The issues under s 33 of the Financial Management and Accountability Act
18 The Minister for Finance and Deregulation has not appeared and is not able to explain her position or that taken by her delegate, Dr Verney in his letter of 22 July 2010. That position was consistent with what Mr Letch identified as the policy of that Department as to the administration of s 33 of the Financial Management and Accountability Act. Dr Verney's only explanation in his letter of 6 October of why, suddenly, after the matter had come before the Court and had received some critical attention from me on 1 October, he was in a position to depart from the emphatic refusal to consider Mr Croker's request earlier, was because he had been requested by Centrelink to review Mr Croker's application.
19 The unsatisfactory aspect of what has occurred is that if the decision taken on 6 October by Dr Verney had been taken shortly after 3 June 2010 and communicated, first to Mr Croker, and potentially the tribunal, it would not have been necessary for the tribunal to further consider the matter or to deliver its decision on 2 July 2010. That would have enabled the tribunal member to deal with other matters instead of writing and delivering her decision.
20 Fundamentally, that means it would not have been necessary for Mr Croker to commence proceedings in this Court at all or, for the Court's resources to be used to deal with the matter. Moreover, if the Secretary's contentions were correct, either his motion would have succeeded or the appeal would have been ultimately dismissed, and it is very likely that in those circumstances, Mr Croker would have been ordered to pay costs of a very substantial kind, far exceeding the sum of less than $2,000 that was in dispute.
21 It is well known that personal litigants are likely to feel stress and strain from being engaged in litigation: cf Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at 214 [101] per Gummow, Hayne, Crennan, Kiefel and Bell JJ. Saliently, their Honours observed, in the context of a rule of Court reflective of Pt VB of the Federal Court of Australia Act and a decision to adjourn a hearing, (Aon 239 CLR at 217 [113]-[114]):
"113 … It is recognised by the courts that the resolution of disputes serves the public as a whole, not merely the parties to the proceedings.
114 ... delay and costs are undesirable and ... delay has deleterious effects, not only upon the party to the proceedings in question, but to other litigants. The Rule's objectives, as to the timely disposal of cases and the limitation of cost, were to be applied in considering [the] application for amendment. It was significant that the effect of its delay in applying would be that a trial was lost and litigation substantially recommenced. It would impact upon other litigants seeking a resolution of their cases." (emphasis added)
22 Those considerations and Pt VB reflect the public policy of the Parliament and the Court with respect to the administration of justice in this Court. The initial refusal of Dr Verney to consider a claim for less than $2,000 until after it was fully litigated, was inappropriate and unjustifiable on any view. There was no apparent cost-benefit in allowing the appeal to be filed without considering whether, if Mr Croker lost, he would be paid that very small sum in any event. The proper use of resources of the Court was ignored by the blind refusal inherent in the application of the policy reflected in Dr Verney's letter of 22 July 2010.
23 Moreover, in cases involving applications for the payment of government benefits by persons such as pensioners or pension claimants, the ordinary stresses and strains of litigation can be expected to be even larger than in other litigation. Usually persons who seek, or claim to be entitled to, pensions are among the most vulnerable members of our community, financially and otherwise. So much is recognised by the fact that the Parliament has seen fit to exercise its powers to provide for payment of moneys to support them in living. Suggestions by an agency of the Commonwealth, such as Centrelink, that there is a reasonable basis to make an act of grace payment in the exercise of discretion under s 33 of the Financial Management Account and Accountability Act must be approached intelligently and sensitively. In such cases, the Minister for Finance and Deregulation or her delegate should consider the consequences of making a decision on a claim under s 33 immediately as opposed to requiring the person seeking the act of grace payment to pursue to the end any claim or legal proceeding brought or foreshadowed by him or her.
24 The Parliament has legislated to provide time limits for filing, for example, applications for review before a competent tribunal or for judicial review, or appeals, such as, under the Administrative Appeals Tribunal Act. In my opinion, it is an unwise and inappropriate exercise of the discretion under s 33 of the Financial Management and Accountability Act, to apply a blanket policy of refusal to consider applications for an act of grace payment, whatever their merits or the circumstances, simply because a claimant indicates that he or she will or may file an application or appeal within the statutory time limit to preserve any rights he or she may have. A blanket policy to refuse to consider an application under s 33 in those circumstances is hard to understand, particularly where the responsible officer, department or agency of the Commonwealth considers that there is a reasonable basis for such a payment.
25 However, s 33(3) of that Act recognises, even if a person has commenced proceedings, conditions can be attached to offers of payment made under this section, so that the Commonwealth's revenues will be protected from a person seeking to "double dip." So much was reflected in [23] of attachment A to the s 33 Scheme. It stated that an act of grace payment is a mechanism of last resort and generally did not apply where it was reasonable to conclude that there was an available administrative review mechanism which had the capacity to provide a remedy for the defective administration. However, as the footnote to that paragraph indicated;
"This does not mean that a claimant should be forced to pursue legal action in circumstances where that legal action is unlikely to succeed or where that legal action will not provide a remedy for the defective administration."
26 Here, not only was Centrelink of the view that there was a reasonable basis to make an act of grace payment but the Secretary also asserted, in his motion, that Mr Croker's appeal from the tribunal's decision to dismiss his application for review of the delegate's decision, had no reasonable prospect of success.
27 It is of some concern that public resources, including those of the Secretary and the Court, ought to have been engaged in litigation involving a very small sum of money where Centrelink as, the paying agency, considered that there was a reasonable basis to make an act of grace payment for no better reason than that Mr Croker had indicated three weeks beforehand that he would file an appeal within the time prescribed by the Parliament.
28 It may be that the delegate ultimately might have decided that no act of grace payment should be made in the proper exercise of the discretion. But, good public administration, one might think, should involve a timely, realistic and intelligent consideration of whether or not to grant applications under s 33 for very small sums of money by indigent persons when they are supported by the responsible instrumentality of the Commonwealth under the s 33 Scheme.
29 Centrelink wrote to Dr Verney on 3 June 2010 stating that it considered that Mr Croker's application had a reasonable basis. Appropriate and prompt consideration of that claim, on or before Dr Verney's letter of 22 July 2010 would have meant that, had he then come to the same decision he came to on 6 October 2010, Mr Croker would not have needed to commence the proceedings. And, thus, Mr Croker would not have been subjected to the stress of the proceedings. The Secretary would not have been put to the expense of defending them. More importantly, the public resources of the Court would not have been diverted to deal with a very small claim that commonsense suggested ought to have been the subject of sensible efforts by the Commonwealth to resolve.
30 The change of position between Dr Verney's letters of 22 July 2010 and 6 October 2010 has revealed that the Department of Finance and Deregulation is capable of taking commonsense positions and making decisions promptly and appropriately. However, that only occurred here because Centrelink asked him to consider the matter as a result of the concerns I had raised in open Court on 1 October 2010 with the solicitor for the Secretary. In saying that, I am not suggesting, one way or the other, whether the act of grace payment should or should not have been made. Rather, my concern is that a decision should have been made promptly after 3 June 2010, having regard to the fact that this litigation would have been unnecessary if Mr Croker had been told that he would be paid the amount he had sought. It did not matter whether he was legally entitled to it under s 1061PA of the Social Security Act or would be given it as an act of grace under s 33 of the Financial Management and Accountability Act.