[2012] AATA 796

SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

SECRETARY, DEPARTMENT OF FAMILIES, HOUSING, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

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SOCIAL SECURITY - Benefits and entitlements - Cancellation of pensions by Centrelink in error - Deemed receipt of notices of decisions - Review of decisions and new claims made more than 13 weeks after notices of decisions given - Calculation of start date for new claim - Start date referable to favourable decision - Decisions under review affirmed - Reference to scheme for compensation for detriment caused by defective administration.

Financial Management and Accountability Act 1997 (Cth)

Social Security Act 1991 (Cth) s 23

Social Security (Administration) Act 1999 (Cth) ss 13, 109, 237, Sch 2

1. Prior to 2 September 2010, Ray Hodges and Heather Hodges were in receipt of the age pension and the disability support pension, respectively, under the Social Security Act 1991 (Cth) (the Act). Their payments were suspended by Centrelink on that date and then cancelled on 18 November 2010. Mr Hodges contacted Centrelink on 7 October 2011 and advised that he and his wife intended to claim payments again and this was acknowledged by Centrelink in letters dated 17 October 2011. Mr and Mrs Hodges lodged their respective claims on 21 October 2011. On 4 November 2011, Centrelink sent letters to them advising that age pension had been granted to them with effect from 7 October 2011. On 12 March 2012 and 18 May 2012, respectively, an authorised review officer and the Social Security Appeals Tribunal (SSAT) affirmed the decision that age pensions were not payable from any date earlier than 7 October 2011.

1. On 5 August 2010, Centrelink wrote to Mrs Hodges with a request that she transfer from the disability support pension to the age pension. The letter pointed to certain advantages which were associated with such a transfer. Mrs Hodges did not respond to that letter and this lack of response was the basis on which Centrelink suspended her disability support pension and Mr Hodges' age pension on 2 September 2010. For the respondent, Mr Simon Letch conceded that those suspensions were imposed by Centrelink in error. He agreed that Mr and Mrs Hodges had been denied pension payments from the date of suspension on 2 September 2010 until the date on which they indicated an intention to make further claims on 7 October 2011. He submitted that the Tribunal had no jurisdiction to remedy the circumstances of Mr and Mrs Hodges on the basis of the Centrelink errors and absence of their pension payments for more than 12 months. I am satisfied that Mr Letch's contention in that regard is correct.
2. The issue for determination is whether the age pension payments are able to be paid from a date earlier than the date on which the applicants indicated an intention to make claims. This was on 7 October 2011. Mr Letch submitted that all of the letters that were sent to Mr and Mrs Hodges were properly addressed by Centrelink and posted to their last known address and that the relevant legislation deemed Mr and Mrs Hodges to have received them. As a result, he submitted, the earliest date from which the age pension was payable to them was the date on which they advised of an intention to reclaim their pensions.
3. Mr Hodges, who appeared on behalf of his wife as well as himself, conceded that all of the Centrelink letters had been correctly addressed. However, he submitted that neither he nor his wife had received the letters of suspension or cancellation and were unaware that their payments had ceased until they received bank statements which recorded the change to their deposits. He said that he had experienced problems with incorrectly delivered mail to his address in the past and also referred to health problems which he had around the time when the letters were sent in 2010. He submitted that the decisions not to backdate the pension payments was unfair as they deprived him and his wife of more than 12 months of pension payments for which they had remained qualified.

1. Copies of the letters sent to Mr and Mrs Hodges on 2 September 2010 and 18 November 2010 were in evidence. They constituted notices of decisions made by Centrelink and were correctly addressed and sent to Mr and Mrs Hodges by pre-paid post to that address. I have noted Mr Hodges' assertions that he and his wife did not receive them. However, provision is made in the Social Security (Administration) Act 1999 (Cth) (the Administration Act) in relation to the receipt of notices of Centrelink decisions:

1. If notice of a decision under the social security law is:
   • (a) delivered to a person personally; or
   • (b) left at the address of the place of residence or business of the person last known to the Secretary; or
   • (c) sent by prepaid post to the postal address of the person last known to the Secretary;

notice of the decision is taken, for the purposes of the social security law, to have been given to the person.

1. Notice of a decision under the social security law may be given to a person by properly addressing, prepaying and posting the document as a letter.
2. If notice of a decision is given in accordance with subsection (2), notice of the decision is taken to have been given to the person at the time at which the notice would be delivered in the ordinary course of the post unless the contrary is proved.
3. This section only applies to notices of decisions, and nothing in this section affects the operation of sections 28A and 29 of the Acts Interpretation Act 1901 in relation to other notices under the social security law (for example, a notice that requires a person to inform the Department about some matter or a notice that requires a person to give the Secretary a statement about some matter).
4. I am satisfied that the notices of suspension and cancellation were sent in accordance with ss 237(1) and (2) of the Administration Act. In accordance with s 237(3) thereof, the notices are taken as having been delivered in the ordinary course of post to the address of Mr and Mrs Hodges. Further, s 23(12) of the Act provides that, where s 237 of the Administration Act applies to a notice of a decision, it has effect even if the intended recipient did not actually receive the notice. It follows that Mr and Mrs Hodges are deemed to have received the notices of suspension and cancellation of their pensions.

1. Under the Administration Act, the general rule is that a pension is payable from the date of claim.[1] However, where contact about a claim is made with Centrelink and a claim is then lodged within 14 days, the start date for payment is the date of contact.[2] For Mr and Mrs Hodges, contact was made on 7 October 2011 and the claim was lodged on 21 October 2011. This enabled Centrelink to determine that the age pension was payable to them from 7 October 2011.

1. As set out above, Mr and Mrs Hodges were advised of the suspension and cancellation of their pensions on 2 September 2010 and 18 November 2010, respectively. Their subsequent contact on 7 October 2011 was treated as a request for review of those decisions. Under s 109(2) of the Administration Act, where such review is sought more than 13 weeks after the notice of the decision was given, a favourable determination takes effect on the day on which the application for review was made. Clearly, the review was sought outside of the 13 week period nominated in that provision and it follows that the favourable determinations made on 4 November 2011 take effect from 7 October 2011, being the date the application for review was submitted.

1. It is not in dispute that Mr and Mrs Hodges have been disadvantaged by the Centrelink suspension and cancellation decisions. Unfortunately, there is no provision in the Act or the Administration Act for their pensions to be paid from a date earlier than 7 November 2011. Accordingly, the decisions under review must be affirmed.
2. Mr Letch undertook to advise Mr and Mrs Hodges of the scheme for compensation for detriment caused by defective administration under the Financial Management and Accountability Act 1997 (Cth).

I certify that the preceding 10 (ten) paragraphs are a true copy of the reasons for the decision herein of Mr R G Kenny, Senior Member.

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[1] See cl 3 of Sch 2 of the Administration Act.