Wiggins and Secretary, Department of Family and Community Services

[2004] AATA 340

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 340

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No T2003/90

GENERAL ADMINISTRATIVE  DIVISION		)
Re		KEVIN JOHN WIGGINS

Applicant

And SECRETARY, DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

Respondent

DECISION

Tribunal Ms A F Cunningham (Part-time Member)

Date31 March 2004

PlaceHobart

Decision The decisions under review are affirmed.

[Sgd A F Cunningham]

Part-Time Member

CATCHWORDS

Social Security – disability support pension – failure to inform of income earned from employment – no special circumstances – decision under review affirmed.

Social Security Act 1991 – ss1237(1),1237AAD

REASONS FOR DECISION

31 March 2004 Ms A F Cunningham (Part-time Member)           

1.      The applicant has sought the review of decisions made by a Centrelink officer on 28 October 2002 and 30 October 2002 to raise and recover two debts arising from overpayment of the applicant’s disability support pension (DSP), one in the sum of $55,934.05 covering the period 6 December 1991 to 24 June 1999 and the second in the sum of $15,813.66 covering the period 7 July 1999 to 17 October 2001.    The total amount of the debts raised is $71,747.71.   Both decisions were affirmed by the Social Security Appeals Tribunal (SSAT) on 24 April 2003.

2. The applicant was represented by John Crooks. Mr Justin Kearney appeared for the respondent. The applicant gave oral evidence before the Tribunal. The T documents were tendered pursuant to s37 of the Administrative Appeals Tribunal Act 1975. 

3.      Also tendered by the respondent was a supplementary group of documents which contained records of the applicant’s income from employment with the South Eastern Sydney Area Health Service between 1 July 1994 and 23 October 2001.   The Tribunal was informed that the decision to  raise an overpayment in respect of the income earned by the applicant during this period was  separate to the decisions under review by the Tribunal.   It was contended by the respondent that the provision of the material would assist the Tribunal in its deliberations.   The applicant did not contest the admission into evidence of the supplementary documents and did not dispute the actual calculation of the income earned during the period being $121,757.57.

4.      There was no dispute  as to the total amount of the debt of $71,747.71.   The applicant did not dispute the respondent’s evidence of the work undertaken by him during the relevant period, nor the respondent’s calculations as to the income earned by the applicant.  

5.      It was argued on behalf of the applicant that the Tribunal should waive the debt raised on the basis of the special circumstances relating to the applicant’s case.   It was contended that there had been minimal contact between Centrelink and the respondent during the relevant period.   For instance, whilst it was conceded that three letters were sent to the respondent advising of an increase in the rate of DSP in 1993, there was no contact from the respondent in 1994 or 1995, one letter was sent in 1996 and between 1997 and 2000 there had been no correspondence at all.   It was argued that had Centrelink made contact with the respondent and initiated a review, the applicant’s employment would have been discovered at an earlier stage and the amount of the overpayment would have been significantly reduced.   Mr Crooks urged the Tribunal to waiving that part of the debt which related to the period when there had been no contact initiated by Centrelink.

6.      The applicant’s pension is paid pursuant to the provisions of the Social Security 1991 (“the Act”).    There was no dispute that the amount of the overpayment of $71,747.71 had been correctly calculated in accordance with the relevant provisions of the Act.   

7.      The issue for determination by the Tribunal is whether the debt could be waived under the provisions of s1237 of the Act.  

“Waiver of Debt Arising from Error

Subject to subsection (1A), the Secretary must waive the right to recover the proportion of a debt that is attributable solely to 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.”

8.      It was not strenuously argued and the Tribunal concludes from the material before it that the debt could not be said to be “attributable solely to administrative error made by the Commonwealth”, nor that the debtor received the payment that gave rise to that proportion of the debt in good faith.   A notation to s1237(1) states:

“Subsection 1 does allow waiver of a part of debt that was caused partly by administrative error and partly by one or more other factors, (such as error by the debtor)”.

9.      As stated above, Mr Crooks contended that the amount of the debt could have been reduced if the respondent had made earlier and more regular contact with the applicant and reviewed his pension entitlement.   It was not contended that any part of the debt was solely due to administrative error.   

10.     Section 1237AAD states:

“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 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.”

11.     It was contended on behalf of the respondent that the debt could not be waived under this section, because firstly, the applicant had failed to comply with the provisions of the Act that require him to notify the respondent of a change in financial circumstances, and secondly, that there are no special circumstances within the meaning of the Act that would make it desirable to waive the debt.

12.     Whilst it appears from the material that the respondent’s correspondence to the applicant was somewhat irregular, there is evidence that the applicant was informed of the grant of his disability support pension with effect from 21 November 1991 and was advised in that correspondence (in accordance with  the provisions of s132 of the Act) that he must inform Centrelink within 14 days of a change in his circumstances, in particular if his income increased by more than $42 per week or if he started or recommenced work.   Further correspondence was sent to the applicant on 16 March 1992,  16 January 1993, 24 March 1993, 20 September 1993 and 9 March 1996 which contained a similar request for information.     The letters were forwarded to the applicant at the address that he had provided to Centrelink.

