Editors --- "Youth Allowance: whether undertaking full-time study; whether payable during an absence from Australia" [2006] SocSecRpr 38; (2006) 8(3) Social Security Reporter, Article 15

• SECRETARY TO THE DFaCS and BROWN
• Background
• The legislation
• The decision of the AAT
• Submissions
• The decision of the Court
• Formal decision

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Youth Allowance: whether undertaking full-time study; whether payable during an absence from Australia

SECRETARY TO THE DFaCS and BROWN

Decided: 11th May 2006 by Bennet J.

Background

Brown was enrolled in an Arts/Law degree at Sydney University (‘Sydney’) for the 2004 academic year. He qualified for youth allowance under the Social Security Act 1991 (‘the Act’).

Brown was accepted for study at Birzeit University in Palestine (‘Birzeit’) from August/September to 24 December 2004. Sydney confirmed that two units of the study at Birzeit could contribute to his Bachelor’s degree at Sydney. However, because there was no official exchange program between Sydney and Birzeit, and due to insurance issues arising if Sydney was to maintain Brown’s enrolment during his study at Birzeit, he had to defer his enrolment at Sydney.

Brown was enrolled in semester 2 at Sydney and discontinued prior to the HECS census date of 31 August 2004. It was Brown’s intention to re-enrol at Sydney in the first semester of 2005, when enrolments were next accepted. Brown was making satisfactory progress towards completing his course.

Centrelink determined that Brown was not qualified for youth allowance during the period he intended to study at Birzeit because he did not satisfy the activity test. The AAT set aside this decision. The DFaCS appealed to the Federal Court.

The legislation

In order to satisfy the activity test, because of his study, Brown had to undertake full-time study (s.541(1)(a) of the Act). Section 541B sets out what is ‘undertaking full-time study’ for the purposes of the Act. Brown needed to establish that he came within the test in s.541B(1)(a)(ii) and (c) which provides:

For the purposes of this Act, a person is undertaking full-time study if:

(a) the person:

(i) is enrolled in a course of education at an educational institution; or

(ii) was enrolled in the course and satisfies the Secretary that he or she intends, and has (since no longer being enrolled) always intended, to re-enrol in the course when re-enrolments in the course are next accepted; or

(iii). ...and

...

(c) the course in question is an approved course of education or study (see subsection (5))...

(emphasis added)

The decision of the AAT

It was agreed by all parties that the Arts/Law degree at Sydney was an approved course of education or study and Sydney was an educational institution for the purposes of s.541B(1) of the Act. It was also agreed that the course at Birzeit was not an approved course of study or education for the purposes of the Act.

Brown’s submission was that, for the purposes of s.541B(1)(c), the ‘course in question’ was the approved course at Sydney in which he was enrolled and intended to re-enrol and that, for the purposes of his undertaking full-time study, the course at Birzeit was irrelevant. The DFaCS submitted that ‘the course in question’ was the course at Birzeit, as was ‘the course’ for the purposes of s 541B(1)(a)(ii).

The AAT rejected the DFaCS submission and held that ‘the course’ in each case was the Sydney course. The AAT found that the DFaCS’s interpretation was not available on the basis of the words of the text. As a result, the AAT considered that when studying at Birzeit, Brown would be undertaking full-time study and would therefore satisfy the activity test.

The AAT considered ss.15AA and 15AB of the Acts Interpretation Act 1901 but held they did not assist the DFaCS. The AAT considered the purpose and object of the Act as a whole and held that it was to provide for the payment of benefits to persons who are entitled to those benefits. There was no alternative construction reasonably available for the purposes of s.15AA. As to s.15AB, the AAT considered that the purpose and object of the Act and the purpose of s.541B(1)(a), as stated in the Explanatory Memorandum (referring to a person enrolled and intending to re-enrol), were not at odds with the ordinary meaning of the words of the section.

The AAT then turned to consider, for the purposes of s.15AB, whether the ordinary meaning of the provision leads to a result that is manifestly absurd or is unreasonable. The AAT noted that a student is taken to be undertaking full-time study despite a hiatus in enrolment if the student is enrolled in a course and intends to re-enrol when enrolments are next accepted, without addressing the nature of activity that the student may be engaged in during that hiatus period. While the activity during the enrolment hiatus could be serious study, it could also be snowboarding. The AAT found that result to be unreasonable but concluded that this does not permit an unreasonable or unnatural construction or a rewriting of the provision (Newcastle City Council v GIO General Limited [1997] HCA 53; (1997) 191 CLR 85 at 113 per McHugh J).

