Redmond and Anor and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs

[2008] AATA 755

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 755

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          Nos 2008/1075
  )          & 2008/1076

GENERAL ADMINISTRATIVE  DIVISION		)
Re		DAVID REDMOND & PATRICIA REDMOND

Applicant

And SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

Nos 2008/1105
  & 2008/1107

Re SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Applicant

And DAVID REDMOND & PATRICIA REDMOND

DECISION

Tribunal Mr S. Webb, Member

Date27 August 2008

PlaceCanberra

Decision The decision under review is set aside and in place thereof the Tribunal decides that Mr and Mrs Redmond are entitled to payment of Age Pension in arrears.  The amount of arrears is to be calculated in accordance with these reasons.  The matter is remitted to the Respondent Secretary for that purpose.

......... signed.....................

Mr S. Webb, Member

CATCHWORDS

SOCIAL SECURITY - Age Pension - error in calculation of rate - rate varied by determinations over time - notice of determinations - notices adequate - determinations without notice - request for review - dates of effect of favourable determination on review - decision set aside

Social Security Act 1991 ss 43,55, 1064

Social Security (Administration) Act 1999 s 78, 79, 80, 108, 109, 115, 129.

Re Secretary, Department of Families, Community Services and Indigenous Affairs and Walshe & Anor [2007] AATA 1861

REASONS FOR DECISION

27 August 2008 Mr S. Webb, Member         

1.      David and Patricia Redmond receive the Age Pension.  Mrs Redmond receives a superannuation pension from the United States of America and has earned income in employment from time to time.  Her income affects the rate of Age Pension that is payable.  Errors have been made in relation to Mrs Redmond’s income.  At the outset Centrelink erroneously recorded the amount of Mrs Redmond’s US pension.  As a result Mr and Mrs Redmond were paid a lower amount of Age Pension than they would otherwise have been entitled to. Subsequently Mrs Redmond failed to correctly inform Centrelink of variations in her income from employment. As a result Mr and Mrs Redmond were overpaid amounts of Age Pension and debts were raised against them.  Following receipt of information from Centrelink, Mr and Mrs Redmond queried the rate of US pension that was used to calculate their Age Pension.  Centrelink’s error was discovered.  However, the Secretary determined that arrears were not payable from the date of grant, only being payable from the date on which application for review was made.  Unhappy with this decision, Mr and Mrs Redmond exercised their rights of review.  The matter came before the Social Security Appeals Tribunal (the SSAT).  That Tribunal decided that arrears were payable from an earlier date.  Mr and Mrs Redmond and the Secretary have applied for review of this decision.

2.      Thus the issue for determination is the period or periods in which arrears of Age Pension is payable to Mr and Mrs Redmond.  For that purpose it is necessary to determine:

(a)when determinations varying the rate of Age Pension were made;

(b)whether proper notices were issued in relation to each determination;

(c)the scope of Mr and Mrs Redmond’s request for review; and

(d)the date on which any resulting favourable determinations had effect.

3.      On 6 June 2008 I directed the Respondent Secretary to file detailed information concerning determinations made in relation to Mr and Mrs Redmond’s Age Pension rate prior to the hearing.  Information was filed on 27 June 2008.[1] 

[1] Secretary’s Supplementary Statement of Facts and Contentions, 27 June 2008, pp 3-5.

4.      At the hearing Mr and Mrs Redmond informed me that they did not dispute the accuracy of the information filed by the Secretary concerning the dates of successive determinations and notices varying the rate of their Age Pension payments, and that they were content for me to proceed on the basis that the dates as stated are correct.  Having considered the evidence, I am satisfied that that is an appropriate conclusion and so find.  I understand that Mr and Mrs Redmond do not dispute that notices were issued to them in relation to some but not all determinations, as specified in the Table set out at pp 3-5 of the Secretary’s Supplementary Statement.  As can be seen from paragraph 1.6 of that Statement, Centrelink offset debts for which Mr and Mrs Redmond were liable against arrears of Age Pension that may, otherwise, have been payable during the following periods:

12 December 2003 to 13 April 2006;

26 May 2006 to 8 June 2006; and

25 May 2007 to 7 June 2007.

The Secretary does not seek to re-open those matters.  I understand that Mr and Mrs Redmond agree and accept that, in effect, they have been paid arrears of Age Pension, applying the correct amount of Mrs Redmond’s US pension, during these specified periods.  I will proceed on that basis.

