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5.8.7 Offering Interim Payments

Each offer of interim compensation requires a new offer/determination and optional choice to take a lump sum or part lump sum payment.  The default payment method is periodic compensation paid fortnightly which should automatically be processed after a specified time (usually 21-30 days from determination date) set out by the delegate in the determinatin letter (noting the s389 choice).Under section 78 of the MRCA, a person may be entitled to choose to convert all or part of the periodic compensation payable to a lump sum.  This could potentially lead to a situation where someone receives a combination of periodic and lump sum payments if more than one interim offer is made.

Subsection 78(3) requires that this choice, if the clients should decide to make it, must be done via writing and submitted to the MRCC within six months of the date that the person received the notice of the periodic amount payable.

In cases where a person is offered more than one interim payment and put into periodic payments, the six month timeframe within which to make an election to commute one or more of those offers to a lump sum may become a relevant consideration.  If that is the case, the 'special circumstances' provision under subsection 78(4) can be invoked when the final assessment occurs.  Effectively this would mean that the veteran has the option of taking all of the PI compensation owed to them (that has not previously been converted to a lump sum) as either a lump sum or a part lump sum.  This use of the special circumstances provision is a good example of a situation that can rightly be classified as exceptional.

Section 389 of the MRCA provides that a member or former member to whom PI compensation is payable, buy who has not been paid any PI compensation, can institute an action for damages against the Commonwealth or a potentially liable member at common law. See part 5.14 "Claimants Pursing Common Law Action" for more information.