Rumere and Secretary, Department of Family and Community Services - [2002] AATA 470

DECISION AND ORAL REASONS FOR DECISION [2002] AATA 470

ADMINISTRATIVE APPEALS TRIBUNAL )

) No S2001/361

GENERAL ADMINISTRATIVE DIVISION       )
           Re      DEBORAH ANNE RUMERE
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES
  Respondent

DECISION

Tribunal Senior Member WJF Purcell

Date23 May 2002
PlaceAdelaide

Decision      For the reasons given orally at the Hearing of this matter, the Tribunal affirms the decision under review.
  (Signed)
  WJF PURCELL
  (Senior Member)
CATCHWORDS
SOCIAL SECURITY – pensions, benefits and allowances – Newstart Allowance – whether there are grounds to waive recovery of all or part of the debt – special circumstances – applicant found guilty in Magistrate's Court of knowingly making false statements and knowingly receiving payments to which she was not entitled – reparation order made for entirety of debt
Social Security Act 1991 sections 1237AAD, 1344(1)(a), 1347(b)

ORAL REASONS FOR DECISION

23 May 2002 Senior Member WJF Purcell

This is an application for review of a decision of the Social Security Appeals Tribunal (the SSAT) of 23 August 2001, which affirmed the decision of an Authorised Review Officer of 12 November 1999, to raise and recover an overpayment of Newstart Allowance in the amount of $12,006.31 for the period 21 June 1997 to 9 April 1999.
The evidence before the Tribunal comprised the documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (the T Documents), together with exhibits tendered by the parties. The applicant appeared on her own behalf, and gave oral evidence. Mr Kilderry represented the respondent (the Department).
The applicant first lodged a claim for Newstart Allowance on 23 December 1996. She worked casually at TAFE and was paid five weeks in arrears. She lodged her fortnightly form for payment of Newstart Allowance, providing an estimate of income earned. She received a lump sum from TAFE, which she did not declare to Centrelink. During the period 21 June 1997 to 9 April 1999 she declared income totalling $3,880, whereas her actual income during that period was $42,021.27. A debt of $12,006.31 was raised for this period. After reconsideration, the amount of the debt was increased to $12,018.10 because the actual dates worked were used in the recalculation. The Authorised Review Officer considered the original amount of $12,006.31, and the SSAT considered its jurisdiction was limited to considering the same amount.
On 24 August 2000, in the Adelaide Magistrate's Court, the applicant pleaded guilty to 19 counts of obtaining benefit which was not payable to her, pursuant to section 1347(b) of the Social Security Act 1991 (the Act), and 21 counts of making false statements to obtain benefits, pursuant to section 1344(1)(a) of the Act. A conviction was recorded with imprisonment for 15 months imposed, but suspended upon her entering into a good behaviour bond of $500 for a period of 2 years. A reparation order was made in the amount of $12,018.10.
When the applicant lodged her application for review in this Tribunal, she provided the following statement:
"I wish to appeal against Centrelink who have charged me with Social Security Fraud and have prosecuted me in the Magistrates Court. I have learnt that through my ignorance of a very complicated Welfare payment system for Casual Income earners I have ended up with a huge debt and a criminal record.
During the time of overpayment I was under severe stress due to my son's depression as a result of the grief from his father's death which subsequently lead to a substance abuse problem. I alerted Norwood Centrelink of these problems and they referred me to the social worker at the time Karen Tierney. She advised me to have domestic violence counselling. I told her my son refused to register for unemployment benefits and this is where Centrelink let me down. There was lack of referral to the proper agencies. I should have been referred to a financial counsellor at Centrelink to sort out my financial affairs. Only after I returned from China this year did I really understand the role of Financial Counsellors at Centrelink and the Counsellor picked up my problem immediately and referred me to Daphne at Fays. This never happened during that stressful time with my son.
The domestic violence counsellor advised me to evict my son from my home after several weeks of intensive counselling. It took several calls to the police before I finally did it. It was the most painful thing I have ever done in my life.
In addition to this my work pay periods did not match with my Newstart Allowance. This made it very difficult for me to work out how much I earned. On top of this my employer always paid me at least 5 weeks in arrears. This is still happening now as Daphne will point out even though I haven't been paid I still have to declare my income and I can't receive any benefits for that fortnight because I have earned too much so I end up with nothing for that fortnight. How do I pay my rent and buy food? Furthermore, on several occasions my number of hours were reduced due to a decline in student numbers and for 10 weeks of the year I was on holidays.
Finally, I am still confused as to why I have several different amended group certificates for the same financial years from Centrelink. For 1997-98 FY I received a certificate on 31 January 2000 saying I earned $1,323.48 and for the same financial year on 6 December 1999 I received an Amended Certificate saying I earned $815.47.
