C29/2005 Expanded Exchange rate variation of Pounds Sterling - Effect on Income Support Pensioners | Compensation and Support Reference Library, Departmental Instructions, 2005

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C29/2005 Expanded Exchange rate variation of Pounds Sterling - Effect on Income Support Pensioners

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DATE OF ISSUE:  1 August 2005

Expanded Exchange rate variation of Pounds Sterling – Effect on Income Support Pensioners

Purpose of Instruction

The purpose of this Departmental Instruction is to provide information about the Pounds Sterling exchange rate variation exercise and to advise about new categories of British Pension included in the daily exchange rate variation.

What has changed

The daily exchange rate variation has now been expanded to apply to all income paid in Pounds Sterling, including war disablement pensions (British DP, including EATS and Composite), social security pensions, official public service pensions, armed forces superannuation pensions and British other income (all other British income).

Introduction

Following the recent variation in UK - Australian exchange rates, DVA will apply a new exchange rate for the assessment of the rate of income support pensions for those in receipt of all income paid in Pounds Sterling:

  • war disablement pensions (British DP, including EATS and Composite)
  • social security pensions
  • official public service pensions
  • armed forces superannuation pensions
  • British other income (all other British income)

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New exchange rate A$2.2738

The exchange rate used to convert Pounds Sterling to Australian Dollars for income support assessment purposes has changed from one Pound Sterling = A$2.3458 to one Pound Sterling equals A$2.2738 (ie A$1 = ?0.4398).

This rate reflects the average of the “on demand airmail buying rate” for the two weeks to 29 July 2005.

Date of effect
2 August 2005

Effective from 2 August 2005 the current exchange rate will change.

On pension payday 18 August 2005 (pay period 30) pensioners will receive a full instalment at the new assessed rate.

Date of processing run

Processing to implement the new exchange rate is scheduled for the evening of Monday 1 August 2005.

Automatic
processing

Amounts recorded as foreign super type non-government British other income (07), British Social Security Pension (08) or British Official Public Service/Forces Pension (09) will be varied by applying the exchange rate to the pounds sterling amount recorded, to determine the new rate of pension in Australian dollars. The income support payment will then be reassessed automatically.

Manual cases

Cases with actions in submission or determined status will not be processed automatically and will be frozen. These cases will be listed on the manual listing for follow up action, and CMS/PIPS cases will be created automatically for action.  Any cases processed through PIPS should be reassessed with effect from 2 August 2005 for payday 18 August 2005.

Non-Government British other income (07)

Previously non-government British other income (07) was refreshed every six months in March and September with other foreign currencies (GROOVER).  As a result of a review of British pensions approved by the Repatriation Commission all sterling payments will be adjusted in uniform exchange rate variations.  British other income (07) will now be reassessed automatically in this and future exchange rate variations.  All other currencies will continue to be updated every six months using GROOVER.

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British DP Cases

Income Support pensioners who are in receipt of ISS, age pension (AP) or service pension with rent assistance (SPRA); and, who also receive disability (war) pension direct from Britain should have that disability pension converted to $A using this exchange rate.  ISS, AP and SPRA should be recalculated by doing a PIPS assessment.  These cases can be extracted through AIS by each state.

Note: If DP has already been assessed as income in determining hardship cases it should not also be assessed as income for RA.

EATS and Composite cases

Previously EATS and Composite cases were subject to a separate exchange rate provided by the UK Government.  This arrangement ceased in 2000 (see DI C29/2000).  The Repatriation Commission has determined that the daily exchange rate variation of plus or minus 2.5% will now be applied to EATS and Composite cases.

These cases can be extracted through AIS by each state and recalculated by doing a PIPS assessment.

Departmental Instruction DI C22/2005 has been issued by Veterans' Compensation. Any queries in relation to the exchange rate for EATS and Composite cases should be directed to Brian Eastman on (02) 6289 6348.

Advice letters

The advice letters for this exercise will be joint advices where both members of a couple are in receipt of pension from the British government and their pension payment varies.  Age pensioners will receive separate advices.

The letter will advise the new exchange rate and the amount of income.  An advice will only be produced for cases where a variation in payment results.

IBM GSA implications

IBM GSA will produce the data and transmit this online in postscript format to Security Mailing Services (SMS) in Sydney.

Overseas, Special Register and Enclosure Advices

Overseas cases for all states apart from TAS clients, Special Register, Enclosure Advice letters (ie cases where a change to treatment entitlement occurs) and reduction to nil cases will be separated by IBM GSA and despatched to State Offices for manual distribution.  This arrangement is the same as for daily advice letters.

Tasmanian Clients with Overseas Postal Address

Tasmanian State Office clients who have an overseas postal address will have the full overseas address printed on their advice letters.

The advice letters for Tasmanian overseas clients will be printed enveloped and sent from the mailing house.  This is a change from previous years where the letters were sent back to the Tasmanian State Office for posting.

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Mail out of bulk advices

Security Mailing will print and prepare the advices for lodgement with Australia Post by 15 August 2005.

Contact officers

The Income Support Branch contact officer is:

Sarah Paras:   (02) 6289 6534

The Veterans' Compensation contact officer for EATS and Composite cases is:

Brian Eastman:   (02) 6289 6348

John Stevens
A/g Branch Head
Income Support

1 August 2005


POUND STERLING EXCHANGE RATE FOR PENSIONS FROM UK GOVERNMENT

Foreign exchange period           Exchange rate

From

To

$ in ?

? in $

3 April 01

14 May 01

0.3550

2.8169

15 May 01

23 July 01

0.3674

2.7218

24 July 01

6 August 01

0.3803

2.6295

7 August 01

1 October 01

0.3701

2.7020

2 October 01

29 October 01

0.3430

2.9155

30 October 01

10 December 01

0.3588

2.7871

11 December 01

7 January 02

0.3709

2.6961

8 January 02

18 March 02

0.3612

2.7685

19 March 02

27 May 02

0.3723

2.6860

28 May 02

10 June 02

0.3830

2.6110

11 June 02

08 July 02

0.3928

2.5258

09 July 02

22 July 02

0.3758

2.6610

23 July 02

05 August 02

0.3643

2.7450

06 August 02

02 September 02

0.3503

2.8547

03 September 02

03 March 03

0.3620

2.7624

04 March 03

28 April 03

0.3816

2.6205

29 April 03

26 May 03

0.3929

2.5452

27 May 03

1 September 03

0.4064

2.4606

2 September 03

24 November 03

0.4168

2.3992

25 November 03

1 March 2004

0.4308

2.3213

2 March 2004

24 May 2004

0.4200

2.3810

25 May 2004

5 July 2004

0.3961

2.5246

6 July 2004

19 July 2004

0.3828

2.6123

20 July 2004

11 October 2004

0.3938

2.5394

12 October 2004

22 November 04

0.4065

2.4600

23 November 04

3 January 05

0.4202

2.3798

4 January 05

31 January 05

0.4004

2.4975

1 February 05

20 June 05

0.4126

2.4237

21 June 05

1 August 05

0.4263

2.3458

2 August 05

0.4398

2.2738