Wilson and Secretary, Department of Social Services (Social services second review)

[2016] AATA 66

Wilson and Secretary, Department of Social Services (Social services second review) [2016] AATA 66 (9 February 2016)

Division	GENERAL DIVISION
File Number	2015/2517
Re	Robert Wilson
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Deputy President Dr P McDermott RFD
Date	9 February 2016
Place	Brisbane

The Tribunal affirms the decision under review.

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Deputy President Dr P McDermott RFD

CATCHWORDS

SOCIAL SECURITY – Debt Recovery and Waiver – disability support pension – whether debt due solely to administrative error - overpayment due to failure to disclose partner’s termination payments –applicant disputes failure – insufficient evidence to support alleged disclosure – administrative error not made out - decision under review affirmed

LEGISLATION

Social Security Act 1991 (Cth) ss 1237, 1237AAD

Social Security (Administration) Act (1999) (Cth) s 237

CASES

Sekhon v Secretary, Department of Family and Community Services (2003) 132 FCR 126

REASONS FOR DECISION

Deputy President Dr P McDermott RFD

BACKGROUND

1. This review relates to a debt arising from an overpayment of the Disability Support Pension (“DSP”) to Mr Robert Wilson in the amount of $2,602.92.

2. Mr Wilson has been in receipt of the DSP since May 2004. Until June 2014 his rate of payment took into account the income of his partner Margaret Doyle (‘Margaret”) in the amount of $1,161.72 per fortnight. On 18 June 2014 Margaret retired from her employment. As a result she received leave payments totalling $9,263, comprised of $3,400 for annual leave and $5,863 for long service leave. Mr Wilson advised the Department that Margaret had ceased employment (though the date of that advice is in dispute between the parties) and his entitlement to DSP was recalculated on the basis of their reduced combined income, resulting in an increase to his fortnightly payment. On 27 January 2015 the Department discovered that it had not taken the termination payments made to Margaret into account when calculating Mr Wilson’s entitlement to DSP and determined to raise and recover a debt of $2,032.74 for the period 24 June 2014 to 18 August 2014.[1] Mr Wilson sought review of that decision. On 11 March 2015 an Authorised Review Officer varied the Department’s decision, determining that the overpayment had been incorrectly calculated and raising a further debt of $570.18. On 12 March 2015 Mr Wilson lodged an application for review of that decision by the then Social Security Appeals Tribunal (“SSAT”). The SSAT affirmed that decision on 5 May 2015. On 22 May 2015 Mr Wilson sought review of that decision by this Tribunal.

   [1] Exhibit One, T Documents, page 36.

3. The primary issue in this matter is whether, and when, Mr Wilson provided to the Department details of his wife’s leave entitlements paid upon her retirement.  

4. Mr Wilson gave evidence at the hearing. He stated that following his wife’s decision to retire from her employment, on 19 June 2014, he phoned Centrelink to advise them that his DSP was to be adjusted as Margaret had finished work and her income no longer needed to be taken into account in calculating his entitlement. He receives payments fortnightly and his payment was to be adjusted for next fortnight. He says he advised the officer that Margaret would get her leave payout on the 24^th or 25^th of June 2014.

5. Mr Wilson stated that on 26 June 2014 he again phoned Centrelink and advised the officer of the amounts of Margaret’s leave entitlements. He says that during the call he had the completed separation certificate in front of him and he read the figures directly from it to the officer. Mr Wilson stated that he advised the Department of the amount of the termination payments, and if they were not recorded it was through no fault of his own. He says nothing further was required of him and that he did the right thing. He says that the debt is not his fault and must therefore instead be due to Commonwealth error.

6. Mr Wilson also gave evidence about other occasions on which he considers the Department has fallen into error. In particular he submitted that his mobile telephone records evidence a 44 minute call to the Centrelink customer service line on 30 June 2014,[2] however Centrelink had no corresponding record of that call. The Centrelink records, he therefore contends, cannot be regarded as accurate.

   [2] Exhibit One, T Documents, page 65.

