ZYFZ and Secretary, Department of Social Services

[2014] AATA 589

[2014] AATA 589

Division	GENERAL ADMINISTRATIVE DIVISION
File Number	2014/2025
Re	ZYFZ
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Dr P McDermott RFD, Senior Member
Date	22 August 2014
Place	Brisbane

The Tribunal affirms the decision under review.

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Dr P McDermott RFD, Senior Member

CATCHWORDS

SOCIAL SECURITY – Pensions and benefits – Disability support pension (DSP) – Whether applicant overpaid DSP – Applicant did not disclose employment – Whether overpayment recoverable – Debts cannot be written off or waived under the Social Security Act 1991 (Cth) – Decision under review affirmed

LEGISLATION

Social Security Act 1991 (Cth) ss 117, 1064, 1223, 1236, 1237A, 1237AAD

REASONS FOR DECISION

Dr P McDermott RFD, Senior Member

22 August 2014

INTRODUCTION

1. I have to determine whether the applicant has been overpaid disability support pension (“DSP”) and if so, whether the amount of such overpayment constitutes a debt due by the applicant to the Commonwealth which is recoverable.

   BACKGROUND

2. Since 2011 the applicant has been in receipt of DSP. Since 2009 the applicant has been sent regular notices to advise her of the requirement to advise Centrelink should her circumstances change and if she commenced employment and had changes to her income from employment.[1] In October 2012 the applicant was contacted as a result of a data match with the Australian Tax Office (“ATO”). On 24 October 2012 the applicant advised Centrelink that she had been employed by an employer on a casual basis from October 2010 to February 2011. Centrelink sent that employer a request for information in relation to that employment, that employer confirmed that the applicant was employed for that period as well as particulars of the gross wages of the applicant.

   [1] Exhibit A, pp 110-168.

3. In December 2012 a further data match with the ATO revealed that the applicant had been employed by another employer during the 2010/2011 tax year and a request for information was sent to that other employer who provided Centrelink with particulars of the gross wages of the applicant from June 2011 until March 2012. On 19 March 2013 an officer of Centrelink made decisions to recover two debts arising from the overpayment of DSP. On 25 March 2013 the applicant advised Centrelink that she had been advised not to declare her earnings if they were less than $1,750 per fortnight.

4. In September 2013 the applicant married. In December 2013 as a result of a data match with the ATO the applicant was contacted by Centrelink and she advised Centrelink of details of the wages of her husband. On 20 December 2013 it was decided to recover a third debt arising from overpayment of DSP. On 2 January 2014 Centrelink asked the applicant to provide details of the wages of her husband for the period ending

   
   

   16 December 2013 and on that date a decision was made to raise and recover a fourth debt arising from overpayment of DSP.

   PRIOR DECISIONS

5. The applicant has sought the review by this Tribunal of decisions in relation to the following four debts:

   Debt 1

   oA decision made on 19 March 2013 to recover $2,329.49 for an overpayment of DSP for the period 1 November 2010 to 28 February 2011.

   Debt 2

   oA decision made on 19 March 2013 to recover $7,176.47 for an overpayment of DSP for the period 20 June 2011 to 26 March 2012.

   Debt 3

   oA decision made on 20 December 2013 to recover $993.67 for an overpayment of DSP for the period 3 November 2013 to 2 December 2013.

   Debt 4

   oA decision made on 2 January 2014 to recover $507.07 for an overpayment of DSP for the period 3 December 2013 to 16 December 2013.

   On 17 March 2014 these decisions were affirmed by the Social Security Appeals Tribunal (“SSAT”).

   LEGISLATION

6. The legislation that provides for a persons’ eligibility for DSP is the Social Security Act 1991 (Cth) (“the Act”).

7. Section 117 of the Act provides that the Pension Rate Calculator at the end of s 1064 of the Act is the appropriate calculator to use to work out the applicant’s rate of DSP. Pension Rate Calculator A in s 1064 includes an income test in Module E. Module E provides how a person’s ordinary income affects the person’s maximum payment rate of pension and provides an upper and lower income test limit. In relation to the lower limit, once a person receives income above that lower level, the rate of pension payable to them reduces by 50 cents for each dollar of income they receive over the limit. Once a person receives income above that upper limit, no pension is payable. Module F of s 1064 provides the method statement for working out the rate of DSP payable to a person if the person is a member of a couple. The method statement applies to the person as well as the person’s partner.

   CONSIDERATION

8. There is common ground that I have to determine two issues: whether there has been overpayments of DSP; and if so, whether the amounts of such overpayment are debts that are recoverable.

   WHETHER THERE HAS BEEN AN OVERPAYMENT OF DSP

9. Section 1223(1) of the Act provides that if a social security payment is made and the person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit, the amount of that payment is a debt due to the Commonwealth by that person and the debt is taken to arise when the person obtains the benefit of the payment.

