22.214.171.124 Discretion to treat a person as not being a member of a couple for a special reason
SSAct section 24 enables a delegate to decide that there is a 'special reason' NOT to treat a person as a member of a couple (1.1.M.120). This is a discretionary area of law and only applies in limited situations.
A person is a member of a couple under the SSAct if they are committed to another person as their partner, where both people are over the age of consent (applicable to the relevant state or territory), are not in a prohibited relationship (subsections 4(12) and 4(13)), and are either:
- legally married, OR
- in a registered relationship (126.96.36.199), OR
- in a de facto relationship (188.8.131.52).
In situations where the department considers that there is a special reason in the particular instance, and it would be unfair to administer the rate of payment, or income and assets test provisions that apply to couples, the Secretary can determine, under the provisions of section 24, that the person should not be treated as a member of a couple.
Act reference: SSAct section 4(12) to section 4(13) Prohibited relationship
Case law provides some direction as to the purpose of this legislation. Section 24 discretion exists to deal with unfair, inequitable and/or unjust anomalies.
Section 24 is intended to be the option of last resort, and should only be applied when all other reasonable means of support have been explored and exhausted.
When section 24 is applied, the person is deemed NOT to be a member of a couple and is treated as a 'single' person for all purposes of the SSAct. As a result, the person is paid the single rate of payment and only their individual income and assets are included in the assessment of the rate of their payment.
It is not possible to predict all the situations where section 24 should be applied as the circumstances of each particular situation need to be considered on a case-by-case basis.
Note: When assessing a person's situation, it may be appropriate to consider whether the person's circumstances are such that they should in fact be regarded as living 'separately and apart' from their former partner. If a person is living separately and apart from their former partner on a permanent or indefinite basis they DO NOT meet the definition of a member of a couple and should be determined as single, without recourse to section 24 (refer to 184.108.40.206).
Act reference: SSAct section 24 Person may be treated as not being a member of a couple (subsection 4(2))
All circumstances must be taken into account
The discretion to treat a person as NOT being a member of a couple should be exercised ONLY where a full consideration of all the circumstances relevant to the individual's case would make it unjust or unreasonable not to do so.
It is appropriate that the decision maker strike a balance between the individual circumstances of the person and the circumstances of the couple. In the case of Boscolo v Secretary, Department of Social Security (1999) FCA 106, the Federal Court found that the decision maker must make the decision with reference to the circumstances of the person seeking the discretion, rather than the position of the couple. HOWEVER, the Federal Court also noted that this does not prevent the decision maker from considering all relevant circumstances, including the position of the couple as it relates to the individual. It is also important to review the partner of the person who has had section 24 applied as part of the process.
The couple's circumstances should be compared to a couple in similar circumstances but for whom the special circumstances to apply section 24 do not exist. There must be some degree to which circumstances are outside the couple's or individual's control and cannot be changed.
Explanation: If it is reasonably within the individual or couple's control to improve their circumstances without section 24, generally this should be explored first.
Three questions that need to be considered as part of the assessment while looking at the full circumstances of the case are:
- Is there a special reason to be considered in this couple's circumstances?
- Is there a lack of being able to pool resources for the couple as a result of the circumstances?
- Is there financial difficulty as a result of the couple's circumstances?
Is there a special reason to be considered in this couple's circumstances?
This discretion can ONLY be exercised 'for a special reason in the particular case'. In general, the circumstances must be unusual, uncommon, abnormal or exceptional. It is the context which generally determines whether the circumstances in one case are markedly different from the usual run of cases. This is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as special.
Explanation - residential care: The fact that a person has entered residential care would generally not be regarded as a special reason. Refer to 220.127.116.11 Determining an illness separated couple.
Explanation - partner in gaol: The fact that a person's partner is in gaol is not regarded as a special reason. Refer to 18.104.22.168 Determining treatment of claimant/recipient with partner in gaol - general provisions.
Decisions from the AAT and Federal Court indicate that ineligibility for social security, of itself, is very unlikely to constitute 'special reason' for the exercise of section 24. Decisions considering a person's financial difficulty is not, of itself, sufficient to constitute 'special reason'.
