C05/1999 VETERANS' VOCATIONAL REHABILITATION SCHEME (VVRS) - Impact on Invalidity Service Pensions

Purpose

The purpose of this departmental instruction is to clarify the assessment of invalidity service pensioners (ISP) participating in the VVRS.

Background

At implementation of VVRS no income support specific instructions were issued due to the small number of cases foreseen.  It has since become apparent that formal instructions on the assessment of these cases would be of benefit to state offices.

Operational Guidelines

This document contains a brief overview of the scheme, with a focus on its impact on invalidity service pensions.  More detailed information can be found in the VVRS Operational Guidelines.

The attachment at the end of this instruction contains instructions for accessing the Operational Guidelines within the National Document Repository on the share drive.

The VVRS Operational Guidelines document states that ISP cases will be handled on a case by case basis, with queries to be referred to the Business Administration Section (now Policy Section) of the Income Support Branch in National Office.  These guidelines will be amended to refer to this instruction in replace of that direction.

Contact

If you have any questions, please contact Elizabeth Quinn either by email or on 02 6289 6078.

Objectives

The objectives of the Scheme are to assist veterans to find, or continue in, suitable paid employment, with particular emphasis on:

(a)facilitating the transition from service in the Australian Defence Force to suitable paid employment;

(b)assisting those veterans whose jobs are in jeopardy to retain suitable paid employment; and

3. in conjunction with Part VIA of the Act, providing an income safety net for certain veterans in receipt of pensions under sections 23 or 24 of the Act, or invalidity service pension, who wish to engage in suitable paid employment.

Principles

The principles of the Scheme are that:

1. participation in the Scheme is voluntary;
2. a rehabilitation plan is to be approved only if the veteran has undergone an assessment of rehabilitation capability by a suitably qualified person;
3. rehabilitation services are to be provided only in accordance with an approved plan that has been developed and agreed with the veteran;
4. rehabilitation services are to be provided only if the Commission is satisfied that these services will result in a suitable paid employment outcome;
5. rehabilitation services are to be approved according to principles of cost-effectiveness and will generally be the minimum necessary to achieve a suitable paid employment outcome;
6. there are no penalties for withdrawal from or failure to complete an approved program, although rehabilitation services may be discontinued in such circumstances;
7. rehabilitation services are not to be provided concurrently with another vocational rehabilitation program.

VVRS

The Veterans' Vocational Rehabilitation Scheme assists veterans to find, or continue in, suitable paid employment.  Services are provided on the basis of assessed need and subject to the likelihood of their obtaining a suitable and sustainable employment outcome.

Services are approved according to the principles of cost effectiveness and will generally be the minimum necessary to achieve a suitable paid employment outcome.

Suitable outcome

The scheme is intended to result in a suitable paid employment outcome.  Suitable paid employment may not necessarily be the best or only job to which a veteran may aspire.

To receive the income protection benefits of the scheme, the veteran's work would need to be as a result of undertaking the program (refer s115G).

Definition: “suitable paid employment outcome”

The following definition of suitable paid employment outcome is taken from the VVRS Operational Guidelines.  To access - see attachment

“Suitable paid employment outcome” means at a minimum:

1. if the veteran is not undertaking any remunerative work – recommencing remunerative work;
2. if the veteran is undertaking part-time remunerative work – increasing substantially the number of hours of remunerative work undertaken;
3. if the veteran is undertaking part-time remunerative work and is at risk of losing that work – maintaining the veteran in part-time remunerative work;
4. if the veteran is undertaking full-time remunerative work and is at risk of having to reduce that work substantially – maintaining the veteran in full-time remunerative work;
5. if the veteran is undertaking full-time remunerative work is at risk of losing that work - maintaining the veteran in substantial remunerative work;
6. if a veteran is otherwise at risk of having to cease remunerative work in the short term – maintaining the veteran in long-term remunerative work;

being work that the veteran is likely to be able to sustain in the long term and which is not likely to worsen the veteran's health.

Provision of rehabilitation services

The services of Commonwealth Rehabilitation Services (CRS) Australia have been enlisted for this scheme.  A contracted vocational case manager will have initial discussions with the veteran to determine suitability for vocational assessment.

Voluntary participation

There is no compulsion on veterans to participate in vocational rehabilitation.  There are no penalties for failure to complete a program set up under the scheme.

Safety net

The scheme provides a safety net for veterans receiving pensions from DVA.  The safety net applies to veterans paid under S23 or S24 of the VEA (intermediate or special rate disability pension) and invalidity service pensioners.

Veterans receiving a general rate disability pension (10-100%) will continue to receive payment, even if they obtain employment.

Other pensioners, eligible for rehabilitation programs, are not eligible for the income safety net provisions.

