Editors --- "Transfers between payments: whether payments can be backdated to a date earlier than the date of commencement of the Administration Act; backdating of entitlement to date of incorrect claim" [2007] SocSecRpr 28; (2007) 9(3) Social Security Reporter, Article 2

• HALIME and SECRETARY TO THE DEWR
• Background
• The issues
• The law
• Formal decision

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Transfers between payments: whether payments can be backdated to a date earlier than the date of commencement of the Administration Act; backdating of entitlement to date of incorrect claim

HALIME and SECRETARY TO THE DEWR

(2007/1345)

Decided: 22nd May 2007 by R. Hunt and Dr Thorpe

Background

Departmental records showed that Halime had been granted newstart allowance on 26 February 1996. On 6 March 1999,payment of newstart allowance was cancelled because Halime failed to lodge a review form. His payments recommenced on 28 May 1999 and he remained on this payment until he was transferred to the disability support pension on 23 October 2002.

The SSAT affirmed the decision not to backdate Halime’s disability support pension from 2002 to 1998. At the AAT, the Department conceded that Halime was entitled to the pension from 20 March 2000, being the date on which the Social Security (Administration) Act 1999 (the Administration Act) commenced. The Department argued, however, that the backdating provisions of the Administration Act could not be applied at any earlier date.

The issues

The AAT identified the following issues for consideration:

(a) whether the retrospective right conferred on an applicant bys.12 of the Administration Act operated prior to 20 March 2000, being the date on which the Act had commenced;

(b) whether the retrospective rights conferred by ss.15(1) and(4A) operate before 20 March 2000, being the date on which the Administration Act commenced;

(c) if it found that it had jurisdiction to backdate the disability support pension to a date earlier than the commencement of the Administration Act, what was the appropriate date for the possible backdating of Halime’s entitlement?

The law

The two main legislative provisions dealing with the backdating of certain social security payments are s.12 ands.15 of the Administration Act. Sub-section 12(1) provides that, if a person is receiving an income support payment and, while receiving the payment, the person becomes qualified for another income support payment, and certain other requirements are met, the person may be taken to have made a claim for the other payment on the day on which that person became qualified for the other payment. Section 15 is based on allowing deemed claims to be backdated where an inappropriate or incorrect claim was made and the person subsequently makes a claim for a social security payment for which he or she is qualified. Under ss.15(1), the person is taken to have made a claim for the other social security payment on the day on which he or she made the incorrect claim. Further, ss.15(4A) provides that, if a person makes a claim for an income support payment, called the ‘initial claim’, and, on the day on which the initial claim was made, the person would have qualified for another income support payment and subsequently makes a claim for that other payment, the person may be taken to have made the later claim on the day on which the initial claim was made.

Application of s.12 – earliest date of receipt of another payment

The Tribunal relied on the authority of Burgess v SDFCS (2004) FCA136 to find that Halime’s disability support pension could be backdated to an earlier date than 20 March 2000 noting that the judgment was binding on it. Whilst the Tribunal agreed with the Department’s submission that a legislative provision should not be assumed to operate retrospectively unless the intention is clear, it found that implicit in the reasoning of the Burgess judgment was a perception that the retrospective intention was clear. The Tribunal further noted that social security legislation was beneficial legislation which meant that it was generally read so as to favour the recipient of the benefit where there is doubt about the meaning of the provision. The Tribunal examined the explanatory memorandum which introduced s.12 and concluded that it was supportive of the intention of the legislators to ease rather than restrict entitlements.

The Tribunal found that, as Halime was receiving no continuous income support payment for a period before 28 May 1999, this was the earliest date on which his claim could be backdated under s.12.

Application of s.15 – initial incorrect claim

The Tribunal noted that unlikes.12, s.15(4A) did not require that the person claiming a particular social security payment must have been receiving another social security payment at the time of the deemed application. Therefore the Tribunal found that Halime was not prevented from claiming his benefit from an earlier date provided he could establish he made an initial claim at a particular date. The Tribunal noted that the break in the payment of Halime’s newstart allowance payments was not relevant, provided the break was not for a reason that meant Halime was no longer qualified.

The Tribunal noted that whilst the possible application of s.15 was not considered relevant to the facts in the Burgess case, the reasoning was valid support for a construction of s.15 which would enable backdating of payment to the date of the initial claim. The Tribunal further noted that the explanatory memorandum introducing both of the new provisions had framed the statement about the desired effect of both sections in the same straightforward way.

The Tribunal accepted the submissions put on behalf of Halime that it had the ability to consider a review application as an initial claim finding support in the decision of Scott v Secretary, Department of Social Security [1999]FCA 1774. Whilst that decision had dealt with the former s.100(2)(a)of the Social Security Act 1991, the Tribunal found that s.15 was virtually indistinguishable from the former s.100. The Tribunal also reasoned that its conclusion was consistent with the legislative intention of Parliament to implement a simpler and more coherent social security system as evidenced by the relevant Explanatory Memorandum and second reading speech.

The question of when an initial claim was made in Halime’s case was problematic because of the Department’s failure to keep its records over a lengthy period. On the basis of the limited records available to the Tribunal, it was found that Halime made an initial claim on or before 26 February 1996, when he first started receiving newstart allowance. Provided that Halime could establish that he otherwise qualified for the disability support pension on or before 26 February 1996, he was entitled to receive the pension from the day on which he made the claim that founded his entitlement as at 26 February 1996. However, if he failed to establish the date of the initial claim on which his payments from 26 February1996 were based, he was entitled to receive the disability support pension from the next earliest date on which he could establish that he made an initial application.

Formal decision

The AAT substituted a decision that Halime was entitled to payment of the disability support pension from 28 May 1999 under s.12 of the Administration Act and in respect of s.15 of the Administration Act from the earliest date on which he made an initial claim provided he met further requirements of the Social Security Act 1991 that otherwise qualified him for the disability support pension.

[G.B.]