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

The Administrative Appeals Tribunal (the Tribunal) considered the matter of Mr and Mrs Winch and the Secretary of the Department of Social Services concerning the assessment of the age pension under the assets test. The core dispute revolved around whether a $50,000 gift, previously made by the Winches, should be disregarded as a deprived asset when calculating their pension rate, particularly in light of their claim of severe financial hardship.

The Tribunal was required to determine whether the $50,000 gift constituted a deprived asset under the Social Security Act 1991 (Cth) and, if so, whether the Winches were experiencing severe financial hardship such that the asset should be disregarded. This involved assessing whether the disposal of the asset would have led to severe financial hardship and whether the Winches had exhausted all other avenues for financial assistance.

The Tribunal affirmed the decision of the Authorised Review Officer, finding that the $50,000 gift would have provided readily available funds for the Winches' day-to-day costs. The evidence did not suggest that had they retained the asset, they would have been in a position of severe financial hardship. The Tribunal noted that the Winches' financial position, as presented in their Statement of Financial Position and supporting statutory declaration, indicated a monthly deficit and outstanding debts, but did not meet the threshold for severe financial hardship in relation to the deprived asset. The Tribunal's reasoning focused on the availability of funds and the lack of evidence demonstrating that retaining the gift would have resulted in severe financial hardship.