AUSTUDY - actual means test - designated student - validity of actual means test regulations - whether actual means of designated student do not include expenditure funded by debt - decision affirmed

Student and Youth Assistance Act 1973 - ss5C, 7, 12, 56, 306(1), (3)

AUSTUDY Regulations - 12Y, 12ZB, 12ZC, 12ZD, 12ZE, 12ZF(1), 12ZF(2)(a), 12ZF(2)(f), 12ZF(2)(g)

Acts Interpretation Act 1901 - s48(2)

Re Adams and Tax Agents' Board (1976) 12 ALR 239

Re Secretary, Department of Employment, Education, Training and Youth Affairs and Duscher (1996) 24 AAR 239

Re Secretary, Department of Employment, Education, Training and Youth Affairs and Thies and Another (1997) 45 ALD 698

Re Russell and Secretary, Department of Employment, Education, Training and Youth Affairs (Unreported, 15 April 1998, AAT 12799)

1. This is an application for review by Henry Mathwin Heuzenroeder ("the applicant") for review of a decision of the Social Security Appeals Tribunal ("SSAT") dated 15 June 1998 affirming a decision made by a delegate of the Secretary, Department of Education, Training and Youth Affairs ("the respondent") on 6 May 1997, as affirmed by an authorised review officer on 7 November 1997, to refuse Austudy benefits on the grounds of the applicant's actual means. The Tribunal would indicate that after having close regard to the SSAT's reasons for decision, it is satisfied that where the SSAT referred to a decision of an authorised review officer dated 9 October 1997, it was in fact referring to the decision of an authorised review officer dated 7 November 1997 (T23).

2. The Tribunal had before it the documents lodged pursuant to s37 of the Administrative Appeals Tribunal Act 1975 (the "T" documents) together with supplementary T documents (the "ST" documents) and additional documentation tendered by the parties including written submissions.

3. The applicant, a barrister and solicitor, represented himself before the Tribunal by way of telephone from Cambridge, England and the respondent was represented by Ms S. Maharaj, of counsel.

4. A statement of agreed facts was placed before the Tribunal (Exhibit R3) and the Tribunal finds, as fact, the matters contained therein. The Tribunal does not see any purpose to be served in reproducing Exhibit R3 in these reasons, its contents being well known to the parties. The same is the case with respect to repeating in these reasons the detail of the submissions and counter submissions of the parties. The Tribunal would indicate that these reasons have been written solely for the parties - to do otherwise would have necessitated an inordinately lengthy repetition of that which is well known to the parties - for example the initial submissions of the applicant i.e. those contained in exhibit A1 comprised nearly 50 pages - these were followed by many more submissions and counter submissions by both parties

5. By way of background, Regulations introducing the actual means test were enacted in Statutory Rules 1995 No. 132 of 1995 with commencement on 1 October 1995. The actual means test was introduced to supplement the existing income tests and assets tests as a means of targeting assistance to students most in need. It was introduced in response to a concern that students of families who were able to minimise their taxable income through financial arrangements were passing the income test and qualifying for Austudy even though they may have been in no more need of assistance than another person from a wage or salary earning family who did not qualify for assistance. Initially, the actual means test applied only to students who had a "designated parent" or a "designated spouse", namely, a parent or spouse who had an interest in a foreign asset, proprietary company or unlisted public company, trust, or partnership or who was self-employed or derived income from overseas. In these cases, the actual means test would assess the total outgoings (expenditure and savings) in the period of study which would then be compared with a cut-off point known as the 'Benchmark', rather than look to taxable income as an indicator of the amount of money available in a year and the student's need for financial assistance. The Benchmark would be set at the level of actual means at which a student from a comparable family deriving the whole of its income from a salary or wage source would just miss out on qualifying for Austudy. If the family or student's actual means were greater than or equal to the relevant Benchmark, then the student would not be eligible for Austudy. The rate of Austudy payable to a student whose means were below the Benchmark also depended on the level of their actual means.