Safety net – special rate disability pensions

If employment is obtained as a result of the scheme, veterans on these rates of disability pension will have the rate adjusted.  The adjustment will be so that the veteran receives 100% general rate, plus half of the difference between general rate and the intermediate or special rate, whichever the veteran was originally receiving.

This adjustment applies for the initial two-year period after gaining employment, and is then tapered for the next five years, after which the adjusted portion is no longer payable.

Safety net – invalidity service pensions

The safety net applicable to invalidity service pension is explained in detail in the section “Invalidity service pensions - Income safety net” to follow.

Withdrawal from scheme

Veterans withdrawing from the scheme will return to the rate of disability pension applicable prior to participation in the scheme.  Invalidity service pensioners retain PI (permanent incapacity) eligibility, and return to the invalidity service pension, subject to the income/assets tests.

Eligibility for scheme benefits

Content of the approved program undertaken as part of the scheme may include elements such as general advice and assistance on job seeking and referral for vocational assistance.  Courses undertaken as part of this are not considered to be the program in its entirety.

Therefore, provided the work undertaken fulfils the definition of suitable paid employment, a veteran would be eligible for the benefits of the scheme.

Withdrawal from the scheme

There are no penalties for withdrawal from or failure to complete an approved program, although rehabilitation services may be discontinued in such circumstances.

It has been agreed with CRS Australia that in some cases it may be appropriate to put a veteran's rehabilitation program on hold because of illness or other problems.  This would not constitute termination of the veteran's participation.

Termination from the scheme

In a situation where CRS and the veteran agreed that continuation of the rehabilitation program would be futile, the veteran's participation would be terminated.

Re-entry into the scheme

There are no time restrictions on a veteran electing to re-enter the scheme.  Where a veteran was terminated, re-entry would be subject to the normal pre-entry checks.  Assessment of the likelihood of reaching a suitable work outcome would be particularly relevant in such a case.

Incapacity assessment

An incapacity assessment must be made on any application for invalidity service pension.  This still applies where the veteran applies for both ISP and VVRS at the same time.

Eligibility retained

A pensioner who commences work as a result of participation in the scheme retains section 37 ISP eligibility.  Section 37AAA refers.

While undertaking a rehabilitation program under VVRS, or while section 115G applies, the veteran will retain their eligibility for ISP.  This eligibility will be according to the criteria which applied to them upon commencing the rehabilitation program.  Where a veteran with a saved right to be assessed according to the ISP criteria which applied prior to 1 January 2000 loses ISP eligibility as a result of section 115G ceasing to apply (that is, after a total of seven years of remunerative employment), and that veteran re-applies for ISP, they will be assessed according to the criteria which apply to applications made after 1 January 2000.

Obligations

The normal obligations and review provisions continue to apply to veterans participating in the scheme.

Income/assets test

The income/assets tests continue to apply to the veteran.  The income protection provisions of the program will affect the income test.

Income safety net

The income safety net provisions apply to the veteran for a seven-year period.

During the initial period, 50% of income earned as a result of the scheme is held in the assessment.  The initial period is the two-year period after commencement of remunerative work as a result of undertaking the program; refer ss115D(1).

This percentage is then increased by 5% every six months during years three to seven.  After the seventh year, 100% of the veteran's income will be held in the assessment.

Note: the two-year initial period does not recommence after a period of not working.

Treatment eligibility

Treatment eligibility may be tied to disability pension (100% or more), the rate of service pension (treatment thresholds) or a combination of the two (50% disability pension +$1 service pension).  If the veteran is in receipt of less than 50% disability pension, his treatment eligibility is tied to his service pension rate.  The veteran's rate of pension will be calculated using the adjusted income figure, beginning at 50% and scaled upwards.  The treatment threshold will then be applied to the rate of pension.

Taxable income

The normal taxation provisions apply to the veteran's income.  DVA holding less than 100% of the veteran's income in the assessment has no bearing on the taxability of that income.

Overview

The guidelines can be found in the National Document Repository, found on the Y drive.

To access this you will need access to the Canberra server.  This link only needs to be set up once to enable access to the National Document Repository.

Accessing the Canberra server

To link to the Canberra Server:

1. Go to 'Start'
2. Go to 'MS Products'
3. Open Microsoft Windows Explorer
4. Click on Tools on the Menu bar
5. Select Map Network Drive
6. Drive:  Click on down arrow to get the drop down menu and ensure that you select an empty drive (eg. e, f, g etc)
7. Path:  Click on down arrow to get the drop menu and select \\ANATFP1\DATA (should be the fifth down)
8. Ensure that Reconnect at Logon has a tick in the selection box
9. Click OK.

Accessing the operational guidelines on the Y drive

To access these operational guidelines:

1. Go to the Y Drive via Microsoft Word or Microsoft Windows Explorer
2. Open 'National Document Repository' folder
3. Open the 'Vocational Rehabilitation Guidelines' folder
4. Click on 'Manual'