013 he still had approximately $100,000.00 left.
[17] See Reasons for Decision of SSAT dated 20 January 2015, paragraph [9]. Exhibit 1, T Documents, T2, ff7-8.
It was around that time that he received a call from Centrelink to remind him about the preclusion period. Centrelink had previously written to Mr Williams at the time of settlement[18] and again on 2 May 2013,[19] advising him of the preclusion period and its operation. Mr Williams denied receiving the letters (presumably because of his change of address). He did, however, recall receiving a phone call from Centrelink concerning the preclusion period. He said that, at the time, he had been experiencing pain and had a headache, that he had taken pain killers, and had been asleep before the phone call. On receiving the call, he became depressed and angry and recalls hanging up on the Centrelink officer. He admitted, however, that he knew at that time that no further money would be coming from Centrelink until at least after the preclusion period had ended.
[18] See Centrelink letters to Mr Williams dated 19 November 2012. Exhibit 1, T Documents, T19, ff222-225.
[19] See Centrelink letter to Mr Williams dated 2 May 2013. Exhibit 1, T Documents, T19, ff220-221.
When asked whether he thought at the time about how his compensation monies might last, Mr Williams responded that he became depressed. He was experiencing more pain and started drinking and gambling in the hope that he might “strike it lucky and survive until 2016”. Nevertheless, he continued to help his daughters and sister, giving or lending them somewhere in the vicinity of $20,000.00. He agreed that by around May 2013 he had about $80,000.00 left.
Mr Williams finally ran out of money in August 2014 when his Commonwealth Bank accounts were overdrawn. It was put to him, and he agreed, that this meant that he spent the remaining $80,000.00 in the 15 months from May 2013.
When asked about his expenses in that period, Mr Williams estimated that his monthly living expenses were about $1,300.00 to $1,500.00, which included $500.00 for rent, $400.00 for food, $100.00 to $200.00 for medication, $120.00 for Foxtel and $80.00 for his phone. Over 15 months, he agreed that would have totalled approximately $20,000.00 to $22,000.00. He said that he also continued to help his daughters, estimating that he would have given them another $10,000.00 in total. When asked where the balance of his monies (estimated at about $50,000.00) went, Mr Williams replied that it must have gone on drinking and gambling.
Questioned on his assets, Mr Williams said that he owns a car but it is not roadworthy. He estimates it will cost $1,000.00 to $2,000.00 to repair and then be deemed roadworthy, and that it will then be worth about $4,000.00 to $5,000.00. He does not believe that he could ask his daughters to repay some of the monies he gave them. He is not on speaking terms with one daughter, Joalah, who has moved back to be with her mother in Mackay. The other daughter’s car needs repairs as it had been in an accident.
His medications now cost him about $60.00 to $80.00 per month. His daughter helps him to some extent and he relies on food vouchers from church groups. In November 2014, he was evicted from his rental property at Slacks Creek and has since been “couch surfing”,[20] or “living on couches”,[21] at the homes of family and friends. His daughter Naomi, who has a two year old child, was herself recently evicted from her Gold Coast premises and has been staying temporarily with a friend who has allowed Mr Williams to stay also, but under the house; Ms Williams pays the rent for them both,[22] even though she is on a single parent’s pension.
[20] Exhibit 2, page 3.
[21] Exhibit 1, T Documents, T2, f7.
[22] Letter from Ms Naomi Williams to Tribunal (undated). Exhibit 2.
During his oral evidence, Mr Williams also said that he has been “misinformed legally” about his situation. He said that the lawyers who represented him in his workers’ compensation case did not want him to talk to other employees about his accident. He also said that when the settlement was being finalised for his neck injury, the lawyers also had him sign a document (presumably the Release and Discharge) saying that he had no further claim in respect of his back injury, for which a nominal amount was assigned.
What are “special circumstances”?
As mentioned earlier, s 1184K of the Act provides that the Secretary may treat the whole or part of a compensation payment as not having been made if the Secretary “thinks it is appropriate to do so in the special circumstances of the case”. The expression “special circumstances” is not defined in the Act. It has, however, been the topic of much consideration by the Tribunal and the courts, whether in the context of s 1184K or the provisions of other legislation where the same term has been employed. While it is acknowledged that the concept of “special circumstances” is broad[23] and difficult to define exhaustively or with precision, it is often taken as referring to circumstances which are “unusual, uncommon or exceptional” which make the case “markedly different from the usual run of cases”; they must have a particular quality of unusualness that permits them to be described as “special”.[24]
[23] See Secretary, Department of Social Security v Hales (1998) 51 ALD 695, 702.
