Reed and Secretary, Department of Social Services (Social services second review)

[2019] AATA 5031

Reed and Secretary, Department of Social Services (Social services second review) [2019] AATA 5031 (29 November 2019)

Division:GENERAL DIVISION

File Number:           2019/0929

Re:Sally May Reed

APPLICANT

AndSecretary, Department of Social Services

RESPONDENT

DECISION

Tribunal:Dr Stewart Fenwick, Senior Member

Date:29 November 2019

Place:Melbourne

The Tribunal affirms the decision under review.

................[sgd]......................................................

Dr Stewart Fenwick, Senior Member

Catchwords

SOCIAL SECURITY – mobility allowance – when qualification for allowance ceased – whether requirement to inform of change in circumstances met – whether debt solely attributable to administrative error made by the Commonwealth – decision under review affirmed

Legislation

Social Security Act 1991

Social Security (Administration) Act 1999

Cases

Secretary, Department of Family & Community Services v Sekhon (2003) 73 ALD 41

REASONS FOR DECISION

Dr Stewart Fenwick, Senior Member

29 November 2019

BACKGROUND

1. Ms Reed has applied for review of a decision of the Social Services and Child Support Division (AAT1) dated 5 February 2019 in which the decision of an Authorised Review Officer (ARO) dated 24 July 2018 was affirmed. The ARO decided that Ms Reed was liable to repay a debt in relation to payments of Mobility Allowance in the sum of $9,054.46. The debt is currently being recovered at the rate of $50 per month.

2. Ms Reed received the allowance as a result of an eye condition, about which there is no dispute. Rather, the key issue arising relates to her continuing entitlement to the allowance, and the proper interpretation to be given to communications between             Ms Reed and Centrelink, in the context of the entitlement and reporting provisions under the Social Security Act 1991 (the Act). Ms Reed’s entitlement arose from her engagement in paid work and vocational training.

3. Ms Reed represented herself at the hearing and lodged several documents in support of her application. T-documents were lodged on behalf of the Secretary, as well as a Statement of Facts, Issues and Contentions (SFIC). A supplementary submission was provided by the Secretary’s representative after the hearing. This was prepared at my request following submissions at the hearing on the administrative impost facing the Secretary in managing information provided by recipients of benefits.

   LEGISLATION

4. The qualification for Mobility Allowance, at what is known as the standard rate, is set out in s 1035 of the Act. To qualify, a person must have a physical or mental disability          (ss 19 and 23) and satisfy the travel test in subsection (2):

   A person satisfies the travel test … if the person is required to travel to and from the person’s home for the purpose of undertaking:

   (a)       gainful employment; or

   (b)      vocational training; or

   (c)      job search activities; or

   (d)      voluntary work; or

   (e)      a vocational rehabilitation program.

5. Under s 19 of the Act, gainful employment is defined as meaning paid employment or   self-employment that is intended to result in financial gain. Voluntary work is defined in     s 1035 of the Act as ‘work approved by the Secretary undertaken in a voluntary capacity for charitable, welfare or community organisations’.

6. Each of the relevant qualifying activities is addressed separately in s 19(1) of the Act, and it is common to each that the Secretary must be of the opinion that the person is unable to use public transport without substantial assistance, and that this is the result of their disability.

7. Additional qualifying criteria are set out for each activity type, in addition to a residency requirement. In the case of employment, vocational training, and voluntary work, the person must be so engaged for at least 32 hours in every four week period   (ss 1035(1)(a), (b) and (f)). A person may also undertake a combination of any two of these activities with the same time commitment (ss 1035(1)(g)).

8. Under s 1035A of the Act, a person may qualify for Mobility Allowance at what is known as the higher rate if they are receiving or have received other payments types, including the Disability Support Pension. The travel test also applies to this form of qualification, together with other specific qualification criteria.

9. The Act provides for continuing entitlement to the allowance for 12 weeks after the time at which they would ordinarily cease to be so entitled (s 1046(3)), where persons were undertaking the qualifying activities of gainful employment, vocational training, and voluntary work.

