SOCIAL SECURITY - Disability Support Pension - applicant permanently living in a country covered by an international social security agreement - criteria for payment - not eligible for unlimited portability period under Act - level of disability - date of effect of decision - decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information pursuant to subsection 201(1A) of the Social Security (Administration) Act 1999.

1. This review relates to decisions by Services Australia (Centrelink) to cancel Ms Naudian's disability support pension (DSP) after she remained outside of Australia for more than 28 days and, subsequently, not to pay her DSP under the terms of the international social security agreement between Australia and Germany ('the ISSA').
2. Mrs Naudian had been receiving DSP since 20 April 2021.
3. On 15 March 2022, Ms Naudian advised Centrelink that she was leaving Australia to live in Germany permanently and requested to be paid under the terms of the ISSA.
4. Mrs Naudian departed Australia for Germany on 23 March 2022.
5. On 20 July 2022, an employee of Centrelink made a decision to cancel Ms Naudian's DSP from 20 April 2022 on the basis that she had been outside of Australia for more than 28 days.
6. On 27 July 2022, a job capacity assessment was completed, in which Ms Naudian was assigned a total of 20 points across 5 Impairment Tables. This assessment was reviewed by the Health Professional Advisory Unit, which advised on 20 April 2023 that the points assigned were appropriate.
7. On 21 April 2023, Ms Naudian submitted a form entitled 'Certification of location in a country which Australia has a Social Security Agreement' to Centrelink (which she had signed on 19 April 2023). The form was interpreted by Centrelink as a request to review its decision to cancel her DSP payment.
8. On 21 April 2023, Centrelink made the decision not to make social security payments to Ms Naudian under the terms of the ISSA as, based on the job capacity assessment of 27 July 2022, she did not meet the severe disability criteria for such payments.
9. On 5 May 2023, Ms Naudian provided an additional letter to Centrelink, containing supporting evidence for an assessment of her impairments. This letter was interpreted by Centrelink as a request to review its decision not to pay her under the ISSA.
10. On 24 May 2023, an authorised review officer of Centrelink affirmed the decisions to cancel Ms Naudian's DSP from 20 April 2022 because she did not meet the criteria to have her portability extended beyond 28 days and not to pay her under the terms of the ISSA from 23 May 2022 because she did not meet the criteria to be paid DSP under its terms.
11. On 9 August 2024, Ms Naudian made an application to the Administrative Appeals Tribunal (the AAT) for an independent review of Centrelink's decisions.
12. From 14 October 2024, the AAT became the Administrative Review Tribunal (the Tribunal). Under the transitional provisions in the Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Act 2024 (the Transitional Act), applications for review to the AAT that were not finalised before 14 October 2024 are taken to be an application for review to the Tribunal. The Transitional Act gives the Tribunal the authority to continue and finalise any aspect of the review not already completed by the AAT. This decision and statement of reasons is made by the Tribunal.
13. The Tribunal hearing was held on 27 March 2025, on which date Ms Naudian and her representative, Mrs Sharon Morabito, spoke to the Tribunal by conference telephone. At the hearing, the Tribunal had before it documents provided by Centrelink (folios 1 to 531; plus a group numbered separately from 111 to 119, the contents of which did not correspond with the folios of those numbers in the other document bundle), copies of which had been sent to the applicant and her representative prior to the hearing. Both Ms Naudian and Mrs Morabito confirmed to the Tribunal that they had received the documents.

1. The statutory provisions relevant to the administration of Centrelink payments are contained in the Social Security Act 1991 (the Act), the Social Security (Administration) Act 1999 (the Administration Act), and the Social Security (International Agreements) Act 1999 (the International Agreements Act).
2. Under section 1211 of the Act, the portability provisions in Part 4.2 of the Act do not apply in those circumstances where the International Agreements Act applies instead. That is, an applicant can qualify for particular payments under either the Act or the International Agreements Act, but not under both acts simultaneously.
3. Ms Naudian first qualified for DSP under the Act. If the Tribunal finds that she qualified for an unlimited portability period under this legislation (and that her DSP was therefore cancelled incorrectly), it will be unnecessary for the Tribunal to consider Ms Naudian's qualification for payments under the International Agreements Act.
4. The issues which arise in this case are therefore:
   • Was Ms Naudian entitled to an unlimited portability period for her DSP under the Act? And if not,

Was Ms Naudian entitled to receive payments under the ISSA?

Was Ms Naudian entitled to an unlimited portability period for her DSP?

