Rushton and Secretary, Department of Education, Employment and Workplace Relations

[2008] AATA 971

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2008] AATA 971

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2007/0889

GENERAL ADMINISTRATIVE DIVISION		)
Re		TRUDI RUSHTON

Applicant

And

SECRETARY, DEPARTMENT OF EDUCATION, EMPLOYMENT & WORKPLACE RELATIONS

And

SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES & INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Ms Robin Hunt, Senior Member

Date31 October 2008

PlaceSydney

Decision

The tribunal sets aside the reviewable decision of the Social Security Appeals Tribunal made on 2 March 2007 and substitutes a decision that: Mrs Rushton received overpayments of newstart allowance and disability support pension; the amounts of those overpayments constitute a debt of $52,469.15 owed to the Commonwealth; and the Commonwealth’s right to recover that debt, which arose by reason of overpayments of newstart allowance in the sum of $16,121.28 paid to Mrs Rushton during the period 1 April 2002 to 16 November 2003 and disability support pension in the amount of $36,347.87 for the period 17 November 2003 to 28 September 2006, is waived under section 1237AAD of the Social Security Act 1991.

....................[Sgd]...................

Ms Robin Hunt
  Senior Member

CATCHWORDS

SOCIAL SECURITY – overpayment of newstart allowance and disability support pension – applicant simultaneously receiving compensation payments – debt to Commonwealth – consideration of writing off debt – consideration of debt waiver – debt not due to sole administrative error – special circumstances – decision under review set aside.

Social Security Act 1991 (Cth) ss 1223, 1237A, 1237AAD

Social Security (Administration) Act 1999 (Cth) ss 68, 69

Department of Social Security v Hales (1998) 82 FCR 154

Director-General of Social Services v Hales (1983) 47 ALR 281

Re Bullivant and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2008] AATA 674

REASONS FOR DECISION

31 October 2008 Ms Robin Hunt, Senior Member   

summary

1.      Mrs Trudi Rushton receives indexed periodic compensation payments after suffering a workplace injury. Over a lengthy period, Mrs Rushton simultaneously received social security payments to which she was not entitled. Her periodic compensation payments were not taken into account in calculating her social security entitlements, resulting in overpayment and a large debt to the Commonwealth. The Secretary raised a debt and Mrs Rushton is resisting the demand to repay the debt. Mrs Rushton says she was ignorant of the need to disclose her compensation payments in order for Centrelink to adjust her social security entitlements. She also thought she had informed Centrelink when she enquired about her entitlements and she had supplied financial information. She acknowledged she did not, however, always keep Centrelink up to date when her compensation payments were adjusted from time to time.

2.      Mrs Rushton now has no means of repaying the debt. I have decided that special circumstances exist which warrant waiver of the debt. My reasons are set out below.

issue

3. The issue in this matter is whether there is a recoverable debt of $52,469.15, or whether any part of the debt should be waived pursuant to either section 1237A of the Social Security Act 1991 (‘the Act’) for sole administrative error or section 1237AAD of the Act in special circumstances.

analysis

4.      The Secretary claims a debt arising out of overpayment of two types of social security assistance given to Mrs Rushton. The debt of $52,469.15 is made up of newstart allowance (‘NSA’) in the sum of $16,121.28 paid to Mrs Rushton during the period 1 April 2002 to 16 November 2003, and disability support pension (‘DSP’) in the amount of $36,347.87 for the period 17 November 2003 to 28 September 2006. Mrs Rushton’s primary objective in these proceedings was to have the debt waived, written off in full or in part, or partially waived.

5.      According to the Secretary’s documents produced to the tribunal, Mrs Rushton applied for DSP on 19 November 2001.  The Secretary’s counsel contended that Mrs Rushton knew at the time of application that she was not entitled to social security payments while also receiving compensation because she had been told this previously. Counsel for the Secretary produced a letter dated 7 January 1994 which informed Mrs Rushton that she was not entitled to sole parent pension at that time because she had too much income.

6.      Under questioning, Mrs Rushton gave evidence to the effect that she understood she was unable to apply for social security payments for two or three years after her court case in 1994/1995. She agreed that she did not, however, apply for assistance in 1997. Mrs Rushton said she went to Centrelink in 2001 to enquire whether she was entitled to any form of assistance because her medication was getting too expensive for her to be able to meet her needs. An officer had told her that she was entitled to assistance and had helped her make a claim in 2001.

