Walsh and Secretary, Department of Family and Community Services

[2003] AATA 1257

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2003] AATA 1257

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No N2003/555

GENERAL ADMINISTRATIVE DIVISION		)
Re		Amber Walsh

Applicant

And Secretary, Department of Family and Community Services

Respondent

DECISION

Tribunal M Griffin

Date12 December 2003

PlaceSydney

Decision The Tribunal affirms the decision under review.

[Sgd] M.A. Griffin
  Member

CATCHWORDS

SOCIAL SECURITY - overpayment of youth allowance - notional entitlement to other benefit - recovery of debt - write off of debt - waiver - special circumstances - decision under review affirmed

Social Security Act 1991 ss.541(1), 541B, 1236, 1237A, 1237AAD

Dranichnikov v Centrelink [2003] FCAFC 133

REASONS FOR DECISION

12 December 2003   M.A. Griffin, Member

1.      This is an application by Amber Walsh (“the Applicant”) for review of a decision of the Social Security Appeals Tribunal (“SSAT”) dated 26 February 2003 (T2). The SSAT affirmed the decision of an authorised review officer (“ARO”) of Centrelink dated 9 January 2003 (T52) to raise and recover a youth allowance debt of $9,006.56 for the period 1 December 2001 to 29 October 2002 (“the Relevant Period”).

2.      At the hearing of this matter on 17 October 2003 the Applicant represented herself and Mr G. Lozynsky, a Centrelink advocate, represented the Secretary, Department of Family and Community Services (“the Respondent”).

3. The Tribunal received into evidence the documents lodged under section 37 of the Administrative Appeals Tribunal Act1975 (T1-54) as well as exhibits marked A1 for the Applicant and R1-R3 for the Respondent.

BACKGROUND

4.      The Applicant was born on 27 July 1979. At the commencement of the relevant period she was twenty-two years old.  In 1998 she was in receipt of Austudy while studying for the Higher School Certificate and then youth allowance from July 1999 while studying at the National Art School. On completion of her full-time studies at the National Art School in December 2001, she was paid youth allowance on the basis that she would enrol in a further course of study in the 2002 academic year.

5.      The Applicant commenced part time work in March 2002 but did not enrol in a course of study until May 2002.  The course of study and the institution, the Commercial Arts Training College, were not in a category approved for the purposes of the payment. Centrelink proceeded to make payments on the understanding that she was, in fact, enrolled in another approved institution. The Applicant became ill in June 2002. She did not submit any assignments for the course of study and withdrew from the course in September 2002. She did not inform Centrelink of her withdrawal from the course.  On 26 November 2002 Centrelink decided to raise and recover a debt for the youth allowance paid during the relevant period. On 9 January 2003 an ARO affirmed the original decision.

EVIDENCE

6.      The Applicant told the Tribunal she believed she did owe some money for four payments totalling about $1200.00 for the end of the relevant period after she withdrew from the course in September 2002. She said she did not owe the remainder of the debt because it arose through the incompetence of Centrelink.

7.      The Applicant said that after she finished her studies in December 2001 she went to the Centrelink office and told an officer that she intended to continue studying in 2002 with a mid-year enrolment and was not yet certain which course she would undertake.  She said the Centrelink officer’s name was Michael and he told her she would be treated as a continuing student and paid youth allowance and just to ring and let Centrelink know when she had enrolled. She said she rang on 18 March 2002 and reported her employment with ‘WestPac Bank’. She said it was the officer’s mistake because he told her it was okay and that she was still considered a continuing student. She said she would have been entitled to Newstart or unemployment benefit anyway and so there was no debt, it was just a different class.

8.      She said she moved house in June and the payment stopped. She said she reported to Centrelink and was told to commence submitting forms fortnightly for the payments to continue. She said she had been upfront and not misleading because she declared the actual course of study and the institution on these forms. She said she became ill and was hospitalised in June. She then began to suffer depression and is still being treated for it. She said she did work on one of the course modules but did not submit any assignments or course work. She said she had difficulty trying to communicate with the school department head and eventually withdrew from the course on 11 September 2002. She said she had since been hospitalised for several suicide attempts and had experienced stress over this debt recovery action.