[24] See Re Beadle and Director-General of Social Security (1984) 6 ALD 1.
In Ivovic and Director-General of Social Services,[25] the Tribunal made it clear that in exercising a discretion such as that conferred by s 1184K of the Act, the decision-maker:
[M]ust have regard to whether, by exercising the discretion in a particular case, he will be achieving or frustrating ends or objects which are conformable with the scope and purpose of the Social Services Act 1947.[26]
[25] (1981) 3 ALN 61.
[26] This passage was cited with approval in the unreported decision of Ivovic at [45], and considered to apply with equal force and effect to the Act by O’Loughlin J. in Secretary, Department of Social Security v Hulls(1991) 22 ALD 570, 580-581.
In that context, the Secretary’s representative referred me to the Tribunal’s decision in Re Secretary Department of Social Security and Winterbotham,[27] as highlighting the principle underlying the compensation provisions contained in the Act, that persons who receive lump sum compensation payments are expected to support themselves from their own resources for a period before seeking support from the taxpayer:
This particular piece of legislation… was aimed specifically at preventing those people receiving compensation for loss of income because of incapacity for work, from being able also to receive benefit from the public purse… Primary responsibility for the payment of such compensation lies at the feet of those responsible for the compensable injury. Once that responsibility has been met, by way of a settlement sum agreed to by both parties, it is inequitable for the recipient to seek supplementary funds from the tax-payer.[28]
[27] [1990] AATA 808.
[28] [1990] AATA 808 at [19].
Are Mr Williams’ circumstances “special”?
Mr Williams’ contention, that special circumstances exist in his case, was essentially based on three interrelated factors: the inadequacy of his legal advice; his ill health; and the financial hardship he is experiencing, and will continue to experience. I deal with each of those factors below.
Inadequacy of legal advice
Mr Williams’ evidence on this factor was brief. It focused, not on any advice given (or not given) in relation to the length of the preclusion period, its start and end dates or its implications for him, but rather, on unrelated matters concerning contact with witnesses and the extension of the Release and Discharge to cover both his back and neck injuries. No documentary evidence was produced in support of the assertions, nor was any reason advanced as to why the advice was incorrect or inadequate. It is therefore difficult to take these matters any further. In any event, they appear to have no bearing on what Mr Williams might have understood about the preclusion period and its operation.
Ill health
It is not in dispute that Mr Williams suffers from a variety of medical conditions. Not long after his settlement, he began experiencing increased neck pain and in 2014, he noticed further pain in his lower back. He continues to suffer from a haemorrhoid condition. He has had two heart attacks since 2012 and has been suffering depression for some time.
Although ill health may have a major bearing on the particular circumstances, it is often remarked that the state of ill health should be more severe than that suffered by the majority of DSP recipients; it is not uncommon for those recipients themselves to suffer from a variety of health complaints.
While Mr Williams complained of increasing neck and then back pain post-settlement, and underwent further CT scans for each, it appears, from the medical evidence available, that they are the same complaints for which he was paid compensation in 2012. The report prepared by Mr Williams’ general practitioner, Dr Marlene Schulz, in support of his DSP claim notes the date of onset of the cervical spine compression as 2011 and gives the history as “cervical problems due to work cover [sic] injury”.[29] The onset date of the lumbar nerve compression is shown as 2010.[30] As those conditions were already the subject of the compensation claim, they cannot also be regarded as a “special” circumstance to disregard, or partially reduce the length of, the preclusion period.
[29] Report of Dr Marlene Schulz dated 1 September 2014. Exhibit 1, T Documents, T10, ff129, 131.
[30] Report of Dr Marlene Schulz dated 1 September 2014. Exhibit 1, T Documents, T10, f132.