6. Statutory Rules 1996 No. 245, extended the ambit of the actual means test to apply to a "designated student with a spouse" and a "designated student without a spouse". The amending Regulations commenced on gazettal on 6 November 1996, but applied only in relation to applications for Austudy for a period starting on or after 1 January 1997. There was no dispute between the parties that these changes applied to the applicant whose application for Austudy was in respect of a period of study starting after 1 January 1997. Relevantly, Regulation 12Y was added by the amending Statutory Rules and provided as follows:

12Y. (1) For the purposes of Subregulation 12X(1), a student is a designated student if he or she:

(i) an asset located outside Australia (and its external territories); or

(ii) a proprietary company or an unlisted public company; or

It was not in dispute that the applicant was a designated student for the purposes of Subregulation 12Y on account of his interest in a trust. The Regulations relevantly went on to provide:

Subdivision E - Actual means test: designated student without a spouse

'notional student' has the meaning given by Subregulation 12ZD(2).

12ZC. This Subdivision applies to a student who:

(a) is a designated student within the meaning of Regulation 12Y; and

(c) apart from this subdivision, would qualify for the independent living allowance under Regulation 67.

12ZD Actual means test: designated student without a spouse

12ZD. (1) A designated student is not entitled to receive living allowance for a period of eligibility in a year of study, unless the Secretary is satisfied that, for that period, the actual means of the designated student are less than the after tax income of the notional student.

(2) For the purposes of Subregulation (1), the notional student, in relation to a particular designated student, is a student who:

(a) receives income solely from a salary or wage source; and

(b) qualifies for living allowance at the same rate as the rate for which, apart from this division, the designated student would qualify; and

(d) has children of the same age and number as has the designated student.

12ZF What are the actual means of a designated student?

12ZF. (1) For the purposes of Subregulation 12ZD (1), the actual means of a designated student for the period of eligibility are taken to be the amount that equates to total expenditure and savings made in that period by the student and his or her family.

(2) Despite Subregulation (1), the actual means of a designated student do not include:

"Family" is defined in Subregulation 12ZF(8) such that it is irrelevant for current purposes and hence the Tribunal shall omit further references to it wherever they might appear in the legislation. The provisions in Subregulation 12ZF(2) as they then stood were also not relevant to the facts of this case.

7. It was not in dispute between the parties, and the Tribunal so finds, that as at 3 March 1997, the date of lodgement of his application for Austudy in 1997 (T5p50), the applicant, being a designated student without a spouse, was subject to the actual means test provisions in the Regulations.

8. Statutory Rules 1997 No. 159 further amended the actual means test provisions. The Regulations were gazetted on 30 June 1997 but were, by virtue of Regulation 1, taken to have commenced on 1 January 1997. The constitutional validity of these Regulations was challenged by the applicant in these proceedings. Subregulation 12ZF(1) was not affected by the amending provisions, however, Subregulation 12ZF(2) was amended such that it read, relevantly:

"12ZF What are the actual means of a designated student?

(2) Despite Subregulation (1), the actual means of a designated student do not include:

(a) expenditure by the student ... for the purchase price of an interest in property that does not increase the total value of the property of the student ... ; or

(f) expenditure by the student ... of money borrowed by the student ... for the purchase price of:

(i) the sole or principle residence of the student ...; or

(ii) an interest in land, or in a building not mentioned in subparagraph (i); or

(iii) a motor vehicle, or a powered aircraft or watercraft; or

(g) expenditure by the student ... to repay the principal or interest in relation to money borrowed by the student ... for any other purpose; or

(h) expenditure or savings from an amount of AUSTUDY to which the student ... is, or may be, may be (sic) entitled under Part 2 of the Act; or

9. It was agreed between the parties that for the period in question (10 February 1997 to 27 June 1997 - a period of 138 days) the Benchmark above which the applicant would not satisfy the means test was $5,692.41. It was also agreed that for the purposes of these proceedings, the following transactions took place in the period in question involving expenditure by the applicant:

Payment to St Marks for Old Collegians dinner $38.00

The Tribunal would note that the total of $11,139.74 disregards an amount of $100 which the applicant submitted, and the respondent conceded, was a conservative estimation by the applicant of "sundry expenses (in case any have been missed)" (T21 at p106) but which did not reflect actual expenditure incurred in the relevant period. Further, it was conceded by the respondent that the amount of $300 relating to payment by the applicant of interest on debt (item 1 on the above list) was not to be included in calculation of the applicant's actual means - Regulation 12ZF(2)(g). Hence, the revised total expenditure made by the applicant in the relevant period would be $10,839.74, a figure that is still well above the Benchmark. Save for the amount of $5,300 for purchase of shares (last item on the above list), the applicant did not submit that any of the remaining amounts in the above list ought to be excluded from his actual means. Excluding the amount of $5,300, the applicant's actual means for the period in question would be $5,539.74, a figure which falls below the applicable Benchmark.