9.      The Applicant said she continues to be employed part-time with the bank working about 45 hours per fortnight and is currently studying at night for a Fine Arts degree.  She said her salary is $32737.00 per annum and she receives about $930.00 net per fortnight. She pays $320.00 rent per fortnight. She has debts for a personal loan, credit card, a loan from her father, telephone and general expenses, which leaves her about $100.00 per fortnight. Her June 2002 illness was related to her ovaries. The condition was treated and is presently stable but may require specialist treatment should she decide to have a child. This is not in her consideration at this time. Her depression is treated with medication and is stable.

10.     In cross-examination the Applicant said she knew she was required to advise Centrelink if she stopped studying. She said she had done that on her visit to the office in January 2001. She was asked if she replied to a series of notices sent to her by Centrelink, which required her to notify changes in circumstances affecting payment such as ceasing to be a full-time student. She said a lot of them are just general things and she threw them out.  She was asked about a Centrelink record of 15 November 2001, which states she intended to study at Royal Melbourne Institute of Technology (RMIT) in 2002 (T7). She said she didn’t recall. She said she had dealings with a Centrelink social worker in January 2002 about her rate of payment in relation to certain family circumstances, which are not relevant to this decision. She said she mentioned then that she was not studying but intended to. She said she was told “you need to get back to us”. She said it was not till March 2002, she spoke to “a guy”, she told him she was “looking at a whole heap of courses but not going to do anything till June”.

11.     Exhibit R3 is a letter from RMIT dated 14 December 2001 addressed to the Applicant offering her a position in the Graduate Certificate in Tertiary Teaching and Learning full-time course. The Applicant said the handwriting on the document belongs to the Centrelink officer she saw in January 2002.  The handwriting includes her telephone number and a course end date of 1 June 2003, that is, about 18 months from the commencement of the 2002 academic year. The Applicant was shown a Centrelink record of 9 January 2002 (T14) which states “yal edc reassessment is doing 18 month grad diploma have updates”. She was asked if she completed a reassessment form. She said she wasn’t sure but didn’t think so. She said the officer was looking at a computer screen at the time and they were talking about courses. She said, “I called in March to say I had the job and was not going to study until June”.. She said he told me I was a continuing student and needed to call with my fortnightly income details to adjust my student bank.

12.     The Applicant was shown a Centrelink record of a letter sent to her on 18 February 2002 (T18), which states “Our records show you will begin studying at RMIT UNI – BUNDOORA on 4 March 2002. Please provide proof of your enrolment by 18 March 2002. If any of the course details have changed you must tell us within 14 days” and asked if she had received it.  She said “I must have, I don’t recall it. The address is correct, I was still there I think”. It was put to her that she did not respond to that letter. She said she did not remember getting the letter. She was asked if she received any notices from Centrelink. She said, “they come all the time…I threw them out because they clearly had my address and knew I was getting the money”.

13.     I asked the Applicant about the course she enrolled in in May 2002. She said she did not know if it was a registered course eligible for the youth allowance payment. She said she didn’t inquire and thought Centrelink would check it. She said she wrote it on the form and “if anybody bothered to look at it there would be no debt”. I asked how she coped with the course workload. She said, “I didn’t do a whole lot”. She said she was hospitalised in June with acute pain related to her ovaries and became depressed after being told she may have trouble having children. She said she comes from a large Catholic family and was very distressed by this news. She said she got some work done on weekends. She said she got her local GP to write a letter about her illness in July but couldn’t do the work or pay the fees and eventually quit.  She said, “there are a few payments I should pay back”.. I asked the Applicant if she told Centrelink she had quit the course. She said, “no I didn’t. I think the period from then I owe”.