13.     The evidence was that shortly after receiving his first payment of DSP in November 1991, the applicant commenced employment as a cleaner with the NSW State Railway Authority on 9 December 1991.

14.     It was the applicant’s evidence that when he was first in receipt of his DSP he was on the methadone programme and suffering memory loss.   In his words he was “a basket case”.  He considered that the pension he was receiving from Centrelink was some type of “death pension” because of his state of health from years of drug abuse.   The applicant informed the Tribunal that he was addicted to various types of illegal drugs, including speed, heroin, LSD and cocaine over a period of many years.  The applicant described how he had been gaoled for armed robbery and had been in and out of rehabilitation centres which had led to a breakdown of his marriage.   At around the age of 40 he had commenced the methadone programme and reconciled with his wife and child.

15.     The applicant initially informed the Tribunal that he had little memory of the earlier years when he was first in receipt of a DSP and that he was still now suffering the effects of his long term drug abuse.    The Tribunal notes however, that the applicant was in employment as a cleaner and earning on average between $574 and $968 per fortnight which employment continued for some 10 years.

16.     The applicant’s evidence was that he was not aware of his obligation to inform Centrelink in the event that he obtained employment.   He said that he did not read the correspondence forwarded to his parents’ address.   When asked in cross-examination why for 10 years he had not informed Centrelink of his income earned,  his response was that he would have if he had known that he was getting the pension.    The applicant said when giving oral evidence to the Tribunal that he personally accessed his bank account into which his pension was paid and that he had also given authority to his wife to access the account.   It is thus clear that he was aware that he was receiving a fortnightly  pension.   The Tribunal does not accept his explanation that he was in receipt of this money because he was considered by Centrelink to be a “basket case”.

17.     The applicant stated that many of his friends were in receipt of social security pensions and had asked him why he was never medically assessed or required to advise of his employment details.   Further, when asked during cross-examination why he had not informed Centrelink of the fact that he had commenced employment in 9 December 1991, the applicant replied that as he had just started the job, he thought it would not last.   This suggests to the Tribunal that he was aware of his obligation and the potential effect that the income he earned would have on his pension benefit.   The applicant also conceded that he had not completed a taxation return since 1998, and said that he would have done so if the Taxation Department had approached him.

18.     It appears from the evidence given by the applicant that whilst he was aware of his obligations in relation to both Centrelink and taxation department, he simply chose not to comply.   The applicant must accept the responsibilities that are attached to the receipt of taxpayer funded benefits and face the consequences of choosing to ignore his obligations.

19.     The Tribunal is satisfied that the correspondence as outlined above was forwarded by Centrelink to the address of the applicant’s parents as provided by him and that he chose not to read the correspondence.    The Tribunal does not accept that the applicant did not at least receive the first correspondence, dated 3 December 1991 advising him of the initial payment of DSP, which also contained the advice that he must inform Centrelink of any commencement of employment.    Accordingly the Tribunal finds that the applicant failed to comply with the provision of the Act which obligated him to inform Centrelink of his change of circumstances.

20.     Further, the Tribunal is not satisfied that there are any special circumstances pertaining the applicant’s case that make it desirable to waive the debt in accordance with the provisions of sub-paragraph (b) s1237AAD.

21.     It could not be contended that there are circumstances which in the words of the Tribunal in Beadle and Director-General of Social Security (1984) 1 AAR 362: are “markedly different from the usual run of cases” .  The Tribunal is not minded to consider the respondent’s history of drug abuse in this context.   The evidence was that during the relevant period the applicant was in regular employment and between the years 1994 and October 2001 was working for two different employers.   He was effectively working on average 36 hours each week.   There is no basis upon which any part of the debt should be waived.   The debt arose due to the applicant’s failure to inform Centrelink that he had commenced employment.

22.     There are no grounds upon which the debt could be written off pursuant to the provisions of s1236(1) of the Act on the grounds that the debtor has no capacity to pay.   The evidence was that the debtor remains in receipt of a Centrelink pension in the sum of $380 per fortnight, less $56  the amount being recovered which leaves a balance of $324.90 per fortnight.   In addition his wife is in receipt of a parenting payment in the sum of $347 per fortnight making the total amount received by the family, of $670 per fortnight.    The respondent and his wife are currently residing in a house owned by the wife which is unencumbered.

23.     The Tribunal being satisfied that the debt raised is properly recoverable by the respondent and there being no basis upon which it should be waived,  for the above reasons the Tribunal affirms the decisions under review and dismisses the appeal.

I certify that the 23 preceding paragraphs are a true copy of the reasons for the decision herein of Ms A F Cunningham (Part-time Member)

Signed: K L Miller (Administrative Assistant)

Date/s of Hearing  3 March 2004
Date of Decision  31 March 2004
Counsel for the Applicant         Mr John Crooks
Solicitor for the Applicant          Launceston Community Legal Centre
Counsel for the Respondent     Mr Justin Kearney.
Solicitor for the Respondent    Centrelink