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

This matter concerned an application by XYMV (the Applicant) for review of a decision by the Secretary, Department of Social Services (the Respondent) regarding the application of a compensation preclusion period and a compensation charge to a lump sum compensation payment received by the Applicant. The Applicant had received a lump sum settlement for economic loss, which the Respondent determined attracted a compensation preclusion period for their Austudy and Newstart allowances. The Applicant sought to have the debt written off or waived. The decision was made by Linda Kirk SM.

The legal issues before the Tribunal were whether the Applicant had received a lump sum compensation payment, whether a compensation lump sum preclusion period applied, and whether the compensation charge had been correctly raised and recovered. Further, the Tribunal was required to determine if special circumstances existed to treat all or part of the lump sum payment as not having been made, and if the compensation charge should be written off or waived.

The Tribunal reasoned that the Applicant had received a lump sum compensation payment as defined by section 17(2) of the Act, because the settlement included a component for economic loss, confirmed by the insurer. Consequently, a compensation preclusion period was required under section 1169(1) of the Act. The Tribunal calculated the lump sum preclusion period by applying the formula in section 1170(4), deeming 50% of the lump sum as the compensation part in accordance with section 17(3)(a) to avoid manipulation. This calculation resulted in a preclusion period of 169 weeks. The Tribunal found no special circumstances under section 1184K of the Act to reduce the lump sum amount or grounds to write off or waive the compensation charge.

The Tribunal affirmed the Reviewable Decision.