Act reference: SSAct section 24 Person may be treated as not being a member of a couple (subsection 4(2))
Is there a lack of being able to pool resources for the couple as a result of the circumstances?
Members of a couple in ordinary circumstances will pool their resources and share their expenses, making it cheaper for them to live than if they were 2 single people. A significant body of case law has established that the inability to pool resources for their mutual benefit is a special reason to exercise the discretion in section 24.
Generally, section 24 would NOT be appropriate where a couple is able to, but chooses not, to pool resources or where one or both members of a couple choose not to access a source of support which they could contribute to the pool. Consideration should be given to whether either member of the couple has access to any social security or other support that has not been explored or realised. Generally a person would be expected to claim any benefits to which they are entitled.
Example: One partner is lost at sea and due to the body not being found, the Coroner will not declare the partner dead for 2 years. The surviving partner cannot pool resources and as a consequence may be eligible for the application of section 24.
Example: Sinead is in receipt of an income support payment and her partner, Hamish, has no financial resources to contribute to the relationship and has no income. Hamish may not be residentially qualified for income support or may be subject to a NARWP. The couple are unable to pool resources as a result of their circumstances. In such cases, and subject to all the usual means and assets tests, section 24 should generally be applied, but should be reviewed regularly to ensure that Sinead's partner has not recently become eligible for a social security payment, e.g. as a result of a 'substantial change in circumstances beyond their control'.
Example: Simon and Anna are a couple and reside together. Before they were married, Simon was receiving NSA at the single rate and Anna had a job. After their marriage, Simon's rate of NSA was paid at the partnered rate. Anna lost her job and chose not to claim income support despite being eligible as she does not want to have to meet the activity test. Simon and Anna are relying on Simon's partnered NSA and are in hardship. Anna is of working age and is able to meet the activity test by looking for or undertaking work. Simon and Anna's financial situation has come about because they made a personal choice for Anna to remain at home. It is within Simon and Anna's power to improve their financial situation; however, they have chosen not to. Section 24 would generally not be appropriate in this scenario.
Generally, SSAct section 24 does NOT apply if the couple are living together overseas. The decision maker in assessing couples living together overseas must be satisfied that the information provided is a special situation to warrant the application of section 24. It is important to consider whether the couple can benefit from pooling of resources.
The case of Cocks v Centrelink (2000) FCA 1248, the Federal Court found that Mr Cocks would not benefit from a pooling of resources whilst he was in Australia and his wife was overseas and that Mr Cocks would likewise not benefit from a pooling of resources while residing with his wife overseas as she has nothing to contribute to the pool. If possible, the decision maker should verify the circumstances stated. The social security system that applies to the country of residence needs to be also taken into account when assessing couples living overseas. For further information refer to Reviews heading below.
Act reference: SSAct section 24 Person may be treated as not being a member of a couple (subsection 4(2)), section 739A(7) …if the person, in the Secretary's opinion, has suffered a substantial change in circumstances…
Policy reference: SS Guide 22.214.171.124 Substantial change in circumstances for SpB
Is there financial difficulty as a result of the couple's circumstances?
Various tribunals and courts described financial difficulty for this purpose as not being able to provide for accommodation and the basic necessities of life or to be without adequate means of support.
In deciding whether or not to apply the discretion in section 24, the overall financial situation should be considered. Income and readily available funds from assets should be compared to necessary expenditure.
Income, and readily available funds, from all sources should be taken into account. This includes, but is not limited to, income from employment, income support payments (including FTB, RA etc), investments, insurance and compensation pay-outs, trusts, accessible superannuation, liquid assets, etc. For information on liquid assets refer to SSAct section 14A. Any in-kind support should be considered. For information on in-kind support refer to 126.96.36.199 Determining the rate of SpB.
Necessary expenditure could include, for example, electricity, gas, telephone, rates, rent, groceries, transport and loan repayments.