Consideration of the Issues in Dispute Between the Parties

10. The Tribunal would indicate that it has carefully considered the totality of the material placed before it including the submissions advanced by both parties and the authorities referred to therein.

11. Apart from submissions relevant to the merits, the applicant has made many submissions on the law to the Tribunal regarding the validity or otherwise of the relevant actual means test Regulations contained in Division 1B of Chapter 2 of the Austudy Regulations ("the Regulations"). The submissions are voluminous, well known to the parties and to the Tribunal which has already indicated that it sees no useful purpose served in repeating them in any detail. Generally speaking, these submissions address four topics:

(i) The constitutional validity of the Regulations;

(ii) The Regulations being ultra vires ie. beyond the power of the Act or, if within power, then the administrative act of making them is unlawful or improper;

(iii) The Regulations being of no effect courtesy of s48(2) of the Acts Interpretation Act 1901; and

12. As to the first of the above topics, the applicant submits that the Regulations are invalid courtesy of sections 51(xxxi), 109 and Chapter III of the Constitution. The Tribunal's considered view in light of Re Adams and Tax Agents' Board (1976) 12 ALR 239 is that when a decision-maker acts in conformity with his or her statutory authority, a person whose interests are affected by that act may not obtain relief from this Tribunal upon the ground that the statute (or Regulations thereunder) is ultra vires the Parliament. The Tribunal has no power of review which it might exercise to give effect to such a ground. It has no judicial power and, accordingly, the grounds put forward by the applicant in his submissions (incorporating as they do the submissions made by Mr Greenwood QC) are not grounds which might invoke the exercise of the Tribunal's powers. The reasons for the Tribunal's view are those expounded by Brennan J (as he then was) in Re Adams (supra). They are compelling reasons and whilst the Tribunal could form, if it chose to do so (and it does not), an opinion on constitutional matters raised by the applicant, that opinion does not produce any effect in point of law. It is, as Brennan J said (at p241) "incapable of adding to or subtracting from any authority or purported authority conferred by the challenged statute."

13. The Tribunal now turns to consider the second topic utilised by the applicant in his submissions. The Tribunal has given earnest consideration to these submissions which have occupied a great deal of the Tribunal's time. In so doing, the Tribunal has accepted for present purposes the correctness of the legal principles outlined by the applicant which could mean, if made out, that the Regulations are invalid as beyond power or, if within power, then the making of them is unlawful or improper.

14. The considered view of the Tribunal is that these submissions do not make out that which they assert. The Student and Youth Assistance Act 1973 ("the Act") was established to provide benefits to students in genuine need. The principles of administration necessary for the provision of those benefits are set out in s5C of the Act. Wide ranging powers for the making of regulations are to be found relevantly in sections 7, 12 and 56. A balanced, fair reading of the Regulations in the context in which they appear in light of the object of the legislation and the wide ranging powers to make regulations, leads the Tribunal to conclude that none of the subject Regulations are invalid as being beyond power. The submission that the administrative act in making the Regulations was unlawful or improper is rejected. The Tribunal is of the view that there is clearly insufficient evidence before the Tribunal to warrant such a finding.

15. The Tribunal now turns to the third of the topics. In this regard, the Tribunal is in agreement with the submission of the respondent and finds that s48(2) of the Acts Interpretation Act 1901 has no applicability with respect to the Regulations.

16. The Tribunal now turns to consider the fourth of the topics. As the Tribunal understands it, there were in effect two aspects to the applicant's estoppel argument; the first relating to the question of jurisdiction (as raised in the submissions of Mr Greenwood QC) and the second relating to the merits (which is considered at paragraph 33 hereunder). In respect of the first aspect, the applicant's submission is that, having decided in March 1997 that the applicant was disentitled to Austudy on one ground which was successfully challenged by the applicant, the Department "was thereafter estopped from relying on other grounds in the regulations to refuse the appellant" - namely, on the grounds of the actual means test - "especially as it is a purpose of the parent Act that AUSTUDY decisions be made promptly (section 5C(a)(iii)" (Mr Greenwood's submissions). The Tribunal is not persuaded by this submission. Clearly, before Austudy can be lawfully paid to the applicant, he must qualify under the relevant legislative criteria, and unless and until the Department is so satisfied, Austudy must by law be refused. In short, it cannot be said that whenever a decision-maker refuses to grant a benefit upon grounds which are later found to be invalid, that the Department is thereafter estopped from relying upon other lawful grounds of refusal as this would, in effect, amount to the granting to a person of a benefit to which they are not lawfully entitled. The corollary to this is that there is no legislative requirement on the Department to proffer each and every ground of refusal at the same time. Any applicant for benefit must at all times qualify for Austudy and, for this reason, an estoppel cannot lie against the Department in the sense submitted above.

