Re Secretary, Department of Family and Community Services and Machan
[2001] AATA 434
•23 May 2001
DECISION AND REASONS FOR DECISION [2001] AATA 434
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2000/1144
GENERAL ADMINISTRATIVE DIVISION )
Re SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
Applicant
And SIMONE MACHAN
Respondent
DECISION
Tribunal Senior Member M D Allen
Date23 May 2001
PlaceSydney
Decision The decision under review is affirmed.
(Sgd) M D ALLEN
..............................................
Senior Member
CATCHWORDS
SOCIAL SECURITY - Youth Allowance. Whether Respondent had undertaken a full-time student load for the particular semester. Whether special circumstances existed.
Social Security Act 1991 (as amended) - ss541, 541B, 1237A, 1237AAD
Higher Education Funding Act 1988 - subs39(2)
Secretary, Department of Social Security v Ellis 24 AAR 535
Re Secretary, Department of Social Security and Hill 40 ALD 687
Haggerty v Department of Education, Training and Youth Affairs (2000) 31 AAR 529
REASONS FOR DECISION
23 May 2001 Senior Member M D Allen
By application lodged 25 July 2000 the Applicant sought review of a decision by a Social Security Appeals Tribunal on 21 June 2000 that the Respondent was not indebted to the Applicant consequent upon an alleged overpayment of Youth Allowance because at all relevant times the Respondent had in fact been a full-time student.
The basic facts leading to the dispute between the parties are not in contention.
In 1996 the Respondent enrolled at the University of Sydney in the faculty of engineering. Currently she holds the degree of Bachelor of Mechanical Engineering with Honours and is working towards a doctorate in that discipline.
Late in the 1998 academic year the Respondent completed a pre-enrolment for the 1999 academic year. In order to proceed to a higher degree, the Respondent would have had to obtain Honours in her Bachelor's Degree and to be awarded Honours she would have had to obtain at least a credit grade in her final year thesis.
After consultation with her lecturers and others, the Respondent structured her fourth year subjects so as to allow her to complete all compulsory and elective subjects necessary to complete her degree in the first semester of the academic year but for her thesis upon which she concentrated in the second semester. She was at all times regarded by the University of Sydney as a full-time student and in the second semester worked at the University of Sydney five days a week until the last one and a half to two months before the completion of her thesis when her work load increased to seven days a week.
Document T9 in the documents prepared for the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 is a document from the University of Sydney confirming the Respondent's status as a full-time student at all times.
Attached to Exhibit R1 in these proceedings is a copy of the Faculty of Engineering Handbook from the University of Sydney. Relevant passages state:
"The minimum time in which you can qualify for the degree is four years. If you want to qualify in the minimum four years, you should plan to gain not less than 48 to 52 units each year. …
The BE degree is available on a full-time basis only and students cannot complete the degree requirements on a part-time basis or externally."
The handbook then goes on to state, under the heading "Intermediate and later year enrolments", the following:
"The minimum enrolment for re-enrolling students is normally 36 units …"
And, under the heading "Result grades", states:
"The Board of Examiners of the Faculty of Engineering is the body which determines BE students' examination results. The Board meets in December each year when it considers the results recommended by the examiners of each course for each student. Official examination result notices are then sent to students.
Some teaching departments may release informal results at the end of First Semester, but these are not official, final results."
The passage referring to "Result grades" clearly indicates to my mind that the University of Sydney considered that the Bachelor of Engineering Degree was pursued on a yearly basis. That is to say, one enrolled for the year rather than, as in some other faculties, where enrolments can be semester based.
In evidence to the Tribunal the Respondent stated that she understood that the Bachelor of Engineering Degree was, as per the Faculty Handbook, a four year full-time course. During the second semester of the 1999 academic year she assumed she was full-time as the degree required full-time attendance. I note that the Respondent also told the Social Security Appeals Tribunal that she paid full-time student fees and continued to have a full-time student card. She was not challenged on those details before me.
For part of the time, until she commenced working on her thesis seven days a week, the Respondent engaged in casual employment. In order to ensure that she was not overpaid Youth Allowance, she approached Centrelink and arranged to fill in a form every fortnight so as to correctly declare her earnings.
The Applicant, however, considers that because the Respondent did not undertake what is termed a standard student load for the second semester of 1999, she was not entitled to Youth Allowance for that semester.