Example: Yossarian is in receipt of an income support payment at the partnered rate and his partner, Koko has no financial resources to contribute to the relationship as a result of losing her job, and Koko is not eligible for an income support payment due to being not residentially qualified or being subject to a NARWP. As a consequence the couple are living on a partnered payment that is designed to support half of a couple, with the result that they are in financial difficulty. In these circumstances, and subject to all the usual means and assets tests, section 24 should generally be applied, but should be reviewed regularly to ensure that the income support payment recipient's partner has not recently become eligible for a social security payment.
There may be circumstances in which factors other than income need to be taken into account in considering whether to apply the discretion. For instance, in some cases a couple may be worse off due to special expenses which have to be taken into account in establishing whether to apply the discretion.
Explanation: A couple may both be on a payment at the partnered rate, but their expenses have increased due to factors beyond their control. For instance, the compulsory attendance of one member of the couple in a prolonged child custody hearing in another state, whereby they are forced to temporarily maintain separate accommodation. A decision may be made by the delegate to pay both persons the single rate of payment as the resources they have to pool have been diminished and they are disadvantaged when compared to another couple that are not forced to live separately.
Example: Sara is on NSA and her partner Kate is working part-time while also receiving PPP. Sara has had to live interstate from Kate for an extended period of time in order to attend a trial. This situation has resulted in much higher living costs for both Sara and Kate as they are now required to maintain 2 residences and are not able to obtain the benefit of pooling their resources from their partnership. This situation leaves Sara and Kate at a disadvantage compared to other couples. If section 24 is applied, the case should be manually reviewed every 13 weeks, earlier if warranted, so that when the couple's circumstances change, the need to apply section 24 is re-assessed.
Act reference: SSAct section 24 Person may be treated as not being a member of a couple (subsection 4(2))
Explanation - residential care
The fact that a person has entered residential care would generally not be regarded as a special reason not to treat a person as a member of a couple. Refer to 188.8.131.52 Determining an illness separated couple.
In establishing whether there is financial difficulty resulting from a member of a couple going into residential care, it is necessary to verify the costs incurred for the residential care. This must take into account all financial assistance available from DoH.
Note: The Aged Care Act 1997 has 'financial hardship' provisions for people who have difficulty in paying their residential care payments and relevant ongoing expenses. Financial hardship assistance may be available to residents who do not have the income or assets to utilise to pay their costs of care. Each case is considered on an individual basis, based on a resident's financial circumstances. Financial hardship provisions allow for financial assistance to be provided for fees and accommodation payments on application to DoH. Residents may apply for:
- financial assistance with their basic daily fees and income tested fees, and/or
- financial assistance with an accommodation bond or accommodation charge they are being asked to pay.
Partner in gaol
Where a person has a partner in gaol, this alone is not sufficient to warrant the application of SSAct section 24. This is because the 'partner in gaol' rate of payment is available to people in this situation in recognition that they are less able to pool resources while their partner is in gaol. Section 24, however, may be applied if there is a 'special reason' in that particular case, other than the partner being in gaol, which the decision maker considers to warrant exercising the discretion to treat the person as not being a member of a couple.
Rehabilitation & probation
Claimants/recipients who are attending a rehabilitation program for a set period of time or claimants/recipients who are on probation and have restrictions on where they can reside as part of their parole requirements may be considered for section 24. The decision would still be based on individual's circumstances taking into account lack of pooling resources resulting in financial difficulty which may lead to them being eligible for the single rate of payment under section 24 provision.
Explanation: One partner is in a rehabilitation program for 6 months and typically the costs are 87% of the single rate of payment plus RA. They are maintaining separate accommodation and paying their own expenses. As a consequence they are unable to pool resources which results in financial difficulty.
Example: John has recently been released from prison. In order to fulfil his parole requirements he must live in a hostel for 12 months. His partner Jane is currently receiving NSA. John is required to pay his own accommodation and food charges where he is living at the hostel from his NSA payments. Jane already has her own place and cannot live at the hostel with John. As both John and Jane need to reside in separate accommodation and pay their own living expenses, they cannot reasonably be expected to benefit from the pooling of resources. Section 24 may be applied in this scenario.
Partner not residentially qualified for an income support payment, or is subject to the NARWP
Subject to all the usual means and assets tests, the discretion to apply section 24 should generally be applied in cases where the couple is in financial difficulty and the partner:
- is not residentially qualified for an income support payment (see example 1), OR
- is subject to the NARWP (see example 2).
