6.2 Internal reviews

Summary

This chapter explains Centrelink's internal review process and covers:

• initiating a review
• Centrelink (Secretary) initiated review
• date of effect and result of favourable decision for Centrelink (Secretary) initiated review
• reviews relating to the CCS activity test
• reviews initiated by affected persons (1.1.P.80)
• review relating to care percentage decisions - initiated by affected persons
• time limit for a review initiated by affected persons
• date of effect of a favourable decision for a review initiated by an affected person
• further requirement for an application for review relating to an income estimate
• continuation of payment during a review, and
• notification of the decision.

Initiating a review

An internal review can be initiated by:

• Centrelink (as a delegate of the Secretary), or
• a person affected by a Centrelink decision.

Centrelink (Secretary) initiated review

Centrelink may review an FA decision where there is sufficient reason to do so. The delegated officer may affirm, vary or set aside the original decision. This includes deemed refusals, where Centrelink has neither made a determination nor refused the original application for ACCS (child wellbeing) (2.8.1.50) or (temporary financial hardship) (2.8.3.40) within 28 days after the day of application. Centrelink will undertake a Secretary initiated review in circumstances where an application:

• has been made and received
• meets the 'form and manner' requirement, and
• contains the required information and accompanying documentation.

Date of effect & result of favourable decision for Centrelink (Secretary) initiated review

Generally, where the review is initiated by Centrelink, the date of effect of a review decision that is favourable to the person affected by the decision is the date from which full effect is given to the review decision (full arrears).

FTB by instalment or SBP

However, if the review decision relates to FTB by instalment, or SBP (paid under the FTB Part A eligibility test), and the decision is made on a date later than 52 weeks after the person concerned was given notice of the original decision, then the date that the review decision comes into effect is the later of:

• the date from which full arrears are payable, or
• 1 July of the income year before the income year in which the review decision is made.

The limitation on the date of effect does not apply where a review of the decision was triggered because the reconciliation conditions were met (including FTB by instalment cases), because an individual and/or their partner’s tax return/s were lodged, or because the individual notified Centrelink of their ATI (1.1.A.20) because they and/or their partner were not required to lodge an income tax return, by the end of the lodgement year (1.1.L.30). The limitation on the date of effect also does not apply in cases of re-reconciliation. That is, if the income used in reconciliation for an income year is retrospectively changed (for example, the Commissioner of Taxation makes an amended notice of assessment), increased amounts of FTB can be paid if the reconciliation conditions for the relevant income year (1.1.R.23) were originally met by the end of the lodgement year.

CCS & ACCS

For Centrelink (Secretary) initiated review decisions in relation to individuals' (1.1.I.90) eligibility and entitlement (1.1.E.30) for CCS or ACCS, or an approved provider's (1.1.A.90) entitlement to be paid ACCS (wellbeing), the date of effect for beneficial changes cannot be earlier than the beginning of the previous financial year. This time limit does not apply where a decision on review:

• changes an individual's ATI for the relevant income year, or the individual's activity test result for a CCS fortnight due to the individual meeting the CCS reconciliation (1.1.R.10) conditions, or
• is affected by a review conducted by the ATO.

Note: If an individual reports a change to their combined annual estimated ATI after the change occurred (whether it is favourable or unfavourable), a review of entitlement is not undertaken, as actual CCS entitlement based on actual ATI is confirmed at reconciliation.

Reviews relating to the CCS activity test

Individuals are obliged to notify Centrelink as soon as practicable if there is a change in their activity that would cause them to move to a different step of the activity test. An individual must also notify Centrelink as soon as practicable if there is a change in their circumstances that would mean they are no longer eligible for an exemption to the activity test, or would now be eligible for an exemption to the activity test.

For Centrelink (Secretary) initiated review decisions relating to activity notified after the change occurred:

• A change in activity level that is FAVOURABLE to the individual (that is, that causes the individual to be entitled to more hours of subsidised care per fortnight), will be backdated a maximum of 28 days to the beginning of a CCS fortnight from the date of notification.
• A change in activity level that is UNFAVOURABLE to the individual (that is, that causes the individual to be entitled to fewer hours of subsidised care per fortnight), will be applied as far back as the date of event, from the beginning of the next CCS fortnight (even if this is in a previous financial year).

For the purpose of CCS:

• the date of notification is the date Centrelink receives the notification regarding a change in an individual's circumstances
• the date of event is the date that a change in an individual's circumstances actually occurred
• the date of effect is the date that particular information about an individual's circumstances will be taken into account.

Beneficial changes in entitlement (activity related) that are taken into account back more than 28 days

In certain circumstances, if an individual is late in reporting a change in their activity level or circumstances that is beneficial in terms of increasing their entitlement to hours of subsidy per fortnight (activity test result), and the delegate believes in their circumstances they have provided the information as soon as practicable, the delegate can take the information into account back more than 28 days. The delegate can take the information into account as far back as the date the change occurred, but not further back than the beginning of the previous financial year (that is, the review could never extend back more than 2 years).

Circumstances in which the delegate may take beneficial activity test information into account back more than 28 days where the individual notified of the change after it occurred could be for reasons such as, but not limited to, the parent, their partner (1.1.P.30) or the child experience a natural disaster, domestic violence, serious illness or medical condition including hospitalisation or significant trauma.

Reviews initiated by affected persons

Generally, a person affected by a decision made by an officer under FA law can apply for a review of the decision. The review will be undertaken by an ARO.

The ARO may affirm, vary or set aside the original decision.

Review relating to care percentage decisions - initiated by affected persons

From 1 July 2010, changes to child support and FTB legislation aligned determinations about care between child support and FTB. This means where a care determination needs to be made in respect of a child, the determination can be made by either a delegate of the Child Support Registrar or the Secretary (CSA Act section 54K and FAAct section 35T).

Where either the Registrar or the Secretary conducts an internal review of a care decision, any new decision made on review will be used by both the Registrar and the Secretary. Where the ART amends a decision or substitutes a new decision about a care percentage, that amended or substituted decision will be used by both the Registrar and the Secretary.

Where the care percentage decision has no effect under FA law (that is, neither party is claiming FTB) only Child Support may make or review care percentage decisions. In such a case, if the individual approaches Centrelink to apply for the review, Child Support, as the original decision maker must undertake the review.

Time limit for a review initiated by affected persons

Generally, an application for review by a person in relation to FA should be lodged within 52 weeks after the individual is notified of the original decision, noting:

• this time limit does not apply to FTB by instalment decisions, and some other decisions
• applications for a review in relation to CCS and ACCS, including requirements of approved providers under FA(Admin)Act Part 8A, must be made within 13 weeks after the applicant is notified of the decision.

However, there are time limits for full arrears to be payable depending upon the circumstances. (For more information, refer to 'Date of effect of a favourable decision for a review initiated by an affected individual'.)

The table below indicates decisions other than instalment decisions where a 52 week time limit may not apply.

Date of effect of a favourable decision for a review initiated by an affected person

Except for CCS and ACCS decisions, provided the person applies for the review within the prescribed timeframe as described above, and the outcome of the review is in their favour, because Centrelink varies or sets the original decision aside, the decision takes effect from the first day of the period to which the original decision relates. This means arrears are payable from that day, giving the decision full effect.

However, for a review decision relating to FTB by instalment, where the application for review is made more than 52 weeks after notice was given of the original decision, or a further period if Centrelink is satisfied there are special circumstances that prevented the applicant from making an application for review on time, then the date of effect is generally the later of:

• the date from which full arrears are payable, or
• 1 July of the income year before the income year in which the application for review is made.

This limitation on the date of effect does not apply where the application for review is the result of:

• the individual meeting the reconciliation conditions and applying for a review of their annual entitlement (that is, asking for reconciliation to occur)
• an assessment or review of taxable income by the ATO, provided the application for review is made within 90 days of when the individual received notification of the ATO decision and the individual had lodged their tax return before the end of the lodgement year, or
• a review of child support entitlement, provided the person makes the application for review within 90 days of receiving notification of the revised child support assessment.

CCS & ACCS

In relation to CCS and ACCS decisions the decision takes effect from the date of the previous decision, if that date is not earlier than the beginning of the previous financial year, provided:

• the person applies for the review within 90 days of a decision relating to eligibility and entitlements
• the outcome of the review is in their favour, and
• the individual had provided all the information required for Centrelink to determine their eligibility or entitlement to CCS and ACCS as soon as practicable.

There is no time restriction where the review is the result of the individual meeting the CCS reconciliation conditions or an ATO review.

Further requirement for an application for review relating to an income estimate

An application for review of a decision in regard to eligibility for or entitlement to FA (other than SBP) or a CCS percentage to the extent that the decision was based on an estimate of the person's ATI cannot be made until after the end of the income year, and where the person is required to lodge a tax return, after the ATO has made an assessment of the person's taxable income for that year.

An application for review of a decision in regard to eligibility for or entitlement to FTB to the extent that the decision was based on an estimate of maintenance income for an income year cannot be made until after the end of that income year.

This restriction does not preclude the person from providing a revised estimate of income at any time during the income year. If a revised estimate is provided and considered reasonable, the rate paid can be varied from the date the revised estimate is provided.

If an FTB instalment claim is rejected due to the income estimate being too high and the income estimate subsequently decreases, the individual can lodge a new claim containing a revised income estimate and, if eligible, be paid prospectively from the date of the new claim. However, the individual will need to wait until their actual ATI is known before they can be paid for the past period (that is, period from the date the first rejected claim is lodged up to the date the new claim is lodged).

Where a claim for SBP has been rejected because of the income estimate, the individual’s eligibility for each payment can be reviewed if they provide a revised estimate within 52 weeks of being notified of the rejection decision. The revised income estimate must include the individual’s ATI and, if the individual was partnered on the day the claim was initially lodged, the ATI of the person to whom they were partnered on that day. This means that if the individual has separated since lodging the claim, their former partner's ATI for the 6 month income test period needs to be included in the revised income estimate.

Continuation of payment during a review

If an unfavourable decision is made and the decision depends upon the exercise of discretion, the person's entitlement to FA may continue during the review process.

Notification of the decision

The reviewer must:

• notify all parties affected by the review decision in writing or another approved manner of
  • the review decision
  • the reasons for the decision
  • the effect of the decision
• advise the affected person that they may seek further review by the ART.