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DATE OF ISSUE:  10 March 1992



1.This Instruction is to advise Branches on the combined Consumer Price Indexation increase and the British Retirement Income exchange rate variation mailout in March.  Please refer to DI B11/92 for information regarding ADP processing.


2.The run for the selection of cases has been scheduled for the weekend of 14/15 March 1992.  Printing will commence on 17 March 1992.  The effective payday for the adjustments is 2 April 1992.

3.As in previous mailouts, joint advices will be issued for the majority of married and defacto cases.  However, the following categories will each receive separate advices:

.fringe benefit cases

.overseas cases

.blinded veterans and their spouses;

.couples separated on medical grounds

.veterans and spouses receiving a different rate of service pension.

4.The indexation advice letters will be dated the first working day following the selection run ie. 16 March 1992.  This will ensure that the letter date represents currency of information.


5.Attached for information, is a copy of a 'mock' advice.  Changes have been made to the BRI wording and the obligations wording.  What was once called the General Information Sheet is now called the Income and Assets Definition Sheet.

6.Inserted with the advice will be a Defence Service Homes Contents Insurance Brochure.  Reference is made to the brochure in the letter and clients are asked to contact DSH on the phone numbers listed on the back of the brochure.  Branches may receive the occasional phone call and are asked to transfer the caller to DSH Insurance.  The phone numbers for the relevant States are listed below:

New South Wales(02) 213 7064

ACT(06) 267 1416

(06) 267 1422

Victoria(03) 284 6816

(03) 284 6817

Queensland(07) 223 8529

(07) 223 8581

(07) 223 8818

South Australia(08) 213 2220

(08) 213 2217

Western Australia(09) 425 8336

(09) 425 8338

Tasmania(002) 216 642


7.To ensure that the information contained in the indexation advices is current at the time of mailing, it will be necessary to withhold daily advice letters produced by Branch action in the Branches, from 16 March, until after the indexation advices have been printed and mailed out.  Central Office will advise when postal action of the dailies may commence.  The deadline for the mailing house to lodge with Australia Post is start of business 30 March 1992.


8.After 14 March, pay-day 2 April 1992 should not be used as the effective dates for action to vary or continue service pension.  Use of this date may result in the production of an advice letter which contains conflicting information - eg. letter indicates an increase in pension, whilst payment details clearly show a reduction.  Should a variation or continuation in pension be necessary between 14 March and 2 April 1992, the pay-day of 16 April 1992 should be used.


9.Cases that require manual action will be printed at the NCC.

10.An exception report will be produced for each state.  The only cases that require manual action by the Branches are those cases involving overseas residents and cases ceasing or gaining Fringe Benefits.  Branches will be required to complete enveloping and mailing the advice letter by COB 27 March 1992.

11.The Central Office contact for this mailout is Felicity Hugg (06) 289 6446.




    March 1992


Example of advice for:

- married

- maximum rate

- CPI and BRI adjustment

- non homeowner

- fringe benefits


File No.






This letter is to advise you of a change to your pension rate. It also explains your obligations as a pensioner. Your pension is adjusted on the first payday after 20 March and 20 September based on changes to the Consumer Price Index. You will receive regular letters whenever your rate of pension varies.

Exchange Rate Variation.

Your income from British Retirement Income has been increased as a result of an exchange rate variation. The exchange rate that now applies is $2.4044 equals 1 Pound Sterling.

Exchange rates for foreign currencies can fluctuate as often as 4 times per day. In order to minimise variations to your rate of Service Pension because of exchange rate fluctuations this Department uses an average exchange rate to calculate your income from British Retirement Income payments. We apply this rate 4 times a year in March, June, September and December. The average rate is calculated by obtaining the exchange rate from the Commonwealth Bank for every working day in January (or April, July, October) for the pound sterling to the dollar Australian. This is then averaged and applied as the exchange rate for the following 3 months.

The combined effect of the Consumer Price Indexation and the exchange rate variation of your British Retirement Income may result in either a reduction or no change to your current rate of pension.

Payment Details

Your pension will be paid from 2 April 1992 at the rate shown below.