10. There is no issue that the applicant received payments of DSP in excess of her correct entitlement because her income from two employers was not taken into account. I will not reveal the name of the employers as there is a confidentiality order in relation to the identity of the applicant. From 1 November 2010 to 28 February 2011, the applicant received payment of DSP of $6,138.01 but was only entitled to $3,808.52 due to her income from one employer: the amount of this excess payment is $2,329.49. From

    
    

    20 June 2011 to 26 March 2012, the applicant received payment of DSP of $14,904.70 but was only entitled to $7,728.23 due to income that she received from another employer: the amount of this excess payment is $7,176.47. From 3 November 2013 to

    
    

    2 December 2013, the applicant received payment of DSP of $1,728.20 but was only entitled to $734.53 due to income that her husband received from his employer:  the amount of this excess payment is $993.67. From 3 December 2013 to

    
    

    16 December 2013, the applicant received payment of DSP of $576.07 but was only entitled to receive $69 due to income that her husband received from his employer: the amount of this excess payment is $507.07.

11. I have reviewed the record of the internal review of the decision. That record contains a typographical error in that debt 2 is stated to be $4176.47.[2] This typographical error is not material as the correct amount for debt 2 of $7176.77 is correctly recorded on the next page of that document.[3]

    [2] Exhibit A, p 39.

    [3] Exhibit A, p 40.

12. There is no issue that there has not been the correct calculation of the amounts of DSP which have been overpaid to the applicant. I am satisfied that these amounts constitute debts which are due to the Commonwealth.

    WHETHER THE DEBTS SHOULD BE RECOVERED

13. The Act provides that debts may not be recovered if they are written off or waived under Part 5.4 of the Act.

14. I will consider whether the debts can be written off. Section 1236 of the Act provides, subject to subs (1A), that the Secretary may, on behalf of the Commonwealth, decide to write off a debt, for a stated period or otherwise. The Secretary can write off the debt only if the applicant has no capacity to repay the debt: s 1236(1A)(b). As the debt is being repaid by deductions of $20 per fortnight from the applicant’s social security payments, the applicant is, by virtue of the operation of s 1236(1C) of the Act, taken to have a capacity to repay the amount unless recovery by those means would result in severe financial hardship. I appreciate that the applicant has a tight financial situation. However, applicant’s husband is also in receipt of income. In these circumstances having regard to the state of the evidence before me I am not prepared to make a finding that the applicant is in severe financial hardship.

15. I am unable to write off the debt having regard to the constraints imposed by social security law upon the exercise of the discretion under s 1236 of the Act.

16. I next consider whether the debts can be waived. Section 1237 provides that on behalf of the Commonwealth, the Secretary may waive the Commonwealth’s right to the whole or a part of the debt from a debtor in the circumstances described in certain sections of the Act. There is no issue that the only provisions which are applicable for consideration are s 1237A and s 1237AAD of the Act.

17. I do not consider that there is any evidence that the debts arose due to any administrative error on the part of the Commonwealth. I therefore do not consider that the debts can be waived under s 1237A(1) of the Act. I appreciate that the applicant claims to have been given incorrect advice from a Centrelink officer. The tenor of what the applicant has told the SSAT and this Tribunal is that she has been informed by a Centrelink officer that as long as she worked under 27 hours a week and earned less than $1750 a fortnight she would remain entitled to DSP. While the applicant, who has been receiving DSP before 2006, can work for up to 30 hours per week, the amount of DSP that she is being paid is governed by Module E which provides that once a person receives income above the prescribed upper limit, no DSP is payable. However, this statement concerning her eligibility to receive DSP is not relevant to the question of whether the applicant has complied with the information notices which have been issued to her.

18. On 22 November 2010, 28 February 2011, and 12 July 2011 information notices were sent to the applicant to require her to advise Centrelink of any start or stop in her employment, or change in her income from employment.[4] The applicant did not comply with those notices by advising Centrelink when she started and stopped employment. If she had complied with those notices then debt 1 and debt 2 would not have arisen. The later information notices such as the notice dated 12 January 2012 also require the applicant to advise Centrelink of a “change in circumstances”. There are no Centrelink records which record the applicant as having advised the Centrelink of her husband’s employment (which I would regard as a “change in circumstances”) except when she has answered a query from a Centrelink officer after a data matching exercise. If she has advised Centrelink of the employment details of her husband then debts 3 and 4 would not have arisen.

    [4] Exhibit A, pp 123, 130, 136.

19. It would be inappropriate to exercise the discretion under s 1237AAD of the Act where there has been the failure of the applicant to answer an information notice given under social security law. It is not necessary to consider whether such conduct comes within the ambit of s 1237AAD(a)(ii) of the Act.

20. I appreciate that the applicant has health problems in common with many recipients of DSP. I also appreciate that the applicant has tendered references from people who testify that she is an honest person and that she has an unresolved claim against a medical practitioner. However I consider that the material tendered on behalf of the applicant does not disclose any special circumstances such as would make it appropriate to exercise the discretion under s 1237AAD of the Act.

    DECISION

21. I affirm the decision under review.

I certify that the preceding 21 (twenty-one) paragraphs are a true copy of the reasons for the decision herein of Dr P McDermott RFD, Senior Member

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Associate

Dated 22 August 2014

Date of hearing	1 August 2014
Applicant	In person
Solicitors for the Respondent	Ashley Burgess, Department of Human Services