Somenthal and Secretary, Department of Social Services (Social security) - [2025] ARTA 1276

Somenthal and Secretary, Department of Social Services (Social security) [2025] ARTA 1276 (17 March 2025)

Applicant/s: Ms Somenthal

Respondent: Secretary, Department of Social Services

Tribunal Number: 2024/B192214
Tribunal: Member B Walters
Place:Sydney
Date:17 March 2025

Decision:The Tribunal sets aside the decision under review and remits the matter for reconsideration in accordance with the order that:
1. From 1 July 2023 to 21 January 2024, and 22 April 2024 to 30 June 2024, [Child 1] was a senior secondary school child in accordance with subparagraph 22B(1)(b)(i) of the A New Tax System (Family Assistance) Act 1999; and
2. The Commonwealth’s right to recover any family tax benefit debt for the 2023–24 financial year arising after reconsideration on this basis is waived under section 101 of the A New Tax System (Family Assistance) (Administration) Act 1999 for special circumstances; and
3. There is no family tax benefit debt for the 2022‑23 financial year.

CATCHWORDS

SOCIAL SECURITY – Family Tax Benefit – debts to the Commonwealth – child ceased secondary studies – study towards a diploma – vocational education and training course – delayed course commencement – exemption from full-time study requirement – special needs of the child – financial hardship – recovery waived for special circumstances – decision under review remitted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information pursuant to subsection 201(1A) of the Social Security (Administration) Act 1999.

Statement of Reasons

BACKGROUND

This review is about decisions made by Services Australia (Centrelink) on 26 September 2024 to recover family tax benefit (FTB) debts of $146.03 for the 2022–23 financial year and $7,080.21 for the 2023–24 financial year.[1]
[1] See pages 15, 51 and 55 of the hearing papers.
The debts were raised by correspondence dated 27 September 2024 and Ms Somenthal requested a review of the debts the same day.[2]
[2] See pages 191, 258 and 262 of the hearing papers.
On 20 November 2024, a Centrelink authorised review officer (ARO) conducted a review of the debts. The smaller debt for the 2022–23 financial year was set aside by the ARO. The ARO also reduced the amount of the larger debt for the 2023–24 financial year from $7,080.21 to $5,392.81.
On 25 November 2024, Ms Somenthal sought further review from the Administrative Review Tribunal (the Tribunal).
The application was heard on 24 February 2025. Ms Somenthal appeared at the hearing by telephone and gave affirmed evidence. The Tribunal had before it 277 pages of documents provided by Centrelink (the hearing papers). These were provided to Ms Somenthal prior to the hearing. The Tribunal also had regard to a Statement of Financial Circumstances prepared by Ms Somenthal.

ISSUES

The statutory provisions relevant to this review are set out in the A New Tax System (Family Assistance) Act 1999 (the Act), the A New Tax System (Family Assistance) (Administration) Act 1999 (the Administration Act) and the Social Security Act 1991.
The issues which arise in this case are:
· Whether Ms Somenthal has debts to the Commonwealth, and
· If so, whether there is any basis for non-recovery.