Subsection 541(1) of the Social Security Act 1991 (as amended) states inter alia:
"Subject to section 541A and subsection (3) of this section, a person satisfies the activity test in respect of a period if:
(a)the person satisfies the Secretary that, throughout the period, the person is undertaking full-time study (see section 541B); …"
Whereas section 541B read inter alia, at the time the Respondent was completing her fourth year in the Faculty of Engineering, as follows:
"(1) For the purposes of this Act, a person is undertaking full-time study if:
(a) the person:
(i) is enrolled in a course of education at an educational institution; …
(b) the person:
(i) is undertaking in the particular study period (such as, for example, a semester) for which he or she is enrolled for the course; or
(ii) intends to undertake in the next study period for which he or she intends to enrol for the course;
at least three-quarters of the normal amount of full-time study in respect of the course for that period (see subsections (2) to (4)); and
(c)the course in question is an approved course of education or study (see subsection (5)); and
(d)in the Secretary's opinion, the person is making satisfactory progress towards completing the course.
(2) For the purposes of paragraph (1)(b), the normal amount of full-time study in respect of a course is:
(a)if the course is a designated course of study within the meaning of Chapter 4 of the Higher Education Funding Act 1988 - the standard student load determined in respect of the course by the institution in question under subsection 39(2) of that Act ; …"
What is clear from the material available from the Faculty of Engineering at the University of Sydney is that the particular study period for which the Respondent was enrolled was the academic year 1999.
I agree with the submissions by Ms Koller, for the Respondent, that the words "(such as, for example, a semester)" in paragraph 541B(1)(b)(i) of the Social Security Act 1991 are just that, namely an example. The course required the Respondent to participate in subjects some semester based, others to be undertaken over a year. However, irrespective of the length of time required to complete a subject, results were annual and re-enrolment was for the academic year.
Subsection 541B(2) draws attention to subs39(2) of the Higher Education Funding Act 1988 which reads:
"Each institution shall determine, in accordance with guidelines issued by the Minister, in respect of each designated course of study that may be undertaken at the institution in a year to which this Chapter applies, a standard student load that represents an equivalent full time student unit."
This subsection enables the institution to determine the standard student load. The purpose of subs541B(2) of the Social Security Act 1991 is to equate the normal amount of full-time study referred to in paragraph 541B(1)(b) with the so-called standard student load as determined by the institution pursuant to subs39(2) of the Higher Education Funding Act 1988. The particular guidelines referred to in subs39(2) of the Higher Education Funding Act 1988 were exhibited in Exhibit R1. These guidelines require all units of study to be apportioned values so that, were the course to be conducted and undertaken on a full-time basis in a year and were the student to be proceeding at an appropriate pace to complete the course in standard time – the combined values would equal 1.00. The document states inter alia (Exhibit R1 page 18):
"The aggregated EFTSU values for units of study and/or parts of units of study in all courses undertaken by a student classed as having a part-time type of attendance would be less than 0.75."
The values of 1.00 and 0.75 are annual values. There is nothing which necessarily equates the calculation of the standard student load with semester periods.
Further, as pointed out in the guidelines, where an institution specifies a range of prescribed workloads, the standard student load for a year in a course should be regarded as the minimum annual workload which, when aggregated with standard student loads for other years of the course, would enable completion of all course requirements in the standard time expected by the institution. In the case of the Faculty of Engineering at the University of Sydney, the standard student load for the years after the first year of the course is 36 units. This was the number of units for which the Respondent enrolled and for which she successfully studied.
As the Respondent's student load was 100% of that required and was sufficient to enable her to meet the requirements of the University, it seems to me that she was at all times, during the 1999 academic year, a full-time student and entitled to Youth Allowance.
As an alternative submission the Respondent's solicitor sought to have the debt waived as being one that arose out of administrative error by the Applicant Department.
Section 1237A of the Social Security Act 1991 states:
"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."
At the outset, let me state that I find that at all times the Respondent acted with complete honesty, as evidenced by her arranging with Centrelink for fortnightly returns of income so as to exclude any overpayments of Youth Allowance. She honestly considered herself a full-time student (as did the University) so that there is no question but that she receive the payments she did receive in good faith – see Haggerty v Department of Education, Training and Youth Affairs (2000) 31 AAR 529.
As pointed out by the Respondent's representative, there is nothing in the material which was supplied by the Applicant to the Respondent that illustrated the way in which a study load was calculated. For example, at Exhibit R1 page 25 the department's claim form reads:
"Full time student
A full time student for the purpose of Youth Allowance is a person who is enrolled at an approved institution and is undertaking at least three quarters of a normal full time workload for their course.
A normal full time workload is:· for a course which attracts a HECS loading, the standard student load, …"
but does not go into any further detail. Obviously if the student is undertaking the subjects recommended by the University for that year of a degree course, he or she can readily expect that they are undertaking the standard student load.
Document T7 is the letter forwarded by the Applicant to the Respondent stating Youth Allowance would be paid. Dated 19 March 1999, it states inter alia:
"We have recorded that you are studying full time. If your study load changes or if you cease study you should let us know within 14 days."
