//
you're reading...
Australian Law and Politics

Centrelink are still using income averaging


Income averaging was found to be illegal by the Federal Court in the Robodebt Test Case of Amato vs Commonwealth (2019), yet Centrelink still use this methodology when calculating income for certain windfalls.

These windfalls include lottery wins, inheritances, gifts, bequests, insurance payments, bursaries, scholarships and anything else Centrelink decide is income, if they are paid in two or more payments.

Normally, if paid as one lump sum, they are considered as exempt amounts, and not assessed as income. This is set out in s 8(11) of the Social Security Act (1991).

However, if they are paid in two or more payments, they are considered as assessable income under s 8(11A) of the Act, even if the payments are irregular in time and amount.

This is where Centrelink use income averaging.

In Module A of s 1064 of the Act, the method for working out assessable income and reduction of benefits is set out. This section applies to aged pensions, disability pensions and carers allowance, but there are similar sections in other parts of the Act for other benefits.

According to Centrelink rules, if a windfall payment is made in January, and another payment made in July, then the two amounts are added together and averaged out to calculate a fortnightly payment that is applied to every fortnight in that six month period.

Consider the case where an insurance company pays an advance on an insurance payment for funeral costs, then pays the balance at a later date. Or where a deceased has bequeathed an inheritance to be paid in instalments instead of as a lump sum. Centrelink apply the same rules.

This is clearly income averaging, which was found to be illegal in the Amato case. Further, the Amato case said that income amounts can only be applied in the fortnight in which they are actually paid.

This was the case I put to the Administrative Appeals Tribunal (AAT) yesterday, and surprisingly, they were unaware of the Amato case.

There is clearly a conflict between the Federal Court’s ruling and the legislation that exists. Not being a legally trained person, I am unsure how this will be resolved.

What is clear is that the minister needs to get advice from the Solicitor-General about whether these sections of the Act are illegal or not. To date, the minister has refused requests to refer the matter to the Solicitor-General, preferring instead to let it play out through two AAT hearings and be returned to the Federal Court for decision.

This legislation potentially affects tens of thousands of people who receive lottery wins, inheritances, bequests and insurance payments paid in two or more amounts, and that is why I took the matter up.

True, I will benefit from it, but so too will tens of thousands of other people. The AAT should make their decision within 14 days, and I will keep you informed of what happens.

One-Time
Monthly
Yearly

The costs of campaigning for changes to government legislation are considerable. If you appreciate this work, please consider donating so we can continue operating in this area.

The money raised will be spent on campaigning to state and federal MP s, as well as newspapers and other media across Australia, to improve social justice for all.

Please bear in mind that while I am a business consultant, I only work part time due to also being a disabled pensioner. I intend to take these matters to court, but that takes time and money.

Any money raised through donations will be kept in a separate bank account to cover these costs.

I would also welcome any help from legal professionals, or professionally qualified volunteers who are willing to assist.

The costs of campaigning for changes to government legislation are considerable. If you appreciate this work, please consider donating so we can continue operating in this area.

The money raised will be spent on campaigning to state and federal MP s, as well as newspapers and other media across Australia, to improve social justice for all.

Please bear in mind that while I am a business consultant, I only work part time due to also being a disabled pensioner. I intend to take these matters to court, but that takes time and money.

Any money raised through donations will be kept in a separate bank account to cover these costs.

I would also welcome any help from legal professionals, or professionally qualified volunteers who are willing to assist.

The costs of campaigning for changes to government legislation are considerable. If you appreciate this work, please consider donating so we can continue operating in this area.

The money raised will be spent on campaigning to state and federal MP s, as well as newspapers and other media across Australia, to improve social justice for all.

Please bear in mind that while I am a business consultant, I only work part time due to also being a disabled pensioner. I intend to take these matters to court, but that takes time and money.

Any money raised through donations will be kept in a separate bank account to cover these costs.

I would also welcome any help from legal professionals, or professionally qualified volunteers who are willing to assist.

Choose an amount

A$2.00
A$5.00
A$10.00
A$5.00
A$10.00
A$20.00
A$20.00
A$50.00
A$100.00

Or enter a custom amount

A$

Your contribution is appreciated.

Your contribution is appreciated.

Your contribution is appreciated.

DonateDonate monthlyDonate yearly

About Craig Hill

Social Justice Campaigner. Business and Education Consultant. Former Business/ESL Teacher. Lived in China and USA. Dealing with disability. My articles have been cited in New York Times, BBC, Fox News, Aljazeera, Philippines Star, South China Morning Post, National Interest, news.com.au, Wikipedia and many other international publications.

Discussion

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

If you liked what you just read, click "Subscribe" to become a follower of the Craig Hill site. You will receive an email each time a new post is published.

Join 1,786 other subscribers

Follow me on Twitter

%d bloggers like this: