7.3.2.50 Waiver in Special Circumstances

Summary

Under FA(Admin)Act section 101, Centrelink can waive (1.1.W.10) the recovery of a debt (1.1.D.60) if there are special circumstances that make it inequitable to recover the debt.

This topic covers the following:

  • waiving recovery of a debt in special circumstances,
  • what are special circumstances, and
  • interpretation of 'knowingly', for the purposes of this provision.

Waiving recovery of a debt in special circumstances

Centrelink may waive the right to recover all, or part, of a debt if it is established that:

  • the debt did not result wholly or partly from the debtor or another person knowingly
    • making a false statement or misrepresentation, or
    • failing or omitting to comply with a provision of the FA legislation, and
  • there are special circumstances, other than financial hardship, that make it desirable to waive the debt, and
  • it is more appropriate to waive recovery, rather than to write off part or all of the debt.

Act reference: FA(Admin)Act section 101 Waiver in special circumstances

What are special circumstances?

Special circumstances are a discretionary provision of the FA(Admin)Act that mirrors the SSAct section 1237AAD. Case law decisions made about the SSAct provide guidance in making decisions about special circumstances for the purposes of the FA(Admin)Act.

Financial hardship can be one of the factors taken into account when making a decision under this provision, however, it cannot be the only one. If financial hardship is the only reason, consideration should be given to writing-off the debt instead.

In Beadle and Director-General of Social Security (1984) AATA 176 the AAT held that, in order for 'special circumstances' to exist, it must be possible to say that the circumstances in the case in question are 'markedly different from the usual run of cases'. The circumstances must have 'a particular quality of unusualness that permits them to be described as special'.

In Secretary, Department of Social Security v Hulls (1991) FCA 58, 22 ALD 570/13 AAR 414, the Federal Court held that it is not possible to set out a complete list of the relevant factors to be taken into account in determining whether special circumstances exist. Each case must be considered on its own merits.

Act reference: FA(Admin)Act section 101 Waiver in special circumstances

Interpretation of 'knowingly' for the purposes of this provision

Under FA(Admin)Act section 101, the debtor or another person must not 'knowingly' have made a false statement, misrepresentation or failed to comply with a provision of FA law.

This means that if there is an element of intent in the debtor's or another person's conduct for the purposes of this provision, the debt will not be able to be waived on the basis of special circumstances. It may also be sufficient if the debtor was recklessly indifferent about their conduct or representations.

Last reviewed: 7 November 2016