C05/2003 Assessment of pensions for special rate-blinded pensioners | Compensation and Support Reference Library, Departmental Instructions, 2003

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C05/2003 Assessment of pensions for special rate-blinded pensioners

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DATE OF ISSUE:  25 FEBRUARY 2003

Assessment of pensions for special rate-blinded pensioners

Purpose

This instruction provides information and action required regarding the assessment of income support pension for special rate-blinded pensioners.

Background

Income support pensions paid to blind pensioners are not subject to the income and assets tests.  The vast majority of blind pensioners should be receiving the maximum rate of income support pension.

The exceptions include:

  • war widow(er)s who receive a ceiling rate income support pension; and
  • those who are affected by compensation recovery provisions such as those contained in Part IIIC of the Veterans' Entitlements Act, 1986 (VEA).

It should also be noted that although income support pensions paid to blind pensioners are paid free of the income and assets tests, the income test applies when determining the level of income tested residential aged care fees payable.  This means that income and assets details must be recorded.

Issue

A recent review of blinded pensioners who are in receipt of Special Rate disability pension, has revealed that many are not in receipt of income support from DVA or the income support that they are receiving may be incorrectly recorded or assessed.

These cases must be investigated, and where appropriate, pension review action must be taken to ensure that these pensioners receive their full entitlements to income support.

Target population

A total of 556 special rate-blinded pensioners were identified. Of these, 194 cases may be incorrectly assessed or recorded because they are:

  • not receiving maximum rate of income support pension; or
  • not receiving any amount of DVA income support pension; or
  • receiving income support pension at the maximum rate but the 'blind' indicator has not been recorded.

The risk with the later group is that if income or assets are recorded the rate may be reduced due to an automatic review.

Action

A list of cases specific to each state will be forwarded under separate cover to income support managers.  The following pages provide instructions on what action needs to be taken with each group.

Procedures should be put in place to ensure that in the future, if a veteran is determined to be blind under Part II or Part IV of the VEA, the case is referred to the income support section for grant/review action if this has not already occurred.

Q&A

A Question and Answer sheet is at Attachment A.

Contact officer

Please contact Kirrily Williams on (02) 6289 6525 for any further information on this matter.

Jeanette Ricketts

Branch Head

INCOME SUPPORT

25 February, 2003
Special rate-blinded not receiving maximum rate

Number in this group

There are 7 special rate-blinded pensioners who are receiving less than the maximum rate of income support.  The list of this group will be forwarded to Income Support Managers separately.

Action

Each case will need to be individually investigated to determine whether there is a valid reason for the veteran receiving a reduced rate of income support.  For example, the person may receive a compensation affected pension that is being reduced as a result of economic loss compensation.

If, however, the pensioner's income and assets are resulting in the reduced rate of income support pension, the blinded indicator must be set (see Attachment B) the pension increased to maximum rate and any arrears paid.

Arrears

If the rate is found to be incorrect, that is, the income and assets exemptions have not been applied to the pension calculation, the correct amount should be backdated to whichever is the later of:

  • the date the pensioner advised the department he/she was blind; or
  • the date the pensioner started receiving service pension.*

The arrears amount will be:

  • the difference between the maximum rate payable at the time; and
  • the rate at which the pensioner was being paid at any given time since being classified as blind and in receipt of service pension.

*Note: If the pensioner is an age pensioner, the incorrect assessment may predate their commencement date with DVA.  If this is the case DVA arrears should be calculated only to the date of transfer.

Arrears from Centrelink

Those age pensioners who were receiving a reduced rate pension while they were at Centrelink must contact Centrelink to pursue the arrears amount. DVA do not have the authority or responsibility to assess this.

Draft letter

If, after investigation, the pension rate needs to be adjusted and arrears paid, the pensioner must be advised in writing.  A draft letter to be used when writing to these pensioners is at Attachment D.

Reporting

In order to advise the Executive of the outcome of the review Managers should arrange to record details of cases that required a change of pension rate.  The information required for each case is the total dollar amount of arrears paid and the effective dates for the retrospective reassessment.

A report pro-forma has been prepared and is at Attachment C.

Please forward this information via email to Kirrily Williams, Income Support Policy Section.


Special rate-blinded receiving nil rate of income support at DVA

Number in this group

There are a total of 65 special rate-blinded pensioners who are receiving nil rate of income support pension from DVA.  The list forwarded under separate cover will identify each case in this group.

Within this group there are two possible situations:

  • those who are receiving no income support; and
  • those who are receiving a social security payment paid by Centrelink.

If there is insufficient information on file to determine the circumstances for the individual, the veteran will need to be contacted in order to establish which situation applies.

Situation 1

The first type are those who are not receiving any income support from DVA or Centrelink.

It will be necessary to establish whether or not individuals have qualifying service and satisfy other service pension eligibility criteria; or whether they satisfy eligibility for the age pension payable by DVA.

If the individuals satisfy either circumstances they should be invited to claim service pension/age pension as appropriate.  Partners should also be provided with information regarding possible entitlement subject to satisfying eligibility and payability criteria.

When a claim has been lodged and the person satisfies the eligibility criteria, the maximum basic rate of pension should be granted and the 'blind' indicator recorded.

Situation 2

The second group are those who are in receipt of a social security pension.

