Re Myddleton and Department of Family and Community Services
[2001] AATA 2
•5 January 2001
DECISION AND REASONS FOR DECISION [2001] AATA 2
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2000/1381
GENERAL ADMINISTRATIVE DIVISION )
Re John Henry Myddleton
Applicant
And Secretary, Department of Family and Community Services
Respondent
DECISION
Tribunal Ms SM Bullock, Senior Member
Date5 January 2001
PlaceSydney
Decision The decision under review is affirmed.
..............................................
Ms SM Bullock
Senior Member
CATCHWORDS
SOCIAL SECURITY - Special Benefit - Sufficient Livelihood - Policy Guidelines
Social Security Act 1991, sections 729
Re Watts and Director-General of Social Security (1984) 6 ALN N201
Re Takacs and Director-General of Social Services (1982) 4 ALN N234a
Re Baptist and Director-General of Social Security (1984) 5 ALN N492b
Re Drake and Minister for Immigration and Ethnic Affairs ( No 2) (1979) 2 ALD 634
Re Champion and Secretary, Department of Social Security (1996) 44 ALD 472
Re Hagedorn and Secretary Department of Social Security (1996) 43 ALD 187
Re Te Velde and Director-General of Social Services (1981) 3 ALN N111
Re Thompson and Secretary, Department of Social Security (1990) 20 ALD 578
Re Secretary, Department of Social Security and Porter (1997) 48 ALD 343
Re Hawkins and Secretary, Department of Social Security (1996) 44 ALD 651
Re Blackburn and Director-General of Social Services (1982) 4 ALN N76
REASONS FOR DECISION
Ms SM Bullock, Senior Member
This is an application for review to the Administrative Appeals Tribunal ("the Tribunal") by Mr John Henry Myddleton ("the Applicant") of a decision of the Social Security Appeals Tribunal ("the SSAT") made on 24 July 2000 (T2). The SSAT affirmed a decision of an Authorised Review Officer ("ARO") of the Department of Family and Community Services made on 13 June 2000, not to grant Mr Myddleton Special Benefit (T14). The original decision not to grant Special Benefit was made by a delegate of the Secretary, Department of Family and Community Services on 17 May 2000 (T12).
A hearing was held before the Tribunal in Sydney on 9 November 2000. The Applicant was too ill to attend the hearing and was represented by his wife, Mrs Sarah Myddleton, who also provided oral evidence to the Tribunal. The Respondent, the Secretary, Department of Family and Community Services ("the Department") was represented by Mr A Cox, Departmental Advocate. The Tribunal took into evidence documents lodged pursuant to Section 37 of the Administrative Appeals Tribunal Act 1975 ("T Documents" – T1-T17) and the following exhibits:
Exhibit Description Date
A1 Self Care/Home Unit Occupancy Agreement – The Aubrey Downer Memorial Orange Homes for the Aged and Invalid 16 June 1997
A2 Contract for Sale of Land 24 August 2000
R1 Respondent's Statement of Facts and Contentions 8 November 2000
R2 Extract from "Guide to the Social Security Law – 1.1.S.170, 1.1.L.90, 3.7.1.50, 3.7.1.70, 1.1.E.140
Issues
The issue in this matter is whether Mr Myddleton is qualified for Special Benefit and specifically, whether Mr Myddleton's circumstances make it appropriate to exercise the discretion to pay Special Benefit as allowed for by subsection 729(1) of the Social Security Act 1991.
LegislationQualification for Special Benefit is contained within section 729 of the Social Security Act 1991 ("the Act"). As relevant, subsection 729(1) states:
"729.(1) A person is qualified for a special benefit for a period if the Secretary determines, in accordance with subsection (2), that a special benefit should be granted to the person for the period.
Note: special benefit is a discretionary benefit and is available only to a person who is not able to get any other income support payment (see paragraphs (2)(a) and (b) below)."
