Editors --- "Assets test: successful claim under financial hardship; whether arrears payable; special circumstance" [2005] SocSecRpr 19; (2005) 7 Social Security Reporter, Article 19

• McALISTER and SECRETARY TO THE DFaCS
• Background
• The issue
• The law
• Formal decision

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Claim for disability support pension: arrears; transfer from newstart allowance under s.12 Administration Act

McALISTER and SECRETARY TO THE DFaCS

(2005/485)

Decided: 27th May 2005 by R. Hunt

Background

McAlister had been receiving either parenting payment or newstart allowance since July 1999. On 23 June 2003he claimed disability support pension (DSP) and this was granted with effect from the date of claim. However McAlister sought a review of this decision, arguing that he was entitled to DSP from July 1999. He supplied medical evidence that he was diagnosed with schizophrenia in 1999 or possibly earlier.

The issue

The AAT found on the evidence that McAlister qualified for DSP before the date of his claim on 23 June 2003. The Tribunal then considered whether section 12 of the Social Security Administration Act 1991 (the Act) operated to allow McAlister’s DSP to be backdated to the date he first qualified for DSP. A further question arose as to the date from which the transfer to DSP should occur.

The law

Rules relating to the payment of DSP are set out in the Administration Act. The commencement date of the Administration Act was 20 March 2000. Sections 41 (1) and 42 of the Administration Act explain that a social security payment becomes payable to a person on that person’s “start day” and refers to Schedule 2.

Clause 3(1) of Schedule 2 sets out the general rule for start days being the day on which a claim for payment is made, provided the person is qualified for payment on that day. Section 11 of the Administration Act states that a person who seeks a social security payment must make a written claim for the payment. However, the Act also contains provisions which allow a claim to be deemed to have been made. Section 12 in particular, provides in part:

(1) Subject to subsection(3), if:

(a) a person is receiving an income support payment; and

(b) while receiving the payment, the person becomes qualified for another income support payment (the other payment); and

(c) the Secretary determines that the person is to be transferred to the other payment; the person is taken, for the purposes of the social security law, to have made a claim for the other payment on the day on which the person became qualified for the other payment.

...

(3) The Secretary may only make a determination under subsection (1) or (2) if the transfer is one that the Secretary could have determined should occur apart from this section.

Transfer under s.12 Administration Act

The AAT accepted that McAlister had been medically qualified for DSP since 1999 and that he met clauses (a) and(b) of section 12(1), that is, he was a person receiving an income support payment who, while receiving the payment, became qualified for another income support payment, being the DSP. The AAT was also satisfied that McAlister should be transferred to the other payment, being the DSP.

The date of transfer

The AAT referred to the decision of Wilcox J in Burgess v Secretary to the Department of Family and Community Services [2004] FCA 136 and held that section 12(3) permits the backdating of a claim for DSP if the applicant is able to satisfy the Tribunal, as a matter of fact, that the applicant was entitled to receive Discontinuously from the date of application for another unemployment benefit, even where this occurred before the date of commencement of the Act.

Following the reasoning in Burgess the AAT determined that McAlister should be deemed to have made a claim for DSP in July 1999, being the date of his earlier application for newstart allowance.

Formal decision

The AAT set aside the decision under review and in substitution thereof decided that McAlister should be taken to have applied for DSP in July 1999, pursuant to section 12 of the Administration Act.

[I.T.]