Student beats $21,000 slug

Welfare Rights Centre helps with Centrelink 'debt'.

Maree O'Halloran
Welfare Rights Centre

Katie left school in 1979. Since then she has had a series of casual or temporary jobs in the hospitality industry. Over the past few years, mental health issues have made it difficult for her to secure regular work.

Not one to sit idle, Katie enrolled in a vocational course at TAFE to improve her prospects of getting back into work.

When she enrolled in 2011, TAFE told her she was classified as a full time student and, based on this advice, she applied for Austudy from Centrelink. The Austudy allowance for a single person is about $200 per week and, after TAFE reconfirmed her fulltime status in 2012, Katie again applied to receive the payment.

However, last Christmas, she was shocked to receive a letter from Centrelink telling her she had run up a debt of $21,000. Centrelink told her that, under its rules, she was not full time and had not been entitled to receive Austudy payments.

Katie exercised her legal right to an appeal thinking the decision would be overturned after she explained her situation to a Centrelink Authorised Review Officer (ARO). However, after contacting TAFE, the ARO ruled her debt would stand.

Katie lodged an appeal with the Social Security Appeals Tribunal (SSAT) and contacted the Welfare Rights Centre for assistance.

It was clear to centre officers, Katie had a strong case. She had tried to do the right thing and prepare herself for paid employment and she was in possession of letters from TAFE that stated she had been a full time student during the period in question.

However, even though TAFE considered her to have been in full time study, social security rules were different and it was necessary to satisfy those rules in order to qualify for Austudy. Based on the number of units she was enrolled in, it appeared Katie had been a full time student, under Austudy requirements, for only part of her debt period.

The Welfare Rights Centre represented Katie at the Appeals Tribunal. The Tribunal agreed that Katie had been a full time student for about 40 per cent of the preceding two year period but this still left her owing Centrelink $13,000.

Eventually, the Tribunal accepted the Rights Centre submission that financial difficulties, health issues and TAFE’s advice on her status amounted to special circumstances and waived the entire debt.

This decision gave Katie the peace of mind she needed to continue her studies and her search for work.