7.      Mrs Rushton gave oral evidence that, whenever she visited the Blacktown offices of Centrelink, she had to stand in a queue and found this very tiring. She had difficulty in concentrating and answering questions by the time she saw an officer because of pain and the effects of strong medication. This was particularly true on the day she made her claim in 2001. Her intention had been to enquire about possible entitlements and she was exhausted by the time she saw an officer. She explained that the pain from her injuries made it very difficult for her to stand for long periods but there was no option if she were to see anyone at Centrelink. She gave further evidence that, when she finally saw an officer, she had to wait in another queue to see someone else for her particular enquiry. When this second officer was available, Mrs Rushton said she was able to sit down but needed assistance to complete an application form. She recalled that two young women helped her fill out the application form; one wrote in some of the information and the other was supervising. The person who was doing the writing was seated at a workstation and filled out parts of the application form on her behalf and ticked many of the boxes required. Mrs Rushton identified her own ticks and distinguished these from a different style of tick which she thought were those of the officer who assisted her.

8.      In answer to question 2 on page 12 of the application form, Mrs Rushton disclosed two bank accounts, one with St George Bank and one with Commonwealth Bank. In the box for the account numbers, on the following page, there is a line drawn through and what appears to be phone numbers in the space where the name of the account holder is expected. Mrs Rushton’s application form also shows a tick in the “no” box on page 18 where there is a question about receipt of any lump sum payment in the last 12 months. No lump sum is disclosed but the parties agree that Mrs Rushton was awarded a lump sum of $42,000 in 1993/1994, well outside the 12 months involved and the question was properly answered.

9.      A question about income from other sources on page 22 of the form, shows a tick in the “no” box. On pages 23 and 24, details of Mrs Rushton’s compensation claim are set out and the 1993/1994 lump sum is disclosed. On page 24, in answer to the question ‘(H)ave you received or are you currently receiving any compensation payments from this claim?’ the “yes” box is ticked.  A tick in the “no” box is scribbled out. No details of the amounts being received, however, are entered where there is space for information about regular payments.

10.     Mrs Rushton gave evidence that the woman who was filling in the form asked her to bring in financial records and proof of identity. She thought she brought back the documents requested on the same day as she made the application. She said she had to stand in a queue again and found this very debilitating due to the pain and discomfort of standing a long time. She told the tribunal that she saw another officer who took the documents away to make photocopies before returning them to her. Mrs Rushton was not sure exactly what she had produced but thought she had supplied bank account statements and compensation payslips from the insurer, as well as identity documents. Mrs Rushton gave further evidence that it was totally incorrect to say that she was asked in 2001 to bring in only proof of identity and proof of bank balance.

11.     Mrs Rushton also said the date, 19 November 2001, written on her application form was not in her writing. She thought this may be explained by her having taken paperwork requested into Centrelink after she saw the officer who helped her make the claim. She thought this officer worked on her claim and processed it after receiving the documents produced following the initial conversation.

12.     In a Centrelink online document entry made on Monday, 19 November 2001, the date marked as the date of application, an officer noted that the “customer will bring all relevant ‘POI’ this week”. At one stage of the proceedings, counsel for the Secretary suggested that ‘POI’ stood for proof of identity. Another online entry also says the customer will bring her Austrian birth certificate along with naturalisation papers and adds reference to financial hardship. On file also is a treating doctor’s report signed by Dr Christine Tan on 16 November 2001, bearing Mrs Rushton’s signature on the front page, with date 15 November 2001, and stamped by Centrelink on 19 November 2001.

13.     There are also copies of two Centrelink letters, dated 23 November 2001, on file. One of these letters informed Mrs Rushton that she would receive NSA from 16 November 2001. The other informed her she was not eligible for DSP as Centrelink considered her disability “temporary”. By my calculation, the date of these letters was the Friday following 19 November 2001, and tallies with notes on the Centrelink file that Mrs Rushton would bring in more information or POI ”this week”.

14.     No financial documents whatsoever for Mrs Rushton are on the Centrelink file initially produced to the tribunal for the review. The Secretary’s counsel submitted that this suggested Mrs Rushton did not produce financial documents. Alternatively, I was asked to find that whatever she did produce was accepted by Centrelink officers as sufficient and was not kept on file. Counsel for the Secretary suggested that Mrs Rushton may have produced something less than substantial evidence of her true financial position and not bank statements or compensation payslips that Mrs Rushton told the tribunal she thought she had produced. Counsel for the Secretary argued that Mrs Rushton may have produced only an ATM receipt.