1. Ms Naudian told the Tribunal that she did not intend to dispute that she was not entitled to an unlimited portability period for DSP while she was outside Australia. Nonetheless (and for the sake of completeness), the Tribunal has reviewed whether she was entitled to unlimited portability after leaving Australia on 23 March 2022.
2. 'Portability' is an individual's entitlement to be paid a social security payment while overseas. Section 1217 of the Act contains the portability provisions for various social security payments, including DSP. These are extracted from the table in Section 1217 and reproduced below:

Any temporary absence, except for any of the following purposes:

A total of 28 days (whether consecutive or not) of temporary absence from Australia for any purpose in the last 12 months, ignoring days on which the person was not receiving disability support pension (but see also sections 1218AAA, 1218AA, 1218AB, 1218, 1218C and 1218D)

Temporary absence for any of the following purposes:

4 weeks (but see also sections 1218AAA, 1218AA, 1218AB, 1218, 1218C and 1218D)

Terminally ill overseas disability support pensioner

1. Turning to the provisions of item 2A, the portability of DSP for a person that has previously met the criteria under the Impairment Tables for severe impairment is not automatic. Section 1218AAA specifies what must happen in order for an unlimited portability period to apply to a severely impaired DSP pensioner as follows:

(1) The Secretary may make a written determination that a particular person's maximum portability period for disability support pension is an unlimited period, if all of the following circumstances (the qualifying circumstances ) exist:

(a) the person is receiving disability support pension;

(b) the Secretary is satisfied that the person's impairment is a severe impairment (within the meaning of subsection 94(3B));

(c) the Secretary is satisfied that the person will have that severe impairment for at least the next 5 years;

(d) the Secretary is satisfied that, if the person were in Australia, the severe impairment would prevent the person from performing any work independently of a program of support (within the meaning of subsection 94(4)) within the next 5 years.

(2) The Secretary must not make a determination under subsection (1) in relation to a person who is outside Australia unless the Secretary is satisfied that:

(a) the person is unable to return to Australia because of either of the following events:

(b) the person's portability period for disability support pension had not ended at the time the event occurred.

1. The Tribunal observed that the Secretary had not made a determination under subsection (1) of section 1218AAA of the Act before Ms Naudian had left Australia. The Tribunal therefore finds that unlimited portability is not available to Ms Naudian under this provision.
2. The provisions of Item 3 are inapplicable as there is no evidence that Ms Naudian is terminally ill, such that the provisions of section 1218AA cannot be satisfied.
3. The remaining applicable provisions for the Tribunal to consider are therefore those of items 2 and 2AA. The Tribunal observes that under both items, the absence from Australia must be a temporary absence. The Tribunal will therefore consider whether Ms Naudian's absence from Australia meets the definition of 'temporary'.
4. Under section 1212C of the Act, a person's absence from Australia is temporary if, throughout the absence, the person does not cease to reside in Australia (within the meaning of subsection 7(3) of the Act).
5. Subsection 7(3) requires the following factors to be considered in determining whether or not a person is residing in Australia:

(a) the nature of the accommodation used by the person in Australia; and

(b) the nature and extent of the family relationships the person has in Australia; and

(c) the nature and extent of the person's employment, business or financial ties with Australia; and

(d) the nature and extent of the person's assets located in Australia; and

(e) the frequency and duration of the person's travel outside Australia; and

(f) any other matter relevant to determining whether the person intends to remain permanently in Australia.

1. In her contact with Centrelink on 15 March 2022, Ms Naudian indicated that she intended to leave Australia permanently on 23 March 2022.[1] Further documentation of a portability interview conducted by Centrelink with Ms Naudian on the same date indicates that she intended to return to Australia for the period 21 September 2022 to 22 March 2023.[2]
2. When asked about her discussion with Centrelink on 15 March 2022, Ms Naudian disagreed that she had told Centrelink she would never return to Australia. Nonetheless, she did say that she had no clear plans, including no clear plan to return to Australia; she was moving to Germany to see whether she could live with her relatives there. On Ms Naudian's evidence, the Tribunal is satisfied that she left Australia indefinitely on 15 March 2022 such that her departure had the characteristics of a permanent, rather than temporary departure.
3. Because the Tribunal has found that Ms Naudian's departure from Australia was permanent rather than temporary, it follows that she ceased to be entitled to DSP from the date of her departure, that is, 23 March 2022. That is, the portability periods (other than unlimited portability periods) provided in section 1217 of the Act cannot apply to Ms Naudian on the basis that these are only applicable to temporary absences from Australia.
4. Subsection 80(1) of the Administration Act states that, if a payment is being paid to a person and is not payable, the payment is to be cancelled or suspended. Centrelink made a decision to cancel rather than suspend Ms Naudian's DSP.
5. The Act does not provide any guidance as to when suspension of a payment is preferable to cancellation. In the Federal Court matter of Mentink v Secretary, Department of Social Services [2016] FCAFC 39, the Court (at [49]) noted that:

As to the point of construction, s 80 is expressed in terms which might suggest that, irrespective of whether the decision-maker decides that the person was not qualified for the payment or that the payment was not payable, she or he has the option of either cancelling or suspending a payment. However, we consider that, sensibly read, the intention was that a payment would be cancelled where the person was not qualified for the payment, and suspended where the person was qualified but the payment was nonetheless not payable in the circumstances. That understanding of s 80 accords with the different substantive effect of cancellation as opposed to suspension. As Davies J held in Freeman v Secretary, Department of Social Security [1988] FCA 294; (1988) 19 FCR 342 at 346:

A decision suspending a pension has an ongoing effect and the suspension may be terminated at any appropriate time. It may well be within the ambit of the Tribunal's decision to terminate a suspension if the facts before the Tribunal showed that the pension or benefit ought to have been suspended only up to a particular date. A decision cancelling a pension does not have ongoing effect in that way. A decision cancelling a pension or benefit brings to an end the entitlement to a pension or benefit. Entitlement to the pension or benefit only revives on the lodgement of a proper claim for the grant of the pension or benefit.

1. In the Tribunal's view, given that Centrelink was still assessing whether Ms Naudian could be transferred from being paid under the Act to being paid under the ISSA, her payment should have been suspended (and not cancelled) until that decision was made on 21 April 2023 (after which date it would have been appropriate to cancel the payment).

Was Ms Naudian entitled to receive DSP payments under the ISSA?

1. Although Ms Naudian's departure from Australia was permanent, her intentions with respect to DSP payments were clear. Centrelink appears to have treated her telephone contact on 15 March 2022 as a request to be transferred to and paid under the ISSA, consistent with the policy guidance in the Social Security Guide at 7.1.20. That is, under this policy (which does not appear to contradict the legislation), Ms Naudian was not required to make a fresh application for DSP. This may explain, in part, the apparent lack of response by Centrelink to Ms Naudian's claim forms submitted repeatedly through the Deutsche Rentenversicherung on 27 June 2023, 5 September 2023, 5 December 2023, 23 January 2024 and 24 April 2024.
2. Under the provisions of the ISSA with Germany, it is possible for a person to receive an Australian payment while they are living in Germany. The relevant provisions (that is, those pertaining to Germany) are found in Schedule 14 of the International Agreements Act. Disability support pension is one of the benefits provided for in Schedule 14 (Article 2, paragraph 1(b)(ii)). Section 5 of the Concluding Protocol of the agreement states as follows:

Australian disability support pension under the Agreement shall not be payable for more than 26 weeks to a person who is not severely disabled while that person is outside Australia.

1. Section 3 of the International Agreements Act provides that unless a contrary intention appears, an expression used in the Act has the same meaning in the International Agreements Act as it does in the Act.
2. The Act provides a definition of 'severely disabled' in subsection 23(4B):

(4B) For the purposes of this Act, a person is severely disabled if:

(a) a physical impairment, a psychiatric impairment, an intellectual impairment, or 2 or all of such impairments, of the person make the person, without taking into account any other factor, totally unable:

(ii) unable to benefit within the next 2 years from participation in a program of assistance or a rehabilitation program or from the provision of supports or services specified in an instrument under subsection (4BA) and provided under an arrangement or grant under the Disability Services and Inclusion Act 2023; or