17. This leaves four issues in dispute between the parties which relate to the merits of the case. The first issue related to the amount of $5,300 expended by the applicant on the purchase of shares. The second issue related to the interpretation of Subregulation 12ZF(2)(h), namely, whether or not the applicant's actual means should not include an amount equivalent to the amount of Austudy which the applicant was entitled to receive but for the operation of the actual means test. Thirdly, the applicant put forward an alternative estoppel argument in the event that he was unsuccessful on the interpretation of Subregulation 12ZF(2)(h). In short, this argument asserted that the representations and conduct of the then Department of Employment, Education, Training and Youth Affairs in the handling of his application for Austudy had precluded the applicant from the benefit of Subregulation 12ZF(2)(h). Fourthly, the applicant made submission on the applicability of s306(3) of the Act.

18. The Tribunal now turns to consider the first of the remaining issues, namely, whether or not the amount of $5,300 being the purchase price paid by the applicant for two bundles of shares, falls properly to be included in the applicant's actual means for the relevant period.

19. With respect to the purchase of $5,300 worth of shares, the Tribunal finds, as fact, the following as agreed between the parties:

(a) 18/2/97 Applicant loans $4,000 to Sans Souci Trust (an interest free loan pursuant to the Trust Deed Clause 4(4)(a)(ii) mutatis mutandis - no separate document as in the other loans).

(b) 28/4/97 Applicant transfers $1,100 from his Visa account into his savings account. That sum was entirely funded by overdraft.

(c) 28/4/97 Sans Souci Trust loans $3,000 to applicant (10% per annum, payable in advance) - ("No. 1 loan to applicant")

(d) 28/4/97 Sans Souci Trust loans $1,000 to applicant (deferred interest security) - ("No. 2 loan to applicant")

(e) 29/4/97 Applicant purchases shares in Robertson-Chowilla Pty Ltd worth $5,000 by way of bank cheque, handed across the table at Mouldens, Solicitors in return for Share Certificates and executed Share Transfer Application forms.

(f) 29/4/97 Applicant pays $300 interest on No. 1 loan to applicant

(g) 15/5/97 Sans Souci Trust loans $300 to applicant. ("No 3. Loan to applicant")

(h) 21/5/97 Applicant purchases shares worth $300 in Highlands Pacific.

In addition, there was further material placed before the Tribunal by the applicant on the topic of the share purchase transactions, namely, a copy of the Deed establishing the Sans Souci Trust, copies of the accounts and tax returns for the applicant and the Sans Souci Trust for the relevant period, copies of two documents in respect of the No. 1 and No. 2 loans to the applicant each entitled "Acknowledgment and Undertaking", copies of minutes of meetings of directors of the trustee company, Sans Souci Nominees Pty Ltd, and a document outlining the applicant's memory of relevant background to the transactions in question. In particular, the applicant asserted that the sum of $4,000 initially settled on the trust came about as a consequence of the sale of various shares prior to the period under consideration ("Applicant's Memory of Share Purchase Transactions" dated 21 June 1999 and received by the Tribunal on 22 June 1999).

20. Turning to the relevant Regulations, Subregulation 12ZF(1) relevantly provides that "the actual means of a designated student for the period of eligibility are taken to be the amount that equates to total expenditure and savings made in that period by the student". The words "expenditure" and "savings" are not defined in the Regulations and the Tribunal's view is that having regard to their context in the Regulations, they should be given their ordinary meanings (Re Secretary, Department of Employment, Education, Training and Youth Affairs and Duscher (1996) 24 AAR 239 at pp 248-9). Relevantly, "expenditure" is defined as "1. the act of expending; disbursement; consumption. 2. that which is expended; expense." (Macquarie Dictionary, 3rd edition). "Expend" is defined as "1. to use up ... 2. to pay out; disburse; spend". "Savings" were not in issue in these proceedings. Importantly, the word "total" which precedes the phrase "expenditure and savings" gives flavour to the meaning of those terms and suggests that the legislature intended it to have wide application and not be confined in its interpretation. Having regard to the above, the applicant's actual means will be the total amount that he spent, paid out or disbursed in the relevant period together with any savings. Prima facie, this will include expenditure by the applicant on the purchase price of shares being, as it is, money spent, paid out or disbursed by the applicant in the relevant period.