15.     Ms Marie Michele Latouche, a Centrelink officer who works at the Blacktown branch which Mrs Rushton said she attended, gave evidence at the tribunal hearing. Ms Latouche told the tribunal she had been at Blacktown since 1999, firstly on the reception counter, and then moving to another area in 2005. Ms Latouche said her duties at reception included “directing customers, collecting all the documents, registering them and passing them to the appropriate customer officer who was handling the case”. She described how she would stamp every single document before the customer left the counter, and would give the customer back the original documents, making sure every single page that needed to be stamped was stamped and signed.

16.     Ms Latouche agreed that, if there was an application for NSA or DSP, Centrelink would want bank statements. Concerning compensation payments, if a customer put on file that they were receiving compensation, or had applied for compensation, Ms Latouche said there was a special form called “Mod C” which would be given to the customer to complete and return. This applied in 2001 as well as at present.

17.     Ms Latouche agreed that it was correct to say that before a benefit can be granted, financial information had to be obtained from a Centrelink client.  Under further questioning, Ms Latouche agreed that, if the information does not appear on the customer file, it can be assumed that information supplied has been lost or misplaced. Ms Latouche gave evidence to the effect that Centrelink would be unable to process a claim without necessary information so, if a claim had been processed, all necessary documents would have been provided and anything missing would be requested back from the customer.

18.     She also gave evidence that normally in the morning there were few people who came to reception, but by mid-morning or late morning the queue could stretch out the door. After a customer had seen a person at the reception counter, the customer, depending on the inquiry, would be referred to another officer. Ms Latouche confirmed that this would occur with an application for NSA or DSP. Reception would organise someone else to see the customer. She agreed this could take some time depending on the number of people waiting, staff available, if an appointment was available, or if it was necessary to book an appointment for the customer to come back.  She agreed it was possible a customer could wait a considerable time.

19.     Ms Latouche also responded to questions about a copy of an undated request for information form, on file, which Centrelink addressed to Mrs Rushton. The request form gave the name and phone number of a Centrelink officer for Mrs Rushton to contact. The request asked for proof of identity and for proof of the balance of bank, building society and credit union accounts, and any other money invested such as bank books and bank statements. Ms Latouche was reluctant to agree to the proposition that the lack of a date on this document demonstrated a failure of best practice. Unfortunately, however, the lack of a date makes it difficult to know when Centrelink supplied this form to Mrs Rushton.

20.     When shown one of Mrs Rushton’s application forms, Ms Latouche agreed that many of the questions on the form were unanswered and that best practice for a person processing a claim would be to identify what questions, including questions about compensation, had not been answered and to have the form completed. Ms Latouche, went on to point out that, in some instances, less than complete information would be enough for Centrelink purposes. She further observed correctly that it was also the client’s responsibility to tell Centrelink of any information. Nevertheless, in circumstances where a customer was sitting at a workstation with an officer of the department, Ms Latouche confirmed it was part of the duty of the officer to assist the person to fill in a form. To the question whether this might encompass ticking a box “yes” or “no”, in answer to question 15 on page 30 of the application form, where the boxes should be completed one way or the other, Ms Latouche responded “maybe”.

21.     The Secretary’s bundle of four identity documents produced during the hearing consists of 2 pages stamped and signed with the date 23 November 2001, and 2 attached sheets which were not stamped or signed. The stamps do not specify the number of pages sighted. The four pages do not form one document but comprise what appears to be an Austrian birth certificate with a NSW driver’s licence and Medicare card photocopied as one document, an Australian naturalisation certificate comprising two pages, the front page of which is stamped while the second is unstamped, and an Australian marriage certificate which is unstamped. The stamp which appears on the two stamped and signed pages reads: ‘original document sighted and returned’ and bears the date below a signature which appears to be that of Ms Latouche. The second stamp is smaller than the stamp on the first page but contains the same words.