CONSIDERATION OF THE ISSUES

14.     The provisions in the Social Security Act 1991 (“the Act”) dealing with youth allowance are at Part 2.11. These provisions allow for the payment of youth allowance to young people until the age of twenty‑five (if in full‑time education) or until the age of twenty‑one (if not in full‑time education). To qualify for youth allowance a person must satisfy the ‘youth allowance activity test’. Section 541(1) of the Act effectively provides that full‑time study is one basis upon which the ‘youth allowance activity test’ is satisfied. Section 541B defines ‘full-time study’:

“541B Undertaking full time study

General 

541B(1)         For the purposes of this Act, a person is undertaking full-time study if:

(a)       the person:

(i)is enrolled in a course of education at an educational institution; or

(ii)was enrolled in the course and satisfies the Secretary that he or she intends, and has (since no longer being enrolled) always intended, to re-enrol in the course when re-enrolments in the course are next accepted; or

(iii)was enrolled in the course and satisfies the Secretary that he or she intends, and has (since no longer being enrolled) always intended, to enrol in another course of education (at the same or a different educational institution) when enrolments in the other course are next accepted; and

(b)       the person:

(i)is undertaking in the particular study period (such as, for example, a semester) for which he or she is enrolled for the course; or

(ii)intends to undertake in the next study period for which he or she intends to enrol for the course;

either:

(iii)in a case to which subsection (1A) does not apply—at least three‑quarters of the normal amount of full-time study in respect of the course for that period (see subsections (2) to (4)); or

(iv)in a case to which subsection (1A) applies—at least two-thirds of the normal amount of full-time study in respect of the course for that period (see subsections (2) to (4)); and

(c)the course in question is an approved course of education or study (see subsection (5)); and

(d)in the Secretary’s opinion, the person is making satisfactory progress towards completing the course.”

15.     The Applicant was paid youth allowance on the basis that despite being over twenty-one years of age she was a continuing student in full-time study. The Applicant contends that she completed her full time arts studies in December 2001 and intended to enrol in further study in mid-2002. She says she advised a Centrelink officer of this and was told that she would be considered a continuing student until then.  She enrolled in an ineligible course in May 2002. She did some of the course work but failed to submit any assignments and withdrew from the course on 11 September 2002. The Applicant concedes she owes a debt for payments received from that date. The Applicant contends the debt for the previous payments is due to administrative error on the part of Centrelink.  The Applicant contends she had a notional entitlement to Newstart or unemployment benefit for the relevant period. She says she should not have to repay the debt.

16.     The Respondent contends that the Applicant failed to comply with her obligation to notify Centrelink that she had stopped full-time study.  The Respondent contends that the Applicant advised Centrelink she intended to enrol in full-time study at RMIT for an 18 month graduate diploma ending in June 2003 and that she was paid youth allowance on that basis. The Respondent submits “there is no sole administrative error in this matter which would warrant waiver of the debt under section 1237A of the Act”.

17. Section 1237A of the Act relevantly provides:

“1237A(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.”

18. And section 1237AAD of the Act provides:

“The Secretary may waive the right to recover all or part of a debt if the Secretary is satisfied that:

(a)the debt did not result wholly or partly from the debtor or another person knowingly:

(i)        making a false statement or false representation; or

(ii)failing or omitting to comply with a provision of this Act or the 1947 Act; and

(b)there are special circumstances (other than financial hardship alone) that make it desirable to waive; and

(c)it is more appropriate to waive than to write off the debt or part of the debt.”

19. The Applicant submitted to the Tribunal that her health and financial circumstances were ‘special circumstances’ for the purposes of the Act. The Applicant also submitted that her notional entitlement to Newstart or unemployment benefit amounted to ‘special circumstances’. However, the Applicant did not provide any evidence to demonstrate that she would have qualified for such entitlement to Newstart or unemployment benefit or any other social security benefit. Indeed, it is apparent that she was, in fact, working for almost the entirety of the relevant period.

CONCLUSION

20.     In reaching its decision, the Tribunal takes into account the written material, the oral evidence and the submissions made at the hearing.