10. Under s 68(2) of the Social Security (Administration) Act 1999 (the Administration Act), the Secretary may give a person notice to inform the Department if a specified event or change of circumstance occurs, or if they become aware such is likely to occur (ss 68(2)(a)). A notice may also require the person to give a statement or statements about a matter that might affect the payment (ss 68(2)(b)).

11. In circumstances where a person does not comply with a notice under s 68(2), then pursuant to s 100 of the Administration Act a payment is deemed to be payable at a reduced rate from the day on which an event or change of circumstances (not advised to the Department) occurs.

12. There is also what is described as a ‘general requirement to inform of a change of circumstances etc.’ in s 66A of the Administration Act. Under ss 66A(2) if a person is receiving a social security payment and an event or change of circumstance occurs that might affect the payment, they must advise the Department within 14 days of the event or change.

13. Under s 1223(1) of the Act, where a payment is made in the absence of an entitlement, the amount paid is deemed to be a debt due to the Commonwealth. 

14. There is power to write off a debt in particular circumstances under s 1236 of the Act. These are if the debt is irrecoverable at law; there is no capacity to repay; the debtor’s whereabouts are unknown; or it is not cost effective to do so.

15. There is also a power to waive a debt under s 1237 of the Act. Relevantly here, waiver may be considered if it ‘is attributable solely to an administrative error made by the Commonwealth’ (s 1237A), or if there are special circumstances arising (s 1237AAD). Waiver under s 1237AAD arises where the debt did not wholly or partly arise from a false statement or representation, or failing or omitting to comply with the Act or the Administration Act, and there are special circumstances other than financial hardship alone, and it is more appropriate to waive than write off the debt or part of it.

    CIRCUMSTANCES

16. The hearing dealt almost exclusively with submissions and there was no detailed recitation of evidence. It is not apparent from the material available to me when Ms Reed commenced receiving Mobility Allowance. However, the allowance was paid at least between February 2014 and early April 2018 (T27, pp 112-120) and based on documents cited below, was originally paid from some time in 2010. Ms Reed also received the Disability Support Pension (see for example T8, 9 and 10, pp 39-65 and T14, pp 72-73), and other allowances, but again, the full periods of payments do not appear from the documentary record.

17. I set out here a summary of the circumstances in this matter, based on material lodged with the Tribunal.

    (a)Review of Mobility Allowance form, dated 5 July 2010 (T3, pp 9-15). States         Ms Reed employed at Big W, working 24 hours per two week period and 48 hours over a four week period.

    (b)Certification of enrolment as part time student, dated 11 May 2012 (T4, pp 19-20). States Ms Reed is enrolled in Course 1: Certificate IV in Business Management with a start date of 30 April 2012, and end date of 29 April 2013. Also states she is enrolled in Course 2: Diploma Management, with a start date of 30 April 2013, and end date of 30 April 2014. Both courses are described as ‘Part time 10hrs per week’.

    (c)Review of Mobility Allowance form, dated 23 August 2012 (T5, pp 21-27). States Ms Reed is undertaking the above Certificate IV course but provides an expected end date of 29 April 2012. Also states employed at Big W, working 18 hours per two week period and 36 hours over a four week period.

    (d)Information required for continuation of Pensioner Supplement form, dated          22 April 2013 (T6, pp 33-35). States Ms Reed will continue to study Diploma Management, with end date of 30 April 2014.

    (e)Centrelink notice ‘Your Mobility Allowance’ dated 1 August 2013 (T7, pp 37-38). On page two of this notice appears, among other information, the following:

    What you have to tell us

    This request is an information notice give under social security law. You must tell us within 14 days if:

    ·     you change your address

    ·     you stop working or change who you work for

    ·     you stop or change your training activity

    ·     you stop your voluntary work or change who you work for

    ·     the number of hours you work and/or spend at your training activity and/or spend undertaking voluntary work falls below 32 hours over a four week period …

    (f)Customer contact report dated 5 June 2014 (T33, p 128). States Ms Reed reported online that her net annual income was $0.00.