22.     As I have already said, no compensation slips or bank statements were produced by Centrelink and it was submitted by the Secretary’s counsel that they would have been included in the bundle if they had been produced. It was put to Mrs Rushton that had she produced compensation slips they would have been with this bundle or stamped in the same manner but Mrs Rushton did not agree. She continued to state that she had returned to Centrelink in order to produce all documents requested in association with her claim.

23.     It is impossible to know with any certainty what the officer who processed Mrs Rushton’s application accepted as evidence of her financial position because no financial evidence is available from the Centrelink file. The belated production by Centrelink for the review of copies of identity documents, stamped and signed on 23 November 2001, does not inspire me with confidence that no financial documents were produced, especially when I bear in mind Ms Latouche’s evidence that Centrelink would not have granted any social security payments without sighting some satisfactory type of financial records. I have not forgotten that the online Centrelink file refers to the need to produce POI, but this does not mean that financial records were not required also or were not already produced when this note was made. Mrs Rushton’s obvious disclosure to Centrelink of two bank accounts does not sit well with an argument that Mrs Rushton concealed her financial position.

24.     Copies of Commonwealth bank statements for 9 October 2001 to 7 December 2001 and also for November 2003, which Mrs Rushton produced in connection with the tribunal hearing, clearly show compensation payments an insurance company was making into Mrs Rushton’s account at the time of her claim. The insurer made payments into the account on 15 October 2001, 29 October 2001, 12 November 2001 and 26 November 2001 and the same insurer did so on 3 November 2003 and 17 November 2003. The bank statements and location displayed on the statements tally with the information Mrs Rushton disclosed on her claim form in 2001 and again in 2003.

25.     With the intervening years and lack of any record of what Mrs Rushton produced in 2001, it is impossible to say for certain what occurred. On balance, in view of the evidence of Ms Latouche as to Centrelink practice in the Blacktown branch Mrs Rushton attended, the Centrelink records showing that further information was required and expected before the grant of any social security assistance, and the fact that payments were approved on the day that Mrs Rushton was supposed to attend and produce various documents, I am reasonably satisfied that she did produce some financial records on or before 23 November 2001.

26.     There is some indication of what normally should be produced in a copy of a Centrelink letter addressed to Mrs Rushton, on 17 November 2003, which informs her of what she must bring along to her appointment on 28 November 2003. This letter is accompanied by a long list of matters for which Mrs Rushton was asked to supply documentation. About halfway down page one of two of the list, she was asked to bring:

Bank Card or Passbook – Current passbook/credit card/ATM card with financial institution showing your signature.

Bank statement – Recent statement for current credit card/ ATM card or cheque account at financial institution in your name and address. Not ATM receipt.

27.     Mrs Rushton’s second claim for DSP was made on 23 November 2003. On page 18 of the 2003 form, she again discloses the same two bank accounts as on the 2001 form. On page 19 of the 2003 form, she discloses one of her bank account numbers. Some details of her compensation claim are filled in, such as the amount of the lump sum received and the year of her compensation claim. Question 3 on page 29 asking, “(H)ave you ever received regular compensation payments?” is left blank. A handwritten note, which looks like a copy of a post-it note and which is attached to page 31 of the photocopy of the claim form before me, contains the words “Comp settled 95”. Unlike the 2001 application form, this form does not disclose that Mrs Rushton was receiving compensation instalments. On the other hand, Mrs Rushton’s evidence again was that she was assisted by a Centrelink officer in filling out the form and that she had already disclosed her compensation payments in 2001. In view of this evidence and the letter of 17 November 2003 informing her that she must bring the bank records described above, I am not reasonably satisfied that Mrs Rushton did not produce the bank information requested to enable the grant of DSP in consequence of the 2003 claim.

28.     I do not consider Mrs Rushton entirely blameless, however. Centrelink sent regular notices to Mrs Rushton. Many of these were the usual notice advising a social security recipient of current entitlements or payments for a period and were despatched at least once a month. These notices routinely included a statement that Mrs Rushton must notify Centrelink if there were any change in her circumstances.  Mrs Rushton admitted she received these notices over the period of the overpayments giving rise to the debt raised. She also admitted that she did not respond to Centrelink although her compensation payments increased from time to time. She explained that the increases were small amounts in line with inflation and she thought that Centrelink would be aware of this. She did not think of these stepped increases as a change in circumstances.