The report of Dr Schulz is also significant, in that she lists Mr Williams’ first heart attack as another medical condition which is “generally well managed and that cause(s) minimal or limited impact on ability to function”.[31] That is reinforced by the clinical notes from the Princess Alexandra Hospital, which she attached to her report and which noted that Mr Williams had “recovered well”.[32] They place Mr Williams’ heart condition as first arising prior to his compensation settlement and being generally well managed. Although Mr Williams suffered another heart attack some six to eight months later, no medical evidence was produced relating to it. All that is known is what Mr Williams stated in oral evidence, that he was prescribed medication and was told to keep his stress at a manageable level. He complained of tiredness, chest pains and weakness in his legs as a result of his heart condition. It therefore seems to me that his heart condition was something neither unusual nor unexpected which would qualify as “special circumstances.” The same applies to his long standing haemorrhoid condition which the Princess Alexandra Hospital clinical notes list as going back to 2003,[33] and which did not rate a mention of any significance from Dr Schulz.
[31] Report of Dr Marlene Schulz dated 1 September 2014, page [10]. Exhibit 1, T Documents, T10, f135.
[32] Clinical notes of the Princess Alexandra Hospital. Exhibit 1, T Documents, T10, ff138-144.
[33] Clinical notes of the Princess Alexandra Hospital. Exhibit 1, T Documents, T10, f138.
Mr Williams produced no medical evidence of his depression, his suicide threat or his subsequent hospitalisation. While I do not doubt that he suffered from depression and was an inpatient for a period, without any objective medical evidence, it is difficult for me to conclude that this factor was so unusual or uncommon as to make it markedly different from the usual run of cases. DSP recipients, due to their medical, financial and family circumstances, commonly suffer stress and anxiety which may readily translate to depression.
Finally, I note that despite Mr Williams having been placed on the Gold Coast Hospital waiting list and despite having received a referral from Dr Schulz to a psychiatrist, he has seemingly taken no steps to seek specialist treatment for his ailments. Although I appreciate that Mr Williams had his own reasons for not pursuing those avenues, that failure on his part makes it difficult for me to conclude that his circumstances are unusual or uncommon when compared with other DSP cases.
I therefore consider there is no reason, on health grounds, to contend that Mr Williams’ circumstances are “special”.
Financial hardship
Mr Williams’ compensation monies were exhausted by August 2014. Having sold some furniture and personal effects, he has no other immediately realisable assets[34] and is seriously overdrawn on his bank and credit card accounts, as well as having other debts. His daughters were able to help out to some degree with food and money for medications, but they themselves are on single parent’s pensions. He was forced to accept food vouchers from charities. He has no place of residence and is “couch surfing”.
[34] His car needs repairs of about $1000.00 to $2000.00 before it can be made roadworthy.
In determining whether financial hardship amounts to “special circumstances”, the Tribunal has often considered the reasonableness of the applicant’s action in disposing of the compensation monies.[35]
[35] See, for example, Martin and Secretary, Department of Social Security [1990] AATA 768 at [10].
In Mr Williams’ case, three specific matters deserve comment.
First, it is obvious that Mr Williams was particularly generous to his family. Within a month or so of receiving his funds, he had bought both of his daughters cars and purchased the furniture for rental premises he was to share at Slacks Creek with one of them and her then partner. A car for his sister quickly followed. Christmas and birthday presents were bought. Well into 2013, he helped out his daughters and sister by giving them or lending them substantial sums of money.
Second, although he did not receive Centrelink’s letters about the preclusion period, Mr Williams was well aware of it and its implications for him. Despite that, he continued to spend his compensation monies rather than take steps to conserve them or put in place a financial plan or budget. He turned down or ignored offers of assistance, hanging up on the Centrelink officer who phoned him. He did not pursue the line of inquiry as to whether any refund would be available from Medicare.
Third, knowing full well that the funds had dissipated significantly and that there was a need to make them last, he embarked on what could be described as a gambling spree, effectively losing the balance of his funds in a relatively short space of time. The representative for the Secretary helpfully referred me to two decisions of the Tribunal which represent different treatments of the dissipation of funds due to gambling. In Males and Secretary, Department of Family and Community Services,[36] the discretion was exercised in the applicant’s favour in circumstances where he was addicted to gambling and had consulted a psychologist and psychiatrist, as well as a counsellor, about his affliction. That is to be contrasted with the approach taken in Rankin; Department of Family and Community Services.[37] In that matter, the Tribunal decided not to exercise the discretion in favour of an applicant, whose gambling spree “(fell) short of insanity”, and rather was the result of a deliberate and somewhat reckless course of conduct. There is no suggestion here that Mr Williams was suffering from some psychiatric condition or that he was subject to some particular vulnerability when he commenced his gambling. Nor is there any evidence of a predisposition to gambling. On the contrary, his oral evidence suggested that it was the result of a conscious decision on his part. Confronted with the reality that he had minimal funds left, he hoped that he might strike it lucky and be able to survive.
