Woods and Secretary, Department of Education, Science and Training

[2007] AATA 62

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2007] AATA 62

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No S2006/143

GENERAL ADMINISTRATIVE DIVISION		)
Re		DAVID JAMES WOODS

Applicant

And SECRETARY, DEPARTMENT OF EDUCATION, SCIENCE AND TRAINING

Respondent

DECISION

Tribunal Deputy President D G Jarvis

Date20 February 2007

PlaceAdelaide

Decision The application is dismissed pursuant to subsection 42B(1) of the Administrative Appeals Tribunal Act.

D G Jarvis
  (Signed)
  Deputy President

CATCHWORDS

JURISDICTION – Social Security – Student Financial Supplement Scheme – Minister closing Scheme administratively – Minister not entering into new agreement with financial corporation in order to maintain Scheme – administrative steps taken by respondent following closure of Scheme – no jurisdiction to review such steps or actions of Minister – determination of application by AAT will be of no practical utility – application dismissed under s 42B of the Administrative Appeals Tribunal Act 1975 (Cth).

Social Security Act 1991, subsection 1061ZZAC(1), Chapter 2B Division 4

Social Security (Administration) Act 1999 (Cth), ss 129, 142 and 151(1), Division 5 Part IV

Meschino v Secretary, Department of Family and Community Services (2001) 65 ALD 220

Re Laird and Australian Broadcasting Tribunal (AAT 78/122, 10 May 1979)

PRACTICE AND PROCEDURE – Social Security – Student Financial Supplement Scheme – jurisdiction of tribunal to review determination of respondent as to eligibility criteria – determination of application by AAT will be of no practical utility – application dismissed under s 42B of the Administrative Appeals Tribunal Act 1975 (Cth).

Administrative Appeals Tribunal Act 1975 (Cth), s 42B

Re Brian Reddish and Civil Aviation Safety Authority [1999] AATA 721

Fearnley v Australian Fisheries Management Authority [2006] FCAFC 3

Re Williams and Australian Electoral Commission (1995) 38 ALD 366

REASONS FOR DECISION

20 February 2007   Deputy President D G Jarvis

1.      A Centrelink officer decided that the applicant, David James Woods, was not eligible to apply for a loan under the Student Financial Supplement Scheme (the “Scheme”), and advised him of that decision by a letter dated 29 March 2006.  The decision was later affirmed by an administrative review officer (“ARO”), and by the Social Security Appeals Tribunal (“SSAT”).

2.      Mr Woods then applied to this tribunal for review of the decision, which he described as a decision that he “is ineligible to apply for a supplement loan under the Student Financial Supplement Scheme” (section 37 documents, T1, page 1).  Written reasons for his request for review were annexed to his application.

3. The Scheme was previously provided for in Chapter 2B of the Social Security Act 1991 (Cth) (the “Act”). The object of that Chapter, as stated in s 1061ZW of the Act, was to establish a Student Financial Supplement Scheme enabling certain tertiary students to obtain a repayable financial supplement by entering into a contract for that purpose with a financial corporation that participated in the Scheme.

4.      On 9 December 2003, the then Minister for Children and Youth Affairs, the Honourable Larry Anthony MP, announced that the Government was administratively closing the Scheme from 1 January 2004.  The Minister had previously entered into an agreement with a financial corporation in order to implement the Scheme, but this agreement had expired, and he did not enter into any new agreement to take its place.  According to Mr Woods’ contentions, the action in closing the Scheme administratively was contrary to law, and had been taken because the Government was then unable to pass legislation through the Senate to close the Scheme.  I note, however, that by an amending act assented to on 22 May 2006, legislation was passed to close the Scheme.

5. The respondent initially applied to strike out Mr Woods’ application for review on the grounds that the tribunal did not have jurisdiction. That application arose from Mr Woods’ contention that the Minister’s administrative action was unlawful. After a directions hearing in relation to that initial application, the respondent also applied to strike out Mr Woods’ application for review pursuant to subsection 42B(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (the “AAT Act”). The hearing before me was to deal with the respondent’s preliminary applications.

