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4.1.6 Special Rate (T&PI or TTI) Eligibility
Last amended: 17 August 2017
What is a Special Rate (T&PI or TTI) disability pension?
The Special Rate of disability pension is the highest level of disability pension available to an injured veteran, member of the Forces, member of a Peacekeeping Force or Australian mariner under the Veterans' Entitlements Act 1986 (VEA).
The Special Rate of disabiity pension is designed to compensate for a person's inability to engage in remunerative work, where that person's inability to work is solely as a result of their VEA accepted conditions. For this reason, in evevry potential Special Rate case, delegates must check to make sure that a client is not recieving compensation for their inability to work through some other channel (for example, through incapacity payments undetr the SRAC or MRCA).
The Special Rate pension is not income or asset tested, nor is it taxable income.
The Special Rate of disability pension is colloquially known as the Totally and Permanently Incapacitated pension (T&PI or TPI).
Where the Special Rate is provided for a limited period of time in respect of a temporary incapacity, this is also known as the Temporarily Totally Incapacitated pension (TTI). The duration of payment of TTI is determined by medical evidence and is subject to review before the end of the determined period. A TTI pension would not normally be payable for more than six months.
What is the purpose of the Special Rate (T&PI or TTI)?
The purpose of the Special Rate of pension is to compensate severely disabled or injured veterans who are unable to ever go back to work, support themselves or their families, or provide for their old age through paid work.
Sections 24, 24A, 25 and 28 of the VEA directly relate to the Special Rate of pension and outline the eligibility criteria that the veteran must meet in order to qualify for Special Rate.
Eligibility for Special Rate of disability pension (T&PI)
The Department has issued a Commission Guideline CM5011 that explains Special Rate eligibility in more detail.
NB: Veterans who are blinded in both eyes as a result of war-caused injury or war-caused disease are automatically deemed to satisfy the criteria in section 24 of the VEA. If they meet the blinded criteria, they are entitled to a pension at the Special Rate.
If a veteran is aged under 65 at the time of lodging a claim, there are three primary tests that must be satisfied before a determination granting Special Rate can be made. The tests must be met discretely, yet concurrently, during the assessment period for the veteran to be eligible. These are:
- 70% Test – under this test in p24(1)(a), a veteran must be in receipt of or eligible to receive a disability pension of at least 70% of the General Rate.
If he or she has suffered from or is suffering from pulmonary tuberculosis, then the 70% test is taken to be satisfied. This provides an entry incapacity threshold for a veteran to be considered for the Special Rate.
- T&PI Test – under this test in p24(1)(b), a veterans' war caused incapacity – alone and of itself – must be responsible for the veteran being unable to work for more than eight hours per week in work other than their substantive remunerative work they have been prevented from continuing (see next test). The veterans' capacity for work is determined by reference to s28. This test is designed to establish the capacity of the veteran to work exclusive of other factors (such as labour market conditions). The veteran is not required to cease all employment, they can continue in work of another type, as long as the eight hour capacity test is satisfied.
- Work Loss Test – under this test in p24(1)(c), a veteran must satisfy three criteria:
- The Alone Test – “by reason of incapacity from that war caused injury or war caused disease or both, alone”; the following two situations eventuate:
- The Prevented Test – that the veteran is “prevented from continuing to undertake remunerative work that the veteran was undertaking”; and
- The Economic Loss Test – that has led to a “loss of salary or wages, or of earnings on his or her own account”.
The Alone and Prevented Test
The central aspect of the Work Loss Test is whether, by the effect of their accepted conditions, alone, the veteran has been prevented from continuing to undertake their substantive remunerative work that they were undertaking.
The most important aspects of the requirements of this provision are that:
- the veteran must have been prevented from continuing in a type of employment that they otherwise would have been undertaking during the assessment period; and
- they had to discontinue it due to the impact of their accepted conditions alone.