Submissions

The DFaCS submitted that the AAT erred in its construction of s.541B(1) by failing to have regard to the narrow and broad context of the provision. The ‘narrow context’ was the ‘proper’ construction of the section: ‘the Tribunal was required to ask itself first whether, during the relevant period, [Brown] was enrolled in a course of education at an educational institution’. The broad context was in fulfilling the purpose of the provision.

The DFaCS also submitted that because the Birzeit course was non-approved and Brown was in fact enrolled at Birzeit, s.541B(1)(a)(ii) was not satisfied. In the DFaCS’s submission, the AAT wrongly dealt with the criterion of that section by reference to Sydney because Brown was not at Sydney for the relevant period.

The decision of the Court

The Court held that it was clear from the wording of s.541B that the ‘course’ as referred to in the various sub-sections of that section refer to the same course. That is the course referred to in sub-section (a)(i): ‘a course of education at an educational institution’. That could only be the Sydney course. Sub-sections (a), (b) and (c) are linked to (a)(i) and provide for further criteria to be satisfied with respect to that course or the person enrolled in it.

During the period at Birzeit, Brown was enrolled in an approved course of education (Arts/Law) at an educational institution (Sydney), and therefore satisfied s.541B(1)(a)(ii). The Court held that the fact that during the relevant period Brown was enrolled at Birzeit, and was enrolled at Sydney prior to that period, meant that s.541B(1)(a)(ii) applied rather than s.541B(1)(a)(i).

The DFaCS argued that the Explanatory Memorandum to the Act indicates that the section was intended to cover the short periods between enrolments in educational institutions. The section ought to be construed with a view to its ‘restricted purpose’ so as not to apply to a person who is enrolled in a course of education for reasons other than those required by the education provider.

The Court held that in order to construe s.541B(1)(a)(ii) in accordance with the DFaCS’s ‘restricted purpose’, the provision would have to be given an unnatural construction. The Court noted that the ordinary meaning of s.541B(1) is clear. It is not ambiguous or obscure and does not lead to a result that is manifestly absurd or unreasonable.

The fact that the course at Birzeit was not an approved course was irrelevant if the hiatus in Brown’s enrolment at Sydney satisfied the requirements of s.541B(1)(a)(ii). There is nothing in the ordinary meaning of the words in the section or in the context in which the section appears in the Act to suggest that the section includes a qualification limiting what students can do during a hiatus in their enrolment.

Section 1218 of the Act

The DFaCS’s appeal also concerned the AAT’s construction of s.1218 of the Act.

Section 1218 of the Act provides:

1) This section applies if, immediately before the period of absence commenced:

(a) the person was undertaking full-time study as part of a course of education at an educational institution; and

(b) the person was receiving youth allowance or austudy payment.

2) The person’s right to continue to be paid youth allowance or austudy payment is not affected merely by the person’s absence throughout so much of the period of absence as is for the purpose of undertaking studies that form part of the course of education.

3) If the person returns to Australia for a period of 13 weeks or less, the return is taken to not affect the continuity of the period of absence.

The DFaCS submitted that s.1218 applies if a student is undertaking full-time study in accordance with s.541B and continues to be enrolled in the Australian education institution during the period of absence. The argument was that Brown did not satisfy s.1218 because, during the hiatus period, Brown was not enrolled at Sydney.

The Court held that s.541B does not require continuing enrolment, and indeed, it provides for a hiatus in enrolment in s.541B(1)(a)(ii). Section 1218 does not import a requirement of current enrolment. The Court referred to the AAT’s observation that s.1218 does not specifically require the person to be enrolled at the educational institution during the period outside Australia for the purpose of an Australian course. There is no reference to enrolment.

The DFaCS also submitted that s.541B provides guidance on what is specifically meant by the words ‘studies that form part of the course of education’ in s.1218. It was submitted that the AAT should have held that the words of s.1218 are ‘form part of the course of education’ not will form part. The words ‘form part of the course of education’ must mean ‘are required to be undertaken as part of the course of education’ and are studies that are part of the curriculum set in respect of that course of education.

The Court held that the words ‘form part of the course of education’ are to be used and applied according to their ordinary meaning. The studies undertaken by Brown at Birzeit were to be undertaken in accordance with the permission given by Sydney for him to complete an equivalent of full-time enrolment at Birzeit. If successfully completed, he would be credited 2 units of that study towards his degree. It follows that those studies were to be treated as equivalent to those at Sydney and thus formed part of Brown’s course of education.

Formal decision

The Court held that the AAT did not err in its construction of the relevant statute, nor did it improperly apply that construction to the facts.

The Court held that it was reasonably open to the AAT on the evidence to hold that Brown was undertaking full-time study in accordance with s.541B(1) and therefore that he satisfied the activity test. His absence was for the purpose of undertaking studies that formed part of the course of education within the meaning of s.1218.

[J.F.]