21. The applicant did not contend there was any express exemption in the Regulations which would exclude the amount of $5,300 from his actual means, nor could he having regard, in particular, to Subregulation 12ZF(2) which delineates the expenditures that a designated student's actual means do not include. In this regard, expenditure of money borrowed by a student for the purchase of shares is not included in the list of specific items in Subregulations 12ZF(2)(f)(i) to (iii). Further, the applicant did not contend that Subregulation 12ZF(2)(a) applied, nor could he, given his concessions, first, that as a matter of general law, there could be no equitable set-off of the various loans as between he and the San Souci Trust and, secondly, that the value of his property had increased as a consequence of the share purchase transactions. Subregulation 12ZF(2)(g) is the other provision that relates to money borrowed by a student but is only relevant to the facts of this case in so far as it has allowed an amount of $300 expended by the applicant on interest pursuant to the No. 1 loan to be excluded from his actual means in the relevant period.

22. Rather than rely on express provisions in the Regulations, the applicant's submission was that as a matter of statutory interpretation, a "broad brushed" approach ought to be adopted in interpreting and applying the Regulations and, in particular, the word "expenditure" in Subregulation 12ZF.

23. In this regard, the applicant's submissions can be summarised as follows. Accepting that the amount he expended on shares was funded, at general law, by "cross-loans", and although it would be impermissible to offset the loans as against each other in accordance with any equitable doctrine or in the taxation context, for the purpose of interpreting and applying the actual means test provisions in the Regulations, the Tribunal could in effect look behind the transactions to the "economic substance of the situation" and find that in fact, the applicant had merely converted one asset (shares sold prior to the period in question) into another asset (shares purchased in the period in question). As the actual means test has, at its core, a "fair comparison" between a notional student and a designated student, any expenditure in the sense mentioned above ie. in the converting of one asset to another, should be disregarded when interpreting the term "expenditure" in Subregulation 12ZF. In other words, although, literally speaking, he had "expended" money in the purchasing of shares resulting in an increase to the value of his property (savings of $4,000 had become a loan of $4,000 owed by the trust to him together with $5,300 worth of shares), the fact that the increase had been funded, at general law, by an increase to his debt meant that the amount of "expenditure", according to its literal interpretation, was not a true representation of the means available to him. A literal interpretation, the applicant submitted, would result in an ineffective, and indeed unfair comparison between the notional student whose entitlement to benefit is not affected by any expenditure or increase to property which is funded by debt, and the designated student who is so affected. The applicant submitted that the unfairness and unreasonableness that would result from an application of literal interpretation of the word "expenditure" was such as to warrant a "broad brushed" interpretation which would "place notional and designated students as far as possible on an equal economic footing".

24. The Tribunal was not persuaded by these submissions.

25. Having regard to the ordinary meaning of the words in Subregulation 12ZF in light of their context, the intended effect of the Regulations is patently clear, namely, to subject a designated student to the actual means test which compares the "total expenditure and savings" of the designated student (subject to the specific exemptions as outlined in Subregulation 12ZF(2)) with the after tax income of a notional student. The process of looking to the expenditure and savings in the case of the designated student is specifically designed to counter the effect of any financial arrangements involving the use of trusts, private proprietary companies and the like which may in any way shape or form, minimise the taxable income of the student and, more importantly, obscure the genuine need of the student for financial assistance. It matters not that the applicant himself may not be seeking to minimise his taxable income by way of his interest in a trust. The mere fact that he has an interest in a trust brings him within a category of persons "designated" by Parliament for the purposes of the actual means test on account of their having a potential to do so.

