XBCZ and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
[2010] AATA 826
•25 October 2010
Administrative Appeals Tribunal
DECISION AND REASONS FOR DECISION [2010] AATA 826
ADMINISTRATIVE APPEALS TRIBUNAL )
) No 2010/2583
General Administrative DIVISION ) Re XBCZ Applicant
And
Secretary, Department of Families, Housing, Community Services and Indigenous Affairs
Respondent
DECISION
Tribunal Senior Member Naida Isenberg Date25 October 2010
PlaceSydney
Decision The decision under review is affirmed.
...................[sgd]..................................
Senior Member
CATCHWORDS
SOCIAL SECURITY - disability support pension - applicant in same-sex relationship - pension reduced from single to partnered rate - applicant's partner a temporary resident - whether special reason for which he should not be treated as a member of a couple – applicant’s partner working full-time on a casual basis - decision under review affirmed.
Social Security Act 1991, ss 24, 152, 1064
Same-Sex Relationships (Equal Treatment in Commonwealth Laws–General Law Reform) Act 2008
Boscolo v Secretary, Department of Social Security (1999) 53 ALD 277
Harding and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2010] AATA 231
Holt and Secretary, Department of Education, Employment and Workplace Relations [2010] AATA 143
REASONS FOR DECISION
25 October 2010 Senior Member Naida Isenberg Background
1. XBCZ began receiving a disability support pension (DSP) at the single rate on 11 August 2008. On 8 August 2008, XBCZ’s partner arrived in Australia from Malaysia. The applicant’s partner was granted an 826 class visa which is temporary visa for two years. In December 2010, the applicant’s partner will be eligible to apply for a permanent visa.
2. On 1 July 2009 amendments to the Social Security Act 1991 (the SS Act) made by the Same-Sex Relationships (Equal Treatment in Commonwealth Laws–General Law Reform) Act 2008 (the SSR Act) came into force, which changed the way same-sex couples were treated under social security law. On 7 July 2009, XBCZ contacted Centrelink to advise he was a member of a couple, and Centrelink subsequently decided he should be paid DSP at the partnered rate. Both Centrelink and the Social Security Appeals Tribunal (SSAT) have affirmed that decision.
3. On 29 May 2010, XBCZ requested his DSP payments to be suspended as he felt ‘humiliated’ and ‘like he was begging for money’ from Centrelink. Since the beginning of June 2010 he has had access to funds from his parents’ age pension which he has been using to cover his living expenses; however, he says these funds will only last him another couple of months.
The legislation
4. The rate at which a person is paid DSP depends on whether or not he or she is a member of a couple as defined in the SS Act. The rationale is that a couple has the ability to pool resources and live more economically than if each was single.
5. If a person is in a de facto relationship with another person, whether of the same sex or a different sex (the partner) and the person is not legally married to the partner, the Secretary may determine that the person is not a member of a couple if there is a special reason in the particular case: s 24 (2) of the SS Act.
The issues
6. The facts are not in dispute. XBCZ continues to see himself as a member of a couple. I have to decide whether, for a special reason in his particular case, XBCZ should not be treated as a member of a couple.
Evidence and submissions
7. XBCZ met his partner in 2006 when he was living in Malaysia. The applicant’s partner moved to Australia in August 2008 and is currently here on a temporary visa. The effect of his visa status is that he is not presently eligible for any Centrelink payment other than special benefit. He has applied for special benefit but was refused on the ground that he did not demonstrate sufficient financial hardship.
8. The applicant’s partner undertook a Master of Engineering in Telecommunications at the University of Technology, Sydney from February 2009 to December 2009 to improve his chances of getting a good job in Sydney. Because of his temporary visa status, the applicant’s partner was considered an international student by the university and therefore had to pay the full fee of $22,000 upfront. He borrowed this money from his parents in Malaysia and he is currently paying them back at $1,000 per month.