The 'alone test' and SRCA/MRCA conditions
This second limb, that the person is prevented from continuing work due to their accepted conditions alone, requires special attention where the client has eligibility under more than one Act. In all cases checks should be made to ensure that the client does not have conditions accepted under the MRCA or SRCA that are not accepted under the VEA.
Where a client is being paid incapacity payments under the MRCA or SRCA for conditions that are not accepted or seen as incapacitating under the VEA, a decision should never be made to grant a disability pension at the Special Rate without first consulting with the Benefits and Payments Policy Team.
Clients with eligibility across multiple acts are not, prima facie, excluded from the Special Rate of disability pension, however, those with cross-act eligibility whose MRCA/SRCA conditions contribute to their incapacity will fail the s24(1)(c) 'alone' test. However, as explained below, a client who fails the s24(1)(c) test, will, invariably, be entitled to some amount of incapacity payment under the MRCA/SRCA.
While it is true that a person who has conditions under both the MRCA/SRCA and VEA that contribute to their incapacity will not be able to obtain the Special rate of disability pension under the VEA, they will be eligible for a VEA disability pension at the general rate, as well as incapacity payments and permanent impairment payments under the MRCA/SRCA.
A client does not need to be incapacitated solely by their MRCA/SRCA conditions in order for incapacity payments to be made. All that is required is that the MRCA/SRCA conditions have made a contribution to their incapacity. There is no set “minimum level” that MRCA conditions need to meet; a delegate needs to decide whether the MRCA/SRCA condition has made a contribution.
Note that this is the same test in reverse as applied to the Special rate of disability pension under the VEA. If an incapacitated client’s MRCA/SRCA conditions do not make a contribution to their incapacity, they must be solely incapacitated due to their VEA conditions, and the Special rate will therefore be payable.
In this way, an incapacitated person will either be eligible for the Special rate of disability pension (where they are incapacitated from working due to their VEA accepted conditions alone), or eligible for incapacity payments under the modern MRCA/SRCA legislation (where their incapacity is as a result of a combination of MRCA/SRCA and VEA conditions, or MRCA/SRCA conditions alone). All incapacitated clients will be eligible for one of these two benefits.
Issues may arise if there is conflicting medical evidence, produced at different times and not considered holistically. These cases can be remedied via a whole-of-client, cross Act review and input from our contracted medical advisors.
It is important to note that in the Work Loss Test, the definition of 'work' differs from that used in the T&PI Test.
The work that is referred to in the T&PI Test means the work that the veteran might be able to do, taking into account their skills and the impact of their incapacity. This work must be different to the substantive remunerative work they were prevented from continuing for the purposes of the Work Loss Test.
The substantive remunerative work, that the veteran was undertaking, as referred to in the Work Loss Test, does not necessarily refer to the veteran's last employment or any specific job that they may have undertaken at any point in their work history. The veteran's entire work history and range of work undertaken will need to be assessed. This consideration will allow for a classification of the type of work that the veteran was undertaking, but have been prevented from continuing by the effects of their conditions.
There are a number of considerations that have to be taken into account when assessing a veteran's remunerative work for the purposes of the Work Loss Test:
- The veteran's entire work history must be analysed.
- The type or types of work undertaken by the veteran must be determined.
- All reasons for the veteran ceasing to continue in that type of remunerative work need to be considered (which is determined by assessing the types of work the veteran has undertaken) and whether they could be continuing that employment during the assessment period if it were not for the effects of their accepted conditions alone.
The questions to be asked to establish whether the Work Loss Test has been satisfied are contained in the Flentjar v Repatriation Commission (1997) Federal Court decision:
- What was the relevant “remunerative work that the veteran was undertaking” within the meaning of s24 (1)(c) of the Act?
- Is the veteran, by reason of war-caused injury or was-caused disease, or both, prevented from continuing to undertake that remunerative work?
- If the answer to question 2 is yes, is the war-caused injury or disease, or both, the only factor or factors preventing the veteran from continuing to undertake that work?