26. The Tribunal's view is that having regard to the meaning to be given to the phrase "total expenditure and savings" in Subregulation 12ZF(1) as discussed above, it was the clear intention of the Parliament to exhaustively delineate those matters which the actual means of a student "do not include". These are set out in Subregulation 12ZF(2). In particular, express allowance is made for expenditure of borrowed money to be excluded from actual means where the money is borrowed for the specific purposes delineated in Subregulation 12ZF(2)(f), none of which apply here. In respect of expenditure of money borrowed for "any other purpose", the Regulations are silent as to whether or not they are to be excluded, meaning, by implication, they are to be included. Clearly, Parliament intended that expenditure of money borrowed for "any other purpose" be included in a student's actual means but that allowance be made for expenditure of money to repay principal or interest which is not included in actual means. The Explanatory Statement to the amending Rules confirms this approach (T40 at p211).

27. In turning its mind to appropriate amounts that a designated student's actual means should not include, Parliament was not neglectful of considerations of fairness. Subregulations 12ZF(2)(f) and (g) addressed the previously undesirable situation of "double counting" identified in Secretary, Department of Employment, Education, Training and Youth Affairs and Thies and Another (1997) 45 ALD 698. In that case, the Tribunal observed that under the Regulations as they then stood, not only the expenditure of borrowed moneys would be included in actual means but also the expenditure of repayments of the principal and interest, a situation which was clearly unfair and justified a legislative remedy. This was achieved by the introduction of Subregulations 12ZF(2)(f) and (g). Further, in the passing of the amendment to Subregulation 12ZF(2)(a), Parliament clearly recognised that it would be unfair to include, in a designated student's actual means, expenditure that represented the purchase price of an interest in property that does not increase the total value of the student's property, ie a situation involving the trading of property. To include such expenditure would be to overstate the means available to a designated student. Hence, Subregulation 12ZF(2)(a) was enacted to address the situation.

28. Tuning to the facts of this case, it was clearly open for the applicant to adopt a course which would not have had adverse consequences in terms of the provisions of the actual means test. Had the applicant chosen to trade his property, namely, by selling the shares held prior to the period in question and, with the proceeds from the sale, purchase other shares of equal value, he would have been able to avail himself of the relief in Subregulation 12ZF(2)(a) and would, in all probability, have passed the actual means test. However, the applicant chose not to adopt such a course. Rather, between the sale of shares and the purchase of other shares, he deliberately induced a complex series of transactions involving loans to and from the trust, presumably for taxation or other financial benefits, which had the effect of increasing the total value of his property at law, taking him outside the ambit of Subregulation 12ZF(2)(a). It is not the intention of the Regulations that a student, having deliberately organised their financial affairs for some perceived advantage is then, for the purposes of the actual means test, able to disregard those transactions.

29. In urging upon the Tribunal to adopt a "broad brushed" interpretation of the words "expenditure", the applicant pointed to unfairness which he alleged resulted from a literal interpretation thereof. The applicant's contention was that as it was open to the notional student to fund expenditure or an increase in property by incurring debt without it affecting entitlement to Austudy, so too should it be open for the designated student to adopt such a course. He said the aim of the Regulations was to make a fair comparison between the notional and designated students which would not be the case were a literal interpretation to be adopted. The Tribunal's view is that it would be misleading to compare, as the applicant has, the designated student and the notional student in any way other than that contemplated by the Regulations. Subregulation 12ZD(2) relevantly defines the notional student as a student who "(a) receives income solely from a salary or wage source; ...". The Regulations thus proceed on the assumption that the total means available to the notional student will be derived solely from a wage or salary source which is taken to be a measure of the student's need for financial assistance. The Regulations do not contemplate that the notional student has the capacity to borrow money or has any means available to him or her during a period of eligibility in a year of study over and above that derived from a salary or wage source. Thus it would be a grave error to make the assumption, as the applicant has, that the notional student has a capacity to incur debt and then seek to place the designated student on an equal footing on that basis. It must be remembered that the notional student is to be taken, at all times, as defined in the Regulations, and in so far as the applicant's submission has imputed to the notional student an additional means available to the notional student in the relevant period, namely, via the incurring of debt, over and above that contemplated by the Regulations, it must fail. Hence, the Tribunal has rejected the applicant's submission that the Regulations unfairly discriminate against the designated student such that they are invalid or should be construed according to a "broad brushed" approach which would be contrary to their ordinary meaning.

