Simmonds and Secretary, Department of Social Services (Social services second review)
[2016] AATA 358
•31 May 2016
Simmonds and Secretary, Department of Social Services (Social services second review) [2016] AATA 358 (31 May 2016)
Division
GENERAL DIVISION
File Number(s)
2015/3853
Re
Marilyn Simmonds
APPLICANTS
And
Secretary, Department of Social Services
RESPONDENT
DECISION
Tribunal Senior Member CR Walsh
Date 31 May 2016 Place Perth The Tribunal affirms the decision under review.
.............[Sgd]...........................................................
Senior Member CR Walsh
CATCHWORDS
SOCIAL SECURITY – newstart allowance - whether applicant was overpaid newstart allowance during relevant debt period – whether overpayment of newstart allowance a debt due to the Commonwealth – whether debt should be written-off - whether all or part of the debt should be waived – whether debt due solely to administrative error by Centrelink – whether “special circumstances” exist – decision under review affirmed
LEGISLATION
Social Security Act 1991 – s 1223(1) – s 1236 – s 1236(1B) – s 1237 – s 1237A – s 1237AAD – s 1237AAD(a) – s 1237AAD(b)
Social Security (Administration) Act 1991 – s 68(2)
CASES
Angelakos and Secretary Department of Employment and Workplace Relations [2007] FCA 25
Beadle and Director-General of Social Security (1985) 60 ALR 225
Davy and Secretary, Department of Employment and Workplace Relations [2007] AATA 1114
Dranichnikov v Centrelink [2003] 75 ALD 134
Fischer v Secretary, Department of Families, Housing, Community Service & Indigenous Affairs (2010) 185 FCR 52
Groth and Secretary, Department of Social Security (1995) 40 ALD 541
Re Beadle and Director-General of Social Security (1984) 6 ALD 1
Re Ivocic and Director-General of Social Services [1981] AATA 57
Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126
REASONS FOR DECISION
Senior Member CR Walsh
31 May 2016
INTRODUCTION
Mrs Simmonds seeks a review the decision of the (former) Social Security Appeals Tribunal (SSAT), dated 12 June 2015, affirming a decision by Centrelink to raise and recover a Newstart Allowance (NA) debt from Mrs Simmonds totalling $14,235 for the period 5 March 2013 to 13 October 2014 (Debt Period) under s 1223(1) of the Social Security Act 1991 (SSA).
FACTUAL & PROCEDURAL BACKGROUND
From 29 June 2012, Mrs Simmonds commenced receiving monthly payments of $1,360 (or $19,200 per annum) from her SuperWrap pension plan (allocated pension) from BT Funds Management Limited.
From 29 June 2012, Mr Simmonds (Mrs Simmonds’ husband) commenced receiving monthly payments of $1,300 (or $15,600 per annum) from his SuperWrap pension plan (allocated pension) from BT Funds Management Limited.
On 5 March 2013, Centrelink granted Mrs Simmonds NA.
Throughout the Debt Period, Mrs Simmonds was issued with notices under s 68(2) of the Social Security (Administration) Act 1991 (Administration Act) notifying her of her obligation to advise Centrelink of changes to her circumstances. Relevantly, this included the receipt of:
…...income from income streams.
Specifically, Centrelink sent Mrs Simmonds notices on 4 August 2014, 26 June 2014, 23 May 2014, 17 April 2014, 31 March 2014, 17 March 2014, 6 January 2014, 23 December 2013, 14 October 2013, 30 September 2013, 22 July 2013, 8 July 2013 and 6 June 2013, requiring Mrs Simmonds to inform Centrelink within 14 days of any changes in her circumstances affecting her rate of NA which included “income...from income streams”.
The notices further detailed that Mrs Simmonds’ rate of NA was being paid on the basis of her fortnightly income being either $0.17 or $0.21, depending on the date of the notice.
On 31 July 2014, following an income stream review using internal channels, Centrelink requested Mrs Simmonds and Mr Simmonds provide details as to their respective income streams.
On 28 August 2014, Mrs Simmonds and Mr Simmonds responded to Centrelink advising it, inter alia, that Mrs Simmonds had a SuperWrap pension plan (allocated pension) with BT Funds Management Limited which she purchased on 29 June 2012 for $67,469 and that from 29 June 2012 she had been receiving monthly pension payments from BT Funds Management Limited, with total gross annual income totalling $19,200.
Mrs Simmonds’ income stream BT Funds Management Limited was not taken into account by Centrelink in assessing her entitlement to NA for the Debt Period.