CONSIDERATION

Issue 1 – Whether there are debts to the Commonwealth

Subsection 71(1) of the Administration Act provides that if a person is paid an amount of FTB that they were not entitled to receive, then the amount is a debt to the Commonwealth.
The decision to raise the smaller debt of $146.03 for the 2022–23 financial year was set aside by the ARO, who wrote on 20 November 2024:[3]
The debt of $146.03 for the 2022-23 financial year was incorrectly raised on the grounds you were not eligible for Family Tax Benefit from 22 October 2022 to 23 October 2022 and the Family Tax Benefit Energy Supplements from 22 October 2022 to 30 June 2023.
[3] Page 15 of the hearing papers.
There is otherwise little information in the hearing papers concerning the basis upon which this debt was raised in the first instance and the Tribunal is not satisfied that Ms Somenthal was not entitled to be paid this amount. The Tribunal will not disturb the decision of the ARO to set this debt aside.
The larger debt of $7,080.21 for the 2023–24 financial year was raised on the basis that Ms Somenthal was no longer eligible for FTB once her son, [Child 1], had ceased secondary studies.
By way of background, it is convenient to reproduce here submissions Ms Somenthal set out in a letter to Centrelink dated 4 October 2024, concerning [Child 1’s] engagement with schooling in recent years:[4]
We began high school at [School 1] where it soon revealed that [Child 1] wasn't coping with conventional learning. He was diagnosed with dyslexia and absorbed information visually and kinaesthetically with ease, but struggled to keep up with text book learning. We moved to the Home Education Unit (HEU) and developed a curriculum that allowed [Child 1] to access alternative learning methods. Funding for HEU learning is only supported until a child reaches 16 years of age for some reason, so we then joined [School 2] for Year 11 which offered online classroom learning and intensive meetups. During this time [Child 1] studied a TAFE in school, [Course 1] which was his favourite subject. We were enrolled to continue with [School 2] for Year 12 but decided, at the last minute, to continue with TAFE online for Year 12. We didn't start this program until April 2024 because we couldn't pay for it upfront. I was trying to negotiate either a fee free or concession rate instead which was finally denied in April and [Child 1] commenced the course as a full fee paying student. This course is costing me $5600 which I am currently paying off. The [School 2] Year 11 cost me $2000.
We chose the [Diploma 1] at TAFE because it was the shortest, most affordable online program that allowed [Child 1] to round out his learning and continue with something relevant to his chosen career pathway. His main interest is [subject area], however the [directly relevant] courses were only available from [a distant] TAFE or were too expensive.
[4] Page 27 of the hearing papers.
Ms Somenthal called Centrelink on 23 September 2024 to enquire about the possibility of additional support to meet the cost of [Child 1’s] TAFE studies.[5] Notes recorded to Ms Somenthal’s Centrelink file indicate that a Centrelink officer advised her that [Child 1] was not an FTB child from the time it was decided he would undertake his diploma course at TAFE. The same day, Centrelink wrote to Ms Somenthal and advised that her FTB had been cancelled.[6]
[5] Page 187 of the hearing papers.
[6] Page 241 of the hearing papers.
The following day, on 24 September 2024, Centrelink wrote to Ms Somenthal, raising an FTB debt for the 2023–24 financial year in the amount of $12,045.06.[7] Within the week, on 27 September 2024, Centrelink wrote to Ms Somenthal again, reducing the amount of the debt to $7,080.21.[8]
[7] Page 250 of the hearing papers.
[8] Page 258 of the hearing papers.
In relation to their decision to reduce the amount of this debt further, the ARO wrote:
After considering the information available to me, including the information you provided during our telephone conversation, I have accepted [Child 1] was intending to resume secondary study in Semester 1 of 2024. As Semester 1 of 2024 commenced on 22 January 2024, you remained eligible for Family Tax Benefit until 21 January 2024.
The Tribunal shares the ARO’s view in this regard and will not disturb this finding.