    (g)Centrelink letter dated 19 January 2017 (T12, pp 66-67).  Letter commences ‘This is a reminder that you must tell us about any changes that may affect your payment’.

    (h)Review of Mobility Allowance forms issue dates 6 March 2018 and 27 March 2018 (T15 and 16, pp 75-90). Forms state, in part:

    Purpose of this form  The information asked for on this form is needed to make sure that you can still be paid Mobility Allowance.

    (i)Suspension of your Mobility Allowance form dated 17 April 2018 (T17, pp 91-92).

    (j)Customer contact printout dated 23 April 2018 (T34, p 145) records among other things, the following:

    Customer contacted CC CENTRAL COAST on 23 APR 2018 regarding General Enquiry for Mobility Allowance …

    Customer contacted on 12/04/2018 to inform that that she had stopped working on 16/03/2018 … but it was noted after submission of activity that no income has been declared since 2015 … no other approved activity had been recorded

    Follow up required as customer has not declared any income since 2015, yet states worked until 16/03/2018 …

    (k)Account payable notice dated 23 April 2018 (T18, pp 93-94). Amount payable stated as $5,911.85 for the period 20 November 2015 to 19 April 2018. Letter states in part:

    Why this amount is payable

    To qualify for Mobility Allowance it is required that you meet the activity test of 32 hours over a 4 week period. Our records indicate that you ceased to meet activity test requirements at Big W on 27/08/2015. You were entitled to a 12 week Period of Grace and this ended on 19/11/2015 …

    (l)Customer contact printout dated 30 April 2018 (T34, p 147). States in part:

    …cust advised has been working for a private business not for wages as such but to have her phone bill paid … felt this was voluntary work for mobility purposes, however I advised cust that voluntary work must be for a not for profit, welfare/community based organisation and will not meet criteria for Mob. Purposes.

    (m)Customer contact printout dated 10 May 2018 (T34, p 149). States in part:

    customer states that in 2014 she called to advise that was no longer working regular or guaranteed hours at Woolworths and was taken off reporting. cust states that at this time she informed CLK that she would be working in the family business as we did not cancel the Mobility Allowance at that time she presumed she was still entitled to receive it.

    (n)Annotations made to above customer contact note were made on   21 or 22 June 2018 (T34, pp 149-152). Annotations state in part:

    Customer advised she called approx.. 4.5 yrs ago to advise she ceased working with BIG W and needed to be taken off reporting … advised me that she started working in her mother’s business … she told Centrelink when she ceased working for BIG W when she ceased declaring income … cannot entirely remember whether she called into her local CSC that is located “around the corner” or phoned the call centre – but insists she advised change in circumstances …

    Customer was being paid Mobility Allowance based on employment with BIG W (WOOLWORTHS).

    Previous MA003’s lodged 15/07/2011 & 30/08/2012.[1]

    [1] This is the document code for Review of Mobility Allowance forms.

    As per EANS[2] reported, customer’s employment hours with BIG W reduced to below the required 32 hours over a four week period on 01/02/2013.

    [2] The Centrelink internal coding for Earnings.

    As per EDCH, customer ceased study with AUSTRALIAN EDUCATION ACADEMY PTY LTD on 30/04/2014 (See POE[3] supplied 30/08/2012).

    [3] The Centrelink internal coding for Proof of Enrolment.

    Customer has advised the work performed with [mother’s business] is not a consequence of an employer/employee relationship. Customer advised she never received payslips or had a formal employee arrangement.

    (o)‘Information about a recent decision’ letter dated 22 June 2018 sent to Ms Reed (T19, p 95) restating the amount payable as $9,054.56. Letter states in part:

    After careful consideration, I have decided the original decision was incorrect. The decision is now based on the information supplied, you ceased to meet the activity test requirements for Mobility Allowance on     30 April 2014. You were entitled to a 12 week Period of Grace and this ended on 23 July 2014 …

    (p)Decision of ARO dated 24 July 2018 (T21, pp 98-100). Decision states in part:

    I have found you ceased the required 32 hours work in a 4 week period at Big W on 1 February 2013 when your hours were significantly reduced.