By letter dated 29 October 2014, Centrelink advised Mrs Simmonds that for the Debt Period she was paid NA in the amount of $18,437.47, but was entitled to $4,202.40, and that the overpayment of $14,235 was a debt which was recoverable in full (Decision).
On 21 November 2014, Mrs Simmonds requested review of the Decision on the basis that she:
believes she provided information.. .numerous times, not just once.
On 4 February 2015, a Centrelink Authorised Review Officer (ARO) reviewed and affirmed the Decision (ARO Decision). In the ARO Decision, the ARO determined that Mrs Simmonds’ debt (of $14,235) could not be waived under s 1237A of the SSA (Centrelink administrative error) or under s 1237AAD of the SSA (special circumstances) for the following reasons:
I acknowledge that the department contributed to the debt through the delay in processing the information that had been given about your BT Funds Management income stream on 28 August 2014 and again on 8 September 2014. However I have taken into account the information the department provided to you in letters that told you of the income that was being assessed in working out your rate of Newstart Allowance and explained your obligation to advise the department of changes in your income. I have not found that the debt was caused solely by the department’s error and have decided that the debt cannot be waived under this provision (section 1237A of the Act).
A debt may be waived if there are special circumstances (section 1237AAD of the Act). Your circumstances need to be sufficiently unusual or uncommon to be termed special. The term ‘special circumstances’ is not defined in the Act, however the department’s policy guidelines and the relevant case law indicates that there must be some factor or factors, which take the case out of the ordinary run of cases. Such circumstances should be sufficiently unusual or uncommon enough to justify non-recovery of public money. This test is not easily satisfied and I have not found that the debt can be waived under this provision in your case.
Mrs Simmonds subsequently applied to the SSAT for a review of the ARO Decision and, on 12 June 2015, the SSAT affirmed the ARO Decision (SSAT Decision). In the SSAT Decision, the SSAT noted:
14.At hearing Mrs Simmonds initially strongly asserted that she provided everything to the lady at the Collie offie of Centrelink when she and her husband went in to lodge their claim forms in March 2013. However, later in the hearing when the tribunal went over the documents attached to her husband’s claim for age pension, which did not include a one page summary of her allocated pension which was provided in relation to her husband, but did include her Bankwest Hero transaction statement for the period 13 February 2013 to 25 February 2013 which reported two deposits from “BT Portfolio”, she said she assumed she provided all the information Centrelink needed. However, on further reflection she said she was not sure she provided the same one page document as her husband had provided. She noted that she keeps asking herself “Did she” or “Didn’t she” provide to Centrelink a similar BT Funds Management statement setting out the allocated pension purchase price and monthly amount. In conclusion she said she feels she handed in all the information required by Centrelink. Mrs Simmonds confirmed that a stamped cop-y of the documents she and her husband provided to the Collie office of Centrelink was not given to her. However she said she recalls the lady did take a photocopy of the documents.
15.On balance, the tribunal prefers Centrelines evidence that Mrs Simmonds only provided a copy of her Bankwest Hero Transaction statement for February 2013 but did not provide details of her BT Funds Management Limited allocated pension (e.g. purchase price and monthly amount) when she lodged her claim for newstart allowance or when her husband lodged his claim for age pension’
In the SSAT Decision, the SSAT also found (at [23]) that the debt could not be written off under s 1236 of the SSA) and (at [33]) that it could not be waived under s 1237A of the SSA due to Centrelink administrative error and (at [40]) that it could not be waived under s 1237AAD of the SSA due to “special circumstances”.
On 24 July 2015, Mrs Simmonds applied to the Tribunal for a review of the SSAT Decision. Mrs Simmonds’ stated “Reasons for Application” are:
I was sure I sent my information as I sent my husbands along with mine.
ISSUES
The relevant issues for consideration by the Tribunal in this case are whether:
(i)Mrs Simmonds was overpaid NA totaling $14,235 in the Debt Period; and, if so
(ii)the overpayment of NA to Mrs Simmonds is a debt due to the Commonwealth; and
(iii)Mrs Simmonds’ debt should be written off or waived.
Each of these issues is considered, in turn, below.
CONSIDERATION
(i)Was Mrs Simmonds overpaid NA in the Debt Period?
It is not in dispute that Mrs Simmonds was overpaid NA, totalling $14,235, in the Debt Period.
(ii)Is the overpayment of NA to Mrs Simmonds a debt due to the Commonwealth?