For the 1998-99 I also experienced the same problem with conflicting Amended Certificates. Please see the information attached. On these occasions when I received the Amended Certificates I took them to the Taxation Office to be processed. This confused the Tax Department as well and now I end up with a Tax bill of over $1,000 which also includes a $106 penalty for filling in an incorrect return.
I believe that as a result of lack of referral and assistance from the appropriate people in Centrelink I have ended up in this disastrous situation which has contributed to the stress in my life as well as a serious financial burden." [T7]
At the hearing, the applicant provided written submissions in the following terms:
"I wish to appeal against Centrelink who have charged me with Social Security Fraud and have prosecuted me in the Magistrates Court. I have learnt that through my ignorance of a very complicated Welfare payment system for Casual Income earners I have ended up with a huge debt and a criminal record. Furthermore, throughout this whole process administrative errors have arisen which have totally confused me and have made the situation worse for me.
I wish to appeal under section 1237AAD Waiver in Special Circumstances. I wish to retract my statement that I made in the SSAT that I knowingly made false statements to Centrelink about my Newstart Allowance. The correct statement is that I might have made a false statement but I did not do it knowingly. Furthermore, there were special circumstances in which this mistake of overpayment occurred. I have letters from Domestic Violence Counsellor Margaret Rose, Dr Damien Mead to the Priority Housing Committee, of SA Housing Trust, Damage bill from the Trust, a letter from social worker Waluwe Simpson-Lyttle all explaining the difficulties I had with my son at the time of the mistake with Centrelink. Additionally, Centrelink made an Administrative Error when I met with Centrelink social worker Karen Tierney and informed her of the serious problem. Unfortunately, there is no record of this meeting as stated in a letter sent to me June 28, 1999. See letter attached. However, I do recall telling Ms Tierney I was casual income earner and needed some financial assistance in organising my financial welfare and also helping me to organise my son's financial welfare who was abusing me due to his severe depression resulting in lack of income and his unwillingness to register for unemployment benefits. The administrative error occurred when I was not referred to a Financial Information Officer at Centrelink. It was not until I returned from China in 2001 that I knew such a person existed in Centrelink. Irene Kontas Financial Officer at Adelaide Centrelink understood immediately the great difficulty I had co-ordinating my casual earnings with Centrelink income. On many occasions even now I have no income from Casual Income or Centrelink benefits for a whole month because I must declare my income before it comes into my Bank account. Casual earners often have to wait five weeks before they get paid. This is the payroll system in some Government jobs. I cannot stress enough the fact that this led to my mistake as I must always earn my wages before I receive them. Furthermore, I was not informed about the Centrelink loans people can take out to cover this gap. Moreover, I never received any Tax Certificates from Centrelink during the time of my mistake and the one's that I obtained later had varying amounts for the same financial years which then led to me paying a Tax bill on top of my debt. The Tax Department changed my tax debt on a number of ocassions [sic] on the advise [sic] of Centrelink. This added to my stress. Please see a list of the Tax Certificates with varying amounts attached for the years of my overpayment. To add to this confusion while working for TAFE at the time of the mistake my working hours were halved within 24 hours notice on several occasions. I was often told I was not guaranteed a job for the next term, I never was paid in school holidays which make up 3 months of the year and my Centrelink form during some of this period needed only to be given to Centrelink every 3 months.
I would like to state that I acted in Good Faith and I would argue against my criminal conviction. I was advised by my lawyer to plead guilty even though I felt I was not guilty. I wanted to appeal but I was ignorant of the law and did not realize that I must appeal within 4 weeks of the court's decision. For financial reasons after my court case I went to China to obtain full time work because I could not afford to live on Centrelink benefits in Australia.
I acted in Good Faith when I made mistakes on the New Start forms. I knew there was something wrong but I did not think it was in my control because everything was so confusing. I was very depressed at the time due to the abuse at home as mentioned previously. I also have problems with figures and may have alcalculia.
I believe there has been an Error of Law on the part of the Tribunal as there has been a misinterpretation of the law with a basis on legalistic jargon and an oversight on the social justice and moral issues involved in my case. This could lead to discrimination of people who are in poor circumstances as is my case. Please see my Income Expenditure Statement from Family and Community Services which shows I am in debt.