29. Mrs Rushton is at fault in this respect. Sections 68 and 69 of the Social Security (Administration) Act 1999 (‘the Administration Act’), empower the Secretary to seek and obligate the recipient of a social security payment to provide particular information as to a specified event or change in circumstances, or the provision of a particular statement within 14 days. Mrs Rushton admits she failed to do this despite regular notices informing her of her obligation to report any change in circumstances. Had she reported increases in her compensation instalment payments, the overpayments being made to her may have come to light much sooner.

is there a debt?

30. I find that the total overpayments constitute a debt owing by Mrs Rushton to the Commonwealth pursuant to section 1223 of the Act. Mrs Rushton did not query the correctness of the calculations performed by Centrelink but has sought relief on other grounds.

possible waiver

31. Subsection 1237A(1) of the Act provides for waiver of a debt that has arisen in consequence of sole administrative error made by the Commonwealth, but only in circumstances were the debtor has received the payment in good faith. Section 1237AAD of the Act provides for waiver of a debt in part or in whole if special circumstances exist that make it desirable to waive as opposed to write off the debt, provided the debt did not arise wholly or partly from the debtor making a false statement or representation or failing or omitting to comply with a provision of the Act.

Consideration of administrative error

32.     As Deputy President Hotop said in Re Bullivant and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2008] AATA 674 (‘Bullivant’), the fundamental precondition of waiver under subsection 1237A(1) of the Act is that the debt, or a proportion thereof, be “attributable solely to an administrative error made by the Commonwealth”.

33.     Mrs Rushton contended that the whole of the abovementioned debt owed to the Commonwealth is attributable solely to administrative error on the part of Centrelink in failing to act upon information which she provided. In order to determine the validity of that contention in Bullivant, Deputy President Hotop broke up the total overpayment period into certain discrete periods and considered the circumstances of each period. This does not greatly assist in the present matter as Mrs Rushton either did or did not make the necessary information available at the time of her two applications that gave rise, firstly, to NSA payments in 2001 onwards, and two years later, DSP.

34.     In the context of sole administrative error, I conclude that Mrs Rushton had an obligation to notify Centrelink if her annual income exceeded a nominated amount or her payments increased over the intervals for which she received notices.  Her belief that her compensation instalment payments did not prevent entitlement to assistance, despite the instalments being within the definition of income, and notifications that she must report any change in circumstances, cannot be attributed to administrative error. Her belief is significant in making a finding she received payments in good faith but does not excuse her from the obligation to notify Centrelink of changes in her income, however minor, when so requested.  In failing to notify Centrelink when requested, I conclude that Mrs Rushton contributed to continuation of ongoing administrative error up to the time Centrelink discovered the error.

35.     In consequence, I conclude that administrative error in this matter was contributed to by both parties and any finding of sole administrative error by the Commonwealth is unjustified.

Special Circumstances

36. In addressing the issue of special circumstances, I have turned to provisions concerning the Commonwealth’s right to recover the whole or part of the debt owed to it and possible waiver under section 1237AAD of the Act.

37. As I have remarked above, Mrs Rushton’s belief that she was entitled to the payments she received shows she acted in good faith. On balance, I accept that she held a mistaken belief that small increases to her compensation payments in accordance with cost of living rises need not be reported in response to letters of obligation as it is well known that payments of this kind are reviewed from time to time. Therefore, I am satisfied that the overpayments did not result, wholly or partly, from Mrs Rushton, or another person, knowingly making a false statement or a false representation, or knowingly failing or omitting to comply with a provision of the Act or the Administration Act. Paragraph (a) of section 1237AAD of the Act is, accordingly, satisfied in this case.

38. For the purposes of paragraph (b) of section 1237AAD and whether “there are special circumstances (other than financial hardship alone) that make it desirable to waive” the Commonwealth’s right to recover the whole or part of the debt, I have referred to dicta in the case of Department of Social Security v Hales (1998) 82 FCR 154 (‘Hales’). French J, as he then was, referring to section 1237AAD of the Act, said:

From time to time in the administration of social security benefits overpayments occur. Sometimes these are the result of innocent non-compliance with the requirements of the law which can be affected by the stress associated with the circumstances that led to the receipt of benefits in the first place. The taxpayer is entitled to expect that in the ordinary course money paid to people which they are not entitled to receive will be recovered, albeit in a way appropriate to the circumstances which led to the overpayment and the circumstances of the person concerned. However, the confining of a recovery regime by rigid rules, particularly in this area of the law, is likely to be productive of unfair or harsh outcomes in some of the great variety of fact situations that can arise. There are provisions in the Act which recognise that reality. They relate to the writing off and the waiver of debts otherwise due to the Commonwealth. ...