7. The Department, however, says they were not advised of the payout figures until December 2014 when the separation certificate was first provided to them by Margaret in connection with an enquiry about a low-income concession card. As a result, the Respondent says, those amounts were not taken into account in calculating Mr Wilson’s DSP entitlement, resulting in the $2,602.92 overpayment.

8. The Respondent submits that Mr Wilson did not on 26 June 2014, or any other date before December 2014, notify the Department of the particulars of the termination payments. Departmental records show Mr Wilson contacted the Department on 26 June 2014 to advise that his wife had ceased work.[3] A`s a result their systems were updated that day with this information and were backdated to have effect from 19 June 2014. The Respondent provided another document referred to as a “CRAM report”.[4] This report contains a record of all occasions on which either Centrelink, or the Applicant through self-service, has accessed Mr Wilson’s account. The report records that on 26 June 2014 Mr Wilson telephoned the Department and indicates screens accessed by the officer in actioning Mr Wilson’s request. The workflow indicates that Mrs Wilson’s earnings information was updated but there were no records with respect to any action taken in relation to termination payments. The records indicate that none of the relevant screens for termination payment information were accessed on that date.

   [3] Exhibit A, T Documents, page 89.

   [4] Exhibit C.

9. The Respondent contends that Mr Wilson was sent a notice on 26 June 2014 following his advice that his wife had ceased work outlining clearly what income was taken into account in assessing his increased entitlement to DSP stating (among other things): “information used for calculating your regular payment: $18.40.”[5] The letter makes no reference to the termination payments received by Mr Wilson’s wife. That notice also contained a message that within 14 days you must tell the Department if “you or your partner’s gross income changes…Gross income includes, but is not limited to: …paid leave such as annual, long service or sick leave.” Mr Wilson contended he did not receive this letter, and indicated he has experienced difficulties with the delivery of his mail which he has investigated with Australia Post. He provided a copy of responses he had received to complaints to Australia Post and the Postal Industry Ombudsman in support of this.[6] The Respondent contended that as the notice was sent by prepaid post to the postal address of Mr Wilson last known to the Secretary it is taken to have been given to him pursuant to s 237 of the Social Security (Administration) Act1999 (Cth).

   [5] Exhibit A, T Documents, page 79.

   [6] Exhibit B.

10. The Respondent submitted that the notice of 26 June 2014 and the receipt of the increased rate of payment put Mr Wilson on notice that the termination payments had not been properly taken into account in calculating his rate of entitlement. The Respondent pointed to a record of contact between Mr Wilson and the Department on 5 February 2015 in relation to which the Authorised Review Officer recorded the following comments:

    I went through customer payments with him and asked about his thoughts on why his payment went up by two hundred dollars when his partner received the payout and customer gave no answer. Only said after notifying us he shouldn’t have to do anything else.[7]

    [7] Exhibit A, T documents, page 87.

11. The Respondent contended therefore that Mr Wilson knowingly received the incorrect rate of payment and as such it cannot be said that the payments were received in good faith, nor can the debt be attributed solely to Commonwealth administrative error.

12. It is not in dispute that Mr Wilson was overpaid DSP in the amount of $2,602.92, and that the overpayment is a debt owed to the Commonwealth. Rather, the issue in this matter is whether all or part of the debt should be waived or written off by the Secretary.

    LEGISLATION

13. Section 1237A of the Act deals with the waiver of debt arising from administrative error on the part of the Commonwealth:

    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.

    Note: Subsection (1) does not allow waiver of a part of a debt that was caused partly by administrative error and partly by one or more other factors (such as error by the debtor).

14. Section 1237AAD of the Act also confers a discretion on the Secretary to waive all or part of a debt in special circumstances:

    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.

    CONSIDERATION

    Should the debt be waived?

15. As a matter of principle, the taxpayer is entitled to expect that in the ordinary course, money paid to people which they are not entitled to receive will be recovered.[8] However, in order to avoid unfair or harsh outcomes the legislation makes provision for the writing off or waiver of otherwise recoverable debts due to the Commonwealth in certain circumstances.

    [8] Secretary, Department of Social Services v Hales (1998) 82 FCR 154, 155 (French J).