1. The Social Security Guide (at 1.1.S.110) notes that given the difficulty in determining the exact number of working hours a person can perform in a given week, '[i]f a person's measured capacity to work is 0 to 7 hours per week (that is, less than 8 hours per week) as a result of their impairment/s, they are accepted as being totally unable to work for the purposes of being severely disabled.' Consistent with the decision in Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, the Tribunal considers there are no cogent reasons not to apply the guidance of the Guide in this matter and will therefore consider whether the evidence indicates that Ms Naudian, by reason of her impairments, has a measured capacity to work of less than 8 hours per week.
2. On 21 April 2023, Centrelink made the decision to reject Ms Naudian's request to be paid DSP under the terms of the ISSA on the basis of the job capacity assessment conducted on 27 July 2022 and subsequently reviewed by the Health Professional Advisory Unit. The assessment was conducted as a file assessment (that is, without an interview of Ms Naudian, who at the date the report was finalised, was overseas)[3] and found that she had a baseline work capacity of 0 to 7 hours per week and a capacity for work within 2 years (with intervention) of 8 to 14 hours per week.[4]
3. On 21 July 2023, Ms Naudian submitted a 2-part medical report dated 3 July 2023 from the [Institution] Berlin to Centrelink.[5] Part A, entitled 'Medical documentation and discussion', appears to have been completed (but not signed) by [Mr A], orthopaedic surgeon and [Mr B], 'specialist for social medicine, department head' (who did sign the report). Part B is entitled 'Social-medical expert opinion' and has the same authorship and signature as Part A. The report is written in English and the Tribunal accepts it into evidence on the basis that it is not a translation of an original German report but rather an original report written in English.
4. Part A of the report contains a diagnosis of Ms Naudian's impairments as follows:

Advanced polyarthrosis, focus on hands on both sides, permanently restricting function M19.9.

Chronic spinal disease with pronounced spinal malposition and contracture of the spine on all levels, permanently limiting function, stress-related pain M54.9

Bilaterial gonalgia with signs of chrondropathia patellae

Multiple allergies, including pollen, animal dander

Impingement syndrome of the shoulder joints on both sides.[6]

1. The 'evaluative medical opinion' in Part A of the report is as follows:

[Age]-year-old subject, normosome. The focus is on a chronic spinal column and joint disease

with signs of advanced degenerative changes, with a focus on the hands on both

sides, as well as impingement syndrome in the shoulder joints on both sides and signs

of chondropathy in the knee joints on both sides. The ability to walk is limited, supported

In addition, there is a clearly depressive mood with experiencing insufficiency and a

feeling of being overwhelmed. The test person is receiving specialist orthopedic treatment.

Physical and physiotherapeutic therapy measures are currently on hold. Pain

Taking into account the diagnoses of the examination findings and the appreciation of

the technical findings of the course of the disease, the test person does not have sufficient

mental and physical stability with regard to employability on the general labor

market. She is unable to work for 8-14 hours per week, also unable for the next two

years by reprogramming, and wasn't able to fulfill these requirements for work also

1. Although there are some fields in both reports that do not appear to have been completed, the Tribunal notes the following remarks in Part B of the 3 July 2023 report:

(a) 1 Functional limitations relevant to integration

Severe limitation to the musculoskeletal systems due to multiple osteoarthritis.

(b) 5 Explanation

unable to work for 8-14 hours per week, also unable for the next two years by reprogramming, and wasn't able to fulfil these requirements for work also before March 22nd, 2022.

1. The Tribunal also had in evidence a translation of a socio-medical opinion provided in Berlin on 20 February 2023 by [Dr C], specialist doctor, social medicine, contracting doctor of the Federal Employment Agency. The original German document is found at folios 25 to 28 of the document bundle; the NAATI-certified translation is provided at folios 529 to 531. The socio-medical assessment provided in the document is as follows:

There is a health impairment that does not permit employment subject to compulsory [social security] insurance [deductions] for 3 hours a day. This restriction is likely to be permanent.

The capacity to work is suspended. Ongoing necessary medical measures take precedence.[8]

1. Ms Naudian explained to the Tribunal that she has not been able to work at any time since arriving in Germany in 2022. She had believed that the documentation of this by doctors in Germany (at an institute for social medicine) would have provided sufficient evidence to Centrelink of her permanent impairments.
2. On balance, the Tribunal prefers the oral evidence of the applicant and evidence in the 2-part medical report dated 3 July 2023 to the evidence of the job capacity assessment conducted by Centrelink on 27 July 2022. The medical report completed on 3 July 2023 in Berlin was clearly prepared after the medical team had seen the applicant and contains a full range of medical observations; the desktop job capacity assessment is made on the basis of medical evidence from 2021 or earlier. While the Tribunal notes that the medical report of 3 July 2023 indicates that Ms Naudian was unable to work from 22 March 2022 and she was not known to the treating team at that date, it does accept the assessment of her inability to work 8 hours or more due to her impairments from this earlier date on the basis that the report engages with Ms Naudian's medical history and made its findings on the basis of both the diagnoses in the medical examination and an appreciation of the 'technical findings of the course of the disease'.[9] The Tribunal also notes that Part A of the report was prepared with the input of orthopaedic surgeon, [Mr A], and places greater weight on his expert opinion than the opinion of the registered occupational therapist[10] who prepared the job capacity assessment report for Centrelink on 27 July 2022. The Tribunal is therefore satisfied, based on the oral evidence of the applicant and the evidence contained in the medical report of 3 July 2023 that that the applicant's condition had not changed from the time of her departure from Australia.
3. The Tribunal therefore finds that Ms Naudian meets the definition of 'severely disabled' under subsection 23(4B) of the Act, did so at the date of her departure from Australia and continued to do so both during the 28-day portability period and at the date her DSP was cancelled. Her DSP should not therefore have been cancelled and instead remained payable to her under Schedule 14 of the International Agreements Act (Section 5 of the Concluding Protocol).