Example 1: A person may not be residentially qualified because they are living overseas while waiting for their residence application to be considered by the Australian authorities; or they are the holder of a temporary visa; or they are a New Zealand citizen who is the holder of a non-protected SCV.
Example 2: The partner may be living in Australia, but is unable to get an income support payment as they are serving the NARWP.
Explanation: The AAT has indicated that only being ineligible for income support, is very unlikely to constitute a special reason for the purposes of the exercise of section 24, but being in financial difficulty as a result of having a partner who is not residentially qualified for an income support payment or who is subject to the NARWP may constitute a special reason.
Note: The holders of some visa types have access to SpB and may be exempt from the SpB NARWP. Generally, if the holder of a visa has access to SpB the discretion to apply section 24 should not be exercised. This is because the Secretary already has discretion as to the amount of SpB that should be paid in a particular case and the same factors, which would normally be taken into account under section 24, have already been taken into account when determining the SpB rate.
If there are no additional special circumstances, and subject to all the usual means and assets tests, section 24 should generally be applied in NARWP and not residentially qualified cases where the couple are experiencing financial difficulty. Any additional circumstances also need to be taken into account, and the section 24 decision should be reviewed regularly to ensure that the income support payment recipient's partner has not recently become eligible for a social security payment, e.g. as a result of a 'substantial change in circumstances beyond their control'.
Examples of NARWP/not residentially qualified
Example 1: John met and married Maria while on a 12-month holiday in Italy. John is an Australian resident, while Maria is an Italian resident. John and Maria have decided that they wish to settle in Australia. John returns to live in Australia, but Maria must remain behind in Italy pending consideration of her application for Australian residency. John applies for NSA, but Maria can contribute nothing to the relationship financially as she works on her parents' small farm and is not paid. The couple has no other financial resources and are in financial difficulty. It may be appropriate in this case to apply the discretion in subsection 24(1) to treat John as not being a member of a couple, and grant NSA at the single (rather than partnered) rate. The case is manually reviewed every 13 weeks, so that when the couple's circumstances change (e.g. when Maria joins John in Australia), the necessity to continue to apply section 24 is re-assessed.
Explanation: Where a couple has married overseas prior to the granting of residential status to the non-Australian partner, and it is considered that the situation has not been contrived to obtain social security (or other) entitlements, it may be accepted that the current situation is not an intended consequence of the partner's actions.
Example 2: Amanda is an Australian resident, who has formed a relationship with Vesna, an independent migrant who arrived in Australia 8 months ago. Amanda is unemployed and receiving NSA. Vesna is not qualified for NSA, because she is serving a NARWP. Vesna has not yet managed to find work and is unable to contribute financially to the relationship. As the couple are in financial difficulty it may be appropriate to apply section 24 to pay Amanda's NSA at the single rate, until Vesna finds work or until NSA becomes payable to her. If section 24 is applied, the case should be manually reviewed every 13 weeks, earlier if warranted, so that when the couple's circumstances change, the need to apply section 24 is re-assessed.
Partner serving NARWP & subject to an AoS
Generally, SSAct section 24 should NOT be applied to a claimant/recipient if their partner (the assuree) is serving a NARWP and has an AoS in place, and the assuree has a valid and legal means of obtaining support from the assurer and/or access to a social security benefit that has not been exercised.
Where an AoS is in place and the assurer is a third party, and the assuree does not receive regular income or in-kind support from the assurer, then the assuree should be encouraged to draw on the AoS or apply for SpB if they are eligible. If the assuree is eligible for and makes a claim for SpB, the assuree must prove that they have made every effort to get adequate support from the assurer prior to making the claim. Any assistance received by the assuree is taken into account as income for SpB.
If there has been a substantial change of circumstances for the assurer (e.g. illness, job loss etc.) and the assurer is unable or unwilling to fulfil the obligations under the AoS, the decision maker should closely examine the assurer's financial circumstances to find out why they cannot provide support to the assuree. If the assurer is still able to provide some assistance, this amount is taken into account as income if the assuree is eligible for and claims SpB. The amount of SpB paid is a debt to the assurer.