As relevant, subsection 729(2) of the Act states:
"729.(2) The Secretary may, in his or her discretion, determine that a special benefit should be granted to a person for a period if:
(a)no social security pension is payable to the person during the period; and
(b)no other social security benefit is payable to the person for the period; and…
(e)the Secretary is satisfied that the person is unable to earn a sufficient livelihood for the person and the person's dependants (if any) because of age, physical or mental disability or domestic circumstances or for any other reason; and
(f) the person:
(i) is an Australian resident; or
(ii) has a qualifying residence exemption for special benefit; or
(iii)is the holder of a subclass 820 visa—Extended eligibility (spouse); or
(iv) is the holder of a subclass 826 visa—Interdependency; or
(v)becomes the holder of a visa that is in a class of visas determined by the Minister for the purposes of this paragraph; and
(fa) the person is in Australia throughout the period; and
Note 1: for "Australian resident" see subsection 7(2).
Note 2: For 'qualifying residence exemption' see subsection 7(6).
Note 3: Repealed by No. 5, 1997, s. 5, Sch. 5(4)."…"
Background
The information contained in this section is provided by way of background and the facts contained herein are not in dispute.
Mr Myddleton was born on 28 January 1910.
He married his wife, Sarah, on 7 October 1952 (T9, p25) and Mr and Mrs Myddleton have one daughter who lives in Sydney.
On 30 April 1997, Mr and Mrs Myddleton migrated to Australia from South Africa (T6), Mr Myddleton having been granted a Permanent Resident Visa on 4 February 1997 (T6, p17).
On 17 April 2000, a Medical Summary prepared by Dr Kwok K Ho indicated that Mr Myddleton first came under Dr Ho's care in June 1997. In August 1997, Dr Ho noted that Mr Myddleton had a seizure and was diagnosed as suffering from epilepsy. Mr Myddleton then had frequent falls due to his unsteady gait and a combination of old age, arthritis and inattention. Dr Ho noted that in June 1999, "definite dementia set in" and further, in December 1999, Mr Myddleton had a very bad fall, suffering a head injury and a fractured femur. Mr Myddleton was subsequently hospitalised, then underwent rehabilitation and was eventually discharged to Wyoming Nursing Home (T8).
On 10 April 2000, the Commonwealth Department of Health and Aged Care wrote to Mrs Myddleton informing her that her application for financial hardship assistance on behalf of her husband would not proceed at that point but advised her of Mr Myddleton's possible eligibility for Special Benefit. No decision as to her financial hardship application would be made pending Mr Myddleton applying for Special Benefit and that application being determined (T7).
Mr Myddleton lodged a claim for Special Benefit on 18 April 2000 (T9) citing the reason that he was residing in a nursing home and was unable to pay the fees which were in excess of his income. At that time, Mr Myddleton was in receipt of a South African pension in the amount of $270.00 per calender month. Mr Myddleton declared that he had a total of $69,000.00 contained within two bank accounts. He also noted that he had cash of "$80.000" (it is not clear to the Tribunal whether this meant $80,000.00 or $80.00).
On 17 May 2000, Mr Myddleton's claim for Special Benefit was rejected. A computer notation on that date noted that Mr and Mrs Myddleton had combined funds of $69,000.00 and that accordingly, Mr Myddleton did not meet the "long term available funds test for hardship". Further, it was noted that Mr Myddleton was not qualified to receive any other pension or benefit from the Department until 9 December 2007, which was 10 years after his arrival in Australia (T12).
Mr Myddleton sought a review by an ARO, who on 13 June 2000, decided that the original decision of the Departmental Delegate should be affirmed because:
"However, there are a number of other requirements that must be met when giving consideration to a person's possible entitlement to Special Benefit. One of these requirements is the "Available Funds Test". Available Funds are primarily funds that can be readily accessed, in your case any monies in a bank or other financial institutions are regarded as Available Funds. The Guide to Social Security Law explains the policy of Department of Family and Community Services, which says that for the purposes of Special Benefit, the Available Funds Test is an assets/income test which precludes payment to customers who have more than $5,000.00 in available funds.