Service Pension$251.50

Rent Assistance$ 30.00

PA$   2.60



Service Pension$251.50

Rent Assistance$ 30.00

PA$   2.60


Fringe Benefits

Your eligibility for fringe benefits is based on cut-off limits which are shown in the attached Income and Asset Definition Sheet at the back of this letter. You are presently eligible for service pension fringe benefits.

Please note that from 22 August 1990 service pensioners who are eligible for fringe benefits do not have the following types of income included when we review whether they still qualify for fringe benefits:

.bank, building society and credit union account interest (including deemed interest);

.income from managed investments (e.g. an approved deposit fund, a deferred annuity, a public unit trust, an insurance bond, an investment with a friendly society, etc.);

.interest from loans, including bonds and debentures;

.income from shares; and

.immediate annuities.

(However, please also note that these types of income are still used to work out the rate of service pension payable.)

Your Obligations to the Department

This letter is issued under Section 54 of the Veterans' Entitlements Act. Please read the following obligations carefully. You must tell us within 21 days if any of the events listed below occur. When you are telling us of changes to your circumstances you should do so by writing to the Deputy Commissioner at the address noted at the beginning of this letter.

If you do not tell us of any of these changes you may be overpaid. We are entitled under the above Act to recover this overpayment and an administrative charge may also be applied. There are penalties that apply for failing to fulfil your obligations or for providing false or misleading information.

Please remember that the following obligations continue to apply to you. However, if you write to us about a change we will tell you of the new obligation relating to that change. It may be helpful if you keep this letter for future reference to your obligations.

Changes You Have Already Told Us About

If you have told us recently about a change to your income or assets or your domestic situation, it may not have been included when sending you this letter. If this is the case, we will be sending you another letter as soon as the change has been put in place.

Obligations- General

You must tell us if:

.You change your postal and/or residential address

.You leave Australia permanently

.You are granted any pension or benefit from the Department of Social Security

.You are granted any pension or benefit from an overseas authority

.You are imprisoned after conviction for an offence.

Obligations - Domestic Situation

You must tell us if:

.You live apart permanently for reasons other than age or ill health

.You get divorced

.You have to live apart because of age or ill health

.Your spouse passes away

Obligations - Rent Assistance

You must tell us if:

.The amount you pay for where you live changes or you stop making these payments

.You start paying rent to a government authority, e.g. State Housing Commission or Authority

.You leave Australia temporarily.

Obligation - Financial

You presently receive the maximum rate of service pension because our records show that your combined income is less than &PRESIAMT. per fortnight and your combined assets are less than &PRESAAMT.. You are obliged by law to tell us if this is not correct. You must tell us by writing to the Deputy Commissioner at the address shown at the beginning of this letter. If in the future your income or assets increase above either of these limits, you must tell us in writing, within 21 days of the change.

Please do not tell us of any changes to your income or assets unless your income increases above &PRESIAMT. per fortnight or your assets increase above &PRESAAMT.

Release and Use of Information

The income and asset information you give to this Department is used to work out your eligibility for pension and other benefits. Some information that you have supplied may be released to other agencies or bodies such as the Department of Social Security; the Australian Taxation Office, the Health Insurance Commission; various state and local government authorities; and superannuation funds.

The reason for supplying information to such agencies or bodies is to verify income/asset details; matching of information; payment of accounts for treatment; and to verify eligibility for rebates or concessions.

Defence Service Homes Contents Insurance

You may insure the contents of your home or unit with DSH Insurance even if you do not have DSH Building Insurance. A brochure for DSH Contents is enclosed. If you would like a premium quote or any other information about the cover, please telephone your nearest DSH Office listed on the back of the brochure and ask for the DSH Contents line.

If you have any questions about any of the above matters please contact this office at the address or telephone number shown at the top of this letter.

Yours sincerely,

Deputy Commissioner as

Delegate of the Secretary


Types of Income

Types of Income for service pension purposes includes bank, building society and credit union interest; interest from loans, bonds, debentures and inscribed stock; dividends on shares; profits form capital growth investments, e.g. insurance bonds, deferred annuities, approved deposit funds, unit trusts, friendly society bonds, superannuation bonds and superannuation funds etc.; profits from a farm, business or estate; income from boarders and lodgers (other than immediate family members); salaries, wages and compensation; superannuation (including lump sum withdrawals); annuities, life interest; maintenance and income from other sources within or outside Australia.