Note: SpB claimants/recipients are generally subject to a long term available funds test if they are likely to be on payment for more than 13 weeks. The long-term available funds test precludes payment to the claimant/recipient if the couple have more than $5,000 in available funds. If a non-residentially qualified partner fails the long-term available funds test when claiming SpB, the discretion to apply section 24 to the person would not normally be exercised.
If the assuree is to serve a NARWP for all payments, including SpB, any assistance provided by the assurer is taken into account when applying looking at financial difficulty.
Example: Peter migrated to Australia from Germany as a permanent resident 3 years ago. His fiancé, Ingrid, made an application for Australian residency. Peter was unable to provide an AoS in respect of Ingrid as his income was below the income threshold required and he was now receiving NSA. His brother Michael agreed to provide the AoS. Once Ingrid's application for residency was approved Peter returned to Germany to marry and they both arrived in Australia a week later. Peter's rate of NSA was reduced to the partnered rate, and he contacted Centrelink to advise that he was in financial difficulty as his brother was only able to offer nominal support of $100 per month. Ingrid had been granted an 820 Spouse (provisional) visa and is eligible for SpB because she arrived in Australia prior to 1 January 2012 when the legislation changed to restrict access to SpB for temporary spouse/partner/interdependency visa holders. Peter did not want Ingrid to apply for SpB as that would create a debt for his brother. The discretion to apply section 24 could NOT be exercised in this example as Ingrid had not tested her eligibility for SpB.
Policy reference: SS Guide 184.108.40.206 Substantial change in circumstances for SpB, 220.127.116.11 SpB for people not residentially qualified for other payments, 9.2 Visa sbclasses & payment eligibility for visas issued after 1/9/94
Limited access to a partner's income or assets
A person may have limited access to their partner's income. If the income of a person is not available for the use or benefit of their partner, they may be eligible for the application of section 24.
Example 1: The person is mentally infirm and a guardian has been appointed to manage their affairs. The guardian may be required by law to use the person's money only in specified ways.
Example 2: The partner's money is in trust, or court restrictions have been placed on the use of the money, such that it can only be used for prescribed purposes.
There may be other situations where the affairs of a couple have been arranged so that the access by one partner to the other's income is limited. When assessing these cases, great care should be taken to ensure that the situation has NOT been contrived for the purpose of qualifying for the single rate under section 24. Also, particular attention should be given to whether one partner is taking, or could reasonably be expected to be taking, steps to gain greater access to the other partner's income.
Example: By seeking a court order.
Explanation: A Centrelink social worker can refer the partner to external agencies or organisations, e.g. legal services.
The situation should also be investigated in terms of whether the couple could be considered to be living separately and apart on a permanent or indefinite basis.
Explanation: If a person is living separately and apart on a permanent or indefinite basis they DO NOT meet the definition of a member of a couple and should be determined as single, without recourse to section 24.
It is NOT usually appropriate to exercise the discretion provided by section 24 to treat 2 people as NOT being members of a couple, if the couple choose not to:
- live together as a married couple, OR
- consummate the marriage until a social ceremony is celebrated.
Explanation: In some cultures a marriage may be celebrated in 2 parts. The registered marriage constitutes the legal marriage. If a couple decides for socio-cultural reasons to stay separated after the legal marriage, then a second ceremony, which is purely 'social' in nature, may be celebrated. Generally, such social ceremonies have no legal status and for the purposes of the SSAct, the couple is regarded as married from the date of the legal marriage.
The Australian social security system does NOT recognise the existence of multiple relationships, regardless of whether they were formed within Australia or overseas. Where a person declares they are part of a multiple relationship their circumstances should be considered under section 24 of the SSAct.
Where a recipient has more than one partner, the recipient will be considered to be in a relationship with the person they are either legally married to, or in a registered relationship with. Where the recipient is not married or in a registered relationship, the relationship that commenced earliest will be recognised for social security purposes.