5.      Mr and Mrs Redmond assert that it is simply unfair and unjust that they are required to repay amounts of Age Pension that were overpaid (as the result of honestly made errors reporting Mrs Redmond’s income from employment), when Centrelink is not required to repay to them amount of Age Pension to which they would have been entitled but for Centrelink’s admitted error.  I note the various submissions and communications handed up by Mr and Mrs Redmond that are in Exhibits A2 and A3.  In their submission, they provided the correct information concerning Mrs Redmond’s US pension and expected Centrelink to process the information correctly.  They say that they expected and relied upon Centrelink to correctly calculate the rates of their Age Pension payments.  Mr and Mrs Redmond assert that the representation of aggregate annualised income and the sheer volume of letters and material they received from Centrelink (up to 12 letters in one day), including in relation to the rate of exchange from time to time, was confusing, was often irrelevant, and did not clearly state the rate of Mrs Redmond’s US pension that was being applied.  They say that the first information they received from Centrelink about the rate of Mrs Redmond’s US pension that was being used for Age Pension calculation purposes was a statement of account dated 26 April 2007.[2]  Mr and Mrs Redmond gave evidence about difficulties they experienced dealing with Centrelink staff when attempting to rectify errors and overpayments, and in order to address issues that are presently on foot.  They say that they were not provided with appropriate information or support and assistance to properly understand and address these matters.  They contend that the SSAT decision is wrong and that they should be entitled to payment of arrears to which they would have been entitled if Centrelink had recorded and applied the correct rate of Mrs Redmond’s US pension from the outset.

[2] Exhibit R1.

6.      The matter is to be determined under the Social Security Act 1991 (the Social Security Act) and the Social Security (Administration) Act 1999 (the Administration Act). The qualification criteria for Age Pension are set out at s43 of the Social Security Act. The rate of Age Pension is to be calculated and determined pursuant to s55 and (relevantly) s1064 of that Act. Once made, the rate determination has continuing effect[3] until it is varied by subsequent determination, pursuant to ss 78, 79, 80 of the Administration Act, for example. The date on which a determination to vary the rate of Age Pension has effect is to be determined pursuant to Division 9, Part 3 of the Administration Act. Relevantly, s 109 of that Act sets out the date on which a favourable determination resulting from the review of a determination has effect. That section provides that if a person is notified of a determination and applies for review of a determination within 13 weeks, a favourable result will have effect from the date of the original determination. However, if the person applies for review after 13 weeks have elapsed, then a favourable determination will have effect only from the date the review was requested. If no notice was issued about the determination and the person applies for review, a favourable result will have effect from the date of the original determination.

[3] s 123(3) of the Administration Act.

7.      In Mr and Mrs Redmond’s case, successive determinations were made varying the rate of their Age Pensions following the determination on 5 January 2004 to grant Age Pension from 12 December 2003.  Notices were issued in relation to some but not all of these determinations. 

8.      Mr and Mrs Redmond were initially granted Age Pension on 15 September 2003, but this was cancelled as Mrs Redmond’s income at that time exceeded the applicable income threshold.[4] It appears that the initial determination of the rate of Age Pension was based, in part, on US pension income of $US521 per month for Mr Redmond,[5] and $US452 per month for Mrs Redmond, resulting in a combined aggregate annualised income (in Australian dollars) of $18,848.60 as notified.[6]  However, Mrs Redmond’s US pension amount was $US113 per month.[7]  It appears that the same rates of US pension were applied when Age Pension was re-granted on 5 January 2004: combined aggregate annualised income (in Australian dollars) of $17,611.24 was notified at that time.[8]

[4] See T12, T96, T13, T97.

[5] T9 folio 106-161.

[6] T12, T96.

[7] T9 folio 160.

[8] T15, T100.

9.      In view of what is agreed and set out at paragraph 4 of these reasons, the periods in issue in relation to determinations and notices are:

8 August 2003 to 22 September 2003;

14 April 2006 to 25 May 2006; and

9 June 2006 to 24 May 2007.

It is accepted and I am satisfied that 26 determinations were made varying the rate of Mr and Mrs Redmond’s Age Pension during these periods pursuant to ss 78 and 79 of the Administration Act and that only 17 of those determinations were the subject of notices issues to Mr and Mrs Redmond.[9]

[9] T12, T30, T38-T42, T44-T47, T59, T96, T123, T130-T134, T136-T139; Exhibit R1.

10. Mr and Mrs Redmond conceded that they received these and other notices (for example at T15 and T100). They did not seek to challenge the adequacy of the notices and gave evidence that many of the notices were in the form of the notice in Exhibit A1. I am satisfied that this form of notice is adequate and proper notice for the purposes of s 109 of the Administration Act. The notice in Exhibit R1 dated 26 April 2007 is in a different form. Nevertheless, this form of notice clearly sets out information concerning changes in the rate of Age Pension and other benefits on specific dates. To my mind, this is sufficient to inform a recipient of those changes, and is adequate notice of the determinations reflected therein for the purposes of s109 of the Administration Act (see discussion of notice requirements in Re Secretary, Department of Families, Community Services and Indigenous Affairs and Walshe & Anor [2007] AATA 1861).

11.     Mr and Mrs Redmond both gave evidence that the combined income amounts that are shown in the notices they received prior to 26 April 2007 are plainly wrong, but they did not comprehend that at the time and they did not seek to challenge these notices.  I observe in passing that it is surprising that Mr and Mrs Redmond did not question the correctness of the calculations concerning the rate of their Age Pensions when debts were raised against them and were recovered from them.  Nevertheless, it appears that the Secretary offset some of those debts against arrears of Age Pension that would otherwise have been payable if the correct amount of Mrs Redmond’s US pension had been applied.