Ms Somenthal’s entitlement to FTB while [Child 1] undertook diploma studies

The requirements to be paid FTB include that a person must have an FTB child in their care.[9] A young person who has reached 16 years of age but is not yet 18 is an FTB child only if they are a senior secondary school child.[10]
[9] See subsection 21(1) and section 22 of the Act.
[10] See subsection 22(3) of the Act, noting limited exceptions at section 22A.
The Tribunal will consider whether [Child 1] can be taken to be a senior secondary school child while he was engaged in study towards his diploma.
Section 22B of the Administration Act sets out the meaning of senior secondary school child. Subsection 22B(1) relevantly provides:
(1)An individual is a senior secondary school child if:
(a)the following requirement is satisfied: …
(ii)for the purposes of any other provision of this Act--the individual is aged 16, 17 or 18 or is aged 19 and the calendar year in which the individual turned 19 has not ended; and
(b)one of the following applies:
(i) the individual is undertaking full-time study in an approved course of education or study that would, in the Secretary's opinion, assist or allow the individual to complete the final year of secondary school or an equivalent level of education; …
An individual is also a senior secondary school child where they have an exemption from the full-time study requirements under subsection 22B(2), which will be discussed further below.
Subsection 22B(5) provides that if an individual ceases to be a senior secondary school child, nothing in section 22B prevents them from becoming a senior secondary school child again.
The question which arises is whether, pursuant to subparagraph 22B(1)(b)(i) of the Act, [Child 1] was undertaking full-time study in an approved course of education or study that would assist or allow him to complete the final year of secondary school or an equivalent level of education.
Section 3 of the Act states that approved course of education or study has the meaning given by subsection 541B(5) of the Social Security Act 1991.
Subsection 541B(5) states that a course is an approved course of education or study if it is a course determined, under section 5D of the Student Assistance Act 1973, to be a secondary course or a tertiary course for the purposes of that Act.
The Student Assistance (Education Institutions and Courses) Determination 2019 is an instrument made under subsection 5D(1) of the Student Assistance Act 1973. Relevantly, clause 10 of the Student Assistance (Education Institutions and Courses) Determination 2019 defines a secondary course as follows:
10 Secondary courses
For paragraph 5D(1)(a) of the Act, a secondary course is a course: …
(b)provided by a secondary school, a registered training organisation or a higher education institution that leads to an accredited secondary course qualification involving:
(i)accredited secondary course subjects; or
(ii)a VET course.
The Tribunal is satisfied that TAFE Queensland is a registered training organisation, and that the diploma course undertaken by [Child 1] was a vocational education and training (VET) course. The Tribunal finds that [Child 1] was undertaking an approved course of education or study.
Policy concerning the full-time study requirement is set out in the Australian government policy document, the Family Assistance Guide (the Guide) at 2.1.1.11:
For FTB purposes, qualifications at the Certificate II level or above, as defined under the Australian Qualifications Framework, are considered equivalent to the final year of secondary school. However, courses such as Access 10 (or similar), which are identified as being an alternative to the year 10 certificate, are not considered equivalent to the final year of secondary school for FTB purposes.
Policy set out in the Guide may be of assistance in relation to the interpretation or application of the legislation, which serves to support the consistency in administrative decision making. However, the Tribunal is not bound to follow the policy.[11] Where policy is not inconsistent with the legislation, the policy is a relevant factor for the Tribunal to take into account when reviewing a decision.[12] The Tribunal is satisfied that the policy is not inconsistent with the legislation and that it is appropriate to apply it in relation to the decision under review.
[11] Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634.
[12] G v MIBP [2018] FCA 1229.
A question that arises on this background is whether the diploma course undertaken by [Child 1] was a qualification at the certificate II level or above, as defined under the Australian Qualifications Framework.
The Australian Qualifications Framework categorises different types of qualifications issued across the senior secondary education, VET and higher education systems in Australia.[13] Courses may be designated levels, indicating the relative complexity and/or depth of achievement and the autonomy required to demonstrate that achievement. Level 1 has the lowest complexity and level 10 has the highest complexity.
[13] See >
Under the Australian Qualifications Framework, a certificate II is located at level 2. A diploma level qualification is located at level 5.[14] The Tribunal is satisfied that whilst undertaking his diploma studies, [Child 1] was engaged in study towards a qualification at the certificate II level or above, as defined under the Australian Qualifications Framework. Further, the Tribunal is satisfied that [Child 1] was undertaking his studies full-time and finds accordingly. Accordingly, he may be taken to be engaged in study equivalent to the final year of secondary school, making him a senior secondary school child for the purposes of the Act.
[14] See
Ms Somenthal told the Tribunal that [Child 1] commenced his diploma in April 2024. This is consistent with Ms Somenthal’s advice to the Centrelink officer she spoke with on 23 September 2024.[15] The TAFE Queensland 2024 academic calendar shows that the third intake for online courses that year occurred on 22 April 2024. The Tribunal is reasonably satisfied that this is the date that [Child 1] commenced his diploma study.
[15] Page 188 of the hearing papers.
The Tribunal finds that Ms Somenthal was qualified for FTB while [Child 1] was undertaking his diploma studies at TAFE from 22 April 2024 to 30 June 2024.

Ms Somenthal’s entitlement to FTB before [Child 1] commenced diploma studies

There remains the question of Ms Somenthal’s entitlement to FTB in the period 22 January 2024 to 21 April 2024. [Child 1] was not engaged in study during this period so he cannot be taken to be a senior secondary school child on the basis that he was undertaking full-time study in an approved course of education or study.
In her letter to Centrelink dated 4 October 2024, Ms Somenthal wrote that [Child 1] did not start his diploma studies until April because she could not afford the upfront fee payable. She attempted to negotiate reduction or waiver of the fee for the course, however by April she received confirmation that this would not be possible. [Child 1] commenced the course as a full fee-paying student. Ms Somenthal is currently paying off the $5,600 course fee.
The Tribunal will consider whether [Child 1] may be exempt from the full-time study requirement pursuant to subsection 22B(2) of the Act. If any of the exemptions applies, then [Child 1] would be taken to be a senior secondary school child and Ms Somenthal would be entitled to FTB during the period of the exemption.
Subsection 22B(2) of the Act provides for exemptions from the full-time study requirement as follows:
Exemption from full - time study requirement
(2)  This subsection applies in relation to the individual if:
(a)  there is no locally accessible approved course of education or study (including any such course available by distance education); or
(b)  where there is such a course:
(i)  there is no place available on the course for the individual; or
(ii)  the individual is not qualified to undertake the course; or