Failure to advise of becoming a member of a couple
In general, where a person receiving the single rate of payment fails to notify Centrelink that they married or entered a registered relationship or a de facto relationship, and their circumstances may have warranted exercise of the discretion of section 24 at the time if the person had notified correctly, it would be appropriate to consider section 24 in working out whether a debt exists.
Partner goes overseas
It may be appropriate to treat a person in Australia (1.1.A.320) as NOT a member of a couple while the person's partner is overseas.
All relevant factors should be listed and weighed. Without being exhaustive, the following factors may be relevant:
- Are there any legal restrictions on the transfer of funds from overseas?
- Explanation: Some countries have monetary controls that prevent the transfer to Australia of some or all of a person's funds.
- Does the overseas partner have sufficient excess funds to send to Australia?
- Explanation: Any funds of the overseas partner above a reasonable level should be considered available to pool. In assessing what constitutes a reasonable level, the decision maker should use the basic level of income support offered in the country. In all cases, the income of the overseas partner should be examined in detail.
- Do either of the parties have the power to alter the situation and, if so, are they taking reasonable steps to do so?
- Has the situation arisen beyond the control of either partner or as an unintended consequence of the partner's actions? (See example below.)
If a partner is temporarily detained overseas due to an illness, it is reasonable to expect arrangements to be made to bring that person to Australia as soon as possible after the illness is over.
Example: The overseas partner is suffering from a medical condition that temporarily detains them overseas. The person would be reviewed every 13 weeks, earlier if the timing of their recovery were short.
If either partner has knowingly contributed to the situation, there would be considerably less justification for exercising the discretion. This may be the case if one partner goes overseas and leaves the partner in Australia with insufficient funds, despite having the means to support their partner.
It is important to ensure that cases where the discretion under section 24 is applied are kept under close review especially if there is a high risk of incorrect payments. A manual review is to be conducted every 13 weeks, earlier if warranted. However, if there is a very low risk of incorrect payment a review may only need to be conducted annually. The purpose of the review is to identify whether it is appropriate to continue to apply section 24, or whether the person's circumstances have changed so that it is no longer appropriate to apply the discretion.
The review should include evaluating the circumstances at the time of the original decision to apply section 24 with the current circumstances:
- Have the circumstances changed?
- Are the circumstances still beyond the control of the recipient?
- Have reasonable steps been taken to change the circumstances within the recipients control?
The review should consider whether reasonable steps have been taken to access funds from assets and/or income previously not readily accessible.
Whenever a claimant/recipient leaves Australia to visit their partner overseas, a review should be conducted to determine if section 24 can still be applied whilst they are away.
Common scenarios - section 24 cases
The following scenarios are based on some common section 24 cases.
Example 1: Erica, an Australian resident, is married to Hans who is currently working overseas. Erica has part-time work but this is not sufficient for her to rely on, and no PPP is payable due to Hans' gross wages. Hans visits Erica and their children every 6 months and during the most recent visit left Erica $5,000 to help buy food, clothes, and pay general expenses. This arrangement means Erica and Hans can benefit from the pooling of their resources and section 24 is therefore NOT appropriate in this scenario.
Example 2: James is currently receiving PPS as he is being treated as single under section 24 due to his partner Carly being overseas. Carly is not residentially qualified for any income support payments in Australia and is living in an Organisation for Economic Co-operation and Development (OECD) country and in receipt of income support. There are restrictions on the transfer of Carly's income out of the country. James has gone overseas temporarily to visit Carly and assist her in the necessary preparations for her emigration to Australia. James can no longer be paid PPS under section 24 as he is living together overseas with Carly, and they can benefit from pooling their resources which was previously not possible.
Example 3: Brianna and Dianna have had to move from Queensland to Victoria for family reasons, and Brianna is now looking for work. Dianna is not able to work as she is only in Australia on a temporary non-working visa. As Dianna is not residentially qualified to claim an income support payment, only Brianna has some support in the form of PP. Brianna and Dianna are in financial difficulty and so they have a special reason for the discretion under section 24 to be applied, therefore treating Brianna as single and paying her PPS.
Act reference: SSAct section 24 Person may be treated as not being a member of a couple (subsection 4(2)), section 4(2) Member of a couple-general, section 4(6) Member of a couple-special excluding determination