Finally, if the AAT cannot overrule the Court decision then I would like my case to to [sic] be re-opened in the Court. As I did not understand the law clearly when I pleaded guilty. Administrative errors have been made in regards to my court case with a miscalculation of over $5,000 more than the true amount of my overpayment to Centrelink. Please see the incorrect figure on my Police report and the letter attached dated 24 January 2002 from Tonia Nielsen for the Director of Public Prosecutions to Mr Ray Kilderry from Centrelink, explaining there has been an error in the amount. I have waited for two months for the Records Release officer from the police Department to contact me regarding the collection of my new National Police Certificate with the correct figure for my Centrelink fraud charge but as yet have not received any response. Why is it taking so long to correct this error when it has been made official that it was a true error. I am grateful to have this Tribunal because if I had not brought this mistake to the Tribunal it would never have been rectified.
I would like my case to be re-examined and in hindsight I should have lodged an appeal, however, my right of appeal which had to be done within 4 weeks of the court's decision was never made known to me."
The Department contends that section 1237AAD of the Act does not apply because the debt resulted from the debtor knowingly making false statements or failing or omitting to comply with provisions of the Act. Having failed to satisfy section 1237AAD(a), which relates to special circumstances, no other provision will assist the applicant.
The Department also contends that the applicant has pleaded guilty in the Adelaide Magistrate's Court, where she was represented by a legal practitioner, to 19 charges under section 1347(b) of the Act, of knowingly obtaining benefit, and 21 charges under section 1344(1)(a) of the Act of knowingly making false statements. In addition, a reparation order was made by the Court.
Section 1237AAD of the Act provides:
"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."
Section 1347 of the Act provides:
"A person must not knowingly obtain:
(a)       payment of a social security payment under this Act or of fares allowance; or
(b)       payment of an instalment of a social security payment under this Act;
for which the person is not eligible, or which is:
(c)       not payable at all; or
(d)       only payable in part."
Section 1348 of the Act provides:
"A person must not knowingly obtain:
(a)       payment of a social security payment under this Act or of fares allowance; or
(b)       payment of an instalment of a social security payment under this Act; or
(ba)     payment of financial supplement;
by means of:
(c)       a false or misleading statement made knowingly or recklessly; or
(d)      impersonation; or
(e)       a fraudulent device."
It is clear on the evidence that the applicant has suffered a number of misfortunes in recent times, and errors by the Department, the Australian Taxation Office and the South Australian Police have added to her distress. The Department has provided three different Group Certificates for the 1997/98 financial year and for the 1998/99 financial year, which led to problems and adjustments of amounts payable to the Australian Taxation Office. The South Australian Police National Police Certificate dated 8 May 2001 records the compensation figure as $18,012.10 instead of $12,018.10. The Commonwealth Director of Public Prosecutions (DPP) has provided a letter of 24 January 2002 attaching a copy of the Certificate of Record in relation to the matter, which states that the reparation order was $12,018.10. The DPP suggests that the South Australian Police made an error in entering the amount. The applicant has not received, as yet, the amended National Police Certificate. All these administrative difficulties have arisen in more recent times, but have added to her general distress.
The applicant has submitted that the discretion provided in section 1237AAD of the Act should be exercised in her favour. That discretion however, may be waived if the debt did not result wholly or partly from the debtor knowingly making a false statement, or failing or omitting to comply with the provisions of the Act. In this matter the applicant pleaded guilty and has been convicted of 19 counts under section 1347 of the Act and 21 counts under section 1348 of the Act. In these circumstances, the exercise of discretion under section 1237AAD of the Act is not appropriate.
The applicant maintains now that she might have made a false statement, but did not do it knowingly, and wishes to pursue avenues of appeal in the appropriate jurisdiction to set aside the convictions. In any event, the conviction on 24 August 2000 is extant, and I am satisfied, on the evidence therefore, that the applicant made false statements to the Department, and it is not appropriate that the discretion provided by section 1237AAD of the Act should be exercised in her favour. I am satisfied also, that none of the provisions within Part 5.4 of the Act – "non recovery of debts" – could provide relief to the applicant.
For these reasons, the Tribunal affirms the decision under review.

I certify that the 15 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member WJF Purcell
Signed:         .....................................................................................
  Associate
Date of Hearing  23 May 2002
Date of Decision  23 May 2002
Counsel for the Applicant        In person
Solicitor for the Applicant         -
Counsel for the Respondent    Mr R Kilderry
Solicitor for the Respondent    Centrelink