    I have found you ceased qualifying studies on 29 April 2014.

    A 12 week period of grace can be applied from 30 April 2014 to                23 July 2014.

    In the period 24 July 2014 to 19 April 2018 you were not participating or undertaking gainful employment, vocational training, job search activities, voluntary work or a vocational rehabilitation program …

    SUBMISSIONS

18. Ms Reed submitted at the hearing that she did not believe the accumulation of the debt was her fault. She stated that she needed the allowance to assist her ‘getting about’. In relation to her work, Ms Reed gave evidence that she ceased working with Big W in order to assist with her mother’s business, and would have stayed with them if she knew she was to lose her allowance.

19. Ms Reed submitted that she informed Centrelink that she was commencing work with her mother. In relation to the study component, Ms Reed stated that she provided Centrelink with documentation about her studies.

20. The representative of the Secretary stated at the hearing that it may appear that Ms Reed had advised Centrelink of everything it needed to know. However, it was also submitted that Ms Reed failed to correctly advise of a change in her circumstances as required by the legislation. Her work in the family business was not capable of meeting the employment test. In relation to her qualifying study, it was submitted that, while the Department was in possession of a statement from the education provider, there remained an obligation to notify once Ms Reed completed her studies.

21. It was also submitted on behalf of the Respondent that the special circumstances test was a high bar. There was, it was argued, no sole administrative error as it was not possible for Centrelink systems to track everything going on in individual cases, and not reasonable to expect that this might happen. It was also submitted in the SFIC that the circumstances for write off of the debt under s 1236 of the Act are not satisfied.

22. The supplementary written submission lodged on behalf of the Secretary after the hearing addresses, principally, the issue of sole administrative error. It is submitted that ‘solely’ in s 1237A of the Act should be given its ordinary meaning and cited Secretary, Department of Family & Community Services v Sekhon (2003) 73 ALD 41 in support of this view.

23. It was further submitted that Ms Reed was given notice in August 2013 requiring her to advise of a relevant change of circumstance and that there is no evidence that she complied. A finding of administrative error in this case requires the conclusion that failing:

    to take into account general information given by a person in assessing  qualification for a payment, relating to possible future events (in this case the end date of the course and two years before that possible event), when assessing entitlements at a future time, is an administrative error. It is clearly not. Or the absence of an administrative process that provided for this is an administrative error. It is clearly not.

24. In the context of the size of the social security system and the volume of transactions taking place at any point in time, it was submitted that such an approach is unreasonable and would place an ‘impossible administrative burden on the Department’. Accordingly, s 1237A of the Act is not enlivened.

    CONSIDERATIONS

25. The preliminary issue is when Ms Reed ceased being qualified for Mobility Allowance.     A further issue is the consequence of the state of knowledge imputed to Centrelink and which informed the making of decisions regarding Ms Reed’s entitlement to Mobility Allowance.

26. The extracts from the material provided, set out above, indicates some uncertainty about when Ms Reed informed Centrelink that she had ceased to be in gainful employment.        I accept that it is possible that this information was provided by her as she submitted. However, I also consider the issue is somewhat clouded by the range of reports made relating to earnings.

27. The question of when Ms Reed’s employment earnings fell below the required threshold was not directly aired at the hearing, but equally, neither party sought to challenge the basis on which this decision was made by Centrelink. I therefore accept that this form of qualification ceased in or around February 2013.

28. Further, I accept that Ms Reed’s engagement with her mother’s business was not an activity that met the requisite test for gainful employment in that she was not a wage earner. I am also satisfied it does not meet the test for voluntary work.

29. There is no dispute that Ms Reed was also qualified on the basis of her participation in vocational training. There is no dispute as to the period in which this training was conducted. I accept that Ms Reed was engaged in vocational training until 30 April 2014, and that this was a basis for qualification.