This is why that (sic) I have decided that the decision not to grant payment of Special Benefit because of the "Available Funds Test" was correct. In my phone conversation Mrs Myddleton (sic) she has advised that at present the combined Available Funds for you both would total an amount in the area of late $70, 000." (T15)On 26 June 2000, Mr Myddleton lodged an application for review to the SSAT noting:
"I was advised by Aged Care and Welfare in Canberra to apply for a grant. I accept the decision to reject any money payment as I am not eligible. However, I feel that although not receiving an Aust. Pension, I perhaps deserve to be classed as a pensioner as I receive such a low amount yet have to pay quite crippling (financially speaking) nursing home fees. I would be grateful if you would consider this request." (T16)
On 24 July 2000, the SSAT affirmed the ARO's decision. In reaching its decision, the SSAT considered a number of cases including Re Takacs and Director-General of Social Services (1982) 4 ALN N234a; Re Thompson and Secretary, Department of Social Security (1990) 20 ALD 578; Re Baptist and Director-General of Social Security (1984) 5 ALN N492b; Re Watts and Director-General of Social Security (1984) 6 ALN N201. The SSAT concluded that it was not bound by the Policy Manual of the Department and must come to its own conclusions based on the application of the provisions of the Act.
The thrust of the cases considered by the SSAT indicated that in deciding whether to exercise the discretion to grant Special Benefit, regard must be had to the purpose of the section, namely, that no one should be left without a sufficient livelihood. For those who do not qualify for receipt of any other pension or benefit under the Act, provision for such livelihood should be made, the SSAT concluded.
In Mr and Mrs Myddleton's case, the SSAT found that Mr and Mrs Myddleton were experiencing considerable financial difficulty and Mrs Myddleton had very understandable concerns about her and her husband's future financial security. The SSAT noted that Mrs Myddleton was managing to sustain a livelihood based on the couple's resources and this was done because of her good financial management. The SSAT decided that Mr Myddleton's case was not one in which a person needed social welfare support. In conclusion, the SSAT determined that while it was clearly impossible for Mr Myddleton to "earn" a livelihood in the sense of receiving income from "personal exertion", nevertheless he did have access to assets of a sufficient level so as to entitle the Secretary not to exercise the discretion to grant Mr Myddleton a Special Benefit at that point in time. The ARO's decision was therefore affirmed by the SSAT (T2).
A further undated letter was sent to Mrs Myddleton by the Commonwealth Department of Health and Aged Care. The letter advised that that Department was unable to approve her application for a reduction in care fees and waiver of income tested fees on grounds of financial hardship. It was detailed within the letter that from figures provided by Mrs Myddleton, there was a combined income of $713.21 net per fortnight from a South African pension, Australian pension and interest. Mr Myddleton's share of this income was noted by the Department of Health and Aged care as being $356.05 per fortnight. While the Department of Health and Aged Care noted that Mr Myddleton was suffering a shortfall of $54.85 per fortnight after paying his nursing home care fees, he did have available to him a share of Mr and Mrs Myddleton's combined financial assets in the amount of $41,137.50 which could be used to assist in paying his care fees. Nursing home residents were expected to utilise savings before a hardship determination could be made by the Department Health and Aged Care. Therefore, Mr Myddleton was determined not to have demonstrated financial hardship (T17).