6.      Mr Woods represented himself at the hearing.  He had lodged responses to the respondent’s initial Statement of Facts and to the respondent’s supplementary Statement of Contentions.  I have carefully considered these responses, and also the annexure to his original application for review, as well as written submissions lodged by the respondent.

Issues Before the Tribunal

7.      The issues raised by the respondent’s preliminary applications, as refined by its supplementary contentions, are as follows.

(a)Does this tribunal have jurisdiction to determine the validity of the Minister’s action in administratively closing the operation of the Scheme, or his failure to enter into a new agreement with a participating corporation?

(b)Should the application be dismissed by the tribunal under subsection 42B(1) of the AAT Act?

8. Subsection 42B(1) of the AAT Act provides in effect that this tribunal may dismiss an application for review if it is satisfied that the application is frivolous and vexatious. It has been held that that section extends to circumstances where the determination by this tribunal of an application for review would be of no practical utility (see for example Re Williams and Australian Electoral Commission (1995) 38 ALD 366; Re Brian Reddish and Civil Aviation Safety Authority [1999] AATA 721 at [33])).

Background Facts

9.      The following background facts were not in dispute.

10.     Mr Woods is a tertiary student.  Prior to the administrative closure of the Scheme, and since 2001 or 2002, he had applied for, and been granted, a financial supplement under the Scheme.

11. Division 4 of Chapter 2B of the Act provides for agreements between the Commonwealth and financial corporations, and contemplates that a participating financial corporation will pay a financial supplement to eligible students.

12. The Commonwealth engaged the Commonwealth Bank of Australia (“CBA”) to act as the financial corporation to provide Scheme loans. The Commonwealth’s contract with CBA expired on 31 December 2003. It was not renewed, and no other financial institution was contracted to perform the functions previously conducted by CBA. Accordingly, from 1 January 2004, the Commonwealth has not been a party to an agreement with a financial corporation under Division 4 of the Act.

13.     Thereafter, no doubt as a result of the administrative closure of the Scheme, no supplement entitlement notices were issued by or on behalf of the respondent.

14.     During the hearing Mr Woods said that prior to applying to the SSAT to review the ARO’s decision, he had brought proceedings in the Federal Court of Australia claiming that the Minister had acted ultra vires in administratively closing the Scheme.  He later discontinued the Federal Court proceedings because he was concerned that if the proceedings were unsuccessful he would be ordered to pay the Commonwealth’s costs.  He further explained that his wife was concerned that an adverse costs order might result in their losing their house to satisfy an order for costs, and his wife was not prepared to let him continue the proceedings because of that risk.

Applicant’s Contentions

15.     I understand from Mr Woods’ contentions at the preliminary hearing that he wants this tribunal to review the following actions, which, he contends, were unlawful:

(a)      the Minister’s action in closing the Scheme administratively;

(b)the respondent’s action in withdrawing the delegation to issue supplement entitlement notices; and

(c)the respondent’s action in refusing to issue the supplement entitlement notices.

16. In support of his first contention, Mr Woods submitted that it was not competent for the Minister to close the Scheme administratively, when the Scheme itself had been enacted by the Parliament, as this was contrary to the separation of powers in the Commonwealth Constitution.

17. He further submitted that unless and until the Scheme had been repealed by legislation, the Minister was empowered to enter into an agreement with a financial corporation to enable loans to be made pursuant to the Scheme, and should have done so. He referred in this regard to subsection 1061ZZAG(1) of the Act, which reads:

“The Minister may enter into an agreement, on behalf of the Commonwealth, with a financial corporation for the payment by the corporation after the commencement of this Chapter, in the year in which this Chapter commences or a later year, of financial supplement.”

He submitted that the word “may” in subsection 1061ZZAG(1) should not be interpreted as conferring a discretion on the Minister as to whether or not to enter into such an agreement.

Legislative Scheme

18. Section 1061ZY of the Act provides for the eligibility criteria for tertiary students to obtain a repayable financial supplement pursuant to the Scheme.

