Centrelink’s decision to cancel the age pension of an 80-year-old man who lives in a nursing home with advanced dementia was “absurd and wrong”, a tribunal has found.
The tribunal heard David Fry was living in an aged care home and his son, John, was appointed his legal guardian, after David was discovered driving on the wrong side of the road and judged to be “mentally incapacitated”.
John Fry became responsible for managing his father’s dealings with Centrelink, which had been paying David the age pension since 2006.
In May 2018, the agency suspended David Fry’s age pension because John failed to provide updated financial details for one of his father’s superannuation accounts.
John, who the tribunal heard was having difficulty obtaining the information and was unfamiliar with Centrelink processes and his father’s finances, called the agency and the payment was reinstated.
However, his father’s pension was suspended again in September for the same reason, before the agency cancelled it altogether in December 2018.
The last letter Centrelink sent before the payment was cancelled, on 20 October, was sent to David Fry, rather than his son.
The tribunal said that letter had no legal effect because the agency knew Fry “did not have the mental capacity to be aware of, let alone respond to, the requests”.
In December 2018, Centrelink wrote to both men advising that David’s pension had been cancelled because “we did not receive a reply to the income stream review letter we sent you”.
In ruling against Centrelink, the tribunal member Roger Maguire said it was “difficult to contemplate a person who might be more vulnerable than a hospitalised septuagenarian suffering from dementia”.
While acknowledging Fry’s son hadn’t complied with the notices in a timely fashion, Maguire said that was in part because he had “no knowledge of his father’s financial affairs and had become guardian of his father’s affairs against his father’s will”.
“His father was not forthcoming with information, and this placed him in a situation of particular difficulty,” he said.
Under social security law, Centrelink may suspend or cancel a payment when a person fails to comply with a certain notice.
However, the tribunal noted the agency also has powers to obtain information from a person’s financial institution.
It did not do so, instead opting to cancel Fry’s age pension.
Centrelink argued the decision to cancel Fry’s payment was “rational and proportionate”, but Maguire found it was “absurd and wrong”.
The financial information sought by Centrelink eventually confirmed that Fry remained eligible for the pension, the tribunal said.
Centrelink also argued Fry should not get backpay for the period he was without the pension – between December 2018 and approximately January 2020 – because the cancellation was not appealed within 13 weeks.
The tribunal ruled against Centrelink, finding there was evidence John had called the agency three times in October.
While staff had not recorded the reason for the call, Maguire said it was “fairly obviously he wasn’t phoning up to try and organise a golf game”.
The case is the latest example of problems with Centrelink’s age pension income stream reviews process, which the independent MP, Andrew Wilkie, recently likened to the robodebt scandal.
In that, Centrelink was similarly criticised for accusing people of underreporting work income based on incomplete information, rather than obtaining evidence directly from a person’s employer.
In one recent case handled by Wilkie’s his office, Centrelink warned an 84-year-old woman she might lose her pension if she did not provide 18 years of financial information.
In another case, a man who was reportedly in hospital the week before Christmas when he received a Centrelink letter telling him his pension may be stopped if he did not provide information from a super fund by 6 January.
Wilkie said Centrelink was “out of control”.
“That Centrelink thinks it’s OK to just go and take the pension of an elderly man in the advanced stages of dementia is either cruel and mindless or symptomatic of an agency that is still beholden to useless automated systems despite the robodebt debacle,” he said.
“Maybe taxpayers should suddenly and arbitrarily stop paying the minister responsible for Centrelink from time to time because that looks like the only way to jolt some sense into the government.”
Labor’s government services spokesperson, Bill Shorten, said it was “more breathtaking cruelty and heartlessness from the government that gave us robodebt”.
Services Australia’s spokesman, Hank Jongen, said the agency conducted income stream reviews each financial year in August to “ensure we assess a customer’s income support payments and concession cards correctly”.
“This decision relates to a payment cancellation in 2018,” he said. “From 1 January 2019, we introduced a new process for our Income Stream Reviews to make it easier for customers. This made it mandatory for all providers of income streams to supply information to us, rather than asking customers to supply it, to complete reviews. Our staff then review if a discrepancy is identified.”
He said when a person was nominated as a Centrelink nominee it was “expected that they will act in the best interests of the customer in all their dealings with us”.
“We encourage anyone who is struggling to fulfil their commitments as a nominee to contact us so we can provide guidance on the best options,” he said.
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