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6.1 Determination & Payment & Interest Payable
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Where there is an amount of compensation payable to a client under section 24 or 25, the Commission has 30 days to make payment from after the date of the assessment of the amount. Once a final amount has been assessed and the client has had reasonable timeframe (eg. 21 days) to consider the s45 election option, payment should be expedited to meet the 30 day deadline. Should an interim payment be approved, only the s24 amount (i.e. compensation for the body part, function or system) is paid. No NEL payment is paid until such time as a final determination is made under s25.
If the compensation payment is delayed beyond this 30 days then, under section 26, interest is payable from the day the 30 day period elapses to the date of the payment. The interest rate payable is the “weighted average yield of 3 month Bank Accepted Bills/Negotiable Certificates of Deposit, over 3 months, as published by the Reserve Bank of Australia, settled immediately prior to the last day of the thirty day settlement period”. This rate is available from the Reserve Bank's website via the following link:
This is the easiest way to access the applicable interest rate on any day. Once in the spreadsheet, scroll down to the latest daily rate and look across under the column 3-month BABs/NCDs (description - Bank Accepted Bills/Negotiable Certificates of Deposit - 3 months) which gives you the weighted average yield of the end of day bank bill rate.
If the link above does not work, go to the RBA website. Once there, click onto “Statistics” located along the top of the screen. Click on ‘Economic and Financial Statistics”, and then "Statistical Tables" then scroll down to "Interest Rate" and click on "Interest Rates and Yields - Money Markets - Daily - F1".
Example of calculating an interest payment
1. RBA interest rate ÷ 100 = interest rate percentage
2. Interest rate percentage x section 24 award amount = yearly amount
3. Yearly amount ÷ 365 = daily amount
4. Daily amount x number of days late = amount payable
Interest rate: 4.75%
Section 24 award amount: $12,706.00
Days late: 168
- 14.75 ÷ 100 = .0475 (interest rate percentage)
- 0475 x 12706 = 603.535 (yearly amount)
- 603.535 ÷ 365 = 1.6535 (daily amount)
- 1.6535 x 168 = $277.79 (amount payable)