30. In effect, the applicant urges the Tribunal to disregard the plain meaning of the words of the Regulations which clearly delineate the expenditure of moneys borrowed by the student that are not to be included in the designated student's actual means, and in lieu thereof, construe them beneficially and in a manner which would have the practical effect of adding to the list of exemptions from actual means delineated in Subregulation 12ZF(2). In short, if such a result was intended then Subregulation 12ZF(2) would have said so but it has not. The Tribunal's view is that in the absence of any absurdity or patent inconsistency between the wording and the intended object or purpose of the legislation (which is not the case here), it would be impermissible for the Tribunal to rewrite the Regulations or interpret them in a manner inconsistent with their express wording. The Tribunal's view is that the language of Subregulation 12ZF is clear, and there is no absurdity or inconsistency, ambiguity or alternative construction such that the Tribunal should prefer an interpretation most favourable to the applicant or should depart from the ordinary meaning of the words. Were the Regulations to be construed as the applicant would have, it would not only contravene the clear wording of the Regulations, but would have the practical effect of enabling a designated student to fund an extravagant lifestyle or an increase in his or her property via the borrowing of money whilst, at the same time, have excluded from his or her actual means, not only the expenditure of borrowed money, but the expenditure on the repayments of principle and interest payable on that money (Subregulation 12ZF(2)(g)). The construction favoured by the applicant bearing in mind the observations of the Tribunal in Re Russell and Secretary, Department of Employment, Education, Training and Youth Affairs (Unreported, 15 April 1998, AAT 12799), namely:

"21. One might speculate that if a person has a capacity to borrow then that is, of itself, indicative of their potential spending power. Should they exercise that potential then any consequent expenditures materialise in that person's actual means. ..."

is one which would clearly defeat the purpose or object of the legislation which is to provide assistance to those students in need.

31. For these reasons, the Tribunal finds that an amount of $5,300 borrowed by the applicant and expended on the purchase of shares is to be included in the applicant's actual means for the relevant period.

32. Having regard to the Tribunal's view of the Regulations in relation to the amount of $5,300, it is of no practical consequence whether or not the applicant was to succeed on the question of the interpretation of Subregulation 12ZF(2)(h). Even if the applicant was to succeed such that a maximum amount of $2,533.56 was not included in his actual means, his actual means would still be well above the relevant Benchmark meaning that he would not pass the actual means test nor qualify for Austudy. Hence, the Tribunal is of the view that it would serve no purpose for the Tribunal to give consideration to this issue.

33. The Tribunal has given careful consideration to the applicant's submissions regarding estoppel. The Tribunal would indicate that to the extent that the applicant's estoppel argument, if successful, would place him back in the situation to take advantage of Subregulation 12ZF(2)(h) and have disregarded from his actual means an amount of $2,533.56, there would be no practical effect were the Tribunal to consider it (for the same reasons as outlined in paragraph 32 above). However, in the material which the applicant placed before the Tribunal, there was also a suggestion that had all the grounds of refusal including the actual means test been put to the applicant at the time of the initial refusal to grant Austudy benefits, then the applicant would not have purchased the shares which would have had the effect of bringing him under the actual means test Benchmark. In this regard, the Tribunal would indicate, firstly, that there is insufficient material before it to satisfy the Tribunal that that which the applicant asserts would have occurred had he been notified of all grounds of refusal at the outset. However, were the Tribunal to be so satisfied (and it is not), the Tribunal's considered view is that an estoppel would not apply in any event by virtue of there being no obligation on the Department to proffer each and every ground of refusal at the same time. In other words, the Tribunal is not satisfied that there has been any unconscionable conduct on the part of the Department or its officers which could give rise to any consideration to the applicability of estoppel in this case.

Section 306(3) of the Student and Youth Assistance Act 1973

34. Finally, the Tribunal is not persuaded by the applicant's argument on the applicability of s306(3) of the Act. In short, there is insufficient material before the Tribunal for it to be satisfied that a person has set aside a decision within the meaning of s306(1)(c) such that the Secretary's discretion in s306(3), and that of the Tribunal in the Secretary's shoes, is enlivened. Rather, the Tribunal is satisfied on the material placed before it that the initial decision made on 21 March 1997 was a decision to refuse to grant to the applicant a benefit under the Austudy scheme and, on each occasion thereafter, this decision was affirmed (albeit upon different grounds) rather than set aside and substituted with a new decision.

35. For these reasons, the decision of the Tribunal is that the decision under review is affirmed.

I certify that the 35 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President BH Burns

Signed: ..................(Signed).............................

Solicitor for the Respondent Australian Government Solicitor