(iii) the individual lacks capacity to undertake the course because the individual has a physical, psychiatric or intellectual disability or a learning disability such as attention deficit disorder; or

(c) in the Secretary's opinion, special circumstances exist that make it unreasonable to require the individual to undertake an approved course of education or study.

The Tribunal has found that [Child 1’s] study towards his diploma is an approved course of education or study. He commenced the course in April because Ms Somenthal was seeking a reduction of the course fees otherwise payable. On this background, the Tribunal is not satisfied that there was no locally accessible approved course of education or study (including any such course available by distance education), that no place on the course was available for [Child 1], or that he was not qualified to undertake the course.
[Child 1’s] dyslexia diagnosis is relevant to the question of whether he may be exempt from the full-time study requirements on the basis that he lacked the capacity to undertake full-time study as a result of a physical, psychiatric or intellectual disability or a learning disability. However, [Child 1] has successfully undertaken study towards his diploma. The Tribunal is not satisfied on the available evidence that [Child 1] may be exempt from the full-time study requirements on the basis that he lacked the capacity to undertake full-time study as a result of disability.
The Tribunal finds that [Child 1] did not meet the requirements for any exemption from the full-time study requirements under section 22B of the Act.
As discussed, [Child 1] did not commence study towards his diploma until April because Ms Somenthal was investigating the possibility of reduction or waiver of [Child 1’s] course fee. This is understandable in the context of Ms Somenthal’s financial circumstances, as discussed at hearing; however, the Tribunal is not satisfied that the circumstances were sufficiently special such that it was unreasonable to require [Child 1] to undertake an approved course of education or study. It is relevant to the Tribunal’s consideration that Ms Somenthal would ultimately pay [Child 1’s] course fee without reduction, albeit by instalments, and that [Child 1] is capable of and did go on to commence study towards his diploma.
The Tribunal finds that because [Child 1] was not engaged in study and none of the 22B exemptions applies from 22 January until 21 April 2024, [Child 1] was therefore not a senior secondary school child during that period. It follows, and the Tribunal finds that, Ms Somenthal was not qualified to receive FTB from 22 January 2024 until 21 April 2024.
The Tribunal will make orders requiring Centrelink to recalculate the debt arising in the 2023–24 financial year on the basis that [Child 1] was a senior secondary school child from 1 July 2023 to 21 January 2024, and then again from 22 April 2024 to 30 June 2024. After recalculation, a debt will remain, though it will be smaller. For this reason, it is appropriate to consider whether such a debt should be recovered.

Issue 2 – Whether there is any basis for non-recovery of Ms Somenthal’s debt

The Tribunal may consider whether there is a basis under family assistance law for recovery of Ms Somenthal’s remaining FTB debt to be written off or waived.
Section 95 of the Administration Act sets out the circumstances in which debts may be written off, whereby recovery is not pursued for a set period or otherwise.
Additionally, there are provisions in the Administration Act for waiver of debts in specified circumstances, including section 97, which provides for waiver due to administrative error. The administrative error waiver does not assist Ms Somenthal in this application as any debt which remains after recalculation on the basis that [Child 1] was a senior secondary school child until 21 January 2024, and then again from 22 April 2024 arose because Ms Somenthal had not yet advised Centrelink that [Child 1] had ceased study before resuming it again in April 2024. Centrelink administrative error was not the cause of the debt.