39.     I think that Mrs Rushton’s is such a case. Mrs Rushton’s failing to notify Centrelink when asked for advice of any change in circumstances may have been the result of innocent non-compliance with requirements affected by stress associated with the circumstances that led to the receipt of benefits in the first place. Mrs Rushton also was under considerable physical distress whenever she visited Centrelink’s offices. She was experiencing difficulty in purchasing the medication she required despite having some income from compensation. She was in severe pain and confused by strong medication.

40.     It is plain that Mrs Rushton would have been entitled to NSA or DSP if she were not in receipt of the income from compensation payments which gave rise to her debt. A decision as to her entitlement was made on the basis of medical evidence and assessment in November 2003. She was granted NSA instead of DSP in 2001 because, although her condition was very poor at that time, the decision-maker wrongly, as it turned out with hindsight, concluded it was temporary.

41.     At the date of Mrs Rushton’s 2001 application for DSP, her treating GP, Dr Tan, wrote in her report for the claim that she suffered various health problems and was taking several medications. Dr Tan referred to her back pain and to iron deficiency anaemia which made her tired, dizzy and lethargic. She was having weekly injections. She also had a reflux problem which caused chest pain and required further medication. In her later report for the DSP claim in 2003, Dr Tan wrote, on 24 November 2003, that Mrs Rushton had chronic back, abdominal, neck and shoulder pain as a result of falls in 1989, 1990 and 2000. She required regular panadeine forte which led to chronic constipation. Dr Tan stated, among other things, that Mrs Rushton was unable to stand for long hours. Mrs Rushton had by then also undergone angiogram and stenosis of mid right coronary artery. She was undergoing counselling for depressed mood and had emphysema and was unable to concentrate. There were other health deficiencies and medications as well.

42.     French J (now French CJ) in Hales, explained how and when a debt might be waived in special circumstances, saying:

The concept of special circumstances is broad. A constellation of factors, including financial circumstances, may fall within it. The express exclusion of financial hardship alone as a special circumstance is an indicator that it would otherwise be included. This gives some measure of the range of circumstances which will qualify as special. But as a matter of grammar and ordinary logic, the exclusion of financial hardship alone as a special circumstance does not mandate its inclusion in the range of matters constituting such circumstances for the purpose of enlivening the Secretary’s discretion.

...

The evident purpose of section 1237AAD is to enable a flexible response to the wide range of situations which could give rise to hardship or unfairness in the event of a rigid application of a requirement for recovery of debt. It is inappropriate to constrain that flexibility by imposing a narrow or artificial construction upon the words. It may be that there will be few cases in which the Secretary will be satisfied that there are special circumstances in the absence of financial hardship. It may be that there are few cases in which having found special circumstances to exist, the Secretary would exercise the discretion to waive in the absence of financial hardship. But to anticipate the limits of the categories of possible cases by imposing on the language of the section a fetter upon its application which is not mandated by its words, is to erode its useful purpose.

43.     I consider that Mrs Rushton’s situation is one where the waiver provision should be exercised flexibly as His Honour suggests. While Mrs Rushton’s financial circumstances are better than most social security recipients, she has more than usual expenses associated with pain control and other health conditions. She is fortunate that her estranged husband allows her to remain in the former matrimonial home and assists with some of her expenses and that she receives regular compensation, albeit in small instalments. Her financial circumstances alone do not constitute special circumstances without something more. I note, nevertheless, that her bank balance in all the statements furnished is consistently just above nil funds. She has explained that this is due to the high cost of her medication. It may be that she is entitled to a health card or could claim some concession for her medication but she gave evidence she did not have this benefit during the time she was overpaid. This again suggests she was not fully informed of possible entitlements and obligations.

