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One Parent Family Payment Case 12

Question At Issue:

Decision to revise the appellant’s entitlement to payment from a date in 1998 and to terminate payment with effect from a date in 1999, on grounds that she had weekly earnings in excess of the statutory limit. As a consequence, an overpayment of some €28,000 was assessed.

Background:

The appellant had been in receipt of a Lone Parent’s Allowance (subsequently One Parent Family Payment) since1992. She commenced employment in 1996. In 2004, her entitlement was reviewed with reference to earnings data held by the Department of Social and Family Affairs. On this basis, it was determined that she was entitled to a lower rate of payment for a period between 1998 and 1999, and that she had no entitlement with effect from a date in 1999. As a consequence, an overpayment of some €28,000 was assessed.

Oral Hearing:

The appellant attended, accompanied by a relative, and the Deciding Officer attended at the request of the Appeals Officer.

The Deciding Officer submitted that the appellant had had no entitlement with effect from the date specified as her earnings had exceeded the limit of £12,000 per annum. She contended that there was an onus on the appellant to notify any increase in means and stated that a notice to that effect had been issued in 1997, with similar advice being printed on all the payable order books. She argued that the appellant’s employment had changed in 1999, with significantly higher earnings, and that this event should have prompted her to contact the Department. The Deciding Officer made the point that fraud was not alleged but that the overpayment was a consequence of non-entitlement and that the Department was obliged to seek to recovery.

It was argued by the appellant’s relative, on her behalf, that the overpayment had arisen because of a failure by the Department to co-relate income records with payment records. He noted that this had been done in arriving at the decision to assess the overpayment and argued that it should have been done much sooner when various exchanges between the appellant and the Department should have alerted them to the situation. He argued that the appellant did not fully understand the process at hand and that it was unreasonable, therefore, to have expected her to comply with the changing regulations. He contended that the appellant had a legitimate expectation that the Department would have continued to monitor and regulate her entitlement, as had been the case at the outset.

The appellant stated that she had notified the Department and the local Health Centre when she had started work in 1996. She reported that her payment had then been reduced and that she lost her rent supplement and medical card subsequently, having moved to a better-paid job in 1999. She stated that she had been in contact with the Department in 2001 when she had applied for local authority housing under the shared ownership scheme. The Deciding Officer accepted that the appellant did correspond with the Department in 2001 but did not accept that this fulfilled her obligation to notify increased earnings. She acknowledged that the earnings limit was not listed in any correspondence but contended that the appellant should have advised the Department as to the substantial increase in her earnings as she was in receipt of a means-tested payment. In response, the appellant argued that she had understood that the Department was monitoring her earnings as she was paying Pay-Related Social Insurance (PRSI).

It was argued on the appellant’s behalf that compliance with the regulations should have been easier for the appellant and that safeguards should have been put in place to prevent such a large overpayment arising. The Deciding Officer did not accept this argument, pointing to what she described as a ‘contract’ that the appellant had entered into when she applied originally for payment as a lone parent, arguing that the appellant had undertaken to notify the Department of any change in her means.

In conclusion, it was submitted on behalf of the appellant that the onus rested with the various sections of the Department to exchange relevant information. The appellant stated that she believed she had made a full disclosure of her means and that, in any case, she could not repay the amount assessed as an overpayment.

Consideration of the Appeals Officer:

The Appeals Officer considered that the appellant had a responsibility to declare an increase in her earnings and he noted, in particular, the change in employment that resulted in a significant increase in earnings. He referred to the objective of the earnings limit as being one intended to ease the means test and so to serve as an incentive for lone parents to re-enter the workforce. He noted that the correspondence issued to the appellant in February 1997 failed to mention the introduction of the earnings limit and he regarded this as a significant omission. He considered it unreasonable to attempt to hold the appellant to the terms of a ‘contract’ when the terms of any such contract had been changed without her knowledge.

The Appeals Officer concluded that the failure in this case to comply with the statutory provisions could be considered only with reference to the means test set out in the Third Schedule of the Social Welfare (Consolidation) Act, 1993. He referred to the recent Supreme Court Judgment in the matter of the Health (Amendment) (No.2) Bill, 2004 in relation to nursing home charges, in which the Court warned against applying retrospective provisions. He considered that this prevented him from considering the case under Section 158 (3), as the Deciding Officer had, on the basis that the appellant had not been alerted to the introduction of an earnings limit under that section.

He considered that account must be taken of the implications of such a substantial overpayment for the appellant, who was of relatively modest means, and that the doctrine of proportionality must apply. He was satisfied that it was a fair assumption by the appellant that the Department would continue to monitor her entitlement as it had done initially. He considered it an equally reasonable expectation that the Department would have advised the appellant of the earnings limit put in place. He referred again to the Judgment on nursing home charges and noted the following statement. ‘The property of persons of modest means must necessarily, in accordance of those principles [of social justice, guaranteed under the Constitution], be deserving of particular attention, since any abridgement of the rights of such persons will normally be proportionately more severe in its effects’ – Murray C.J. [2005] IESC 7. The Appeals Officer did not consider it safe to apply the provisions of Section 158 (3) (the earnings limit) as he was satisfied that the appellant was unaware of the legislation and that the Department had failed to advise her as to the statutory conditions governing entitlement.

The Appeals Officer considered that the appellant was not without obligation to notify the Department of the substantial increase in her earnings in 1999 but accepted, as submitted, that the Department had a duty to act and to review entitlement when it became aware of the increase in her means. He took the view that the Department was aware in February 2001 when the appellant made contact and sought a statement of the payment being made to her. He noted that the Department was made aware again of her earnings in 2002 when she applied for Disability Benefit, a payment regulated by receipt of a One Parent Family Payment. He concluded that the appellant had failed in her obligation to notify the Department of an increase in her means for a period between April 1998 and February 2001. He was satisfied the he could consider the assessment of an overpayment for that period only, and with reference to the social welfare provisions governing means. He noted that the effect of this determination would be to reduce significantly the amount of the overpayment, to a level that he considered was sustainable, applying principles of fair procedure and natural justice.

Outcome:

Appeal partially allowed.

End of Document