19.     Subsections 1061ZZAC(1) and (2) require the respondent to make decisions as to eligibility for financial supplement.  Subsection 1061ZZAC(1) provides as follows:

“If a person claims youth allowance, austudy payment or pensioner education supplement, the Secretary must decide whether the person is eligible to obtain financial supplement for a period that is the whole or part of a year.”

20.     If the respondent decides that a person is eligible to obtain financial supplement, the respondent is required by subsection 1061ZZAC(3) to give the person a supplement entitlement notice.

21. A person who has been provided with a supplement entitlement notice may apply for financial supplement only to a participating corporation (section 1061ZZAF). The Act goes on to provide, in Division 4, for agreements between the Commonwealth and financial corporations. Division 4 includes subsection 1061ZZAG(1), which is set out in paragraph 17 above.

22.     Division 5 provides that a person with a supplement entitlement notice may apply to a participating corporation during the period of the notice for financial supplement by:

(a)      completing an application form approved by the Secretary; and

(b)lodging it, with the notice, at an office of a participating corporation.

23.     The relevant provisions contemplate that decisions will be made by the respondent about the entitlement of a person to obtain financial supplement.  However, the respondent does not have any decision-making role in relation to the making of agreements with participating corporations.  It is the Minister, and not the respondent, who may enter into agreements with financial corporations under s 1061ZZAG.

Does the aat have jurisdiction to determine the validity of the minister’s actions, or other actions of the respondent following the closing of the Scheme?

24. Section 129 of the Social Security (Administration) Act 1999 (Cth) (the “Administration Act”) entitles a person affected by a decision of an officer under the social security law (which would include the decision made by the Centrelink officer in this case) to apply to the respondent for review of that decision. The Act goes on to provide for the review to be undertaken by an authorised review officer (amongst other persons).

25. Under s 142 of the Administration Act a person whose interests are affected by the decision of an authorised review officer (or other relevant person) may apply to the SSAT for review of that decision. The SSAT may, for the purpose of reviewing a relevant decision, exercise all the powers and discretions that are conferred on the Secretary (subsection 151(1) of the Administration Act).

26. Division 5 of Part IV of the Administration Act provides for a right of review by this tribunal of decisions made by the SSAT. Under subsection 43(1) of the AAT Act, this tribunal may exercise all the powers and discretions that are conferred by the relevant enactment on the person who made the decision under review, being for present purposes the decision of the SSAT.

27. It follows from the above legislative chain that it is the respondent (or a delegate of the respondent) who can make decisions as to the eligibility of a person to obtain financial supplement, and where a review has been sought of such a decision, and the relevant decision has been reviewed by the SSAT, this tribunal has jurisdiction to review the merits of the decision as to eligibility (which in the first instance would have been made by a delegate of the respondent), and this review would entail a consideration of the eligibility criteria referred to in s 1061ZY of the Act.

28.     This tribunal does not have an inherent general jurisdiction to review or determine the validity of actions taken by the Commonwealth or officers or agencies of the Commonwealth.  Its jurisdiction must be derived from another enactment that specifically confers jurisdiction on this tribunal.  This was made clear many years ago in Re Laird and Australian Broadcasting Tribunal (AAT 78/122, 10 May 1979), where President Davies J considered an application relating to the jurisdiction of this tribunal to review a decision of the Australian Broadcasting Tribunal.  His Honour said:

“An application for review may not be made to the Administrative Appeals Tribunal unless an enactment specifically empowers the making of that application.  An application so authorised is an application made under that enactment and thus an application to which s 25(4) of the Administrative Appeals Tribunal Act empowers the Administrative Appeals Tribunal to adjudge.”

29. The Act does not confer jurisdiction on this tribunal to consider the validity or otherwise of the action of the Minister in closing the scheme administratively, and it has not been suggested that any other legislation confers any such jurisdiction on this tribunal. I accordingly decide that whilst this tribunal does have jurisdiction to review the decision as to Mr Woods’ eligibility to obtain financial supplement, it has no jurisdiction to determine the validity of the Minister’s administrative action.