12.     Mr Redmond gave evidence that he queried the income amount after receiving an account statement dated 26 April 2007.  In his evidence this was the first such statement they received from Centrelink, and it was the first time that the rate of Mrs Redmond’s US pension that was being used for Age Pension calculation purposes was clearly stated to them ($US509.66).[10] It is accepted that, in consequence, Mr Redmond contacted Centrelink on 31 May 2007 and inquired about the rate of US pension that was being used to calculate the rate of his and Mrs Redmond’s Age Pension. I accept that this inquiry was, in effect, a request for review of a determination pursuant to s129 of the Administration Act.

[10] Exhibit R1, pp 3 - 4.

13.     The Secretary asserts that this inquiry was, in effect, a request for review of the initial determination to grant Mr and Mrs Redmond Age Pension, whereby the rate of their pensions was initially (and erroneously) determined, and it is not a request for any subsequent determination.  I do no accept that assertion.  There are three things to say about this.  First, the particular notice in Exhibit R1 sets out information concerning determinations that were made to vary the rate of Mr and Mrs Redmond’s pensions on 2 February 2007, 16 February 2007, 2 March 2007, 16 March 2007, 30 March 2007 and 26 April 2007.  As Mr Redmond was responding to this information, it is reasonable to conclude that his request related to the determinations reflected therein.  I so find.  Second, there is no contemporaneous evidence concerning the specific terms of Mr Redmond’s request on 31 May 2007.  Nevertheless, it is plain enough from Mr and Mrs Redmond’s oral evidence, which was not challenged, and from their written submissions and communications over time, that their request does not simply relate to the determinations covered by the 26 April 2007 notice, but also related to the initial rate determination and to all subsequent determinations prior to 31 May 2007. Third, by the Secretary’s account notices were not issued in relation to determinations varying the rate of Mr and Mrs Redmond’s Age Pension during the following periods:

14 April 2006 to 25 May 2006;

23 June 2006 to 6 July 2006;

7 July 2006 to 20 July 2006;

29 September 2006 to 12 October 2006;

22 December 2006 to 4 January 2007;

5 January 2007 to 18 January 2007;

19 January 2007 to 1 February 2007;

27 April 2007 to 10 May 2007; and

11 May 2007 to 24 May 2007

It is reasonable to conclude that Mr Redmond’s request relates to these determinations without notice.

14.     Thus I am satisfied that Mr Redmond’s inquiry on 31 May 2007 was, in effect, a request for review of all previous determinations varying the rate of his and Mrs Redmond’s Age Pension from the date of initial grant. I so find.

15. As the determinations in questions are within the scope of ss 108 or 115 of the Administration Act, any favourable determination on review will be subject to s109 of that Act. The effect of that section is as follows. Favourable determinations resulting from review of the determinations referred to in the notice dated 26 April 2007 will have effect from the dates of those original determinations. Favourable determinations resulting from review of original determinations without adequate notice within or concerning the periods specified at paragraph 13 above will have effect from the dates of those original determinations. Favourable determinations resulting from review of other determinations[11] that were the subject of adequate notice will have effect from 31 May 2007. I so find.

[11] T12, T30, T38-T42, T44-T47, T59, T96, T123, T130-T134, T136-T139.

16.     The amount of Age Pension arrears to which Mr and Mrs Redmond are entitled is to be calculated on this basis.  The decision of the SSAT is not sustained on the evidence before me and must be set aside.  The matter will be remitted to the Secretary to calculate the correct amount of Age Pension arrears to which Mr and Mrs Redmond are, respectively, entitled.

17. Finally, it is appropriate to observe that when a pension claimant provides accurate information for the purposes of determining the correct rate of his or her entitlement under the Social Security Act, it is reasonable for that person to expect the information to be properly recorded and applied. That did not occur in this case. However, it must also be accepted, and Mr and Mrs Redmond did accept, that it is reasonable to expect a pension recipient to ensure that any payments they receive are correct and to check the information that is set out in notices issued by the Secretary from time to time. Mr and Mrs Redmond failed to properly check the notices that were issued to them. Had they done so, they would have seen that the total income amount was incorrect. Even if, as they assert, calculating their aggregate annualised income in Australian dollars was too complicated, properly checking the notices issued to them against their actual monthly incomes would have been sufficient to alert them to a potential problem that could have been raised with Centrelink.

conclusion

18.     The decision under review is set aside and in place thereof the Tribunal decides that Mr and Mrs Redmond are entitled to payment of Age Pension in arrears.  The amount of arrears is to be calculated in accordance with these reasons.  The matter is remitted to the Respondent Secretary for that purpose.

I certify that the 18 preceding paragraphs are a true copy of the reasons for the decision herein of Mr S. Webb, Member

Signed:       ............................................
  Peter Strauch, Associate

Date of Hearing  8 August 2008
Date of Decision  27 August 2008
Representative for the Applicants Self Represented
Solicitor for the Respondent        Jennifer Maclean
  Centrelink Legal Services Branch