16. In considering the conflicting contentions of the parties it is necessary to objectively weigh up the evidence that supports those contentions. Mr Wilson relies on telephone records evidencing his contact with the Department, and his own account of the details of that contact. He contends that he contacted the Department first on 19 June 2014 to advise his wife had stopped work. This is not supported by any record of the Department, or Mr Wilson.[9] Mr Wilson asserts that he then contacted the Department a second time on 26 June 2014 and advised of the particulars of the termination payments. The Respondent concedes, and I accept, that Mr Wilson contacted the Department by phone on 26 June 2014. This contact is supported by Departmental records.[10] However, the Department’s records of this contact do not contain any mention of any termination payments or any action taken that would be associated with recording termination payments. Rather, initial action recorded as being taken to record Mr Wilson’s wife’s cessation of employment and the subsequent reduction of her income. On the basis of this evidence, I have concluded that Mr Wilson contacted the Department for the first time in relation to his wife’s retirement on 26 June 2014 but that particulars of the termination payments were not provided at this time.

    [9] I note Mr Wilson’s assertion that he was unable to obtain the record from his previous phone provider for this call.

    [10] Exhibit One, T Documents, page 89.

17. In relation to the alleged 30 June 2014 contact, I am not satisfied that the termination payments were discussed at this time. The evidence provided by Mr Wilson in relation to this contact is a record of a phone call to the Department from his phone provider. The Department has no record of receiving a call on that date. Whilst I accept that Departmental record keeping can be less than perfect, having regard to average call waiting times, which can be extensive, I do not accept that this substantiates that any particular conversation took place with respect to the termination payments.

18. On the basis of the above findings I am not satisfied that there was an administrative error on the part of the Department.

19. I also accept the evidence of the Respondent that Mr Wilson was, or ought to have been, put on notice that the termination payments had not been taken into account in calculating his entitlement to DSP. Mr Wilson gave evidence at the hearing that he was aware the termination payments needed to be disclosed, and would affect the calculation of his entitlement. I note Mr Wilson’s evidence that he did not receive the written notice dated 26 June 2014 showing the income amount of $18.40 taken into account in calculating his rate of payment. However, even accepting that evidence, Mr Wilson would no doubt have been aware of the significant increase to his payments which occurred immediately following his advice about the cessation of his wife’s employment.

20. In any event, even if (contrary to my conclusion) there were an administrative error by the Commonwealth, I do not consider that the debt was “attributable solely” to that error, as required by the section.

21. Selway J in the Full Federal Court decision in Sekhon v Secretary, Department of Family and Community Services remarked:

    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.[11]

    [11] (2003) 132 FCR 126, [35].

22. Having regard to this statement by Selway J, even if I were to accept Mr Wilson’s evidence that the details of the termination payments were provided verbally on 26 June 2014 and the Department erroneously failed to record them, in light of the evidence before me I do not accept that the debt arose solely due to administrative error. This is because I consider Mr Wilson contributed to the debt by failing to notify the Department of the error in his payments following the notice sent out on 26 June 2014 and the receipt of payments at a significantly increased rate. Mr Wilson did not provide the separation certificate to Centrelink after his conversation of 26 June 2014 even though the form of the certificate indicates that it is an official Centrelink document.

23. On the basis of the above findings I am not satisfied that the debt was attributably solely to administrative error and as such the debt cannot be waived under s1237A of the Act.

24. Section 1237AAD of the Act also contains a discretion to waive all or part of the debt where there are special circumstances that, in all the circumstances, make it appropriate to do so. There were no special circumstances (aside from the version of events claimed above) alleged to warrant the exercise of this discretion, and Mr Wilson indicated that if he is unsuccessful in this review he will continue to pay down the debt by instalments. As such I do not consider the debt can be waived under s 1237AAD of the Act.

    CONCLUSION

25. I affirm the decision under review.

I certify that the preceding 25 (twenty -five) paragraphs are a true copy of the reasons for the decision herein of Deputy President Dr P McDermott RFD

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Associate

Dated 9 February 2016

Date of hearing	27 November 2015
Applicant	In person
Solicitors for the Respondent	Department of Human Services