Editors --- "Parenting payment partnered debt: whether applicant received the bene?t; recovery of the debt" [2010] SocSecRpr 24; (2010) 12(2) Social Security Reporter, Article 10

• MOSS and SECRETARY TO THE DEEWR
• Background
• The issues
• The law
• Discussion
• Formal decision

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Parenting payment partnered debt: whether applicant received the benefit; recovery of the debt

MOSS and SECRETARY TO THE DEEWR

(2010/214)

Decided: 29th March 2010 by R.P. Handley

Background

Moss sought review of Centrelink’s decision to raise and recover an overpayment of parenting payment (partnered) of $6846.28 for the period 24 April 2003 to 10 March 2004 following a data matching activity. The debt arose because of his wife’s earnings. The debt had arisen prior to their separation in January 2006.

Prior to separation, his wife had made a claim for parenting allowance with an attached Module P Partner Details form which was signed by Moss on the same date. A couple of weeks later, in July 1997, the claim for parenting allowance was granted. In January 2002, during a review of Ms Moss’s parenting payments, she requested that her parenting payments be transferred to Moss as he was then staying at home and taking care of the children. Centrelink agreed to this request and documented it on both of their records. Centrelink also sent a letter to Moss advising him that he would be paid parenting payments from 4 January 2002 and informing him of his obligation to notify Centrelink if his circumstances changed. Thereafter in the period 2002 to 2004, Centrelink records showed that it wrote to Moss on a number of occasions and that he both telephoned Centrelink and also attended Centrelink offices on a number of occasions in connection with the parenting payments. Moss denied that he received letters from Centrelink or attended Centrelink offices during this period. His evidence was that he was not aware that parenting payments were being made to him until February 2008 when he was contacted by a debt collector in relation to recovery of the debt.

Moss’ parenting payments were paid into an account in his wife’s name to which he denied having access and denied having a linked keycard. The documentary evidence showed that his wife transferred money from this account into their joint account from which Moss purchased daily necessities such as bread, milk and petrol. Also, payments were made directly from the bank account into which the parenting payments were paid for motor vehicle insurance, mortgage payments and grocery items.

The issues

The key issues before the Tribunal were:

• Whether the Moss received the benefit of the overpayment?

• If yes, were there any grounds not to recover part or all of the debt?

The law

Section 1223(1) of the Social Security Act 1991 (the Act) states that if a social security payment is made and a person who obtains the benefit of the payment was not entitled for any reason to obtain that benefit, the amount paid is a debt due to the Commonwealth by the person and is taken to arise when the person obtains the benefit.

The write off provisions contained in s.1236 of the Act provide that a debt may only be written off in very limited circumstances. Section 1237A and s.1237AA of the Act are relevant to whether all or part of the debt can be waived.

Discussion

In relation to the first issue in dispute, the Tribunal concluded that Moss had benefited from the parenting payments. It found that the benefit Moss received in relation to the parenting payments was in the form of fund transfers from his wife’s account into the joint account from which he acknowledged he withdrew funds to purchase everyday items. Further the Tribunal also found that Moss had benefited through his wife paying for items such as motor vehicle insurance, mortgage payments and grocery items on the grounds that it was ‘reasonable to assume that such payments were generally for the support of the family as a whole’ (Reasons, para. 48).

In relation to the second issue as to whether Moss should be required to repay the debt, it held that write off was not appropriate because Moss was employed and had a capacity, albeit a limited one, to repay the debt. The Tribunal went on to consider waiver and found that as Centrelink’s records indicated that it acted properly in relation to this matter there was no power to waive the debt under s.1237A of the Act on the basis of administrative error.

In relation to waiver under s.1237AAD, the Tribunal concluded that it could not be satisfied that Moss had complied with his obligations under the Act. In this regard, the Tribunal found the contradictions between Moss’s oral evidence and the documentary evidence provided by Centrelink troubling. Whilst the Tribunal found that Moss had presented his oral evidence openly and without hesitation, it decided that the weight of the evidence was against his account. In particular it found it ‘difficult to believe that so many Centrelink letters did not reach their destination’ (Reasons, para. 42) and ultimately decided on the balance of probabilities that Moss should have been aware of his obligation to advise of changes in circumstances by reason of the correspondence addressed to him by Centrelink. In any event the Tribunal went on to state that it did not consider that Moss’s circumstances amounted to special circumstances as required by s.1237AAD of the Act.

Formal decision

The Tribunal affirmed the decision under review.

[G.B.]