44.     Overall, I consider Mrs Rushton’s health is unusually or uncommonly poor and contributes to special circumstances. Her oral evidence was that her compensation is not adequate to enable her to purchase all the medication she needs. Dr D Tang saw Mrs Rushton in 2007 at the request of her legal aid solicitor and furnished a report on 29 July 2007. Dr Tang observed Mrs Rushton had anxiety and chronic depression as well as hypertension and insomnia. Dr Tang described her multiple health problems in some detail and commented that her constant pain had resulted in depression which was a disease of the mind. This led her to anhedonic and melancholic state. Dr Tang noted that her impecunious state led to additional stress. He referred to her multiple medications and the expense of these, as well as the resulting danger and detriment to Mrs Rushton’s health of being able to afford only those most necessary for her treatment. He also referred to the additional stress caused her by having to fill out forms.

45.     Dr Bruce Westmore, forensic psychiatrist, who saw Mrs Rushton in connection with the review process on 13 September 2007, noted Mrs Rushton’s long history of multiple chronic problems as reported by Dr Tang. Dr Westmore on 14 September 2007 furnished an extensive report and noted that the deduction of $20 from her fortnightly payments of approximately $650 would significantly impact on her and that this would impact on her mood state. Dr Westmore recommended at the end of his report that Mrs Rushton might benefit from pain management assessment and treatment and further use of antidepressants.

46.     In a further report on 24 September 2007, Dr Westmore confirmed his earlier opinion that Mrs Rushton suffered from an adjustment disorder which was a reactive disturbance of mood. He further opined that the financial and social hardship likely to result to Mrs Rushton from reduced Centrelink payments would make her life more difficult and potentially aggravate her adjustment disorder.

47.     In addressing the totality of circumstances in this matter, I have weighed up whether requiring Mrs Rushton to repay her debt would mean she is treated unfairly to such an extent that these also are special circumstances which should excuse the debt.  In so doing I acknowledge that Mrs Rushton has contributed to the outcome, because of her perceptions and misunderstandings about reporting obligations.

48.     The issue of debt accumulation is affected by the length of time of the erroneous payments. The accumulation stems from failure to investigate any overpayment until August 2006, when Centrelink checked Mrs Rushton’s income details with the Australian Taxation Office and found she was in receipt of additional income. When contacted by Centrelink, Mrs Ruston made a telephone call in response on 31 August 2006 and advised Centrelink that she was in receipt of compensation payments. This conversation is recorded in the Centrelink papers before me.  I also note Centrelink either failed to obtain financial information from Mrs Rushton, which was desirable and usual practice according to the Secretary’s witness, before approving her payments or Centrelink did not adequately peruse bank statements or compensation slips if they were produced in 2001 and 2003 as Mrs Rushton claims.

49. From my analysis I conclude that to recover the accumulated debt from Mrs Rushton would be unfair and that her circumstances are unusual and uncommon. Further, I recognise that the imposition of a significant accumulated debt on Mrs Rushton has caused her increasing anxiety and concern about how it will be repaid and how it will make it even more difficult for her to obtain the medication she needs. As well as finding special circumstances do exist in this matter, I have already found that Mrs Rushton did not knowingly omit to comply with a provision of the Act. In so finding I acknowledge and accept her evidence as to her perception about what information she should have provided. I also note that the chance of recovery of the debt is scant in view of Mrs Rushton’s financial position and poor health. This was a relevant consideration for the majority of the Full Federal Court in Director-General of Social Services v Hales (1983) 47 ALR 281, per Lockhart and Sheppard JJ. I have therefore reached the conclusion that the reviewable decision should be set aside

decision

50.     The tribunal sets aside the reviewable decision of the Social Security Appeals Tribunal made on 2 March 2007 and substitutes a decision that:

a.Mrs Rushton received overpayments of newstart allowance and disability support pension;

b.the amounts of those overpayments constitute a debt of $52,469.15 owed to the Commonwealth; and

c.the Commonwealth’s right to recover that debt, which arose by reason of overpayments of newstart allowance in the sum of $16,121.28 paid to Mrs Rushton during the period 1 April 2002 to 16 November 2003 and disability support pension in the amount of $36,347.87 for the period 17 November 2003 to 28 September 2006, is waived under section 1237AAD of the Social Security Act 1991.

I certify that the 50 preceding paragraphs are a true copy of the reasons for the decision herein of Ms Robin Hunt, Senior Member

Signed: .........................[Sgd].............................
  Jennifer Wong, Associate

Date/s of Hearing  22 February and 8 April 2008
Date of Decision  31 October 2008
Counsel for the Applicant  L Karp
Solicitor for the Applicant  Legal Aid Commission NSW
Representative for the Respondent          Centrelink Legal Services