Evidence of Mrs Myddleton
Mrs Myddleton informed the Tribunal that she is aged 77 years old and is in good health. She came to Australia with her husband from South Africa in 1997. Six months after arriving in Australia, Mr Myddleton was diagnosed as suffering from epilepsy but the condition was controlled, Mrs Myddleton stated. Mr Myddleton then suffered a number of falls, not related to epilepsy. In 1999, at Mr and Mrs Myddleton's grandson's wedding, Mr Myddleton had a serious fall, fracturing his femur. He was hospitalised and following hospitalisation, his general health and state of mind deteriorated. Mrs Myddleton told the Tribunal the deterioration was so severe and Mr Myddleton's mobility so impaired as to warrant him being discharged from hospital not to his residential home, but to a nursing home. Furthermore, Mr and Mrs Myddleton were living in a self-care unit at the Aubrey Downer Memorial Orange Home for the Aged and Invalid at Point Clare. There was some possibility, Mrs Myddleton explained, that because she was living in a double unit, she may have been required to move within the home to single unit accommodation. However, this did not eventuate.
Thus, following hospitalisation, Mr Myddleton was admitted to the Wyoming Nursing Home in March 2000. Since then, his condition has deteriorated rapidly.
Currently, Mr Myddleton cannot walk or shower and has difficulty speaking. He knows Mrs Myddleton and his daughter but he is confused as to the identity of other people. Mr Myddleton continues to suffer epilepsy and now has been diagnosed as having dementia. Mrs Myddleton stated that her husband's medication is that used for schizophrenia. She does not believe her husband has this condition and is very concerned about the type and level of medication. She told the Tribunal that she is going to take this matter up with Mr Myddleton's doctor.
The nursing home fees are approximately $1,200.00 per calendar month, Mrs Myddleton stated. In addition, Mrs Myddleton has to pay $70.00 per week in rent for her self-care accommodation in the home at Point Clare. The SSAT estimated that there is a short fall of some $400.00 per month in Mr and Mrs Myddleton meeting their expenses. Mrs Myddleton confirmed with the Tribunal that she believes that this figure estimated by the SSAT is correct. Mr and Mrs Myddleton have two fixed term bank deposits with a balance of approximately $69,000.00. These deposits were to reach term on 6 November 2000. The interest on the fixed term deposits at six per cent per annum earns between approximately $300.00 to $350.00 per month, which Mrs Myddleton uses for her and her husband's living expenses.
Recently, Mrs Myddleton has entered into a contract to purchase a two-bedroom unit at Wyong for $110,000 (Exhibit A2). She will use the balance in the fixed term deposits, in addition to an amount of $20,000.00 loaned to her by her daughter, to purchase the property. Mrs Myddleton estimated that she would then have remaining funds of only $3,000.00 to $4,000.00. Mrs Myddleton stated that she did not believe she would be required to repay her daughter the $20,000.00 loaned to her.
Mrs Myddleton stated that she had been given an application form by rehabilitation staff at the hospital to send to the Commonwealth Department of Health and Aged Care, concerning wavering of income tested fees for Mr Myddleton's nursing home accommodation on the grounds of hardship. Mr Myddleton is classed as a self funded retiree, Mrs Myddleton stated. If Mr Myddleton's application had been successful, the nursing home care fees would have been reduced from $28.00 to $22.00 per day. Mrs Myddleton believed that the accommodation fee would also have been lowered. When Mr Myddleton's application had been rejected by the Department of Health and Aged Care, Mrs Myddleton did not request a review of that decision because she had "chucked in the towel". It had also been suggested to Mrs Myddleton that she reapply for the reduction of fees due to hardship or the Special Benefit when she had purchased her unit as her funds would have been substantially if not completely depleted. Mrs Myddleton stated that she had in fact written recently to the Department of Health and Aged Care (that is, three weeks prior to hearing) advising of her pending substantial change in financial circumstances and hence her possible eligibility of reduction of nursing home fees due to hardship.
Mrs Myddleton stated that she has been helped from time to time by a lawyer who was now "very cross" with her for purchasing a unit. Mrs Myddleton could not understand the lawyer's reaction to this purchase as she had thought that the purchase price was such a "bargain".