9. According to the SSAT decision, the applicant’s partner began working in September 2009 on a part-time basis and increased his hours when he finished his Master’s degree in December 2009. At the time of the SSAT decision, the applicant’s partner was working 7 days per week. XBCZ provided evidence at the hearing that the applicant’s partner is currently employed by a recruitment agency and is contracted to work for Telstra full-time on a casual basis. There have been a few weeks since September 2009 where the applicant’s partner has not worked, and his earnings continue to vary. However, Centrelink records indicate he has worked fairly consistently since he began working and has earned between $260 and $2,400 per fortnight.
10. XBCZ and his partner currently share a 2 bedroom apartment which they purchased in around December 2008. The mortgage on the apartment is now approximately $350,000. The mortgage repayments were being paid by The applicant’s partner with the help of XBCZ’s brother who was contributing $700 per month for a period of six months. However, they have not been able to make repayments on their mortgage for the past five months because repayments have risen to $2,800 per month following several interest rate increases. In September 2010 they sold the property for $479,000 and intend to purchase another, smaller, apartment for around $300,000 to $350,000.
11. XBCZ also has an investment property which he purchased with moneys received from a compensation payment. XBCZ claims that this is an income neutral asset since the mortgage repayments and other expenses are covered by the rental income he receives. In July 2010, Centrelink valued the equity in the investment to be approximately $32,000.
12. Since 29 May 2009, when XBCZ requested that his DSP be suspended, he has been using funds given to him by his parents to meet his expenses. These funds are essentially his parents’ Australian age pension benefits accumulated over six months, which they are not using because they are living overseas. The age pension is paid at around $650 per fortnight and XBCZ says the funds will last him another month or two.
13. XBCZ gave evidence that he broke his back and neck in a car accident in 1999 and continues to suffer chronic pain. He requires physiotherapy twice a week and medication which costs him about $50 per month after subsidies. He says he needs full-time care, but cannot afford it. XBCZ currently employs two carers for a day and a half each week, which costs him $300 per week in total. XBCZ also pays $110 per month for private health insurance to cover some of his physiotherapy costs and other medical costs such as hospital fees.
14. XBCZ argues that Centrelink is penalising him for having a partner and says that even when his partner was not working he was being paid at a reduced rate. He further submits he and his partner are experiencing financial hardship which constitutes a special reason for which he should not be treated as a member of a couple. He says that because his partner is a temporary resident and had to pay his tuition fees upfront leaving him a large debt to pay, they are not able to pool their resources as well as other couples. XBCZ also submits that his health problems and medical costs constitute a special reason within the meaning of s 24 (2).
15. Centrelink says that at the time of its decision to pay XBCZ DSP at the partnered rate, the applicant’s partner was working fairly consistently on a full-time basis. Centrelink contend that XBCZ and his partner have at all relevant times been living together and sharing household expenses from their joint bank accounts thereby pooling their resources. Although they may be experiencing some financial difficulties, their circumstances are not unusual or ‘special’ such that s 24 (2) of the SS Act should be enlivened.
Consideration
16. The maximum rate of DSP which is payable to a person is to be determined in accordance with s 1064 of the SS Act. Under this provision, it is clear that a person who is a member of a couple is entitled to a lesser rate of pension than a single person. The lower rate applies even when the partner is not earning a regular income or any income at all.
17. For XBCZ to be paid DSP at the single rate, he must be able to show that there is a special reason he should not be treated as being a member of a couple. In Boscolo v Secretary, Department of Social Security (1999) 53 ALD 277, French J said (at [18]) that the word “special” before “reasons” indicates that the “discretion it constrains is not lightly to be enlivened”. However, that does not require that the case be extremely unusual, uncommon or exceptional:
The core of the requirement for "special circumstances" or "special reasons" is that there be something unusual or different to take the matter the subject of the discretion out of the ordinary course.
18. French J also said (at [20]):
It is of importance in the present case to note that s 24 requires the decision-maker to focus on the position of one person, not the couple, and to assess whether that person should for a special reason not be treated as a member of the couple.