Section 1223(1) of the SSA provides that if an amount is paid to a person and the person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit, then the amount paid is a debt to the Commonwealth.
It is common ground that Mrs Simmonds was overpaid NA, totalling $14,235, in the Debt Period as a result of Mrs Simmonds’ “income stream” from BT Funds Management Limited not being taken into account by Centrelink in assessing Mrs Simmonds’ rate of NA for the Debt Period, as it should have, and that this overpayment constitutes a debt due to the Commonwealth pursuant to s 1223(1) of the SSA.
(ii) Whether Mrs Simmonds’ NA debt should be written off or waived?
Write-off – s 1236 of the SSA
Section 1236 of the SSA provides:
Secretary may write off debt
(1) Subject to subsection (1A), the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise.
(1A) The Secretary may decide to write off a debt under subsection (1) if, and only if:
(a) the debt is irrecoverable at law; or
(b) the debtor has no capacity to repay the debt; or
(c)the debtor’s whereabouts are unknown after all reasonable efforts have been made to locate the debtor; or
(d)It is not cost effective for the Commonwealth to take action to recover the debt.
Based on the evidence before the Tribunal:
· Mrs Simmonds’s debt is not “irrecoverable at law” (within the meaning of s 1236(1B) of the SSA);
· Mrs Simmonds has capacity to repay the debt via installments at a fortnightly rate. (Mrs Simmonds is currently repaying the debt by way of fortnightly withholdings of $50 from her on-going NA payments);
· Mrs Simmonds’ whereabouts are known; and
· it is cost effective for Centrelink to take action to recover the debt from Mrs Simmonds.
Consequently, Mrs Simmonds’ NA debt cannot be written off under s 1236 of the SSA.
Waiver: administrative error – s 1237A of the SSA
Section 1237A of the SSA provides:
Waiver of debt arising from error
Administrative error
(1)Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to an administrative error made by the Commonwealth if the debtor received in good faith the payment or payments that gave rise to that proportion of the debt. [Emphasis added]
In Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126, the Full Federal Court considered the meaning of the phrase “attributable solely to” for the purposes of s 1237A of the SSA. The Court said at [35]:
The ordinary or usual interpretation of the phrase “attributable solely to” is that it refers to the single or sole cause of the relevant act or event. The word “attributable” means “capable of being attributed”. It involves an objective assessment of causation. The words “a debt attributable solely to an administrative error” can be paraphrased as meaning that the only cause that objectively can be ascribed to the relevant debt is an administrative error.
There is no evidence of sole administrative error by Centrelink being the cause of Mrs Simmonds’ NA debt. Rather, Mrs Simmonds’ NA debt arose because Centrelink was not notified of Mrs Simmonds’ allocated pension from BT Funds Management Limited until 28 August 2014.
Mrs Simmonds and Mr Simmonds were issued with notices under s 68(2) of the Administration Act throughout the relevant period. Specifically, Mrs Simmonds was issued with notices under s 68(2) of the Administration Act on 4 August 2014, 26 June 2014, 23 May 2014, 17 April 2014, 31 March 2014, 17 March 2014, 6 January 2014, 23 December 2013, 14 October 2013, 30 September 2013, 22 July 2013, 8 July 2013 and 6 June 2013. Those notices required Mrs Simmonds to inform Centrelink within 14 days of any changes in her circumstances affecting her rate of NA which included “income...from income streams”. The notices further detailed that Mrs Simmonds’ rate of NA was being paid on the basis of her fortnightly income being either $0.17 or $0.21, depending on the date of the notice. Despite this, there is no record of Mrs Simmonds contacting Centrelink to advise it of her allocated pension from BT Funds Management Limited until responding to Centrelink’s request for information on 28 August 2014.
The Tribunal acknowledges Mrs Simmonds’ contention that she “provided everything to the lady at the Collie office of Centrelink when she and her husband went in to lodge their claim forms in March 2013”. However, there is no corroborating evidence to support Mrs Simmonds’ contention that she notified Centrelink about her allocated pension at the time she applied for NA on 13 March 2013 and, by her own admission to the SSAT, Mrs Simmonds has advised of her own uncertainty in respect of same: refer to paragraph 14 above. Similarly, Mrs Simmonds’ oral evidence at the hearing before this Tribunal was that she “couldn’t’ recall specifically what she gave Centrelink that day (i.e. on 13 March 2013)”.