If Mr Myddleton was not helped by the granting of Special Benefit, Mrs Myddleton stated that she did not know how she would cope financially with Mr Myddleton's nursing home fees. Her only option in such circumstances would be to bring Mr Myddleton home, she told the Tribunal. This option would create great difficulties not only for her but her husband in terms of the intensive care required for him. She stated that if she could not afford the nursing home fees then he simply could not be cared for in a nursing home.
SubmissionsMrs Myddleton asked the Tribunal to exercise compassion in its consideration of her husband's application for review in relation to the decision of the SSAT not to grant Mr Myddleton a Special Benefit. Mrs Myddleton submitted that her husband had served in the South African Army and she thought that he should receive a service pension but he does not.
Mrs Myddleton further submitted that she would not be able to cope with nursing home fees without income support from Special Benefit and believed that her circumstances in purchasing her own home and depleting her fixed term deposits would make Mr Myddleton eligible for income support through the Special Benefit.
Mr Cox for the Respondent submitted that Mr Myddleton was not qualified for any other pension or benefit under the Act. Specifically in relation to the Age Pension, Mr Myddleton was also not qualified to receive this because he did not meet subsection 43(1) of the Act which requires ten years qualifying residency in Australia. The only possible benefit which could be paid to Mr Myddleton at this time is Special Benefit.
Mr Cox noted the SSAT's reference to Re Watts and Director-General of Social Security (supra) and submitted that the Tribunal take note of that decision which stated:
"Section [729] is expressed in simplistic terms, but I have come to the view that it intends to confer a discretionary power upon the [Secretary] to pay a benefit to a person who is in real need of income and for whom all appropriate means of achieving a livelihood are closed, whatever the reason be… Section [729] does not establish criteria which, once satisfied, gives rise to the exercise of a wide discretion. It is looking to cases where, from a practical point of view, people need support because they cannot obtain it by any other proper means… When section [729] speaks of "a sufficient livelihood" it is not intending to provide a benefit to a person who has no income. It is looking to support a person who needs social welfare support because support is not obtainable from any other suitable source"
Qualification for Special Benefit is contained within subsection 729(1) of the Act, Mr Cox submitted. He further submitted that the SSAT had not understood the discretionary nature of Special Benefit and had incorrectly treated the preconditions contained within subsection 729(2) of the Act as qualification criteria. Mr Cox maintained that the proper construction of subsection 729(2) is that it contains preconditions, which must exist before the qualification can be determined in accordance with subsection 729(1) of the Act. Support for this view, Mr Cox contended, is contained in Re Champion and Secretary, Department of Social Security (1996) 44 ALD 472 in which that Tribunal noted that it must first decide, "whether Ms Champion passes through the gate to the exercise of the discretion…", that is satisfying subsection 729(2) before dealing with subsection 729(1) of the Act. Re Te Velde and Director-General of Social Services (1981) 3 ALN N111 previously noted the preconditions which must be satisfied for the exercise of the discretion to grant Special Benefit. Mr Cox further referred the Tribunal to Re Hagedorn and Secretary Department of Social Security (1996) 43 ALD 187.
Mr Cox submitted that subsection 729(2) contains a number of preconditions contained in subsections (a) through to (fa) which must be met before the discretion to grant Special Benefit can be exercised. These are not qualifications for payment. Qualification for Special Benefit is in fact contained in subsection 729(1) of the Act.
Mr Cox submitted that Mr Myddleton gave details of his combined bank accounts on his claim form totalling an amount of $69,000.00 in bank deposits. Further, regarding the cash held by Mr Myddleton, it is not clear whether Mr Myddleton had $80,000.00 or $80.00 in cash. Noting the SSAT had reported that there was an additional $9,000.00 in another bank account (T26), then perhaps the total amount was approximately $80,000.00 to incorporate cash in all three bank accounts. Thus, in Mr Cox's submission, the available evidence suggests that there would be combined funds available to Mr Myddleton of $80,000.00.