[36] [1999] AATA 863.
[37] [1999] AATA 496.
In short, Mr Williams is the author of his own misfortune. Ignoring the warnings as to the need for financial prudence, he made deliberate, and in some respects, foolhardy, decisions for which he now pays the price. I therefore do not consider that his financial circumstances are so “special” as to justify treating the whole of his compensation payment as not having been made. The question is whether the resulting circumstances justify a partial reduction in the preclusion period.
What became apparent during the hearing is that the “landscape” of Mr Williams’ daily life has changed significantly in recent times, leaving his position increasingly uncertain. While it appears that earlier in the preclusion period, both of Mr Williams’ daughters had their own rental premises and that, at different times, he lived with each of them and shared the rent and other expenses, that situation has now come to a halt. In November 2014, Mr Williams was evicted from the Slacks Creek premises he previously shared with one of his daughters, Joalah. He is estranged from that daughter, as she has moved to Mackay to be with her mother; there is no current prospect of receiving support or assistance from her. His other daughter, Naomi, was also evicted from her Gold Coast rental premises. She currently has no premises of her own, renting for herself and her two year old child a room in a friend’s house on a temporary basis (three to four weeks). She has arranged for Mr Williams to stay there for a short time; he resides under the house. Naomi, who is on a single mother’s pension, pays the rent and buys some food, with her father receiving food vouchers. It is unclear for how long that situation will last, and what Mr Williams, his daughter and grandchild will do next.
While it is not unusual for DSP recipients to be impecunious and in straitened circumstances,[38] I am also conscious of the line of Tribunal decisions to the effect that it is inappropriate to require people to take a “one way ticket to poverty” before they can qualify for a social security payment.[39]
[38] See Director-General of Social Services v Hales (1983) 47 ALR 281 at [321], per Sheppard J.
[39] See Secretary, Department of Social Security and VYS [1995] AATA 371 at [48].
I am inclined to agree with the position adopted by Senior Member Isenberg in O’Neill and Secretary, Department of Education Employment and Workplace Relations.[40] In that case it was acknowledged that allowing the shortening of a preclusion period following reckless spending may invite others to do likewise, and as such is likely to cause public outcry.[41] However, the Tribunal considered this to be moderated by the fact that it is “equally true that the public would be concerned to learn that Mr O’Neill has been forced into a life on the streets, because there is no other option available to him.”[42] It was therefore found in that case that the destitute circumstances in which the applicant found himself possessed “the particular quality of unusualness that permits them to be described as special”,[43] and the preclusion period was brought to an end.
[40] [2009] AATA 619.
[41] Ibid at [46].
[42] Ibid at [46].
[43] Ibid at [47].
On those bases I consider that the circumstances of financial hardship in which Mr Williams now finds himself, with no clear future in the short to medium term, amount to “special circumstances” which justify a short reduction in the preclusion period. That would enable him to at least move from the subsistent existence he presently has. I am also comfortable that this compromise does not offend the general philosophy of the scheme which I outlined earlier; a partial reduction in the preclusion period, for compassionate reasons, would not diminish, or detract from, the legislative intent behind the scheme.
I therefore propose to exercise the discretion in s 1184K of the Act, such that part of Mr Williams’ compensation payment, being an amount which would result in his preclusion period ending on the date of this decision, be treated as not having been made.
CONCLUSION
The decision under review is set aside. In substitution, I decide that the preclusion period ends as of the date of this decision. Accordingly, so much of the compensation payment is to be treated as not having been made so as to ensure that the preclusion period ends on this date.
I certify that the preceding 57 (fifty -seven) paragraphs are a true copy of the reasons for the decision herein of Senior Member A C Cotter ................................[SGD]....................................
Associate
Dated 24 July 2015
Date of hearing 12 June 2015 Applicant In person Advocate for the Respondent Mr R McQuinlan, Department of Human Services
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