Simmonds and Secretary, Department of Social Services (Social services second review)
[2016] AATA 360
•31 May 2016
Simmonds and Secretary, Department of Social Services (Social services second review) [2016] AATA 360 (31 May 2016)
Division
GENERAL DIVISION
File Number(s)
2015/4307
Re
Terrence Simmonds
APPLICANT
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 – age pension - whether applicant overpaid age pension during relevant debt period – whether overpayment of age pension is 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 Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
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
Mr Simmonds seeks a review of a decision of the (former) Social Security Appeals Tribunal (SSAT), dated 12 June 2015, affirming a decision to raise and recover from Mr Simmonds an Age Pension (AP) debt totalling $6,680.68 for the period 20 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, Mr Simmonds commenced receiving monthly payments of $1,300 (or $15,600 per annum) from his SuperWrap pension plan (allocated pension) from BT Funds Management Limited.
From 29 June 2012, Mrs Simmonds (Mr Simmonds’ wife) commenced receiving monthly payments of $1,360 (or $19,200 per annum) from her SuperWrap pension plan (allocated pension) from BT Funds Management Limited.
On 20 March 2013, Centrelink granted Mr Simmonds AP.
Throughout the Debt Period, Mr Simmonds and Mrs Simmonds were issued with notices under s 68(2) of the Social Security (Administration) Act 1991 (Administration Act) notifying them of their obligation to advise Centrelink of changes to their circumstances. Relevantly, this included the receipt of:
…...income from income streams.
On 16 April 2013, Centrelink sent Mr Simmonds an “Income and Assets Statement” that “represented all of the income and assets that Centrelink currently [held] on [his] records” (Statement). The Statement listed, inter alia, details in respect of Mr Simmonds’ allocated income stream but failed to note any details in respect of Mrs Simmonds. The Statement requested that Mr Simmonds “advise [Centrelink] within 14 days of receiving this notice if details are incorrect”.
On 31 July 2014, following an income stream review using internal channels, Centrelink requested that Mr Simmonds and Mrs Simmonds provide details of their respective income streams.
On 28 August 2014, Mr Simmonds and Mrs 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 received monthly pension payments from BT Funds Management Limited, with total gross annual income totalling $19,200.
Mrs Simmonds’ income stream from BT Funds Management Limited was not taken into account by Centrelink in assessing Mr Simmonds’ entitlement to AP in the Debt Period.
By letter dated 29 October 2014, Centrelink advised Mr Simmonds that in the Debt Period he was paid AP in the amount of $25,418.04, but was entitled to $18,737.36, and that the difference, of $6,680.68, was a debt which was recoverable in full by Centrelink (Decision).
On 21 November 2014, Mr Simmonds requested review of the Decision on the basis that he:
believe[s] required docs...had been lodged not just once, but several times.
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 Mr Simmonds’ debt (totalling $$6,680.68) 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 partner’s BT Funds Management income stream on 28 August 2014 and 8 September 2014. However I have taken into account the information the department provided to you in letters that were sent to you when your Age Pension was granted that told you of the income that was being assessed. 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.
On 12 June 2015, Mr Simmonds 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:
13. 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.
14.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 [22]) that Mr Simmonds’ debt could not be written off under s 1236 of the SSA) and (at [28]) that it could not be waived under s 1237A of the SSA due to Centrelink administrative error and (at [35]) that it could not be waived under s 1237AAD of the SSA due to “special circumstances”.
On 19 August 2015, Mr Simmonds applied to the Tribunal for a review of the SSAT Decision. Mr Simmonds’ stated “Reasons for Application” are:
All of our papers were sent in to Collie Centrelink.
ISSUES
The relevant issues for consideration by the Tribunal in this case are whether:
(i)Mr Simmonds was overpaid AP in the Debt Period; and, if so
(ii)the overpayment of AP to Mr Simmonds is a debt due to the Commonwealth; and
(iii)Mr Simmonds’ debt should be written off or waived.
Each of these issues is considered, in turn, below.
CONSIDERATION
(i)Was Mr Simmonds overpaid AP in the Debt Period?
It is not in dispute that Mr Simmonds was overpaid AP, totalling $6,680.68, in the Debt Period.
(ii) Is the overpayment of AP 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 Mr Simmonds was overpaid AP, totalling $6,680.68, 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 Mr Simmonds’ rate of AP 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) Should the overpayment of AP to Mr Simmonds 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:
· Mr Simmonds’s debt is not “irrecoverable at law” (within the meaning of s 1236(1B) of the SSA);
· Mr Simmonds has capacity to repay the debt via installments at a fortnightly rate. (Mr Simmonds is currently repaying the debt by way of fortnightly withholdings of $100.);
· Mr Simmonds’ whereabouts are known; and
· it is cost effective for Centrelink to take action to recover the debt.
Consequently, Mr Simmonds’ AP 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 Mr Simmonds’ AP debt. Rather, Mr Simmonds’ AP debt arose because Centrelink was not notified of Mrs Simmonds’ allocated pension from BT Funds Management Limited until 28 August 2014.
Mr Simmonds and Mrs Simmonds were issued with various notices under s 68(2) of the Administration Act throughout the relevant period which advised them of their obligation to inform Centrelink of any changes to their circumstances which included, ‘”income.. .from income streams”: On 16 April 2013, Mr Simmonds was issued with a notice advising him that his rate of AP had been calculated using a “combined annual income of $7,442.22”. The notice informed Mr Simmonds to advise Centrelink within 14 days of any changes to his circumstances. Further, on 16 April 2013, an “Income and Assets Statement”’ was issued to Mr Simmonds by Centrelink which reflected his allocated income stream with an asset value of $156,012 and income stream of $7,432 per annum. No details were provided to Centrelink in respect of Mrs Simmonds’ allocated income stream. Mr Simmonds was again advised of his obligation to inform Centrelink within 14 days if any details contained within the statement were incorrect. Despite this, there is no record of Mr Simmonds or Mrs Simmonds contacting Centrelink to advise of Mrs Simmonds’ 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 and Mr Simmonds applied for AP 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 13 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 Mr Simmonds’ AP debt was contributed to due by Centrelink’s delay in processing the information Mrs Simmonds gave it on 28 August 2014 concerning her pension on 28 August 2014 (i.e. the decision to raise the debt against Mr 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, Mr Simmonds’ AP 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 Mr Simmonds’ case.
The relevant issue for consideration is whether there are “special circumstances” (other than financial hardship alone) that make it desirable to waive Mr Simmonds’ AP 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].
At the SSAT hearing, Mrs Simmonds advanced the following submissions in respect of “special circumstances” relevant to Mr Simmonds’ case:
· Mr Simmonds had not received a social security payment prior to 20 March 2013;
· Mr Simmonds and Mrs 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
· Mr 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 Centrelink’s delay in raising Mr Simmonds’ AP debt and that the raising of the debt may have caused Mr Simmonds to fall into a degree of financial difficulty. However, the Tribunal finds that there is nothing sufficiently unusual, uncommon or “special” about Mr Simmonds’ circumstances to warrant the waiver of Mr Simmonds’ AP debt under s 1237AAD of the SSA. There is no evidence of severe financial hardship and Mr Simmonds has capacity to repay his debt via withholdings from his on-going AP payments.
DECISION
For the above reasons, the Tribunal affirms the SSAT Decision.
I certify that the preceding 36 (thirty -six) 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 In person Representative for the
RespondentMr 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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Statutory Construction
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Appeal
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Jurisdiction
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Remedies
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