Mr Cox submitted that because Mr Myddleton was not qualified to receive another pension or benefit until 9 December 2007, he also did not satisfy the relevant policy guideline. That is, Mr Myddleton's circumstances did not satisfy the "Long Term Available Funds Test" for hardship. The relevant policy guidelines are contained in the Social Security Guide, principally Guidelines 1.1.L.90 and 3.7.1.70 of the Guide. Further, the "Available Funds Test" under the guidelines precludes payment where a person has more than $5,000.00 in available funds. Mr Cox submitted that Mr Myddleton's available funds are in excess of $69,000.
Mr Cox summarised the policy contained in the Social Security Guide. He maintained that principally, the Available Funds Test is an assets/income test, which can preclude payment of Special Benefit where funds are of a certain level. There is both a long and short term Available Funds Test, those being, 1.1.L.90 and 1.1.S.170. A decision as to which test is to be applied depends, Mr Cox submitted, on a decision as to the length of time a person would be expected to be on the Special Benefit. If the person is likely to be on benefit for more than 13 weeks, as in Mr Myddleton's case, then the Long Term Test for Special Benefit applies, which is 3.7.1.70. The Long Term Available Funds Test precluding payment where a person has liquid funds of more than $5,000.00 applies regardless of marital status or the number of dependants. The policy states that a claim should be rejected in those circumstances as contained in Policy Guide 3.7.1.70 (Exhibit R2). Under the policy, an adjustment could be made to the amount of liquid funds to offset exceptional or unforeseen expenses that are not ongoing or recurring.
Mr Cox referred the Tribunal to the fact that Special Benefit has been described in numerous decisions by courts and tribunals as a benefit of last resort. In terms of the legislative scheme, it represents a payment to those who do not fit into any other category of payment but who cannot be ignored by a Social Security system based on need. Often the question of which individuals will be paid and those that will not, is a matter of discretion. The benefit of a consistent policy to guide decision-makers in those circumstances is readily obvious, Mr Cox submitted. Policy allows a frame of reference for decision-makers who may otherwise be distracted by subjective and perhaps not wholly relevant criteria. The application of policy allows for consistent principles to be applied and for regard to be had to the nature of the payment and the legislative scheme as a whole. In this way, Mr Cox submitted, policy helps to restrain decisions which may erode the effectiveness of provisions that preclude payment of other payment types; for example, as applies to Mr Myddleton, the ten-year residency rule. Mr Cox referred the Tribunal to Re Drake and Minister for Immigration and Ethnic Affairs (No2) (1979) 2 ALD 634 in which Brennan J concluded:
"…Decision-making is facilitated by the guidance given by an adopted policy, and the integrity of decision-making in particular cases is the better assured if decisions can be tested against such a policy."
Mr Cox submitted that the application of policy in Mr Myddleton's case supports the decision to reject payment of Special Benefit. Given that the total available funds in Mr Myddleton's case were in the vicinity of $80,000.00, Mr Cox contended that there is no reason to disregard the policy "on the grounds of reason, justice or fairness".
Mr Cox referred the Tribunal to subsection 24(1) of the Act, which deals with the discretion to treat a married person as not being a member of a couple, for example, because of separation as a result of illness. Mr Cox submitted that it may be possible to utilise this provision and consider Mr Myddleton, for the purposes of the legislation, as not a member of a couple. However, if such a finding were made by the Tribunal, Mr Cox submitted that Mr Myddleton would still be regarded as having half the assets of the couple. In such circumstances, Mr Myddleton's available funds would still exceed $5, 000.00, the limit of the Available Funds Test and thus Mr Myddleton's claim for Special Benefit should be rejected.
In conclusion, Mr Cox submitted that the SSAT's decision to reject Mr Myddleton's claim for Special Benefit should be affirmed, however, not for the reasons expressed by the SSAT in its decision. Mr Cox reiterated that the SSAT did not understand the discretionary nature of Special Benefit and had incorrectly treated the preconditions in subsection 729(2) as qualification criteria whereas, in his submission, they are preconditions which must exist before the discretion can be considered.