Income also includes interest on any investment that is not paid on a regular basis but which is held and paid on maturity of the investment, e.g. term deposits, rollover funds and superannuation schemes.

Income does not include service pension and/or allowances, or disability pension and/or allowances.

The income used to work out your rate of service pension is income before tax.

Deemed Income

Income for service pension purposes from banks, building societies, credit unions, loans, bonds and debentures is calculated by multiplying each balance by the interest rate and dividing by 26. This gives a fortnightly amount.

The interest rate used for financial institution accounts is either the actual interest rate payable, or a deemed rate. An interest rate of 6 percent will be deemed on money which has an actual interest rate of less than 6 percent, unless your money was invested in a debenture, bond or was loaned prior to 22 August 1990. If your money was invested in a bond, debenture or loaned prior to this date the actual interest rate received will continue to be regarded as income. This saving provision does not apply to banks, building societies, credit unions and cash amounts.

Please note that interest will not be deemed on the first $2,000 ($4,000 per couple) that you have in cash, or in a bank, building society, or credit union account. 'First' means the $2,000 ($4,000 per couple) in financial institution accounts or cash which earns the least interest (including NIL).

Types of Assets

Assets for service pension purposes includes deposits in banks, building societies and credit unions; investments in finance companies; shares in private and public companies; investments in capital growth schemes; unit and discretionary trusts; farms, crops and livestock; business and stock; real estate; household contents and personal effects; loans; motor vehicles; gifts (see below); the surrender value of insurance policies; jewellery; antiques and personal hobby collections and all other property or assets but not including the exempt items listed below.

Exempt assets are the home in which you live; aids for the disabled; funeral expenses paid in advance; awards for valour other than those held for investment or hobby purposes.

To work out your rate of service pension we use the current market value of your assets. This is the amount you would expect to receive if you sold the assets now.


You may gift or dispose of assets up to the value of $10,000 a year without affecting your service pension. Each 12 month period starts on the anniversary of your grant of service pension. This limit applies to single and widowed pensioners, and is a combined limit for married couples.  However, if you give away money or assets or sell assets for less than their NET value (e.g. if you have given, in the last 12 month period, $12,000 to your children or sold a car worth $16,000 for $4,000) your pension could be affected.  If you give away or dispose of any asset above the $10,000 limit your income will be assessed on the basis of the amount which exceeds the $10,000.  If the asset did not earn any income (or if the income was less than 6 percent per year), we will work out your income as if you were receiving 6 percent per year. If the income previously received from this asset was more than 6 percent per year, we will hold this actual income in your assessment.

Telephone Rental Concession

You may be eligible to receive a concession on your telephone rental if you live in Australia and have a telephone connected in your name where you live.  If you do not already have telephone concession vouchers and think that you do qualify please contact this office as soon as possible. Please remember to tell us if your telephone number changes, or if you move.

Maximum income/assets you can have and still get maximum rate service pension.

Income TestAssets Test

per fortnightHome OwnersNon Homeowners

Married Pensioners$148.00$157,500$237,000


Single Veterans $84.00$110,750$190,250

Separated spouse/ widow/widower $74.00$  78,750$118,500

The income test cut off limits are increased for each dependent child or student, and/or if Rent Assistance is payable.

Cut off limits for Fringe Benefits

Income TestAssets Test

per fortnightHome Owners Non Homeowners

Married Pensioners $360.00$180,500$260,000


Single Veterans $210.00 $126,250$205,750

Separated spouse/ widow/widower $210.00 $126,250$205,750

Add $52.00 per fortnight to income test limits for each dependent child/student.

Cut off limits for service pension

Income TestAssets Test

per fortnightHome Owners Non Homeowners

Married Pensioners $1169.00$285,500$365,000 (combined) Single Veterans               $696.20               $187,500              $267,000 Separated spouse/ widow/widower               $584.60               $142,750              $182,500

The income test cut off limits are increased for each dependent child or student, and/or if Rent Assistance is payable.