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Overseas War Widow's/Widower's Pensions
Last amended: 9 December 2008
War widow/widower definition
Under the VEA, the definition of war widow/widower includes a person who is receiving a pension payable under the law of a foreign country, that is similar in character to an Australian war widow's/widower's pension.
War widow/er test of “similar in character”
The essential test for a finding that an overseas payment is similar in character to an Australian war widow/er's pension is that the payment represents a compensation payment for the loss of the person's partner due to war-caused or war-related injury or disease arising out of the partner's war service.
It is possible that overseas compensation payments in respect of war-caused loss will also share other features associated with Australian war widow/er's pension, such as being non-means tested and tax exempt. However, it is not essential that the overseas payments also share these features, in order to be regarded as a payment that is similar in character to Australian war widow/er's pension. Provided that the payments are compensatory in nature, rather than income support, the test of being similar in character has been met.
Assessment under the income test
Payments for war-caused incapacity or death made to dependants, such as widow or surviving spouse benefits, are regarded as satisfying the test of being in respect of incapacity or death resulting from employment in connection with war or warlike operations in which the Crown has been engaged, and so are excluded from the income test.
Assessment under the adjusted income test
Overseas payments similar in character to war widow/er's pension, while excluded from the definition of income, still fall within the meaning of adjusted income in the same manner as a VEA disability pension. These payments will be included within the person's assessable adjusted income for income support supplement purposes.
As an overseas war widow/er is ineligible to receive income support supplement, it is necessary for the person to also meet the definition of Australian war widow/er, and to receive income support supplement on this basis, for the assessment of the overseas payment as adjusted income to arise.
Overseas war widow/er payments and partner service pension
Where the overseas payment is determined to be a payment similar in character to Australian war widow/er's pension, the recipient is not eligible to receive partner service pension.
Where the overseas payment is not assessed as being similar in character to a war widow/er's pension (i.e. it does not arise from the war-caused death or incapacity of the veteran), ineligibility for partner service pension does not arise. This assessment of the overseas payment, that it is not war-related, will result in the payment being included within the income test.
Reduction of war widow/er's pension
A person assessed as receiving an overseas payment similar in character to Australian war widow/er's pension is not prevented from receiving Australian war widow/er's pension. However, the war widow/er's pension paid by DVA is reduced on a dollar for dollar basis by the overseas payment. These cases are known as “composite assessment” war widow/ers.
Care should be taken to ensure that overseas payments that are directly offset against war widow/er's pension are not counted for a second time when determining the pensioner's adjusted income for income support supplement purposes.
Where the Australian war widow/er's pension is totally offset against the overseas payment on a dollar for dollar basis, income support supplement is not payable. The definition of war widow/er on which the ISS eligibility rules are based require that the person be receiving pension payable under the VEA at a rate determined under subsection 30(1).
Overseas war widow/er's payments and comparable foreign pensions
Overseas payments similar in character to Australian war widow/er's pension do not satisfy the meaning of comparable foreign pension (CFP) under the VEA. The VEA provides that CFPs are those that are similar to Australian service pension, income support supplement or social security pension. This test is not satisfied where the overseas payment is made to compensate for loss related to war-caused death or incapacity rather than being an income support safety net payment.
This distinction means that the VEA requirement that a person take reasonable action to obtain a CFP does not arise in respect of a payment that is similar in character to an Australian war widow/er's pension.
Hong Kong war widow's pensions
Hong Kong war widow's pensions should be carefully examined to determine that they are war-caused compensation payments. Cases have been seen where the payments are not based on the veteran's death being war related. In this circumstance they are therefore not similar in character to a war widow's pension paid under the VEA. Partner service pension eligibility therefore remains, but is likely to be payable at a reduced rate as the Hong Kong war widow's pension will be assessable income under the income test.
New Zealand surviving spouse pensions
New Zealand surviving spouse pensions are similar in character to a war widow's/widower's pension paid under the VEA. This is because eligibility depends on the veteran's death being caused by a severe disability or medical condition acquired as a result of their service. A person receiving this pension therefore loses their eligibility for a partner service pension.
Canadian surviving spouse pensions
Surviving spouse pensions paid by Veterans' Affairs Canada are similar in character to a war widow's/widower's pension paid under the VEA. A person receiving this pension therefore loses their eligibility for a partner service pension.