30.     It can also be seen from the above narration of the effect of the relevant provisions that this tribunal also has no jurisdiction to determine the validity of the Minister’s decisions not to renew the agreement with the CBA and not to enter into a new agreement with another financial corporation.  Further, the tribunal has no jurisdiction to make any order to compel the Minister to take either of those steps.

31. As mentioned above, Mr Woods also contends that the respondent’s actions in withdrawing the delegation to issue supplement entitlement notices, and in refusing to issue them, was unlawful. Whilst these were actions taken by the Secretary (or delegates) rather than the Minister, Mr Woods’ contention meets the same difficulty; that is, there is no provision in the Act, or in any other legislation, which gives this tribunal jurisdiction to review those actions by the respondent (or delegates). In my view, these actions by the respondent (or the relevant delegates) were administrative steps consequential upon the closing of the Scheme, and were not decisions amenable to review: see Meschino v Secretary, Department of Family and Community Services (2001) 65 ALD 220.

Should the application be dismissed under subsection 42B(1) of the aat act

32.     In Fearnley v Australian Fisheries Management Authority [2006] FCAFC 3, Emmett J said, at [98], that when an application for dismissal under subsection 42B(1) of the AAT Act is made by a respondent:

“(i)t is a matter for the applicant to adduce before the Tribunal, on the hearing of such an application, all such evidence as the applicant wishes to have before the Tribunal, to resist the assertion that the proceeding is or has become frivolous.”

His Honour went on to reject an argument that the applicant need do no more than demonstrate an arguable or prima facie case in answer to an application for dismissal under subsection 42B(1).

33.     Mr Woods explained his reasons for pursuing his application to this tribunal.  He said in effect that if he received a decision that he was entitled to a loan under the Scheme, and the Secretary was required to issue a supplement entitlement notice, then this might facilitate a further challenge to the Minister’s actions in the Federal Court, or might in some way make it more likely that a Federal Court action would succeed or confer some immunity for costs on him, so that his wife would agree to his instituting a further Federal Court action.  The respondent did not challenge this explanation.

34. Under the Act and the AAT Act, this tribunal has jurisdiction to review the decision as to Mr Woods’ eligibility for obtaining financial supplement. However, as I have also explained above, this tribunal has no inherent jurisdiction to determine the issues that Mr Woods apparently wished to agitate in the Federal Court. If Mr Woods wishes to pursue those issues, it would be necessary for him to do so pursuant to the Administrative Decisions (Judicial Review) Act 1977 (Cth), by instituting fresh proceedings in the Federal Court.  It appears that he would have no difficulty in establishing that he has standing to do so, by adducing evidence that he fulfilled the eligibility criteria for obtaining financial supplement; indeed the respondent did not contest, for the purposes of the present proceedings, that he fulfilled those criteria.  Even though there is no doubt that this tribunal has jurisdiction to review the decision as to that issue, there would be no practical utility in doing so, because there has not existed, at any material time, an agreement between the Commonwealth and a financial corporation.

35.     Even if this tribunal were to express an opinion about the other issues that could be the subject of Federal Court proceedings (and I do not think that it is appropriate to do so) any such expression of opinion would not, of course, be binding on the Federal Court, or facilitate any further proceedings in that court; nor would it make it more likely that any such proceedings would succeed, or provide Mr Woods with any immunity as to costs.

36.     I have accordingly concluded that the determination of the issue that is within the jurisdiction of this tribunal, that is, whether or not Mr Woods fulfilled the eligibility criteria for obtaining financial supplement, would not be of practical utility.  In those circumstances, and in accordance with the approach referred to by Emmett J in Fearnley (supra), I am satisfied that the application is frivolous within the meaning of s 42B of the AAT Act.

Decision

37. The application is dismissed pursuant to subsection 42B(1) of the Administrative Appeals Tribunal Act.

I certify that the 37 preceding paragraphs are
a true copy of the reasons for the decision
herein of Deputy President D G Jarvis

Signed:         .....................................................................................
           L. Wunderer  Associate

Date/s of Hearing  12 December 2006
Date of Decision  20 February 2007
Applicant  In Person
Counsel for the Respondent     Mr B Dube
Solicitor for the Respondent     Sparke Helmore