19. Each case must be decided on its merits but it is helpful to consider how the Tribunal has determined other cases.
20. In Holt and Secretary, Department of Education, Employment and Workplace Relations [2010] AATA 143, the Tribunal decided that Mr Holt should be paid Newstart Allowance at the single rate, and set out all the particular circumstances which it considered amounted to a special reason in his case. However, this case can be distinguished from the current decision under review because unlike Mrs Holt, XBCZ’s partner has been able to secure paid employment.
21. In Harding and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs [2010] AATA 231, the Tribunal agreed with the Secretary that the discretion should not be exercised in Mr Harding’s favour. That case was in some respects quite similar to this. Mr Harding was in a same-sex relationship and his partner had migrated from China and was unable to obtain Centrelink benefits. The partner had some difficulty obtaining employment; however the applicant’s partner did manage to secure employment and had been earning approximately $2,000 per fortnight at the time of the hearing. His earnings were paid into a bank account jointly held by Mr Harding and his partner. There was also evidence to suggest the applicant’s partner owed $10,000 to relatives in China and was attempting to repay the debt. The Tribunal concluded there was no special reason to treat the applicant as not being a member of a couple.
22. I accept that XBCZ’s financial situation is strained. His medical expenses and the cost of employing carers are not insubstantial. He has had to sell their apartment and look to downsize in order to repay the mortgage on the apartment where he and his partner reside. However, as French J said in Boscolo, the discretion contained in s 24 is not lightly to be enlivened. I am not satisfied that XBCZ’s circumstances are unusual, different, or out of the ordinary such that they amount to a special reason for which he should not be treated as a member of a couple.
23. XBCZ’s partner is employed and although his earnings vary, Centrelink records indicate he is earning on average approximately $1,000 per week. His earnings are paid into a joint bank account and their household expenses are shared. XBCZ owns an investment property in which he has equity of around $32,000. Although XBCZ told the Tribunal he wants to keep the property as security for his later years, it is nevertheless a significant asset which must be taken into account. Further, XBCZ will be in a better financial position following the sale of his and his partner’s apartment and their decision to down-size.
24. At the hearing, XBCZ raised the issue as to whether Centrelink had allowed a period of grace for recipients of social security benefits to disclose their relationship status when the SSR Act came into force. He claims that other couples who had not notified Centrelink that they were a member of a same sex relationship were not being penalised because Centrelink had allowed a grace period for same sex couples to declare their relationships. XBCZ says that he did not realise his DSP would be affected when he declared to Centrelink that he was a member of a couple and now feels disadvantaged for having been so frank with Centrelink.
25. At the conclusion of the hearing, the Tribunal directed the respondent to file submissions as to whether such a grace period existed, whether formal or informal. The respondent’s submissions state that the provisions of the SSR Act came into force on 1 July 2009 and there was no grace period for notification of relationships, or in relation to the raising or waiving of debts. The Tribunal accepts these submissions. XBCZ does not have the benefit of any grace period and the provisions of the SSR Act applied to XBCZ from 1 July 2009.
26. I note that the Secretary submitted to the Tribunal that if the discretion under s 24 of the SS Act was applied in XBCZ’s favour, the date of effect would be 8 April 2010 being the date of application to the SSAT: s 152 of the SS Act. Since I have affirmed the decision under review it is not necessary for me to canvass this issue here.
27. I observe that since May 2009 XBCZ has elected not to receive the DSP to which he is entitled. As I noted at the hearing, to have done so is entirely a matter for him. He may wish to reconsider his position given his strained financial circumstances.
Decision
28. The decision under review is affirmed.
I certify that the 28 preceding paragraphs are a
true copy of the reasons for the decision
herein of Senior Member Naida IsenbergSigned: ...............................[sgd].................................................
Diana Weston AssociateDate of Hearing 13 October 2010
Date of Decision 25 October 2010
ApplicantSelf-represented
Representative for the Respondent Ms Stefanie Memmott, Centrelink Advocacy Branch
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