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7.4 Calculating Compensation Offsetting of Dependant's Payments
To calculate compensation offsetting for a widow/er follow the six steps below:
Step 1 - Identify the dollar amount of the DVA dependant's pension paid in respect of the veteran's death. Includes W/W and children.
Step 2 - Identify the fortnightly equivalent of other compensation paid, excluding Additional Death Benefits paid under Defence Act 1903.
Step 3 - Calculate the fortnightly equivalent of the lump sum using the AGA instructions and tables.
Step 4 - The dependant's pension rate is compared with the fortnightly equivalent of the lump sum and the lesser is the amount by which the dependant's pension/s is offset.
Step 5- Using the preferred pensioner rules, the offset amount is manually entered into the PIPS by CPI at the same time as war widows pension.
Step 6 - Refer the file to the income support area if the dependant is in receipt of a CAP and is under pensionable age. If over pension age the ADB may effect the assessment of income support supplement, depending on the method of the lump sum disposal (invested or otherwise).
Step 1 - Widow B receives $758.70 war widow's pension per fortnight in respect of her husband's defence caused death.
Step 2 - Widow B received $241,556.66 lump sum which included $40 531.62 under the Defence Act in respect of the veteran's death. Compensation for offsetting purposes = $201,025.04. ($241,556.66 - $40,531.62)
Step 3 - Widow B is 46 years old next birthday. The fortnightly equivalent is calculated by:
20 — 1 025.04 x 17.102 = 343.79.
Step 4 - As the fortnightly equivalent is lower than the current war widow's pension rate, the offset amount is $343.79
Step 5 - As Widow B is the only dependant in payment, $343.79 is manually entered into the PIPS payment system, Disability Pension Screen/PTIV indexed field against her war widow's pension.
Step 6 - As the ADB is not offset against war widow pension it has the potential to affect the ISS assessment. Refer file to income support section.
The Department of Veterans' Affairs.