Mr Cox concluded that relevant policy should not be knowingly ignored but seriously considered. Further, the facts of Mr Myddleton's case and the application of policy would not result in an unfair, unjust or reasonable outcome. As such, the Available Funds Test should be applied and the Tribunal should decide to affirm the SSAT's decision rejecting the claim for Special Benefit.
FindingsThe Tribunal has reached a decision in this matter taking into account the oral and documentary evidence, the submissions, the legislation and case law.
The Tribunal considers Mrs Myddleton to have been truthful in her evidence and a credible witness.
Most unfortunately, Mr Myddleton is extremely ill and is required to be cared for in a nursing home. There has been a serious deterioration of his condition, including epilepsy, dementia and poor mobility. The cost of his care is considered by the Tribunal to result in a short fall of $400.00 per calendar month. This finding takes into account, at the time of hearing, available funds in the vicinity of $80,000.00 made up of long term bank deposits of approximately $69,000.00 in combination with an amount of cash of approximately $9,000.00.
Mr Myddleton receives a small part-pension from South Africa and Mrs Myddleton receives the Australian Age Pension.
Recently, Mrs Myddleton entered into a contract to purchase a two-bedroom unit in Wyong. The purchase price is $110,000.00 and is to be raised by utilising the two long-term bank deposits in addition to an amount of $20,000.00 given to her by her daughter.
Once the purchase of the unit has occurred, Mr and Mrs Myddleton's financial situation will be dramatically changed. Then, on Mrs Myddleton's evidence, she will have only approximately $3,000.00 or $4,000.00 remaining in addition to her receiving her Age Pension and Mr Myddleton receiving his South African pension.
The Tribunal notes that Mrs Myddleton has already reapplied to the Commonwealth Department of Health and Aged Care for consideration of a reduction in nursing home fees because of her increased financial hardship. Mrs Myddleton also advised that she may well follow other advice given to her to reapply for Special Benefit in light of her change of financial circumstances following the purchase of new property.
The Tribunal notes that under subsection 24(1) of the Act, the Tribunal may treat Mr and Mrs Myddleton as not being a member of a couple for a special reason. Mr and Mrs Myddleton are living separately and apart because of Mr Myddleton's requirement for long term care. There is case law where couples separated by illness are treated as not being members of a couple (see Re Secretary, Department of Social Security and Porter (1997), 48 ALD 343; Re Hawkins and Secretary, Department of Social Security (1996) 44 ALD 651. Even if the Tribunal found that pursuant to subsection 24(1) of the Act, Mr Myddleton was not a member of a couple because of the special reason of separation because of illness, he would still have available to him at the time of claim and at hearing, funds of $40,000.00.
The Tribunal considered whether or not, in light of the funds available to Mr Myddleton of either $80,000.00 or $40,000.00, it is able to exercise the discretion contained in section 729 of the Act to find Mr Myddleton is qualified for Special Benefit. The Tribunal agrees with Mr Cox and the reasoning in Re Te Velde (supra) and Re Champion (supra) that subsection 729(2) is the gate through which Mr Myddleton needs to pass before the Tribunal can consider exercising the discretion contained within subsection 729(1) of the Act to grant Mr Myddleton a Special Benefit. The Tribunal is of the view that subsection 729(2) contains the preconditions required to be satisfied before turning to subsection 729(1) of the Act.
It is the Tribunal's finding that Mr Myddleton is not entitled to any other pension or benefit. He therefore satisfies subsections 729(2)(a) and (b) of the Act. In relation to subsection 729(2)(e), the Tribunal considers that Mr Myddleton is unable to earn sufficient livelihood because of his age and his physical condition. In so deciding, the Tribunal takes "earnings" to mean the ability to receive something for labour, which is a definition based on the ordinary meaning of the word "earning" as discussed in Re Takacs and Director-General of Social Services (supra). The Tribunal considers that all other sub-categories under subsection 729(2) of the Act are also met in Mr Myddleton's circumstances.