- If the answers to questions 2 and 3 are, in each case, yes, is the veteran by reason of being prevented from continuing to undertake that work, suffering a loss of salary, wages or earnings on his own account that he would not be suffering if he were free of that incapacity?
If other factors have been identified, this does not necessarily mean failure of the test. Rather, the real effect of these factors need to be assessed in the circumstances of the case. To fail the Work Loss Test, the decision-maker must be reasonably satisfied that the evidence demonstrates that such factors, either singly or in combination, had a real effect in contributing to the veteran being prevented from continuing to undertake the kind of work previously undertaken.
In a situation where the delegate is satisfied that the applicant does not satisfy the 'alone' test, as a result of their non-accepted condition/s contributing to their prevention from continuing work, then the ameliorating provisions (ss24(2)) may apply. The applicant must meet the following conditions:
- is not currently working;
- is under the age of 65;
- has been actively and genuinely seeking work (or would have been seeking work); and
- the evidence points to the accepted condition/s as being the substantial reason for the inability to obtain work.
If these conditions have been satisfied, then the 'alone' test is taken to be satisfied. The ameliorating provisions are specifically included in the tests for Special Rate to make sure that the 'alone' test is not a blanket exclusion, and that where a veteran is attempting to work, but they cannot gain employment due substantially to the impacts of their accepted condition/s then they can still be considered for Special Rate.
Eligibility criteria for Temporary Special Rate (TTI)
A person is eligible for TTI pension in the following situations:
- he or she is temporarily incapacitated from war-caused or defence-caused disabilities, and
- if the incapacity were permanent, the person would qualify for a T&PI pension.
The period for which TTI pension is determined as payable is the time for which the incapacity is likely to continue.
Eligibility for Special Rate (T& PI and TTI) for people over 65 years of age
Before Special Rate can be granted to a veteran who has reached the age of 65, there are additional eligibility criteria that must be met. The veteran must:
- have been prevented from continuing in paid work due to incapacity from their accepted disabilities alone and thereby be suffering a loss of earnings;
- have been employed for a continuous period of at least ten years which must have started prior to the veteran turning 65 and continued past the age of 65 (NOTE: There is no requirement for the veteran to have only worked for one employer or in a single type of employment during this period);
- meet the 70% Test, T&PI Test and the Work Loss Test
What is a 'continuous period?'
Ultimately, there is no rigid definition of what constitutes a 'continuous period'.
The relevant Commission Guideline (http://clik.dva.gov.au/compensation-and-support-reference-library/commission-guidelines/cm6882-special-rate-and-intermediate-rate-pension/part-three-determination-cases-where-veteran-age-65-or-over-time-lodging-claim) states:
…that 10-year period may include periods during which the veteran was not working (taking holidays etc), as long as that break is not too extensive, but it cannot include periods where the veteran ceased to work (i.e. 3 years touring Europe would likely be considered more than just a holiday and mean that the continuous 10-year requirement had not been met). These are questions of fact to be decided to the satisfaction of the delegate.
A good rule of thumb test might be what would be seen as a reasonable break if the employee was working for the same employer. For example, taking 12 months leave from your job would not normally be seen as reasonable without mitigating factors (parenting commitments, injury or illness or LSL), and would almost certainly be leave without pay, whereas a period of leave of 4 weeks would seem reasonable to a majority of employers as recreation leave, should they have that entitlement.
Where the duration of the break between a person’s jobs is such that it could otherwise be seen as a holiday if they returned to work for the same employee, then the nexus of employment will almost certainly not be broken.
Please note that this advice is not saying that every case where the leave is longer than a few weeks will fail the over 65 Special Rate test. The delegate’s discretion remains the overriding consideration, and there may be heretofore unknown reasons why a longer break may be acceptable. For any cases where the break in employment was more than a month or two, further investigation may be required to establish the precise circumstances surrounding the break.
A beneficial approach should be taken at all times. The benefit of the doubt should be given to clients in these scenarios.