If individuals have qualifying service and satisfy the service pension eligibility criteria or they are eligible for age pension, they should be invited to transfer to the appropriate DVA pension.

The benefit for this group would be that they only need to deal with one Department.

Referrals to National Office

Files in this group also need to be investigated to determine whether the pensioner has previously inquired about their eligibility for an income support pension.  In cases where incorrect or misleading advice has been given, for example no clear statement that income support is free of income and assets testing and the blind pensioner can be in full time employment and still qualify, the files should be forwarded to Income Support Policy Section so that a legal opinion can be obtained and appropriate action taken.

Draft letter

A draft letter to be used when writing to these pensioners is at Attachment E.

Reporting

Managers are requested to keep a record of how many pensioners were:

  • contacted by phone; or
  • contacted by letter; and
  • how many of those contacted have applied for a service pension or age pension; and
  • how many have transferred their age pension to DVA; and
  • how many, if any, are forwarded for consideration for by National office.

A report pro-forma has been prepared and is at Attachment C.

Please return this information via email to Kirrily Williams, Income Support Policy Section.


Special rate-blinded receiving maximum rate but no 'blind' indicator

Number

There are a total of 122 special rate-blinded pensioners who, although correctly receiving the maximum rate of pension, do not have the 'blind' indicator recorded in their assessment.

Action

State Offices are requested to ensure that all special rate-blinded pensioners, both those identified via this process and all future grants, are flagged as 'blinded' in PIPS on the Adult Details screen (see Attachment B).

Reason

When a blind pensioner reports an income or assets increase, which would, if the exemption rules did not apply, result in a reduction to their rate of pension, the 'blinded' indicator prevents the exemption being overlooked.  It is a vital step that must be taken when granting all blinded income support pensions.

The 'blinded' flag is also essential for ensuring the accuracy of statistical information for projections.

Partner's assessment

While the blinded income support pensioner receives their income support without regard to the means test, the income and assets of the couple still impacts on the partner and obligations still apply to them.


Attachment A

Questions & Answers

Why has my pension increased?

A person who is blinded does not have the income and assets tests applied to the assessment of their income support pension. This generally means that you should be receiving the maximum rate payable because we don't take into account any income you receive, or assets you own.

Previously, your income and assets have been taken into account.  This has now been amended.

Why wasn't I receiving a pension/max rate pension previously?

When a blind pensioner is granted an income support pension, a 'blind' indicator is recorded on the system, which ensures that any income and assets you have are exempted and that maximum rate pension is payable.

With regard to your situation, this has now been resolved and in future you will receive the maximum rate of income support pension, regardless of your income and assets levels.

Will I receive any arrears?

Yes.  You received arrears of $...... for the period -/-/- to -/-/-.

What is the advantage of receiving AP from DVA?

Although there are no financial benefits to transferring your age pension from Centrelink to DVA, one advantage would be receiving all of your pensions from the one department.

Will Centrelink pay my arrears for the time I was receiving an age pension from them?

If you were blinded while you were receiving age pension from Centrelink you should have been receiving the maximum rate. If you were receiving a reduced rate you should contact Centrelink who will determine what amount of arrears is owing.


Attachment B

Adult Details screen

See the following screen dump, under Options, for the location of the 'blinded' indicator.



Attachment C

Report 1

Use this table to collate information on special rate – blinded veterans who were receiving a reduced rate of income support pension.

FILE NO.

AMOUNT OF ARREARS PAID

BACKDATED TO:

CONTACT BY LETTER

CONTACT BY PHONE

Report 2

Use this table to collate information on special rate – blinded cases who were receiving nil rate of income support at DVA.

FILE NO

PENSIONER HAS APPLIED FOR SP

PENSIONER HAS APPLIED FOR AP

PENSIONER HAS TRANSFERRED AP TO DVA

REFERRED TO NATIONAL OFFICE? YES/NO

CONTACT BY LETTER

CONTACT BY PHONE


Attachment D

Dear Veteran

I am writing to you concerning your income support pension.

A recent review has shown that you are not receiving the correct rate of income support pension.  A person who is blinded is entitled to receive their income support pension free from income and assets testing.

From ../../.. you will start to receive your income support pension at the maximum rate of $???.??.

I have calculated that you were entitled to receive the maximum rate of income support pension from ../../.., and have accordingly calculated your arrears payment of $   for the period of ../../.. to ../../.. The arrears payment may have an income tax implication for you. If so it will appear on your group certificate at the end of the financial year. The Australian Taxation Office will determine if any income tax is payable.

If you have any questions concerning this letter please do not hesitate to contact me on <R>>.

Yours sincerely

Delegate


Attachment E

Dear Veteran

I am writing to advise you that you may be entitled to receive an income support pension in addition to your special rate disability pension.  You may not be aware that people who are blind may receive an income support payment free of the income and assets tests (subject to satisfying certain eligibility criteria).

If you are not in receipt of a Centrelink or DVA payment of income support you may be entitled to claim.

In order to receive an age or invalidity service pension from DVA you must have qualifying service.  If you wish to test your qualifying service please contact me on the number at the top of this letter.

If you do not have qualifying service and you have reached pension age you may be entitled to a social security age pension payable by DVA.  If you are under pension age and do not have qualifying service you may wish to contact Centrelink to claim a payment from that Agency.

If you have any questions concerning this letter please do not hesitate to contact me on <R>>.

Yours sincerely

Delegate