1. In circumstances where there is a favourable determination as defined under section 108 of the Administration Act, the date of effect becomes relevant. Section 109(1) of the Administration Act relates to the date of effect of a resumption of payment after cancellation pursuant to section 85 where:
   • An original decision is made to in relation to a person's social security payment; and
   • The person is given a notice informing him or her of that decision; and
   • The person seeks internal review of the decision (section 129) no more than 13 weeks after the notice is given; and
   • As a result of the application for review a favourable decision is made.
2. Centrelink made a decision to cancel Ms Naudian's DSP on 20 July 2022, and subsequently to reject her requested to be paid DSP pursuant to the terms of the ISSA between Australia and Germany on 21 April 2023.
3. Records provided by Centrelink show that Ms Naudian contacted Centrelink on 21 April 2023 and that this contact was interpreted by Centrelink to be a request for a review of its decision of 20 July 2022. The Tribunal accepts this interpretation and observes that it occurred outside 13 weeks of the notice being given.
4. The same records provided by Centrelink show that Ms Naudian contacted Centrelink on 5 May 2023 and that Centrelink interpreted this contact as a request for review of the decision of 21 April 2023. The Tribunal accepts this interpretation and observes that it occurred within 13 weeks of the notice being given.
5. The Tribunal observes that Ms Naudian entered into a nominee arrangement with Centrelink, which the agency acknowledged on 21 March 2022, that is, slightly under a fortnight before leaving Australia.[11] Under the terms of this arrangement, Mrs Morabito was authorised to receive copies of Ms Naudian's Centrelink correspondence and provide information about Ms Naudian to the Centrelink on her behalf.[12]
6. Ms Naudian's application for review with the AAT (as it then was) was lodged on 9 August 2024, that is, well over 12 months after the Centrelink authorised review officer's decision had been made on 24 May 2023.
7. The Tribunal confirmed with the parties that the address to which the decision of 24 May 2023 was sent was the address of Ms Naudian's nominee, Mrs Morabito.
8. The Tribunal asked Mrs Morabito when she had notified Ms Naudian of Centrelink's letter of 24 May 2023. Although Ms Morabito had no specific recollection of the date at which she notified Ms Naudian of this letter (and her WhatsApp records were unavailable at the time of the hearing), she said that she would usually photograph and send any Centrelink correspondence to Ms Naudian within 2 days of receiving it. Ms Naudian confirmed that this was her recollection of matters as well.
9. Section 160 of the Evidence Act 1995 sets out the presumption (unless evidence sufficient to raise doubt about the presumption is adduced) that a postal article sent to any specified address in Australia is received at that address on the seventh working day after having been posted. Taking into account the evidence of Mrs Morabito and Ms Naudian, Ms Naudian is taken to have been notified of the Centrelink review officer's decision by 3 June 2023.
10. Pursuant to section 147, item 8(d)(ii), of the Administration Act, in circumstances where a person applies to the Tribunal more than 13 weeks after they received notice of a decision, and the effect of the Tribunal's decision is to direct the making of a social security payment, the decision takes effect on the date on which they applied to the Tribunal. Disability support pension is therefore payable to Ms Naudian under the terms of the ISSA from 9 August 2024.

The Tribunal sets aside the decisions under review and, in substitution, decides that Ms Naudian's disability support pension remained payable to her pursuant to Schedule 14 of the Social Security (International Agreements) Act 1999, the international social security agreement between Australia and Germany, at the date she left Australia. The date effect of this decision is 9 August 2024.

[5] Folios 376 to 383 and a duplicate at 429 to 436