30. Accordingly, payment was made to Ms Reed in the absence of entitlement and must be considered a debt under s 1223(1) of the Act. I accept the submission on behalf of the Secretary that the criteria for write off of the debt under s 1236 are not satisfied. I note in this respect that Ms Reed is currently repaying the debt in instalments.

31. The issue arising from the parties’ submissions, then, is whether the circumstances support waiver of the debt under s 1237A of the Act on the basis the debt is attributable solely to an administrative error made by the Commonwealth. More specifically, is it reasonable to expect Centrelink to manage payments to Ms Reed following provision of a statement at a point in time that a qualifying activity (in this case vocational training) will last for the period notified?

32. The most complete notification provided to Centrelink was the confirmation of enrolment letter from May 2012. Ms Reed also supplied Centrelink with the end date of her Diploma of Management in the Pensioner Supplement form in April 2013.

33. I accept that Ms Reed was provided with a document in August 2013 which in part included notification of a requirement to advise of changes to her qualifying activities, including if ‘you stop or change your training activity’. I note this document is described in the Respondent’s SFIC as an ‘obligation notice’. On its face this document is not issued under any specific provision, and does not reference any specific reporting provision. In its reference to providing advice within 14 days it appears to reflect the general reporting obligation under s 66A of the Administrative Act.

1. On the evidence available to me, I find that the last point in time at which Ms Reed actively notified Centrelink about undertaking vocational training was April 2013.

2. I accept the submission put on behalf of the Respondent that it is not appropriate to characterise what occurred in this matter as an administrative error. It may be intuitively appealing to consider notification of a future intention to be a satisfactory notice of the events described. However, it is entirely possible that the events described might not occur as foreshadowed. In such circumstances, entitlement would cease. An alternative hypothesis might be that Centrelink should have issued a Review of Mobility Allowance form earlier than those on record, which were sent to Ms Reed in 2018.

3. Both examples serve to demonstrate the flaw in thinking it appropriate to reverse the obligation that rests with the recipient of benefits. I understand this fundamental obligation to arise from both reporting requirements (ss 66A and 68(2) of the Administration Act) and the fact that under the Act a lack of entitlement is sufficient to create a debt (s 1223(1) of the Act).

4. While it may not be necessary to consider this waiver provision further, I add that even were it appropriate to characterise Centrelink’s purported failure to recall, or to in some way register, a future end date of a qualifying activity for purposes of its administration of Mobility Allowance, I do not consider that this would amount to sole administrative error. This is because of the effect of the provisions cited immediately above which placed a reporting requirement upon Ms Reed and which, when not met, contributed to the continued payment of the allowance.

5. I must also consider whether the criteria for waiver under s 1237AAD of the Act apply. I accept that Ms Reed failed or omitted to comply with a provision of the Act or the Administration Act. It is also necessary to consider whether special circumstances apply, and that it is more appropriate to waive than to write off the debt or part of it.

6. Ms Reed has a relatively extensive history of receiving social security benefits. As noted, I am unable to determine when she first commenced receiving payments but they span a number of payment types, over several years. I consider that this demonstrates Ms Reed is well informed about the social security system, and the record demonstrates she is capable of engaging effectively with Centrelink. Taken as a whole, I do not see the circumstances of Ms Reed’s overpayment to reveal anything that might be considered as particularly unusual so as to be considered ‘special’.

   CONCLUSION

7. While I accept that Ms Reed has given a straightforward account of her dealings with Centrelink, I am unable to accept the proposition that the information she provided to the agency must be seen to satisfy the reporting obligations otherwise imposed by the legislation.

   DECISION

8. For the reasons given, the Tribunal affirms the decision under review.

I certify that the preceding 41 (forty-one) paragraphs are a true copy of the written reasons for the decision herein of Dr Stewart Fenwick, Senior Member

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Associate

Dated: 29 November 2019

Date(s) of hearing:	16 September 2019
Applicant:	In person
Advocate for the Respondent:	Mr Brian Sparkes
Solicitors for the Respondent:	Department of Human Services