21. The Tribunal finds that Centrelink paid the youth allowance to the Applicant during the relevant period because the Applicant represented her intention to commence full-time study at RMIT in March 2002. The Tribunal accepts that Centrelink did not act on subsequent advice from the Applicant of her actual studies. However the Tribunal finds that the Applicant failed to reply to a Centrelink letter in February 2002 detailing its understanding of her enrolment status with RMIT which was wrong. In these circumstances the Tribunal is satisfied that the debt is not due solely to an administrative error made by the Commonwealth and therefore the waiver pursuant to section 1237A is not appropriate.

22. In relation to section 1237AAD of the Act, the various sub-sections are conjunctive. That is, the discretion to waive is only enlivened where sub-sections 1237AAD (a) and (b) and (c) are made out. Section1237AAD(b) requires “… special circumstances (other than financial hardship alone)…”.  In Dranichnikov v Centrelink [2003] FCAFC 133 at paragraph 65, Hill J in considering the term “special circumstances” said:

“65. … The origin of the test apparently adopted by the Secretary appears to be the decision of the first instance Judge in Beadle v Directory-General of Social Security (1985) 60 ALR 225.. That was a decision under previous legislation, the history of which is referred to by French J in Secretary of Department of Social Security v Hales (1998) 82 FCR 154.. The Full Court in Beadle comprising Bowen CJ, Fisher and Lockhart JJ, however, was of the view that it was not possible to lay down precise rules as to what constituted special circumstances under the then s 102(1)(a) of the Social Security Act 1947 (Cth). Their Honours point out that the question whether there were special circumstances was one for the decision maker (in that case the Director-General) bearing in mind the purpose for which the power was given. The reference to the first instance decision from which the words “unusual, uncommon or exceptional” come was not actually affirmed by the Full Court.

66. To some extent the question whether there were special circumstances must depend on how it came about that the error occurred.  Again that is not a matter to which the decision maker apparently averted.  Other cases which have considered analogous words such as “special reasons” has tended to conclude, albeit in different contexts, that what is required will be circumstances which distinguish the case in consideration from the usual case.  There will be a requirement that the circumstances are such that takes the case out of the ordinary: Jess v Scott (1986) 12 FCR 187 and the cases in various contexts in the decision which Lockhart, Shepherd and Burchett JJ discuss.

67. It is possible to read the decision statement as suggesting that the present case was one incapable of falling within the words “special circumstances”..  If that is what was held, it would involve legal error.  However, the real problem with the exercise of discretion under s 101 as with the mandatory provisions of s 97, is that the decision maker appears not to have considered at all what the circumstances were which gave rise to the overpayment.  Whether those circumstances were or were not special will obviously be a matter for the decision-maker when the factual circumstances have been ascertained.”

23. The Applicant has been and continues to be both studying and working for some 45 hours a fortnight. She has some debts but they are not out of the ordinary for a low-income student. She has experienced some health problems but they have stabilised and do not interfere with her ability to study and work. On the evidence presented, the Tribunal finds that there is no notional entitlement to Newstart or unemployment benefit. There are no personal or financial, or other matters raised by the Applicant that could constitute ‘special circumstances’, nor is there anything in the circumstances which gave rise to the overpayment that constitute ‘special circumstances’.. Therefore, the Tribunal finds that the Applicant does not satisfy section 1237AAD(b) of the Act. As a result, she is unable to satisfy section 1237AAD, and the debt may not be waived.

24. The Applicant is in regular employment and has capacity to repay the debt. In these circumstances there are no grounds to write off the debt under section 1236(1A) of the Act.

DECISION

25.     The Tribunal affirms the decision under review.

I certify that the 25 preceding paragraphs are a true copy of the reasons for the decision herein of M Griffin, Member

Signed:         A. Krilis
  Associate

Date/s of Hearing  17 October 2003
Date of Decision  12 December 2003
Representative for the Applicant    Self Represented
Solicitor for the Respondent          George Lozynsky