More relevantly, section 101 of the Administration Act provides for waiver in special circumstances:
101 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 the family assistance law; 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.
First, the Tribunal must be satisfied that the debt did not arise because Ms Somenthal or another person knowingly made a false statement or knowingly failed to comply with a provision of the family assistance law.
Ms Somenthal was, in the Tribunal’s assessment, a genuine and truthful witness. On the available evidence, the Tribunal is satisfied that the debt did not arise because Ms Somenthal or any other person made any false statement or knowingly failed to comply with a provision of the family assistance law.
To contemplate waiver pursuant to section 101 of the Administration Act, the Tribunal must also be satisfied that there are special circumstances in the case (other than financial hardship on its own) which make it desirable to waive the debt.
The phrase special circumstances is not defined in the legislation. The case law indicates that there must be something unusual or out of the ordinary about the circumstances of a case such that application of the usual rules would be unfair, or unjust.[16] Ordinarily, there would need to be something about the circumstances which distinguishes the case from the usual run of cases.[17] However, the circumstances do not need to be exceptional.[18]
[16] Secretary of the Department of Families, Housing, Community Services and Indigenous Affairs v Jones [2012] FCA 639 at [51].
[17] Dranichnikov v Centrelink [2003] FCAFC 133 at [66].
[18] Angelakos v Secretary, Department of Employment and Workplace Relations [2007] FCA 25 at [33].
In relation to Ms Somenthal’s circumstances, the Tribunal notes:
·[Child 1] has dyslexia and this has impacted his ability to engage with and succeed in mainstream schooling. Ms Somenthal has faced out-of-pocket costs for alternative education opportunities for [Child 1]. School fees for year 11 at [School 2] were $2,000 and the fee for [Child 1’s] TAFE course was $5,600. Before his studies at [School 2] and TAFE, Ms Somenthal home schooled [Child 1], which also impacted the family finances.
·She parents [Child 1] on her own with no practical or financial contributions from [Child 1’s] father, who lives with a serious mental health condition.
·She provides care to her [age]-year-old father who has been experiencing impairment of memory. Ms Somenthal does not receive any carer payment or allowance as she is disinclined to increase her reliance on government payments and her father is reluctant to undergo relevant assessments to support any claim. Providing care and assistance to her father has reduced the amount of time available to Ms Somenthal to devote to her small business. She also provides her father with some financial support as he is in debt and his pension is not sufficient to meet all his costs.
·The family lives in a rural area and this has limited [Child 1’s] educational options and results in a higher cost of living for the family.
Further, the family finances are straitened. Ms Somenthal receives a small business training stipend of $778 per fortnight and estimates that she will receive $10,000 to $20,000 of gross income from self-employment in the next year. She provided the Tribunal with a Statement of Financial Circumstances which establishes that the family budget includes no indulgences and that they are only just managing to get by.
Ms Somenthal owns a one-third share of the home where the family lives, however, the house requires treatment for termites, which she cannot afford. Her car requires repairs at a cost of $3,000, which she also cannot afford, and it is now unregistered. She has only a small amount of savings, less than half of what would be needed to repair her car.
The Tribunal has carefully considered the circumstances raised by Ms Somenthal and is satisfied they are sufficiently special as to warrant waiver of any debt which remains after the debt for the 2023–24 financial year is recalculated on the basis that [Child 1] was a senior secondary school child from 1 July 2023 to 21 January 2024, and from 22 April 2024 to 30 June 2024. The Tribunal has had particular regard to the difficulties Ms Somenthal has faced in supporting [Child 1] to engage with suitable educational opportunities, the additional costs she has faced in this regard, and that no debt would have arisen had a suitable course of study been available for [Child 1] to commence in January 2024 at no or low cost.
The Tribunal considered whether it was more appropriate to waive recovery of the debt than to write it off. Having regard to Ms Somenthal’s financial circumstances, which are unlikely to significantly improve in the near future as she continues to provide care to her father and [Child 1] in his young adulthood, the Tribunal concludes that it is more appropriate to waive than to write off the debt under review.

DECISION

The Tribunal sets aside the decision under review and remits the matter for reconsideration in accordance with the order that:

From 1 July 2023 to 21 January 2024, and 22 April 2024 to 30 June 2024, [Child 1] was a senior secondary school child in accordance with subparagraph 22B(1)(b)(i) of the A New Tax System (Family Assistance) Act 1999; and
The Commonwealth’s right to recover any family tax benefit debt for the 2023–24 financial year arising after reconsideration on this basis is waived under section 101 of the A New Tax System (Family Assistance) (Administration) Act 1999 for special circumstances; and
There is no family tax benefit debt for the 2022–23 financial year.

Date(s) of hearing:	Monday, 24 February 2025
Representative for the Applicant:	Self-represented