Having so determined, the Tribunal turned to consider whether or not the discretion should be exercised to allow Mr Myddleton's qualification for Special Benefit. The Tribunal is firmly of the view in exercising the discretion contained within subsection 729(1) of the Act, that it must consider any policy matters relevant to a determination of qualification for Special Benefit. This is not to say that a decision-maker must slavishly follow policy but merely that the Tribunal has regard to the policy, as it supports the legislative intent, in this case for Special Benefit. The policy matter which the Tribunal considers relevant is that specifically contained in policy 3.7.1.70 the Long Term Available Funds Test and ancillary policy guidelines detailed previously in this decision, which note that if a person has available funds of more than $5,000.00, then Special Benefit is not payable regardless of marital status or the number of dependants. In such circumstances the policy requires the Special Benefit to be rejected. Noting Drake (supra), the Tribunal considers it appropriate to apply this policy. The Tribunal finds that Mr and Mrs Myddleton had available to them at the time of claim and at hearing an amount of approximately $80,000.00 and that this amount is not an irrelevant consideration. Even if Mr Myddleton was not considered as a member of a couple, he would still have available funds of $40,000.00.
The Tribunal notes that policy does not have the force of law but is there as a guide. In this case, the Tribunal considers that policy must be applied. Regardless of whether Mr Myddleton is considered to have $80,000.00 or $40,000.00, the Tribunal considers that such funds are a significant amount, which to disregard would not be in keeping with the legislative intent behind Special Benefit. Mr Myddleton's circumstances are indeed unfortunate and the fact that the available funds are tied up in long term deposits has meant that the interest on these amounts and the other income was not quite covering the cost of care for Mr Myddleton in the nursing home. These funds, however, could be liquidated and used for the purpose of Mr Myddleton's care until such time as he was qualified for the Age Pension or the funds depleted. The Tribunal finds that having regard to the policy, it cannot exercise the discretion contained in section 729 of the Act to consider Mr Myddleton qualified for Special Benefit. In making this determination, the Tribunal has further taken account of such matters as were discussed in Re Blackburn and Secretary, Department of Social Security (1982) 4 ALN N76, in which that Tribunal concluded that the decision-maker should apply compassionate consideration to matters of qualification for Special Benefit, noting:
"Ultimately our prime consideration must be a compassionate approach to the security in society of this Applicant."
In all the circumstances and for all the reasons expressed above, pursuant to section 43 of the Administrative Appeals Tribunal Act 1975, the Tribunal affirms the decision under review.
The Tribunal notes that if Mr and Mrs Myddleton's financial situation changes for the worse as was foreshadowed by Mrs Myddleton once the purchase of her two bedroom unit is concluded, then it is open to Mr Myddleton to reapply for Special Benefit in light of his changed circumstances. Mrs Myddleton's evidence is that she is considering this option. Further, the Tribunal notes that at the time of hearing, Mrs Myddleton had also reapplied to the Department of Health and Aged Care for reconsideration of her financial hardship because of her changed circumstances. The Tribunal is not aware of the outcome of this re-application. In light of Mr and Mrs Myddleton's likely changed circumstances at the time of purchase of a new property, it may well be that Mr Myddleton's qualification for Special Benefit may be able to be favourably considered.
I certify that the 42 preceding paragraphs are a true copy of the reasons for the decision herein of Ms SM Bullock, Senior Member
Signed: .....................................................................................
Sharonne Brainenberg, AssociateDate of Hearing 9 November 2000
Date of Decision 5 January 2001
Representative for the Applicant Mrs MyddletonRepresentative for the Respondent Mr Anthony Cox, Departmental Advocate
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