Whilst the Tribunal acknowledges that Mrs Simmonds’ debt was contributed to by Centrelink’s delay in processing the information Mrs Simmonds gave it on 28 August 2014 concerning her pension (i.e. the decision to raise the debt against Mrs Simmonds was not made by Centrelink until 29 October 2014), that does not represent sole administrative error on the part of Centrelink for the purposes of s 1237A of the SSA. Consequently, Mrs Simmonds’ NA debt cannot be waived all or part of the debt under section 1237A of the SSA.
Waiver: special circumstances – s 1237AAD of the SSA
Section 1237AAD of the SSA:
Waiver in special circumstances
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, the Administration 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.
It is not in dispute that s 1237AAD(a) of the SSA is satisfied in Mrs Simmonds’ case.
The relevant issue for consideration is whether there are “special circumstances” (other than financial hardship alone) that make it desirable to waive Mrs Simmonds’ NA debt for the purposes of s 1237AAD(b) of the SSA.
The expression “special circumstances” has been considered extensively by the Federal Court and the Tribunal in the context of social security and family assistance law. In summary, it has been held that for circumstances to constitute “special circumstances” they must be circumstances which are “unusual, uncommon or exceptional,” “markedly different from the usual run of cases,” “special” or “out of the ordinary” and they include “events which would render the (strict application of the rule in question) unfair or inappropriate:” see for example, Re Ivocic and Director General of Social Services [1981] AATA 57 at [45]; Re Beadle and Director-General of Social Security (1984) 6 ALD 1 at 3 per Toohey J; Beadle and Director General of Social Security (1985) 60 ALR 225 at 228 as per Bowen CJ, Fisher and Lockhart JJ; Groth and Secretary, Department of Social Security (1995) 40 ALD 541 at 545 per Kiefel J; Dranichnikov v Centrelink [2003] 75 ALD 134 at [66] per Hill J; Angelakos and Secretary Department of Employment and Workplace Relations [2007] FCA 25 at [33] and Davy and Secretary Department of Employment and Workplace Relations [2007] AATA 1114 at [80]. Circumstances might be “special”, although they apply to more than one person or class of persons, provided they are not of universal application (for example, they are a common or universal characteristic of social security recipients): see Fischer v Secretary, Department of Families, Housing, Community Services & Indigenous Affairs (2010) 185 FCR 52 at [65].
Mrs Simmonds’ contentions concerning her “special circumstances” are, in summary, as follows:
· Mrs Simmonds has been diagnosed and treated for anxiety and depression following the raising of the NA debt. This is corroborated in the report of Dr Mei, dated 5 October 2015;
· Mrs Simmonds finished work at the Red Cross in October 2014 as she could no longer “deal with things”;
· Mrs Simmonds was suggested to apply for NA by Centrelink staff and had not received a social security payment prior to 5 March 2013;
· Mrs Simmonds and Mr Simmonds were forced to forgo travelling plans with their caravan due to recent financial hardship that had arisen due to the debt and the need to financially support their son and daughter; and
· Mrs Simmonds is required to pay excess overpayments due to the delay in the raising of the debt until the end of October 2014.
The Tribunal acknowledges the medical certificates dated 24 April 2015 and 28 July 2015 completed by Dr Stanakzai, general practitioner, that detail Mrs Simmonds’ current medical conditions as chronic back pain, hypertension and depression.
The Tribunal acknowledges that the raising of the debt may have caused Mrs Simmonds’ health to deteriorate and for her to fall into a degree of financial difficulty. However, Mrs Simmonds’ circumstances are not sufficiently unusual, uncommon or “special” to warrant her NA debt being waived all or part of the debt under s 1237AAD of the SSA. There is no evidence of severe financial hardship and Mrs Simmonds has capacity to repay her debt via withholdings from her on-going NA payments.
DECISION
For the above reasons, the Tribunal affirms the SSAT Decision.
I certify that the preceding 38 (thirty- eight) paragraphs are a true copy of the reasons for the decision herein of Senior Member CR Walsh .............[Sgd]...........................................................
Administrative Assistant
Dated 31 May 2016
Date of hearing 4 April 2016 Applicant
Representative for the
RespondentIn person
Mr A Burgess
Solicitors for the Respondent
Sparke Helmore Lawyers
Key Legal Topics
Areas of Law
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Administrative Law
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Statutory Interpretation
Legal Concepts
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Judicial Review
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Procedural Fairness
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Standing
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Statutory Construction
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Appeal
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Remedies
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