Paid Work and Voluntary Work
The eligibility criteria for Special Rate/Intermediate Rate pension require that a person has limited capacity to work in paid work. Paid work is work that is remunerated. It is different from voluntary work.
Voluntary work is generally defined as 'unpaid work for a recognised community or welfare organisation'. Unpaid work for a not-for-profit organisation or ex-service organisation will generally constitute voluntary work. Unpaid work for family, friends, or a business enterprise formed for the purposes of making a financial profit is not classified as voluntary work.
The general policy approach is that voluntary work does not have the same pressure or stress that is inherent in paid employment and should therefore be discounted when assessing a person's eligibility for Special Rate/Intermediate Rate disability pension. It is recognised that voluntary work has many social, psychological and physical benefits.
There is no defined upper limit to the hours of voluntary work a person may undertake, and the hours worked in voluntary work are not linked at all to the eight hour limit imposed on remunerative work. A high number of hours in voluntary work is not on its own an indication that the veteran is able to work in remunerative work.
For the purposes of Part VI of the VEA, a reference to a veteran is taken to be a reference to:
- a veteran as defined in subsection 5C(1) of the VEA;
- a member of the Forces as defined in subsection 68(1) of the VEA; or
- a member of a Peacekeeping Force as defined in subsection 68(1) of the VEA.
For the purposes of Part VII of the VEA, according to subsection 5C(1), veteran means a person (including a deceased person):
- who is taken to have rendered eligible war service, or
- in respect of whom a pension is, or pensions are, payable under subsection 13(6) and
- in Part III and Part VIIC of the VEA includes a person who is:
- a Commonwealth veteran, or
- an allied veteran, or
- an allied mariner.
A member of the forces is a person who served in the defence force for a continuous period that commenced after 7 December 1972 and has the type of service required in sections 69, 69A and 69B of the VEA.
“Member of a Peacekeeping Force means a person who is serving, or has served, with a Peacekeeping Force outside Australia as an Australian member, or as a member of the Australian contingent, of that Peacekeeping Force."
A person who was during World War 2:
- a master, officer or seaman employed under agreement, or an apprentice employed under indenture, in sea-going service on a ship registered in Australia that was engaged in trading between a port in a State or Territory and any other port, or
- a master, officer or seaman employed under agreement, or an apprentice employed under indenture, in sea-going service on a ship registered outside Australia who was, or whose dependants were, resident in Australia for at least 12 months immediately before he or she entered into the agreement or indenture.
Refer to section 5C of VEA for a full definition.
A person may be regarded as permanently blind in both eyes where:
- there is a total loss of sight; or
- visual acuity after correction with suitable lenses is less than 6/60 in both eyes on the Snellen Scale; or
- where, in the written opinion of an ophthalmologist, the visual field deficits and/or combination of deficits results in a visual impairment which is the equivalent of a corrected visual acuity measure of less than 6/60 in both eyes.
The Commission Guideline CM5829: Determining 'permanently blind', 'no useful sight' and 'blinded in both eyes' may be instructive in making a blinded/blindness determination.
The assessment period begins on the day the formal claim for pension or application for increase in pension is lodged and ends on the day the claim is determined.
A claim or application is lodged when it is received at an office of the Department of Veterans' Affairs.
According to subsection 5D(1), an injury means any physical or mental injury (including the recurrence of a physical or mental injury) but does not include:
- a disease, or
- the aggravation of a physical or mental injury.
According to subsection 5D(1), disease means:
- any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development), or
- the recurrence of such an ailment, disorder, defect or morbid condition,
but does not include:
- the aggravation of such an ailment, disorder, defect or morbid condition, or
- a temporary departure from:
the normal physiological state, or
the accepted ranges of physiological or biochemical measures,
that results from normal physiological stress (for example, the effect of exercise on blood pressure) or the temporary effect of extraneous agents (for example, alcohol on blood cholesterol levels).