Editors --- "Austudy debt: full-time study; flexible delivery; waive" [2005] SocSecRpr 18; (2005) 7 Social Security Reporter, Article 18

• TAURIO and SECRETARY TO THE DFaCS
• Background
• Issue
• Findings
• Formal decision

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Austudy debt: full-time study; flexible delivery; waive

TAURIO and SECRETARY TO THE DFaCS

(2005/437)

Decided: 16th May 2005 by E. Christie

Background

Taurio enrolled in an Advanced Diploma at TAFE in 2002. The course was provided in ‘flexible delivery’ mode. Taurio claimed and was granted Austudy as a full time student. Due to a variety of administrative problems, he was unable to undertake certain courses in2002. Centrelink raised a debt of $9606for the period April 2002 to September 2003. Taurio was also prosecuted and pleaded guilty prior to the appeal.

Issue

Whether the debt due to the Commonwealth could be waived, in part or in full, for either ‘administrative error’ or ‘special circumstances’? The relevant sections of the Social Security Act1991 (the Act) are ss.1237, 1237A and 1237AAD.

Findings

Full time study

The AAT spent some time exploring the nature of the flexible delivery TAFE course Taurio had enrolled in. It sought additional information from TAFE. When Taurio claimed Austudy, he sought advice from Centrelink about his full time status and had communications with TAFE, as a result of which he considered he was a full time student. Taurio advised the Tribunal that at no time had he been told that to qualify as a fulltime student in the Advanced Diploma offered by TAFE he had to undertake 15 hours face-to face contact each week. He acknowledged that at no stage during 2002/2003 had he met this requirement.

Administrative error

The Tribunal noted that fors.1237A to apply, Taurio must not have contributed in any way to the administrative error that led to the overpayment and he had to receive the overpayments in good faith. Centrelink argued that as Taurio did not advise about a change of status, he had contributed to the error that led to the overpayments.

The Tribunal concluded that Centrelink, Taurio and TAFE all contributed to the overpayment. Centrelink determined the course was full time by simply dividing the total number of hours of the course by the number of teaching weeks to complete the course. TAFE was unspecific about what ‘flexible delivery’ meant. However the AAT decided that Taurio should have queried his status in Semester 1, 2002 when he did not undertake any coursework. As Taurio contributed to the administrative error the debt could not be waived under this section.

Special circumstances

The Tribunal considered whether Taurio ‘knowingly’ made a false statement. It referred to Re Callaghan and Secretary, Department of Social Security (1996-1997) 45 ALD435. The Tribunal concluded that the “lack of clarity of the meaning of the term ‘full-time student’ for Austudy purposes, when Mr Taurio’s course was taken by ‘flexible delivery’, has created confusion as to the real status of MrTaurio’ enrolment category” (reasons, para 53). Accordingly, Taurio only had constructive knowledge and not actual knowledge that he was making a false statement.

In considering whether there were ‘special circumstances’, the Tribunal found that given the unusual nature of Taurio’s studies by flexible delivery, he should have contacted Centrelink to query his status. The Tribunal concluded that there was nothing unusual or unfair or unintended in the circumstances leading the Taurio’s overpayment.

Criminal prosecution

The Tribunal noted that a criminal prosecution had preceded the appeal and the different standards of proof that applied.

The Tribunal makes the further observation that, in cases where the respondent is seeking to pursue a concurrent civil action and a criminal prosecution, it may be prudent for the respondent to have in place Departmental Policy Guidelines. Specifically guidelines that prescribe criteria when and how the discretion to prosecute is to be applied to pursue a criminal referral - prior to all appeal avenues being exhausted in the civil action. (Reasons para. 63)

Formal decision

The Tribunal affirmed the decision under review.

[M.A.N.]