That letter also states that the Respondent will be sent a review form every six months. Nothing was put before me to show that the said review form was ever sent to the Respondent, nor were any copies of the fortnightly adjustments of income forms lodged by the Respondent with Centrelink put before me.
At no time did the Respondent's study load change. She remained at all times, in the eyes of the University, a fourth year engineering student. It may be argued that after the first semester, her study load changed in that no longer did the Respondent have to contend with the subjects completed in that semester but this argument ignores the fact that the engineering course was calculated on a year's work and not by semesters. In any event her study load did not change, it was just redirected to the one subject, namely her thesis.
Whereas I accept the submissions by the Respondent that the information provided to students by Centrelink as to how full or part-time status was determined was defective, I am not persuaded that that failure amounts to administrative error.
The Respondent referred to the decision of Senior Member Dwyer in Re Secretary, Department of Social Security and Hill 40 ALD 687. In that decision Senior Member Dwyer determined that a failure to ask a particular question in a Department of Social Security form amounted to an administrative error. With respect to the Senior Member concerned, I am of the opinion that decision is taking the concept of administrative error too far. Administrative error is an error in administration. No doubt the design of a form and the questions it asks are matters of administration but I do not understand the concept of administrative error in s1237A of the Social Security Act 1991 as extending so far as to permit the waiver of a debt because a form is badly designed or more information could have been given. To my mind, where administrative error is referred to, it refers to an error in the administration of a welfare beneficiary's particular case.
Section 1237AAD, however, states:
"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 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."
In this matter I am satisfied that the alleged overpayment did not arise from the Respondent "knowingly" making a false statement or failing or omitting to comply with a provision of the Social Security Act 1991. As stated above, at all material times the Respondent and the University of Sydney were of the opinion that the Respondent was a full-time student in the fourth year of a Bachelor of Engineering Degree.
The concept of what are special circumstances was discussed by Carr J in Secretary, Department of Social Security v Ellis 24 AAR 535 at 539, namely:
"In Beadle v Director-General of Social Security (1985) 7 ALD 670, a Full Court of this Court had to consider whether the Administrative Appeals Tribunal had erred in its interpretation of s 102(1)(a) of the Act which provided for an extension of time in which to claim a family allowance '… in special circumstances …'. At 673-674 the Full Court said:
'Presumably in this context special circumstances must include events which would render the six months unfair or inappropriate … It would depend upon the circumstances of the particular case whether these constituted special circumstances. We do not think it is possible to lay down precise limits or precise rules. The matter is one for the Director-General bearing in mind the purpose for which the power is given. The phrase 'special circumstances', although lacking precision, is sufficiently understood in our view not to require judicial gloss.'
In Groth v Secretary, Department of Social Security (1995) 40 ALD 541 at 545, Kiefel J, after referring to Beadle, said:
'… for present purposes it is sufficient to observe that it would require something to distinguish Mr Groth's case from others, to take it out of the usual or ordinary case. That was, I consider, the only inquiry to be undertaken in this case. It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary. The inquiry I have referred to would involve considering what would be the effect, if the provision in question or the principle of liability it creates, is applied.'"
In this matter the Respondent was certainly misled by the particular forms issued by Centrelink. As pointed out by Ms Koller, for the Respondent, it would have been very easy for the Applicant to state in the forms that determinations of full or part-time status were made by an assessment of the Higher Education Contribution Scheme (HECS) points over each and every semester. If this had been done it would have been very easy for the Respondent to add up her points and, if necessary, take another subject. The Respondent, however, relied upon advice from the University and structured her course accordingly.
Further, as pointed out in the Respondent's unchallenged evidence, her second semester was spent full-time as a student. I note that at page 16 of Exhibit R1 the requirements deadlines for the thesis requires that the student consult with their supervisor at least fortnightly and preferably once a week.
There is no doubt in my mind that at all relevant times the Respondent was, to all intents and purposes, a full-time student at the University of Sydney. To deprive her of Youth Allowance would, in the words of Kiefel J, be unfair and unjust. If, therefore, I am wrong as to the statutory interpretation points in this matter, I would affirm the decision under review in any event on the grounds of special circumstances pursuant to s1237AAD of the Social Security Act 1991.
I certify that the 32 preceding paragraphs are a true copy of the reasons for the decision herein of:
Senior Member M D Allen
Signed: .....................................................................................
AssistantDate of Hearing 10 May 2001
Date of Decision 23 May 2001
Solicitor for the Applicant Ms S Fahey,
Department of Family & Community Services
Solicitor for the Respondent Ms S Koller, Welfare Rights Centre
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